October 23/GOLD AND SILVER RISE DUE TO GLOBAL ROUT: GOLD UP $11.85 TO $1233.65/SILVER IS UP 22 CENTS TO $14.56//ITALY REFUSES TO BACK DOWN FROM THE DEMANDS OF THE EU TO REDO ITS BUDGETARY DEFICIT: 4 MAJOR STORIES ON THIS TONIGHT/MORE STORIES ON KHASHOGGI/OIL ALSO CRASHES/MORE SWAMP STORIES FOR YOU TONIGHT/

 

 

GOLD: $1233.65 UP  $11.85 (COMEX TO COMEX CLOSINGS)

Silver:   $14.78 UP 22 CENTS (COMEX TO COMEX CLOSING)

Closing access prices:

Gold :  1230.20

 

silver: $14.75

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For comex gold and silver:

OCT

 

 

 

 

 

NUMBER OF NOTICES FILED TODAY FOR  OCT CONTRACT: 16 NOTICE(S) FOR 1600 OZ

Total number of notices filed so far for OCT:  1752 for 175,200 OZ  (5.4494 TONNES)

 

 

 

 

 

FOR OCTOBER

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

59 NOTICE(S) FILED TODAY FOR

295,000 OZ/

Total number of notices filed so far this month: 468 for 2,340,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Bitcoin: OPENING MORNING TRADE  $6538: DOWN  $43

 

Bitcoin: FINAL EVENING TRADE: $6550  UP  29 

 

end

 

XXXX

 

China is controlling the gold market

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 1968 CONTRACTS FROM 197,576 UP TO  199,544 DESPITE YESTERDAY’S 8 CENT FALL IN SILVER PRICING AT THE COMEXTODAY WE  MOVED CLOSER TO  AUGUST’S RECORD SETTING OPEN INTEREST OF 244,196 CONTRACTS.

WE HAVE ALSO WITNESSED A LARGE AMOUNT OF PHYSICAL METAL STAND FOR COMEX DELIVERY(WELL OVER 30 MILLION OZ AT THE COMEX FOR JULY , 6 MILLION OZ FOR AUGUST AND NOW JUST LESS THAN 31 MILLION OZ STANDING IN SEPTEMBER. AS WELL WE ARE WITNESSING CONSIDERABLE LONGS PACKING THEIR BAGS AND MIGRATING OVER TO LONDON IN GREATER NUMBERS IN THE FORM OF EFP’S.  WE WERE  NOTIFIED  THAT WE HAD A HUGE SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP:

EFP’S FOR NOV.  3420 EFP’S FOR DECEMBER AND ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE: OF 3420 CONTRACTS. WITH THE TRANSFER OF 3420 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 3420 EFP CONTRACTS TRANSLATES INTO 17.110 MILLION OZ  ACCOMPANYING:

1.THE 8 CENT FALL IN SILVER PRICE AT THE COMEX AND

2. THE STRONG AMOUNT OF SILVER OUNCES WHICH STOOD FOR THE JUNE/2018 COMEX DELIVERY MONTH. (5.420 MILLION OZ);  30.370 MILLION OZ  STANDING FOR DELIVERY IN JULY, FOR AUGUST: 6.065 MILLION OZ AND  39.505 MILLION  OZ STANDING  IN SEPT. AND 2,050,000 OZ STANDING IN OCTOBER.

 

 

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

34,203 CONTRACTS (FOR 17 TRADING DAYS TOTAL 34,203 CONTRACTS) OR 171.01 MILLION OZ: (AVERAGE PER DAY: 2011 CONTRACTS OR 10.059 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH OF SEPT:  171.01 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 24.42% OF ANNUAL GLOBAL PRODUCTION (EX CHINA EX RUSSIA)*  JUNE’S 345.43 MILLION OZ IS THE SECOND HIGHEST RECORDED ISSUANCE OF EFP’S AND IT FOLLOWED THE RECORD SET IN APRIL 2018 OF 385.75 MILLION OZ.

ACCUMULATION IN YEAR 2018 TO DATE SILVER EFP’S:           2,390.53    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

ACCUMULATION FOR JUNE 2018:                                           345.43         MILLION OZ

ACCUMULATION FOR JULY 2018:                                            172.84          MILLION OZ

ACCUMULATION FOR AUGUST 2018:                                      205.23          MILLION OZ.

ACCUMULATION FOR SEPTEMBER 2018:                                 167,05          MILLION OZ

RESULT: WE HAD A INCREASE IN COMEX OI SILVER COMEX CONTRACTS OF 1968 DESPITE THE  8 CENT FALL IN SILVER PRICING AT THE COMEX //YESTERDAY. THE CME NOTIFIED US THAT WE HAD A STRONG SIZED EFP ISSUANCE OF 3420 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) .

TODAY WE GAINED A STRONG SIZED: 5388 TOTAL OI CONTRACTS ON THE TWO EXCHANGES:

i.e 3420 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH INCREASE OF 1968  OI COMEX CONTRACTS. AND ALL OF  DEMAND HAPPENED WITH A 8 CENT FALL IN PRICE OF SILVER  AND A CLOSING PRICE OF $14.56 WITH RESPECT TO FRIDAY’S TRADING. YET WE HAD A GIGANTIC AMOUNT OF SILVER STANDING AT THE COMEX FOR DELIVERY IN THE BIG JULY DELIVERY MONTH OF SLIGHTLY OVER 30 MILLION OZ, IN AUGUST ANOTHER BIG 6.065 MILLION OZ IN A NON ACTIVE MONTH AND IN SEPTEMBER AN FINAL MONSTROUS 39.505 MILLION OZ OF SILVER STANDING FOR DELIVERY… NOBODY IS PAYING ATTENTION TO THE HUGE NUMBER OF PHYSICAL OUNCES STANDING FOR SILVER THESE PAST SEVERAL MONTHS.

 

In ounces AT THE COMEX, the OI is still represented by JUST UNDER 1 BILLION oz i.e. 0.997 BILLION OZ TO BE EXACT or 144% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT AUGUST MONTH/ THEY FILED AT THE COMEX: 59 NOTICE(S) FOR 295,000 OZ OF SILVER

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

AND NOW WE RECORD FOR POSTERITY ANOTHER ALL TIME RECORD OPEN INTEREST AT THE COMEX OF 244,196 CONTRACTS ON AUGUST 22/2018 AND AGAIN WHEN THIS RECORD WAS SET, THE PRICE OF SILVER WAS $14.78 AND LOWER IN PRICE THAN PREVIOUS RECORDS.

ON THE DEMAND SIDE WE HAVE THE FOLLOWING:

  1. HUGE AMOUNTS OF SILVER STANDING FOR DELIVERY  (MARCH/2018: 27 MILLION OZ , APRIL/2018 : 2.485 MILLION OZ  MAY: 36.285 MILLION OZ ; JUNE/2018  (5.420 MILLION OZ) , JULY 2018 FINAL AMOUNT STANDING: 30.370 MILLION OZ   )  FOR AUGUST 6.065 MILLION OZ. , SEPT:  AN INITIAL HUGE 39.505 MILLION OZ./AND NOW OCTOBER: 2,050,000 oz
  2. HUGE RECORD OPEN INTEREST IN SILVER 243,411 CONTRACTS (OR 1.217 BILLION OZ/ SET APRIL 9/2018) AND NOW AUGUST 22/2018:  244,196 CONTRACTS,  WITH A SILVER PRICE OF $14.78.
  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/  AND THE SECOND HIGHEST RECORDED EFP ISSUANCE JUNE 2018 345.43 MILLION OZ

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).

IN GOLD, THE OPEN INTEREST FELL BY A CONSIDERABLE SIZED 2245 CONTRACTS DOWN TO 472,832 DESPITE THE LOSS IN THE COMEX GOLD PRICE/YESTERDAY’S TRADING (A FALL IN PRICE OF $3.90).THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A  GOOD SIZED 5793 CONTRACTS: ALWAYS, ON THE WEEK PRIOR TO FIRST DAY NOTICE IN ANY ACTIVE MONTH WHETHER GOLD OR SILVER THE OI COLLAPSES.  IT IS HERE THAT THE MIGRANTS RECEIVE THEIR FIAT BONUS FOR ENGAGING IN THIS EXERCISE. WE HAD THE FOLLOWING EFP ISSUANCE FOR TODAY:

 

NOVEMBER HAD EFP’S ISSUED AND, DECEMBER HAD AN ISSUANCE OF 5793 CONTACTS  AND ALL OTHER MONTHS ZERO.  The NEW COMEX OI for the gold complex rests at 472,832. 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 GOOD OI GAIN IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 3548 CONTRACTS:  2245 OI CONTRACTS DECREASED AT THE COMEX AND 5793 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI GAIN: 3548 CONTRACTS OR  354,800 OZ = 11.03 TONNES. AND ALL OF THIS DEMAND OCCURRED WITH A FALL IN THE PRICE OF GOLD/ YESTERDAY TO THE TUNE OF $3.90.

 

 

 

 

YESTERDAY, WE HAD 2545 EFP’S ISSUED.

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF SEPT : 131,130 CONTRACTS OR 13,113,000 OZ OR 448.65 TONNES (17 TRADING DAYS AND THUS AVERAGING: 7713 EFP CONTRACTS PER TRADING DAY OR 771,300 OZ/ TRADING DAY),,

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 17 TRADING DAYS IN  TONNES: 448.65 TONNES

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

THUS EFP TRANSFERS REPRESENTS 448.65/2550 x 100% TONNES =  17.59% OF GLOBAL ANNUAL PRODUCTION SO FAR IN JULY ALONE.***

ACCUMULATION OF GOLD EFP’S YEAR 2018 TO DATE:     6,0683.66*  TONNES   *SURPASSED ANNUAL PROD’N

ACCUMULATION OF GOLD EFP’S FOR JANUARY 2018:           653.22  TONNES (21 TRADING DAYS)

ACCUMULATION OF GOLD EFP’S FOR FEBRUARY 2018:         649.45 TONNES  (20 TRADING DAYS)

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)

ACCUMULATION OF GOLD EFP FOR JUNE 2018                      650.71 TONNES  (21 TRADING DAYS)

ACCUMULATION OF GOLD EFP FOR JULY 2018                       605.5 TONNES     (21 TRADING DAYS)

ACCUMULATION OF GOLD EFP FOR AUG. 2018                      488.54  TONNES  (23 TRADING DAYS)

ACCUMULATION OF GOLD EFP FOR SEPT 2018                       470.64 TONNES   (19 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 2245 WITH THE LOSS IN PRICING ($3.90) THAT GOLD UNDERTOOK YESTERDAY) //. WE ALSO HAD A GOOD SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 5793 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 5793 EFP CONTRACTS ISSUED, WE HAD A GOOD GAIN OF 4290 CONTRACTS IN TOTAL OPEN INTEREST  ON THE TWO EXCHANGES:

5793 CONTRACTS MOVE TO LONDON AND 2245 CONTRACTS DECREASED AT THE COMEX. (in tonnes, the GAIN in total oi equates to 11.03 TONNES). ..AND ALL OF THIS GOOD DEMAND OCCURRED WITH A SMALL LOSS OF $3.90 IN YESTERDAY’S TRADING AT THE COMEX.

 

 

we had: 16 notice(s) filed upon for 1600 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 $11.85 TODAY: / 

NO CHANGES IN GOLD INVENTORY TODAY

 

 

 

 

 

 

 

 

 

 

 

/GLD INVENTORY   747.88 TONNES

Inventory rests tonight: 747.88 tonnes.

TO ALL INVESTORS THINKING OF BUYING GOLD THROUGH THE GLD ROUTE: YOU ARE MAKING A TERRIBLE MISTAKE AS THE CROOKS ARE USING WHATEVER GOLD COMES IN TO ATTACK BY SELLING THAT GOLD.  IT SURE SEEMS TO ME THAT THE GOLD OBLIGATIONS AT THE GLD EXCEED THEIR INVENTORY

SLV/

WITH SILVER UP 22  CENTS TODAY

SURPRISINGLY A HUGE WITHDRAWAL OF 2.819 MILLION OZ OF SILVER FROM  SLV INVENTORY

 

 

 

 

 

 

 

 

 

 

/INVENTORY RESTS AT 331.690 MILLION OZ.

 

NOTE THE DIFFERENCE BETWEEN THE GLD AND SLV: THE CROOKS CAN RAID GOLD BECAUSE THEY DO HAVE SOME PHYSICAL.  THEY DO NOT RAID SILVER PROBABLY BECAUSE THERE IS NO REAL SILVER INVENTORIES BEHIND THEM

 

end

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

1. Today, we had the open interest in SILVER ROSE BY 1968 CONTRACTS from 197,576 UP TO 199,544  AND MOVING A LITTLE CLOSER TO THE NEW COMEX RECORD SET LAST IN AUG.2018 AT 244,196 WITH A SILVER PRICE OF $14.78/(AUGUST 22/2018)..THE PREVIOUS RECORD WAS SET ON APRIL 9/2018 AT 243,411 OPEN INTEREST CONTRACTS WITH THE SILVER PRICE AT THAT DAY: $16.53). AND PREVIOUS TO THAT, THE RECORD  WAS ESTABLISHED AT: 234,787 CONTRACTS, SET ON APRIL 21.2017 OVER  1 1/3 YEARS AGO.  THE PRICE OF SILVER ON THAT DAY: $17.89.  AS YOU CAN SEE, WE HAVE RECORD HIGH OPEN INTERESTS IN SILVER  ACCOMPANIED BY A CONTINUAL LOWER PRICE WHEN THAT RECORD WAS SET…..

 

.

OUR CUSTOMARY MIGRATION OF COMEX LONGS CONTINUE TO MORPH INTO LONDON FORWARDS  AS OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE:

i) 0 EFP’s for November… and

 

3420 CONTRACTS FOR DECEMBER AND  AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 3420 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 1968 CONTRACTS TO THE 3420 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN A  NET GAIN OF 5388 OPEN INTEREST CONTRACTS.  THUS IN OUNCES, THE HUGE GAIN ON THE TWO EXCHANGES: 26.94 MILLION OZ!!! AND YET WE ALSO HAVE A STRONG DEMAND FOR PHYSICAL AS WE WITNESSED A FINAL STANDING OF GREATER THAN 30 MILLION OZ FOR JULY, A STRONG 6.065 MILLION OZ FOR AUGUST..  A HUGE 39.505  MILLION OZ  STANDING FOR SILVER IN SEPTEMBER…AND NOW OVER 2 million  OZ STANDING FOR THE NON ACTIVE MONTH OF OCTOBER.

 

 

RESULT: A INCREASE IN SILVER OI AT THE COMEX DESPITE THE 8 CENT PRICING LOSS THAT SILVER UNDERTOOK IN PRICING// YESTERDAY.BUT WE ALSO HAD A HUGE SIZED 3420 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE STRONG  SIZED AMOUNT OF SILVER OUNCES STANDING FOR SEPTEMBER, 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/ WEDNESDAY NIGHT: 

SHANGHAI CLOSED DOWN 60.05 POINTS OR 2.26% //Hang Sang CLOSED DOWN 806.60 POINTS OR 3.08% //The Nikkei closed DOWN 604.04 OR 2.67%/ Australia’s all ordinaires CLOSED DOWN 1.02%  /Chinese yuan (ONSHORE) closed UP  at 6.9365 AS POBC RESUMES  ITS HUGE DEVALUATION  /DELEGATION COMING TO THE USA TO SEE TRUMP IN NOVEMBER CANCELLED/Oil DOWN to 68.07 dollars per barrel for WTI and 78.03 for Brent. Stocks in Europe OPENED RED //.  ONSHORE YUAN CLOSED SLIGHTLY UP AT 6.9365 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED SLIGHTLY DOWN ON THE DOLLAR AT 6.9452: HUGE DEVALUATION/PAST SEVERAL DAYS RESUMES// TRADE TALKS STOPPED   : /ONSHORE YUAN TRADING STRONGER  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 A FULL TRADE WAR COMMENCED

 

 

 

 

 

 

 

 

 

3A/NORTH KOREA/SOUTH KOREA

i)North Korea/South Korea/USA/

 

 

 

b) REPORT ON JAPAN

3 C/  CHINA

i)The war of words between China and the USA continues unabated:  this time China warns of their ignorant and malicious debt trap.

( zerohedge)

ii)First it was Sweden’s powerful Wallenberg family ready to dispose of much of its hugely acquired assets.  Now we find that one of China’s largest fund, Everbright, is also ready to dump stocks

(courtesy zerohedge)

 

 

4/EUROPEAN AFFAIRS

 

i)ITALY/EU

Yesterday we reported on the former EU Dijsselbloem’s assertion that it is Italy itself in trouble and that if they default it would be Italian citizens holding the bag.  Tom Luongo debunks that theory but good.  Our former EU minister,Dijsselbloem  highlights the huge target 2 imbalances that is owed by Italy to the central bank and that must be paid before Italy ever dreams of leaving the EU.  Italy will leave the EU and the ECB will be holding the bag on that huge target 2 imbalance of over 492 billion euros.

a must read…

( Tom Luongo)

ii)Another excellent piece from Mish Shedlock who also delves into the huge target 2 imbalance of Italy.  It seems that the average Italian is moving his money out of Italy and moving it into Switzerland (preferable) or Germany.

a must read….
( Mish Shedlock)

iii)This ought to get the EU and the west angry:  Salvini requests that Russia should buy Italian bonds when QE official ends in either the Dec 31.2018 or mid 2019 if they exercise operation twist.(courtesy zerohedge)

iv) World War III just broke out between the EU and Italy as they just told our stubborn Mediterranean nation to resubmit its budget as they rejected it in full. Conte then states that he has no plan B

(courtesy zerohedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

i)SAUDI ARABIA
Turkey claims that the killing of Khashoggi was planned and the killing was extremely savage
(courtesy zerohedge)

ii)It seems that the remains of Khashoggi have been discovered in the Saudi Consul General’s home

( Sky News/zerohedge)

 

6. GLOBAL ISSUES

The entire global banking stocks (system) is crashing hard just like it did in 2008

a must see…

( zerohedge)

 

 

7. OIL ISSUES

 

Crude crashes

( zerohedge)

 

8 EMERGING MARKET ISSUES

 

 

9. PHYSICAL MARKETS

i)We now have sovereign India (learning from its citizens) are buying gold
(courtesy Reuters)

 

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

 

 

MARKET TRADING

a)last night

b) morning trading

c) late morning trading

ii)Market data

 

iii)USA ECONOMIC/GENERAL STORIES

a)interesting:  Ford states that due to the Trump tariffs, USA steel is the highest priced steel in the world
( zerohedge)

b)This makes sense:  the Trump 10% tax cut for the middle class is to be advanced only if the Republicans take the house( zerohedge)

iv)SWAMP STORIES

a)This ought to go over well with our creepy porn lawyer: he just been hit with a $4.85 million judgement.

(special thanks to G for sending this to us)

b The real Michael Avenatti comes to life:  he lived a lavish lifestyle while owing millions to the IRS

( zerohedge)

 

E)SWAMP STORIES/THE KING REPORT

Let us head over to the comex:

 

The total gold comex open interest FELL BY A CONSIDERABLE SIZED 2245 CONTRACTS DOWN to an OI level 472,832 WITH THE FALL IN THE PRICE OF GOLD ($3.90 LOSS IN YESTERDAY’S COMEX 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 AS WELL AS WE WITNESS THE COMEX OPEN INTEREST COLLAPSE. ONCE WE GET TO FIRST DAY NOTICE, THEN THE OPEN INTEREST RISES AND AGAIN THEY DID NOT DISAPPOINT US.

 

 

WE ARE NOW IN THE ACTIVE DELIVERY MONTH OF OCT..  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 5793 EFP CONTRACTS WERE ISSUED:

OCTOBER: 0 EFP’S AND DECEMBER:  5793 AND  ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE:  5793 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: A 3548 TOTAL CONTRACTS IN THAT 5793 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST 2245 COMEX CONTRACTS.

NET GAIN ON THE TWO EXCHANGES:  3548 contracts OR 354,800 OZ OR 11.03 TONNES.

Result: A CONSIDERABLE SIZED DECREASE IN COMEX OPEN INTEREST WITH THE LOSS IN PRICE/ YESTERDAY (ENDING UP WITH THE FALL IN PRICE OF (3.90). THE  TOTAL OPEN INTEREST GAIN ON THE TWO EXCHANGES:  3548 OI CONTRACTS..

We are now in the active contract month of OCTOBER. For the October contract month, we lost 51 contract to fall to 65 contracts.  We had 55 notice yesterday, so we GAINED 4 contracts or 400 oz will  stand for delivery at the comex and these guys refused to march over to London as they shunned receiving London based forwards on top of a fiat bonus.

 

The next delivery month is the non active NOVEMBER contract month and here the OI FELL by 25 contracts down to 342.  The next delivery month after November is the very big December contract month and here the OI FELL by 734 contracts up to 370,857 contracts.

 

 

 

 

WE HAD 16 NOTICES FILED AT THE COMEX FOR 1600 OZ.

 

FOR COMPARISON BETWEEN LAST YR AND TODAY:

 

FOR THE OCTOBER CONTRACT MONTH: OCTOBER IS THE WEAKEST OF ALL DELIVERY MONTHS IN GOLD.

FOR THE COMEX OCT 2017 GOLD CONTRACT MONTH: WE INITIALLY HAD 300,600 OZ STAND FOR DELIVERY OR 9.349 TONNES. (VS 13.695 TONNES OCT 2018)

AT THE CONCLUSION OF THE OCTOBER/2017 TRADING MONTH: 333,300 OZ OR 10.367 TONNES FINALLY STOOD FOR DELIVERY

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And now for the wild silver comex results.

Total silver OI ROSE BY 1968 CONTRACTS FROM 197,576 DOWN TO 197,576 (AND CLOSER TO THE NEW RECORD OI FOR SILVER SET ON AUGUST 22.2018.  (THE PREVIOUS RECORD WAS SET APRIL 9.2018/ 243,411 CONTRACTS) AND TODAY’S  OI COMEX GAIN OCCURRED DESPITE A 8 CENT FALL IN PRICING.

 

WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF OCTOBER AND, WE WERE  INFORMED THAT WE HAD A STRONG SIZED 3420 EFP CONTRACTS:  FOR NOVEMBER:  0 CONTRACTS AND FOR …

 

FOR DECEMBER: 3420 CONTRACTS 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: 3420.  ON A NET BASIS WE GAINED 5388 SILVER OPEN INTEREST CONTRACTS AS WE OBTAINED A 1968 CONTRACT GAIN AT THE COMEX COMBINING WITH THE ADDITION OF 3420 OI CONTRACTS NAVIGATING OVER TO LONDON.

NET GAIN ON THE TWO EXCHANGES:   3548 CONTRACTS...AND ALL OF THIS DEMAND OCCURRED WITH A 8 CENT RISE IN PRICING// YESTERDAY.

 

 

 

 

We are now in the non active delivery month of October and here we had a GAIN of 59 contracts to stand at 60 contracts.  We had 0 notices filed  YESTERDAY so we gained 59 contracts or AN ADDITIONAL 295,000 oz will stand for delivery at the comex as these guys refused to accept a London based forward plus as well as a fiat bonus . Somebody was after badly needed physical silver.

 

After October, is the non active delivery month of November and here we lost 11 contracts down to 1260 contracts.  After November, we have a December contract and here we gained 1932 contracts up to 158,286

 

 

 

 

 

 

 

 

We had 59 notice(s) filed for 295,000 OZ for the SEPTEMBER 2018 COMEX contract for silver

 

Trading Volumes on the COMEX

 

PRELIMINARY COMEX VOLUME FOR TODAY: 271,061 contracts,

 

CONFIRMED COMEX VOL. FOR YESTERDAY:  202,019  contracts..

 

 

 

 

 

 

AND NOW COMPARISON FOR OCTOBER:

 

FOR THE OCTOBER 2017 CONTRACT MONTH WE HAD 4.205,000 OZ OF SILVER INITIALLY STAND FOR DELIVERY.

BY MONTH’S END WE HAD 5,475,000 OZ FINALLY STAND AS QUEUE JUMPING IN SILVER WAS ALREADY IN THE NORM.

OCTOBER IS A NON ACTIVE DELIVERY MONTH FOR SILVER BUT AS YOU CAN SEE OCT 2017 DELIVERIES WERE PRETTY

GOOD.

 

 

 

 

 

INITIAL standings for  OCT/GOLD

OCT 23-/2018.

Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
 nil  oz
Deposits to the Dealer Inventory in oz NIL oz

 

Deposits to the Customer Inventory, in oz  

 

100.0000

 

oz

 

?? jpm

 

 

 

 

 

No of oz served (contracts) today
16 notice(s)
 1600 OZ
No of oz to be served (notices)
49 contracts
(4900 oz)
Total monthly oz gold served (contracts) so far this month
1752 notices
175,200 OZ
5.4494 TONNES
Total accumulative withdrawals of gold from the Dealers inventory this month NIL oz
Total accumulative withdrawal of gold from the Customer inventory this month xxx oz

 

we had 0 dealer entry:

 

total gold entering dealer:  0 oz

total gold withdrawing from the dealer;  0 oz

 

we had 0 kilobar transaction/
we had 0 withdrawal out of the customer account:
total customer withdrawals:  0 oz
we had 1 customer deposit
i) Into JPMorgan: 100.000 oz
total customer deposits: 100.00  oz
we had 1 major adjustment..and I was waiting for this:
out of HSBC:  49,828.126 oz was adjusted out of the dealer and this landed into the customer account of HSBC and this should be deemed a settlement

FOR THE OCTOBER 2018 CONTRACT MONTH)

Today, 0 notice(s) were issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 16 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 9 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 OCT/2018. contract month, we take the total number of notices filed so far for the month (1752) x 100 oz or 100 oz, to which we add the difference between the open interest for the front month of OCT. (65 contracts) minus the number of notices served upon today (16 x 100 oz per contract) equals 180,100 OZ OR 5.6018 TONNES) the number of ounces standing in this non active month of OCT

 

Thus the INITIAL standings for gold for the OCT/2018 contract month:

No of notices served (1752 x 100 oz)  + {65)OI for the front month minus the number of notices served upon today (16x 100 oz )which equals 180,100 oz standing OR 5.6018 TONNES in this active delivery month of OCTOBER.

 

We gained 4  contracts or 400 oz of gold will stand as these guys refused to morph into London based forwards and received a fiat bonus for their effort.

 

 

THERE ARE ONLY 5.987 TONNES OF REGISTERED COMEX GOLD AVAILABLE FOR DELIVERY AGAINST 5.6018 TONNES STANDING FOR OCTOBER  

 

 

 

total registered or dealer gold:  142,390.415 oz or   4.428 tonnes
total registered and eligible (customer) gold;   8,101,521.184 oz 251.99 tonnes

IN THE LAST 25 MONTHS 104 NET TONNES HAS LEFT THE COMEX.

LADIES AND GENTLEMEN: THERE IS NO GOLD AT THE COMEX..AS THE CROOKS SEEMS TO BE FORCING LONGS TO TAKE DELIVERY OF LONDON FORWARDS AND NOT TAKE POSSESSION OF ANY GOLD AT THE COMEX/

end

And now for silver

AND NOW THE OCTOBER DELIVERY MONTH

OCTOBER INITIAL standings/SILVER

OCT 23 2018
Silver Ounces
Withdrawals from Dealers Inventory NIL oz
Withdrawals from Customer Inventory
 1,202,087.009 oz
CNT
Scotia

 

 

Deposits to the Dealer Inventory
NIL
oz
Deposits to the Customer Inventory
1,747,384.638 oz
oz
jpm
cnt
No of oz served today (contracts)
59
CONTRACT(S)
295,000 OZ)
No of oz to be served (notices)
1 contracts
(5,000 oz)
Total monthly oz silver served (contracts) 468 contracts

(2,340,000 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

total dealer withdrawals: 0 oz

we had 2 deposit into the customer account

i) Into JPMorgan: 1,146,794.700 oz

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

JPMorgan now has 146.144 million oz of  total silver inventory or 50.9% of all official comex silver. (147.26 million/289 million)

ii)Into CNT:  600,589.938 oz

 

 

 

 

 

 

 

 

 

 

 

 

 

total customer deposits today:  1,747,384.638  oz

we had 2 withdrawals from the customer account;

 

i) Out of CNT: 602,084.369 oz

II) Out of Scotia:  600,003.290 oz

 

 

 

 

total withdrawals: 1,202,087.009 oz

 

 

we had 0 adjustments

 

 

 

 

 

 

 

 

 

total dealer silver:  77,197 million

total dealer + customer silver:  289.267  million oz

The total number of notices filed today for the OCTOBER 2018. contract month is represented by 59 contract(s) FOR 295,000 oz. To calculate the number of silver ounces that will stand for delivery in OCT., we take the total number of notices filed for the month so far at 468 x 5,000 oz = 2,340,000 oz to which we add the difference between the open interest for the front month of OCT. (60) and the number of notices served upon today (59 x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the OCT/2018 contract month: 468(notices served so far)x 5000 oz + OI for front month of OCT( 60) -number of notices served upon today (59)x 5000 oz equals 2,345,000 oz of silver standing for the OCT contract month.  This is a huge number of oz standing for an off delivery month.

We gained 59 contracts or an additional 295,000 oz will be standing at the Comex as these guys refused to morph into London based forwards on top of not receiving a fiat bonus .

 

 

 

 

 

 

 

 

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

ESTIMATED VOLUME FOR TODAY: 83,351 CONTRACTS  …

 

 

 

CONFIRMED VOLUME FOR YESTERDAY: 58,862 CONTRACTS..

 

 

YESTERDAY’S CONFIRMED VOLUME OF 59862 CONTRACTS EQUATES TO 294 million OZ  OR 42.04% OF ANNUAL GLOBAL PRODUCTION OF SILVER

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

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

end

NPV for Sprott 

1. Sprott silver fund (PSLV): NAV FALLS TO -4.01% (OCT 23/2018)
2. Sprott gold fund (PHYS): premium to NAV FALLS TO -1.42% to NAV (OCT 23/2018 )
Note: Sprott silver trust back into NEGATIVE territory at -4.01%-/Sprott physical gold trust is back into NEGATIVE/

(courtesy Sprott/GATA)

3.SPROTT CEF.A FUND (FORMERLY CENTRAL FUND OF CANADA):

NAV 12.48/TRADING 11.92/DISCOUNT 4.45

END

And now the Gold inventory at the GLD/

OCT 23/WITH GOLD UP $11.85 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 747.88 TONNES

Oct 22/WITH GOLD DOWN $3.90 TODAY: A WITHDRAWAL OF 2.97 TONNES OF GOLD FROM THE GLD INVENTORY/INVENTORY RESTS AT 745.82

AND THEN: A DEPOSIT OF 2.06 TONNES SUCH THAT THE FINAL RESTING INVENTORY IS 747.88 TONNES

OCT 19/WITH GOLD DOWN $1.70 : NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 748.76 TONNES

OCT 18/WITH GOLD UP $2.80/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RSTS AT 748.76 TONNES

OCT 16/WITH GOLD UP BY ONLY $1.00/WE HAD ANOTHER 4.12 TONNES OF GOLD ADDED TO THE GLD/INVENTORY RESTS AT 748.76 TONNES

OCT 15/WITH GOLD UP $8.45/ANOTHER 5.65 TONNES OF GOLD WAS ADDED TO THE GLD INVENTORY/INVENTORY RESTS AT 744.64 TONNES

OCT 12/WITH GOLD DOWN $4.35/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 738.99 TONNES

OCT 11/WITH GOLD UP $35.20 TODAY: A HUGE PAPER GOLD INVENTORY GAIN OF 8.82 TONNES/INVENTORY RESTS AT 738.99 TONNES

OCT 10/WITH GOLD UP $2.65 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 730.17 TONNES

OCT 9/WITH GOLD UP $2.00 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 730.17

OCT 8/WITH GOLD DOWN $18.60 NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 730.17TONNES

OCT 5/WITH GOLD UP $3.75, WE HAD A BIG WITHDRAWAL OF 1.47 TONNES FROM THE GLD INVENTORY/INVENTORY RESTS AT 730.17 TONNES

OCT 4/WITH GOLD DOWN $1.90/WE HAD NO CHANGES IN GOLD INVENTORY AT THE GLD/731.64 TONNES

OCT 3/WITH GOLD DOWN $4.05, ANOTHER HUGE REMOVAL OF 6.18 TONNES

OCT 2 WITH GOLD UP $15.80 TODAY A HUGE WITHDRAWAL OF 8.35 TONNES

OCT 1…GOLD ADDS 3.94 TONNES TO THE GLDINVENTORY RESTS AT 746.17 TONNES

SEPT 28/WITH GOLD UP $8.90/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 742.23 TONNES

SEPT 27/WITH GOLD DOWN $10.90: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 742.23 TONNES

SEPT 26/WITH GOLD DOWN $6.05: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 742.23 TONNES

SEPT 25/WITH GOLD UP 0.75: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 742.23 TONNES

SEPT 24/WITH GOLD UP $3.20: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 742.23 TONNES

SEPT 21/WITH GOLD DOWN $9.90/NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 742.23 TONNES

SEPT 20/WITH GOLD DOWN $2.80/A SMALL WITHDRAWAL OF .3 TONNES AND THIS IS TO PAY FOR FEES/742.23 TONNES

SEPT 18/WITH GOLD DOWN $3.00: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 742.53 TONNES

SEPT 17/WITH GOLD UP $5.20: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 742.53 TONNES

SEPT 14/WITH GOLD DOWN $6.95 TODAY, ANOTHER HUGE 2.65 TONNES OF GOLD WAS REMOVED FROM INVENTORY AT THE GLD..PRETTY SOON WE WILL HAVE ZERO INVENTORY/INVENTORY RESTS AT 742.53 TONNES

SEPT 13/WITH GOLD DOWN $2.65:NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY REMAINS AT 745.18 TONNES

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

OCT 23.2018/ Inventory rests tonight at 747.88 tonnes

*IN LAST 483 TRADING DAYS: 185.33 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 383 TRADING DAYS: A NET 28.80 TONNES HAVE NOW BEEN REMOVED FROM GLD INVENTORY.

 

end

 

Now the SLV Inventory/

OCT 23/WITH SILVER UP 22 CENTS/A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 2.819 MILLION OZ /INVENTORY RESTS AT 331.690 MILLION OZ.

OCT 22/WITH SILVER DOWN 8 CENTS: A SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 470,000/INVENTORY RESTS AT 334.509 MILLION OZ/

OCT 19/WITH SILVER UP 6 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INV. RESTS AT 334.039 MILLION OZ

OCT 18/WITH SILVER DOWN 6 CENTS: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.127  MILLION /RESTS AT 334.039 MILLION OZ/

OCT 16/WITH SILVER DOWN 2 CENTS/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 332.912 MILLION OZ/

OCT 15/WITH SILVER UP 10 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 332.912 MILLION OZ/

OCT 12/WITH SILVER UP 3 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 332.912 MILLION OZ/

OCT 11/WITH SILVER UP 25 CENTS TODAY; NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 332.912 MILLION OZ/

OCT 10/WITH SILVER DOWN 7 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 332.912 MILLION OZ/

OCT 9/WITH SILVER UP 9 CENTS TODAY: NO CHANGE IN SILVER INVENTORY: SLV INVENTORY RESTS AT 332.912 MILLION OZ

OCT 8/WITH SILVER DOWN 33 CENTS, A GOOD SIZE WITHDRAWAL OF 563,000 OZ/INVENTORY RESTS AT 332.912 MILLION OZ.

OCT 5/WITH SILVER UP 5 CENTS, NO CHANGE IN SILVER INVENTORY AT THE SLV

OCT 4/WITH SILVER DOWN 9 CENTS/A WITHDRAWAL OF 1.316 MILLION OZ

OCT 3 WITH SILVER FLAT, A GOOD INCREASE OF 1.879 MILLION OZ INTO INVENTORY

OCT 2 A HUGE CHANGE IN SILVER INVENTORY AT THE SLV/INVENTOR RESTS AT 332.912

OCT 1.NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 333.046 MILLION  OZ.

SEPT 28/WITH SILVER UP 41 CENTS, STRANGELY WE HAD A WITHDRAWAL OF .517 MILLION OZ AT THE SLV.INVENTORY RESTS AT 333.046 MILLION OZ/

SEPT 27/WITH SILVER DOWN 10 CENTS: A HUGE WITHDRAWAL OF 1.457 MILLION OZ AT THE SLV/INVENTORY RESTS AT 333.563 MILLION OZ/

SEPT 26/WITH SILVER DOWN 9 CENTS: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 335.020 MILLION OZ/

SEPT 25/WITH SILVER UP 16 CENTS: STRANGE!! A BIG CHANGE IN SILVER INVENTORY AT THE SVL: A WITHDRAWAL OF 1.645 MILLION OZ/.INVENTORY RESTS AT 335.020 MILLION OZ/

WITH SILVER DOWN ONE CENT TODAY: A HUGE DEPOSIT OF 1.692 MILLION OZ INTO THE INVENTORY OF THE SLV

INVENTORY RESTS AT 336.665 MILLION OZ/

SEPT 21/WITH SILVER UP 2 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 334.973 MILLION OZ/

SEPT 20/WITH SILVER UP 3 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 334.973 MILLION OZ/

SEPT 18/WITH SILVER DOWN 4 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 334.973 MILLION OZ/

SEPT 17/WITH SILVER UP 8 CENTS TODAY:NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 334.973 MILLION OZ/

SEPT 14/WITH SILVER DOWN 11 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 334.973 MILLION OZ/

SEPT 13/WITH SILVER DOWN 2 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.316 MILLION OZ OF SILVER ENTERS SLV INVENTORY/INVENTORY RESTS AT 334.973 MILLION OZ/

 

 

 

OCT 23/2018:

 

Inventory 331.690 MILLION OZ

LIBOR SCHEDULE AND GOFO RATES:

HUGE JUMP IN LIBOR AND GOFO RATES

YOUR DATA…..

6Month MM GOFO 2.36/ and libor 6 month duration 2.73

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

G0FO+ .37

 

 

XXXXXXXX

12 Month MM GOFO
+ 2.65%

LIBOR FOR 12 MONTH DURATION: 3.03

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.38

end

 

 

PHYSICAL GOLD/SILVER STORIES

end
i) GOLDCORE BLOG

IMF Warning Highlights Gold’s Importance As Diversification

Profile picture for user GoldCore

– As stock sell-off became systemic globally, gold rose meaningfully – World Gold Council
– IMF Global Financial Stability report highlights an increase in level of risk among multiple global metrics – WGC Investment Update
*Happy 15th Birthday GoldCore*

via Gold.org

The latest IMF Global Financial Stability report (released 10 October), highlighted an increase in the level of risk among multiple global metrics.

*Intra-day performance of major assets classes from 10 Oct and 12 Oct 2018.
Source: Bloomberg, World Gold Council

Following its publication, stocks in the US, Europe and Asia lost 4%, 3% and 4% respectively over three days. While the market has regained some of its early losses, we believe the report and the subsequent market pullback underline the relevance of holding gold in the near and long term.

As stocks were hammered, gold acted as a key flight-to-safety asset in the market. Initially, as the US market retreated, gold held steady. But as the sell-off became more systemic globally, gold began to rally meaningfully (see chart above).

Access full report at Gold.org

 

THANK YOU for helping GoldCore reach our 15th year in business. We were incorporated on this day 15 years ago, on October 23rd 2003, and we are delighted to have reached this milestone and achievement.

Over the years, we have been fortunate to enjoy the unwavering support of our families, government mint and refinery suppliers, vault partners, great staff and supportive clients.

We are positive on the outlook for gold and silver and regarding GoldCore’s next 15 years. We are excited about the continuing growth in assets in GoldCore Secure Storage (up over 22% this year), the launch of Direct Access Gold and the launch of storage in Ireland in Dublin and other international storage locations in the coming months.Thanks to our excellent staff over the years and our amazing team today. And thanks to our community for your support and our clients for their support and custom.

We look forward to protecting and growing your wealth in the next 15 years.

Yours sincerely,

Stephen, Mark and all the GoldCore team

 

 

News and Commentary

Gold Recommended by BofAML As Asset Hedge and “Value Play” (Bloomberg.com)

Stocks Deepen Losses as Investors Flock to Havens: Markets Wrap (Bloomberg.com)

Gold nudges up as Asian shares edge lower (Reuters.com)

May tries to calm Brexit rebels, says deal almost done (Reuters.com)

Palladium futures rally to trade near a record above $1,100 an ounce (MarketWatch.com)


Source: Capital & Conflict

The Global Dollar Shortage is Here – And It’s Becoming A Big Problem (ZeroHedge.com)

Italy Responds To EU Commission, Admits Deficit Breach But Refuses To Budge (ZeroHedge.com)

Gold – Opposite of Growth? (CapitalAndConflict.com)

Forget Russia. Here’s the Real Threat to American Elections… (BonnerAndPartners.com)

Starting to See ‘Cracks’ From Rate Hikes (Bloomberg.com)

Listen on SoundCloud , Blubrry & iTunesWatch on YouTube below

Gold Prices (LBMA AM)

22 Oct: USD 1,222.90, GBP 938.09 & EUR 1,062.21 per ounce
19 Oct: USD 1,228.25, GBP 942.44 & EUR 1,073.12 per ounce
18 Oct: USD 1,224.60, GBP 933.76 & EUR 1,062.83 per ounce
17 Oct: USD 1,226.75, GBP 933.68 & EUR 1,061.38 per ounce
16 Oct: USD 1,228.85, GBP 931.35 & EUR 1,061.73 per ounce
15 Oct: USD 1,233.00, GBP 937.70 & EUR 1,064.45 per ounce
12 Oct: USD 1,218.75, GBP 922.11 & EUR 1,052.15 per ounce

Silver Prices (LBMA)

22 Oct: USD 14.63, GBP 11.23 & EUR 12.72 per ounce
19 Oct: USD 14.61, GBP 11.21 & EUR 12.75 per ounce
18 Oct: USD 14.52, GBP 11.06 & EUR 12.60 per ounce
17 Oct: USD 14.65, GBP 11.16 & EUR 12.69 per ounce
16 Oct: USD 14.76, GBP 11.16 & EUR 12.74 per ounce
15 Oct: USD 14.74, GBP 11.19 & EUR 12.71 per ounce
12 Oct: USD 14.60, GBP 11.04 & EUR 12.60 per ounce

Recent Market Updates

– End Of The Financial World?
– Gold Reserves Surge 1,000% In Hungary As It Joins Poland, Russia, China and Other Central Banks Buying Gold
– How Do You Sell Your Digital Gold When the Internet Goes Down?
– IMF Issues Dire Warning – ‘Great Depression’ Ahead?
– Poland Raises Gold Holdings to Record High in September – IMF
– Why It’s Worth Holding Gold Bullion in Your Portfolio
– Gold’s Best Day In 2 Years Sees 2.5 Percent Gain As Global Stocks Sell Off – This Week’s Golden Nuggets
– Gold Up 2.5 Percent As Global Stock Rout Spreads To Europe
– “Gold Is On The Cusp” Of An “Explosion Higher” As Stock and Tech “Crash Is Coming”

DAG Video Still Play V2

end
ii) GATA stories
iii) Other Physical stories:
We now have sovereign India (learning from its citizens) are buying gold
(courtesy Reuters)

India offloading US Treasuries to support national currency & buy gold

Published time: 22 Oct, 2018 10:22Edited time: 22 Oct, 2018 10:23

© Reuters

The Reserve Bank of India (RBI) is cutting down on its holding of US Treasuries, joining a number of countries which have been dumping US debt to bolster domestic economies.

The country’s share of US sovereign debt saw a gradual decline from $157 billion in March to $140 billion as of the end of August, according to the latest US Treasury report. RBI needed US dollars to sell in the market to stop the steep slide of its currency, the rupee. The bank has sold foreign currencies worth $18.6 billion in the spot market since April to rein the value of the rupee.

Foreign portfolio investors (FPI) have pulled out more than $10 billion of their investments in the Indian markets since April. That has resulted in rupee losing more than 10 percent in value against the dollar.

“If FPI flows do not revive amid an US-China trade war, the RBI may need to sell another $10-15 billion by March,” said Bank of America Merrill Lynch. According to its report, there could be more pressure on India’s central bank to sell US bond holdings in order to meet the dollar demand.

Experts say the RBI may be using part of the sales proceeds of the US bonds to buy gold. Statistics showed that the bank’s gold reserves grew to 18.64 million troy ounces in August from 18.01 million troy ounces in March 2018.

Liquidating US sovereign bonds has recently become a trend among major holders. The latest data showed that Russia has dumped nearly all of its holdings of US debt, trimming 84 percent of them during 2018. Turkey’s share of US Treasuries fell by 42 percent in the first half of the current year.

Japan and China, the biggest holders of the US securities, have also reduced their shares in August. Tokyo cut its holdings to $1.029 trillion, the lowest since October 2011. Beijing’s holdings are down to $1.165 trillion, from $1.171 trillion in July, marking the third consecutive month of declines.

https://www.rt.com/business/441912- india-sells-us-bonds/

_________________________________________________________________________________________________

 

 

 

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 6.9365/HUGE DEVALUATION FOR THE PAST FOUR WEEKS RESUMES/CHINESE COMING TO USA FOR TRADE TALKS IN NOVEMBER CANCELLED //OFFSHORE YUAN:  6.9452   /shanghai bourse CLOSED DOWN 60.05 POINTS OR 2.26%

. HANG SANG CLOSED DOWN 806.60 POINTS OR 3.08%

 

 

2. Nikkei closed DOWN 604.04 POINTS OR 2.67%

 

3. Europe stocks OPENED RED 

 

 

 

/USA dollar index FALLS TO 95.86/Euro FALLS TO 1.1502

3b Japan 10 year bond yield: RISES TO. +.15/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 112.19/ THIS IS TROUBLESOME AS BANK OF JAPAN IS RUNNING OUT OF BONDS TO BUY./JAPAN 10 YR YIELD IS NOW TARGETED AT .11%/JAPAN LOSING CONTROL OF THEIR BOND MARKET

 

3c Nikkei now JUST BELOW 17,000

3d USA/Yen rate now well below the important 120 barrier this morning

3e WTI:: 68.07 and Brent: 78.03

3f Gold UP/JAPANESE Yen UP/ CHINESE YUAN:   ON SHORE UP/OFF- SHORE:  DOWN

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO +.43%/Italian 10 yr bond yield UP to 3.47% /SPAIN 10 YR BOND YIELD DOWN TO 1.65%

3j Greek 10 year bond yield FALLS TO : 4.34

3k Gold at $1237.50 silver at:14.78   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 14/100 in roubles/dollar) 65.34

3m oil into the 68 dollar handle for WTI and 78 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 112.19DESTROYING 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 0.9957 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1412 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 +0.43%

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 3.14% early this morning. Thirty year rate at 3.34%

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

6.  TURKISH LIRA:  UP  TO 5.7649

“Drowning In A Sea Of Red”: Global Markets

Plunge As European Tech Stocks Crash; Chinese

Rout Returns

Yesterday morning, Morgan Stanley declared that the “dead cat bounce is over. One day later, the bank’s thesis was confirmed with global markets a sea of red on Tuesday, as a violent rout in Asia carried over into Europe, slamming tech and industrial stocks, and crossing the Atlantic, sending US equity futures retesting the lowest level hit during the October 10/11 two-day rout.

An ugly start to European trading pushed world shares towards their lowest level in a year on Tuesday, as negative drivers from Saudi Arabia’s diplomatic isolation to worries about Italy’s finances, trade wars and a slew of ugly earnings piled on the pressure.

Selling escalated from Wall Street into a heavy selloff in Asia before hitting Europe, which was facing a fifth day of uninterrupted declines.

One day after relentless Chinese jawboning sent the Shanghai Composite surging 4.1%, its biggest gain in two years, Chinese stocks resumed their slide as traders overpowered Beijing much to the surprise of professional traders, especially after Beijing announced fresh measures to ease the funding strains of private companies, as top officials – including president Xi – sought to restore confidence in the world’s second-largest economy. The State Council announced it would support bond financing by private firms, and said the central bank will provide funding to facilitate this. It was not enough however, and the Shanghai Composite resumed its slide, dropping 2.3% overnight and reversing more than half of Monday’s gain, while China’s CSI300 tumbled 2.7%.

The sudden, sharp moves in Chinese stocks in either direction have made the Shanghai Composite the most volatile world index, as vol spiked to the highest level since March 2016.

Despite the return of China’s rout, the yuan was little changed and stood near Monday’s 21-month low, trading at 6.9464 per dollar in the onshore market on expectations China will pursue looser monetary policy to cope with pressure from U.S. President Donald Trump on tariffs.

“This morning weaker stocks in Asia raised some eyebrows and overall sentiment is suffering from trade tensions, Italy to Brexit; a concoction of concerns,” said ING strategist Benjamin Schroeder.

Asia’s overnight tumble gave back much of the ground the region had clawed back over the last two sessions with MSCI’s index of Asian shares dropping 2.1% to a one and a half year low and on the verge of a bear market…

… with declines in many of the region’s heavyweight markets even more pronounced. South Korea’s Kospi and Hong Kong’s Hang Seng both fell 3% and Japan’s Nikkei lost 2.7%.

“We’ve got a few negative factors when market sentiment was already fragile,” said Hiroyuki Ueno, senior strategist at Sumitomo Mitsui Trust Asset Management. “And earnings from some Japanese companies were weaker than expected, with some starting to blame trade wars.”  Hurting local stocks, the yen gained 0.5% amid the risk-off mood to 112.30 to the dollar.

Meanwhile, all major European indices were “drowning in a sea of red” as sentiment continued from Asia amid trade woes and growing concerns surrounding Saudi and the West. Indeed, Asia’s weakness only added to Europe’s ugly mood, with the European STOXX 600 index dropping to a two-year low with almost half of its stocks now in bear-market territory — down 20 percent from their peak.

The bloodbath has spared nobody: Germany’s DAX fell to late 2016 lows with Bayer one of the worst performers, dropping 8% after a U.S. court found the company liable for Monsanto weed killer Roundup’s link to cancer; London’s FTSE was down near April lows, and MSCI’s world share index was just two points of a one-year low.

Eurpope’s rout was led by industrial and tech names as the tech sector index, SX8P dropped as much as 4.4%, hitting the lowest level since August 2017, led lower by AMS and Atos. Apple supplier AMS plunged as much as 32% after its margin outlook disappointed; Atos fell 24% after it also cut its outlook. The SX8P is down 18% from peak in June, getting close to bear territory; technical chart shows 50-DMA crossing below 200-DMA for first time since August 2016, triggering bearish “death cross” signal.

Other tech heavyweights also tumbled with ASML -4%, SAP -3%, Infineon -4.8% all dragged lower in sympathy. According to Bloomberg, the European tech sector now trades at 17.8x fwd earnings, down from 22.4x in June.

Also hit were European industrials with the Stoxx 600 Industrial Goods & Services index falling as much as 2.5%, touching the lowest level since Feb 2017 following a slew of warnings and disappointing results in the sector. Swedish defense company Saab (-14%) led the sector lower after posting weaker-than-expected 3Q earnings and announcing a rights issue, while Finnish power plant components manufacturer Wartsila fell 9.5% after 3Q results which disappointed on “several fronts.” Swiss elevator maker Schindler dropped 8% after 3Q results which were a slight miss across the board, sparking more fears about earnings in 2019.

“Global financial markets continue to struggle to rally as various geopolitical concerns weigh on investor confidence,” Nick Twidale, chief operating officer at Rakuten Securities Australia, said in a note. “With the rest of the world looking much more pessimistic in the current environment,” markets were poised for “a firm correction,” he added.

And with both Asia and Europe crumbling, not even US equity futures, usually resilient to offshore turbulence, were able to stage a rebound, and tumbled 37 points, or 1.3%, retesting the lows from the October 10/11 two-day rout.

In FX, the euro also fell towards a two-month low and Italian bonds struggled before a European Commission meeting that could see Brussels take the unprecedented step of demanding changes to Italy’s recently laid out budget plans.  That has bred some doubt about the European Central Bank raising interest rates next summer, leaving the euro at $1.1470.

“The prospect of a normalization of (ECB) monetary policy was the main reason why the euro was able to appreciate over the past year. However, there is a rising risk that this support is now going to crumble,” Commerzbank analyst Thu Lan Nguyen said.

The pound rose above $1.30, rebounding from an almost three-week low, as the threat of an imminent leadership challenge to U.K. Prime Minister Theresa May faded. Former Brexit minister Steve Baker dropped a parliamentary attempt to sabotage the withdrawal talks, and Conservative Party challengers judged they don’t have the numbers to overthrow May.

All that contributed to the risk-averse mood, with the safe-haven Japanese yen and Swiss franc strengthening while higher-yielding currencies like the Australian and New Zealand dollars fell. The worst performing Emerging Market currency was the Turkish lira which dropped more than 3%, leading declines among emerging-market currencies, after the leader of the nationalist MHP said he’d end a voting alliance with President Recep Tayyip Erdogan’s ruling AK Party at local elections scheduled for March 31.

The Bloomberg dollar index trimmed the overnight haven bid, which capped just shy of 2018 highs.

In global rates markets, BTPs reversed early losses, bolstered by a press report that Italy hopes ECB will buy country’s debt if spreads get out of control. Bund/BTP spread broadly steady around 300bp.

U.S. growth data later in the week as well as earnings from companies including Amazon, Alphabet, Microsoft and Intel could be key to how far much further the drop will go. In the meantime, uncertainty over the death of a Saudi journalist, Italy’s budget and Brexit are among the factors weighing on sentiment.

Meanwhile, fears about diplomatic escalation with Saudi Arabia over the Khashoggi murder festered after Turkish President Erdogan said the information and evidence shows journalist Khashoggi was murdered savagely and was part of a planned operation, he added the Saudi King acknowledged the murder in a phone call. Riyadh faces international pressure to provide all the facts about an incident that has raised a global storm and added the threat of sanctions against the kingdom to a list of market concerns. U.S. President Donald Trump said on Monday he was not satisfied with what he had heard from Saudi Arabia about the killing, but expressed reluctance to punish the kingdom economically.

Investors worry that may lead to Saudi retaliation through crude oil, although a pledge by the Saudi energy minister to play a “responsible role” and keep markets supplied while not ruling out that Saudi output should be 1-2m b/d higher held down crude prices on Tuesday; as a result, WTI and Brent are both in the red with prices currently hovering under USD 68.50/bbl and USD 78.50/bbl respectively. Saudi Energy Minister Al Falih said the oil market is in a good place now and will continue to monitor the oil market, but supply and demand have their uncertainties. Al-Falih sees a lot of output decline in many regions and does not rule out that Saudi output is going to be 1-2mln BPD higher. He said that the nation will be able to produce 12mln bpd of oil in less than three months.

Gold is trading with gains in excess of 1% amid safe haven flows. Elsewhere, China’s alumina exports for September have increased by over 5 times to 165.8k tonnes compared to August. Separately, world refined copper market showed a 47k tonnes deficit in July vs. June’s deficit of 38k tonnes.

Verizon, McDonald’s, 3M and Texas Instruments are among companies reporting earnings. Richmond manufacturing survey is due.

Market Snapshot

  • S&P 500 futures down 1.3% to 2,720.50
  • STOXX Europe 600 down 1.3% to 355.20
  • MXAP down 2.1% to 150.51
  • MXAPJ down 2.1% to 475.27
  • Nikkei down 2.7% to 22,010.78
  • Topix down 2.6% to 1,650.72
  • Hang Seng Index down 3.1% to 25,346.55
  • Shanghai Composite down 2.3% to 2,594.82
  • Sensex down 0.9% to 33,826.52
  • Australia S&P/ASX 200 down 1.1% to 5,843.09
  • Kospi down 2.6% to 2,106.10
  • German 10Y yield fell 0.7 bps to 0.441%
  • Euro up 0.04% to $1.1469
  • Brent Futures down 1.2% to $78.89/bbl
  • Italian 10Y yield rose 0.7 bps to 3.118%
  • Spanish 10Y yield fell 2.2 bps to 1.674%
  • Brent Futures down 1.2% to $78.89/bbl
  • Gold spot up 1.2% to $1,236.25
  • U.S. Dollar Index down 0.1% to 95.92

Top Overnight News from Bloomberg

  • Erdogan said the murder of Saudi journalist Jamal Khashoggi in Istanbul was part of a planned operation as he tries to turn the death into a catalyst for changing the balance of power in Saudi Arabia and regaining influence across the Middle East
  • Equities failed to get any reprieve after China announced fresh measures to ease the funding strains of private companies, as top officials seek to restore confidence in the world’s second- largest economy. The State Council announced it would support bond financing by private firms, and said the central bank will provide funding to facilitate this
  • French Finance Minister Bruno Le Maire said euro-area limits on budget deficits must be respected and the Italian government has an interest in upholding the restrictions. The European Commission will likely decide Tuesday on whether to formally demand a member state to take back, revise and resubmit its budget, a step it has never taken before
  • The Italian government hopes that the European Central Bank would purchase the country’s securities if the bond yield spread with German bunds gets out of control in the coming months, newspaper La Stampa reported, without saying where it obtained the information
  • U.S. President Donald Trump’s surprise call to cut middle-income families’ taxes by 10% could mean top earners get a break, too. It’s still unclear how Trump will propose to reduce the tax burden on middle-class Americans, but one of the most straightforward ways would be to lower rates by 10% for single filers making up to $82,500
  • A small group of British currency traders didn’t have the power to fix prices in a $5.1 trillion-a-day market where hundreds of competitors were battling to get the best price, a foreign-exchange expert told a U.S. jury considering criminal antitrust charges against the lot known as “The Cartel”

Asian equity markets were lower across the board following the uninspiring performance on Wall St where most major indices finished in the red amid underperformance in financials and in which the S&P 500 posted a 4th consecutive loss. ASX 200 (-1.05%) was dragged lower by weakness across the large industries including financials, energy and resources, while Nikkei 225 (-2.67%) slumped as Japanese exporters suffered the ill-effects of a firmer currency. Hang Seng (-3.08%) and Shanghai Comp. (-2.26%) conformed to the downbeat tone as buying in the mainland eased following the prior day’s over 4% rally, while US equity futures declined alongside their Asian peers with pressure exacerbated as the E-mini S&P broke below US session lows around the 2750.00 level. Finally, 10yr JGBs were quiet and only marginally benefitted from the downbeat risk tone, while the enhanced-liquidity auction for 10yr, 20yr and 30yr JGBs failed to spur any meaningful demand with the b/c unchanged from the prior.

Top Asian News

  • Indonesia Holds Key Rate as Run of Hikes Helps Stabilize Rupiah
  • China’s Central Bank to Offer More Funds for Private Companies
  • Agarwal Says Trying to Combine Anglo, Hindustan Zinc Ops: CNBC
  • J&J to Buy Rest of Japan Skin-Care Company Ci:z for $2 Billion

All major European indices are drowning in a sea of red as sentiment continues from Asia amid trade woes and growing concerns surrounding Saudi and the West; Germany’s DAX (-2.1%) is lagging its peers, largely due to downside in Bayer (-8.0%) after a US judge affirmed a verdict in regards the weed-killer which was linked to cancer. Key sectors are broadly in the red, with IT (-3.8%) the lagging index, significantly weighed on by Atos (-22.4%) following a cut to their financial year growth guidance. Meanwhile, AMS (-27.0%) slumped amid earnings, with the likes of STMicroelectronics (-4.8%), Infeneon (-5.0%) and Wirecard (-5.8%) dragged lower in sympathy.

Top European News

  • Car Stocks Fall as Renault Sales Miss Offsets Confirmed Guidance
  • French Are Target of Widespread Spying by Chinese, Figaro Says
  • BTPs Rise on Report That Italy Hopes ECB Will Buy Nation’s Debt

In FX, the Yen was the standout G10 outperformer on safe-haven grounds, with Usd/Jpy retreating further from Monday’s near 112.90 highs towards 112.25 where stops are anticipated down to 112.20 and Jpy crosses also trending lower again as big figure levels give way (like 129.00 vs the Eur and 80.00 vs the Aud). GBP – A sterling effort to avoid another leg-down and loss of a round number, as Cable rebounds firmly from sub-1.2950 lows to retest 1.3000 with the aid of reported model buying around 1.2985. However, the Pound remains precarious and prone to further Brexit-related pressure, as Eur/Gbp hovers above 0.8800 having broken above a couple of Mas yesterday. NZD – The Kiwi is also relatively resilient to broad risk aversion and hovering around 0.6650 vs its US counterpart, albeit partly on favourable cross-flows again as AUD/Nzd remains capped around 1.0800 and the Aud loses 0.7100 support alongside ongoing weakness in the Yuan. EM – The Lira has lost more of its recent recovery momentum on a mixture of factors including a move from the CBRT ahead of Thursday’s rate meeting to raise the RRR on Usd, renewed political uncertainty following the national party announcing that it will not continue its AK party allowance and a further deterioration in consumer confidence. Usd/Try just off near 5.8700 highs, but still significantly above lows circa 5.6670.

In commodities, WTI and Brent are both in the red with prices currently hovering under USD 68.50/bbl and USD 78.50/bbl respectively, this price dip comes as Saudi Arabia pledges to be responsible in energy markets removing some of the market’s risk sentiment ahead of the step-up in Iranian sanctions. Saudi Energy Minister Al Falih said the oil market is in a good place now and will continue to monitor the oil market, but supply and demand have their uncertainties. Al-Falih sees a lot of output decline in many regions and does not rule out that Saudi output is going to be 1-2mln BPD higher. He said that the nation will be able to produce 12mln bpd of oil in less than three months. Iran said they are not concerned about maintaining oil production. Iranian Oil Minister said the country’s oil exports cannot be stopped and sanctions on Iran will keep the market volatile.

Gold is trading with gains in excess of 1% amid safe haven flows due to political tensions between Saudi Arabia and Western countries. Elsewhere, China’s alumina exports for September have increased by over 5 times to 165.8k tonnes compared to August. Separately, world refined copper market showed a 47k tonnes deficit in July vs. June’s deficit of 38k tonnes.

US Event Calendar

  • 9:30am: Fed’s Kashkari Speaks at Early Childhood Development Event
  • 10:00am: Richmond Fed Manufact. Index, est. 24, prior 29
  • 1:30pm: Fed’s Bostic Speaks on Economy and Monetary Policy
  • 2:15pm: Fed’s Kaplan Speaks at Economic Development Event in Texas
  • 8pm: Fed’s George Takes Part in Payment System Conference in Sydney

.

 

3. ASIAN AFFAIRS

i) TUESDAY MORNING/ WEDNESDAY NIGHT: 

SHANGHAI CLOSED DOWN 60.05 POINTS OR 2.26% //Hang Sang CLOSED DOWN 806.60 POINTS OR 3.08% //The Nikkei closed DOWN 604.04 OR 2.67%/ Australia’s all ordinaires CLOSED DOWN 1.02%  /Chinese yuan (ONSHORE) closed UP  at 6.9365 AS POBC RESUMES  ITS HUGE DEVALUATION  /DELEGATION COMING TO THE USA TO SEE TRUMP IN NOVEMBER CANCELLED/Oil DOWN to 68.07 dollars per barrel for WTI and 78.03 for Brent. Stocks in Europe OPENED RED //.  ONSHORE YUAN CLOSED SLIGHTLY UP AT 6.9365 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED SLIGHTLY DOWN ON THE DOLLAR AT 6.9452: HUGE DEVALUATION/PAST SEVERAL DAYS RESUMES// TRADE TALKS STOPPED   : /ONSHORE YUAN TRADING STRONGER  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 A FULL TRADE WAR COMMENCED

 

3 a NORTH KOREA/USA

 

North Korea/South Korea/USA/China

3 b JAPAN AFFAIRS

 
END

3C CHINA

The war of words between China and the USA continues unabated:  this time China warns of their ignorant and malicious debt trap.

(courtesy zerohedge)

China Slams Pompeo’s “Ignorant And Malicious” Debt-Trap Warning

The Communist Party’s simmering antipathy toward Secretary of State Mike Pompeo – which was on full display earlier this month during an unprecedented public confrontation between Pompeo and his Chinese counterpart during a meeting in Beijing – boiled over once again this week as a series of editorials in China’s Global Times and China Daily newspapers attacked the secretary of state over remarks he made during a recent tour of Latin America, where he warned about the dangers of China’s so-called “debt diplomacy.”

Pompeo

Per Reuters, Pompeo met heads of state in Panama and Mexico during a Latin American tour late last week. And during one brief meeting with reporters, Pompeo warned during a visit to Mexico City that “when China comes calling it’s not always to the good of your citizens” referring to China’s strategy of extending cheap credit, then seizing assets – like they did with a port in Sri Lanka – that will help further the country’s neocolonialist ambitions.

“When they show up with deals that seem to be too good to be true it’s often the case that they, in fact, are,” he said on Thursday in Mexico City, according to comments posted on the US State Department’s website.

Though Pompeo clarified that the US has nothing against legitimate Chinese investments.

“When they show up with a straight-up, legitimate investment that’s transparent and according to the rule of law, that’s called competition and it’s something that the United States welcomes,”said Pompeo. “But when they show up with deals that seem to be too good to be true it’s often the case that they, in fact, are.”

Of course, Pompeo isn’t the only senior Trump administration official to criticize these aggressive tactics. Mike Pence centered his criticism of China’s economic aggression around the country’s strategy of using credit as a tool to entrench its global dominance and further expand its One Belt One Road global development strategy.

But in an editorial published Monday, the state-run China Daily newspaper said Pompeo’s comments were “ignorant and malicious” and that criticisms surrounding the country’s use of “debt traps” were false.

“Pompeo’s latest undisguised message to Panama and other countries not to participate in China-proposed Belt and Road projects lays bare the U.S. condescending and bullying manner to the region,” said the English-language China Daily.

“Washington continually tries this tired old tactic of trying to pin suspicions about China’s motives on the Belt and Road so as hinder its advancement,” the newspaper added.

The Global Times said in a separate editorial that Pompeo’s comments were “disrespectful” and accused the US of “trying to drive a wedge” between China and Latin America.

“For years, Latin American countries have been pursuing peace and development, on which, however, the U.S. did not offer much support. Latin American countries depend on the U.S. economy, but the U.S. does not make the region rich and prosperous.”

“Relations between China and Latin America are based on mutual respect and equality. As China is winning trust and support from Latin America, the U.S. feels lost and is trying to drive a wedge.”

There’s a hint of irony in these criticisms, because while the US has long maintained strong political influence in the region, more recently, China has been making inroads that have driven several Latin American countries away from the US sphere of influence. Over the past two years, three Latin American countries – El Salvador, Panama, and the Dominican Republic – have switched diplomatic ties from Taiwan to Beijing. And China’s money-for-oil loans have essentially kept Venezuela’s disintegrating economy on life support. America’s dominance of the region may be nearing its twilight – no matter what Pompeo does or doesn’t say.

end
First it was Sweden’s powerful Wallenberg family ready to dispose of much of its hugely acquired assets.  Now we find that one of China’s largest fund, Everbright, is also ready to dump stocks
(courtesy zerohedge)

“Time To Prepare For The Next Crisis”: One Of China’s Largest Funds Is Getting Ready To Dump Stocks

A few days after we reported that the investment vehicle of Sweden’s most powerful family, the Wallenbergs, has begun preparations for the next global crisis, concerns about the future have spread to one of China’s largest state-backed asset manager which runs about HK$139 billion ($18 billion) in assets, and which said it was preparing to sell shares in as many as 30 stocks on concern that valuations worldwide have peaked.

There are 20 to 30 companies in China Everbright’s global portfolio that are ripe for exit after they went through initial public offerings, Chief Executive Officer Chen Shuang said in an interview in Hangzhou on Tuesday according to Bloomberg. And alhough he didn’t specify which stocks Everbright would sell out of, Chen said the company is planning to make its exits “as soon as possible.”

“We will be actively disposing of assets and be prudent about new investments,” Chen said. “Global markets including the U.S. have peaked. We should be prepared for the next round of financial crises and turmoils.”

Chen also said Everbright raised more funds overseas after it became “very difficult” to do so in China. According to Bloomberg, new rules on the asset management industry slowed the increase of fundraising for private equity firms to 8% this year from an average annual rate of 20% in the past five years, he said. “Most of our new funds this year were raised from overseas,” he said.

Everbright, which has invested in more than 300 companies worldwide, has joined a wave of pessimism rippling through markets recently.  The Hong Kong-listed firm, part of China Everbright Group, counts electric-car maker NIO and Netflix-like streamer iQiyi both of which went public in the U.S. this year, within its portfolio.

Earlier today, the MSCI Asia Pacific Index was on the verge of a bear market as Asian stocks tumbled on rising geopolitical tensions, receding optimism over U.S. stocks, including a possible slowdown in earnings and economic growth.

It is likely that Chen will be punished for his bearish remarks: his comments come in direct refutation of an unprecedented jawboning campaign by various heads of Chinese financial regulators and Vice Premier Liu He making statements last week pledging increased support for private companies and the markets. On Sunday, even president Xi Jinping vowed “unwavering” support for the country’s private sector.

“Any words and practices that negate and weaken the private economy are wrong,” Xi said in a letter to private entrepreneurs, “Supporting the development of private enterprises is the Party Central Committee’s consistent policy,” Xi said.

In apparent refutation of Beijing’s attempt to instill confidence with even more stimulus, Chen said China’s economic growth should rest more on fundamentals than policy stimulus. “Long-term growth cannot rely on policy drive,"he said

It was not clear if words that suggest the selloff is only going to get worse are also “wrong” although if we were Chen, we’d be very nervous right about now.

China’s attempt to boost confidence worked… briefly. China saw its biggest stock rally in three years on Monday, followed by another 2% drop on Tuesday as the effects wore off.

4.EUROPEAN AFFAIRS

Yesterday we reported on the former EU Dijsselbloem’s assertion that it is Italy itself in trouble and that if they default it would be Italian citizens holding the bag.  Tom Luongo debunks that theory but good.  Our former EU minister,Dijsselbloem  highlights the huge target 2 imbalances that is owed by Italy to the central bank and that must be paid before Italy ever dreams of leaving the EU.  Italy will leave the EU and the ECB will be holding the bag on that huge target 2 imbalance of over 492 billion euros.

a must read…

(courtesy Tom Luongo)

By Going Nuclear The EU Has Already Lost Its Battle With Italy

Authored by Tom Luongo,

“Here’s where we hold ’em by the nose, and kick ’em in the ass”
— Patton

If you ever want to know who’s losing an argument simply look at who’s doing the most threatening.

Not who’s shouting the loudest or who’s the angriest, but who is threatening.

Those who threaten are doing so because they feel their power is, itself, under attack.

It doesn’t matter if it is an argument with your kids or a big, geopolitical disagreement, as I always say, he who goes nuclear is losing.

Now, you might think I’m talking about the U.S. and President Trump’s incessant financial bullying of allies and enemies alike.  I am somewhat, but not primarily.

Because as important as Trump’s mad flailing to try and remake the U.S.’s trade position around the world is, it pales in comparison to the acute crisis brewing in Europe.

Yes, Europe is more important.  Why?

Because the EU just went nuclear on Italy. 

Former Dutch Minister of Finance and former President of the Eurogroup, Jeroen Dijsselbloem, went on CNBC on Friday to declare all-out financial war on Italy.

That’s the way Zerohedge put it.

As a ‘former’ big wig it was his job to go out and state the position of those currently in power who can safely hide behind his words.

And if you watch the clip from CNBC in the linked article you’ll note that CNBC excised the most important quotes, where Dijsselbloem threatened the Italians that no exit from the euro is on the table.

But, why would he say this when Italy hasn’t brought it up at all?

In fact, Italy’s leadership has been nothing but supportive of the European Project while standing firm on it adopting fairer rules for member countries.

The response from Italy was calm and direct, not hyperbolic.     They would not violate their budget deficit targets and are trying to work with the European Commission on this.

Ignore the reality that Italy can’t grow their way out of this without shaving the scalps of bondholders and issuing its own currency.  Italy’s calm demeanor is what is important.

Dijsselbloem is lying when he says that most of the Italian debt is domestically owned. A large portion of it is.

But, tell me again, Jeroen, what is that $1+ trillion TARGET 2 balance on the ECB’s books?

A lot of it is Italian debt.

Seeing marginal improvement in Italy’s 42% Non-Performing Loan portfolio after seven years of enforced austerity is not an endorsement of the policy but an indictment.

It’s a real liability which ECB President Mario Draghi says Italy must re-pay before it can leave the euro.

Of course Draghi is acting like a loan shark, continuing to backstop purchases of Italian debt under TARGET 2 and then telling the debtor, Italy, it needs to pay up. 

The bigger these TARGET 2 imbalances get the more leverage Italy has in these budget negotiations.  Because no one is buying that the European banking system is not exposed to horrific losses if Italy defaults.

And while Dijsselbloem would have no problem bailing-in Italian depositors and ruining the Italian banking system I don’t think he realizes just what the secondary and tertiary effects of that action would be.

Why would anyone ever invest in a European bank that can be seized and sold leaving the investors to suffer 100% losses all because the technocrats in Brussels refuse to give up one iota of power?

That’s what he’s saying in the video, though.

So, note Italy’s response.  Calm, assertive.

We will do what is right for Italy and reform the EU.”

“We chose to start the process before it became a crisis.  Now you are threatening us with one.”

This is an astute political move which has moved Italian voters firmly on their government’s side.  Strategically this was always their best move.

The latest polls have more than 56% of Italians would leave the EU if an Italeave referendum were held today.

Brexit never polled that well.

As always, the heavy-handed Djisselbloem has his thumb on the pulse of the EU’s problems, opening his mouth and making things worse, just like he did with Greece.

In Greek negotiations, the EU was calm.  It told Greece over and over, “No.”  Greece threatened the nuclear option, leaving the euro and its bluff was called.

So, Dijesselbloem’s warning is just like Greece’s threats and they are going nuclear on Italy.

They have to.  The EU has zero leverage over Italy.

The so-called populists in charge in Italy know exactly what they are doing.  They are killing the EU with kindness. Five Star Movement leader Luigi Di Maio reiterated over the weekend that there is “no Plan B” for leaving the EU.

The goal is to reform it from within.

That’s a talking point from the campaign they needed to cultivate a “Good Cop” to Matteo Salvini’s “Bad Cop” that talks openly about the euro being a monstrosity and “a crime against humanity.”

Italian polls have Salvini’s League more popular now than Di Maio’s Five Star.  They are becoming more radicalized.  The more Salvini lobs rhetorical grenades at Brussels, the more popular he becomes.

Together they command more than 60% of Italians.  Syriza, in Greece, never had more than 30%.  And no more than 30% of Greeks ever backed leaving the euro.

Trump went nuclear on Kim Jong-un before Kim lit off a couple of nukes himself to prove his point.  Then he went to the Seoul Olympics and ended the war of words. Peace is breaking out on the Korean peninsula and the U.S. cannot stop it now, though many want to.

Dijesselbloem just told Salvini and Di Maio the EU has no truly has no Plan B.  

You can bet that the Italians actually do.

*  *  *

Join my Patreon because I will never go nuclear.

END
Another excellent piece from Mish Shedlock who also delves into the huge target 2 imbalance of Italy.  It seems that the average Italian is moving his money out of Italy and moving it into Switzerland (preferable) or Germany.
a must read….
(courtesy Mish Shedlock)

“One Size Fits Germany”-Math Impossibility:

Mish Warns “Get Your Money Out Of Italy Now!”

Authored by Mike Shedlock via MishTalk,

Italy, on the Euro, has a currency that is 9% too high. Germany, on the Euro, has a currency that is 11% too low.

There was much discussion last week about the US Treasury report that determined China was not a currency manipulator.

However, there are six countries on the manipulation watch list: China, Japan, Korea, India, Germany, and Switzerland.

  • Japan, Germany, and Korea have met two of the three criteria in every Report since the April 2016 Report having material current account surpluses combined with significant bilateral trade surpluses with the United States.
  • Germany has the world’s largest current account surplus in nominal dollar terms, $329 billion over the four quarters through June 2018, which represented its highest nominal level on record. Germany also maintains a sizable bilateral goods trade surplus with the United States, at $67 billion over the four quarters through June 2018. There has been essentially no progress in reducing either the massive current account surplus or the large bilateral trade imbalance with the United States in recent years, in part because domestic demand in Germany has not been sufficiently strong to facilitate external rebalancing and because Germany’s low inflation rate has contributed to a weak real effective exchange rate.

Try Fixing This

  1. The Euro is 11% undervalued in Germany, the largest Eurozone economy.
  2. The Euro is 9% overvalued in Italy, the third largest Eurozone economy.

The normal way central banks make adjustments to fix over-valued or undervalued situation is through interest rate policy or direct currency intervention.

No matter which the ECB does, it will impact Italy and Germany in opposite directions.

Meanwhile, interest rates are on the verge of spiraling out of control in Italy.

Italy vs Germany 10-Year Bond Spread

Theory vs Practice

In theory, German, Italian, and Greek 10-year bonds should all have the same yield. In practice, they clearly don’t.

The spread between German 10-year and Italian 10-year bonds is 330 basis points (3.3 percentage points).

The difference is perceived default risk. The odds of Italy leaving the Eurozone are rising.

Major Confrontation

On September 28, Italy’s proposed budget deficit of 2.4% sent bond yields soaring. And they haven’t stopped.

Today, ECB president Mario Draghi warned “Undermining EU budget rules carries high price for all” and yields surged again.

For discussion, please see Italy Bond Yields Surge In Confrontation with ECB President Mario Draghi.

Sudden Stop of Capital

Italian bonds are just two steps above Junk.

Again, this should not happen “in theory”. All Eurozone sovereign debt should have similar ratings.

Practice is another matter, as Goldman Sees Italy Junk Risk Leading to ‘Sudden Stop’ of Capital.

Capital Flight Underway

Capital flight is already underway. Proof can be found in Target2 Imbalances.

Target2 Imbalances

Italian Money Heads to Switzerland

Zerohedge reports More Italians Move Savings to Switzerland as Fears of Banking “Doom Loop” Intensify.

With the euro weakening against the Swiss franc and Italian stocks and bonds tumbling once again on reports that the European Commission is planning to reject the Italian draft budget plan submitted earlier this week – a repudiation of Italy’s populist leaders that was widely anticipated – the Telegraph’s Ambrose Evans-Pritchard offered a glimpse into how middle-class Italians are reacting to the deteriorating relationship between Italy and the EU, and its attendant impact on the country’s banks and capital markets.

In a trend that’s eerily reminiscent of the banking run that precipitated the near-collapse of the Greek banking system (most recently in 2015), Italians are scrambling to convert their euros into Swiss francs and stash them across the country’s northern border with Switzerland.

Big Players Already Out

The Swiss group Albacore Wealth Management told Italy’s Il Sole had received a wave of inquiries from Italians with €5m to €10m in liquid capital. The super-rich are already a step ahead. “The big fish have been organizing the expatriation of their wealth for some time,” it said.

“There is fear creeping in,” said Massimo Gionso, head of family wealth managers CFO Sim in Milan.

“People are concerned that if we get into the same situation as Greece, they might find the banks are closed and they can take out only €50 a day from cash machines. They don’t want to risk it,” he told the Daily Telegraph.

“These are families with savings of €200,000 or €300,000. They want to set up accounts in Lugano or Chiasso across the border in Ticino where everybody speaks Italian. The big players have already got their money out,” he said.

How Much Money Is Leaving?

  • Italy July Target2 : -471.1 Billion Euros
  • Italy August Target2: -492.5 Billion Euros

Between July and August, Italy’s Target2 imbalance rose by 21.4 billion euros. That was before these budget concerns became apparent.

Fatally Flawed Setup

  1. The ECB’s interest rate policy, was fatally flawed from inception.
  2. Target2 is a failed construct
  3. German productivity vs peripheral Eurozone productivity is yet another issue.
  4. EU policies take all 27 nations to agree, or nothing gets done. So the broader EU is fatally flawed as well.

These flaws were generally recognized actually. So were problems with Greece. Yet, they welcomed Greece with open arms.

The global economy is slowing, Trump’s trade polices are wreaking havoc and Brexit is going to damage trade ralations as well.

We have had a 10-year recovery, yet the ECB is still expanding its balance sheet. The ECB is supposedly going to cease those asset purchases in 2019.

Good luck with that.

Who will buy Italian bonds, and at what price? And what about the Italian bond inevitable downgrade to junk?

Good luck with that, too.

Word of Advice

If you have money in Italian banks, get it out now, while you can. Capital controls are coming and Italy is increasingly likely to leave the Eurozone entirely.

end

This ought to get the EU and the west angry:  Salvini requests that Russia should buy Italian bonds when QE official ends in either the Dec 31.2018 or mid 2019 if they exercise operation twist.

(courtesy zerohedge)

Italy’s Salvini Requests Russia To Buy Italian Bonds

When QE Ends: Report

With just over two months left under the ECB’s sovereign bond buying program (unless, of course, Mario Draghi reverses should European stocks continue to plunge), Italy – which has been the biggest beneficiary of ECB’s QE generosity, keeping Italian bond yields low, is starting to sweat: after all, without the ECB backstop and with Italy now in a critical stand off with the EU which will likely get much worse before it gets better, why would anyone buy BTPs?

So, as a bizarre alternative, Italy’s La Stampa reported this morning that Italy Deputy Prime Minister and head of League partyMatteo Salvini requested that Premier Giuseppe Conte discuss possible Russian purchases of Italy govt bonds at his meeting with President Vladimir Putin on Tuesday in Moscow.

According to the Italian newspaper, “Salvini would favor Russia buying Italy govt bonds once there is no shield from ECB.”

It was not clear why or how, or under what mandate Russia would backstop Italy, or how the ECB would view such an action from the Kremlin, or whether Russia funding the Italian deficit is even permitted by Article 123 of the Lisbon Treaty, but we doubt the proposal was meant to be taken seriously, and if anything we merely a “trial balloon’ by Salvini to show what may happen if and when Italy leaves the monetary union.

In terms of what actually is on the agenda, Conte is expected to discuss with Putin EU sanctions on Russia over Crimea annexation and may ask Putin to attend conference on Libya that Italy will hold in Palermo Nov. 12-13.

Separately, and in a somewhat related story, Italian bonds initially advanced on Tuesday after La Stampa also reported that the government hopes that the ECB would purchase the nation’s debt if the bond yield spread with German Bunds got out of control in the coming months. Following the bizarre report, which we assume is premise on a continuation of QE only for the benefit of Italy, something neither the ECB nor Germany would ever agree to, the Italian 10y spread to Germany tightened 2bps to 302bps, and the FTSE MIB outperformed European index peers.

However, the outperformance was not meant to last, and Italian bonds reverse gains after PM Conte denied moments ago that he has a “Plan B” – something speculated earlier in the day – to the nation’s budget in an interview with Bloomberg Television, prompting a safety bid in EGBs.

Italy’s FTSE MIB stock market also extends its drop, down 0.7% as of 2:35pm CET, after Conte’s “Plan B” denial.

And now all eyes turn to Brussels (if not the Kremlin just yet), as the EU may implement the “never-before-used” step of demanding revisions to the budget as soon as today.

end

World War III just broke out between the EU and Italy as they just told our stubborn Mediterranean nation to resubmit its budget as they rejected it in full. Conte then states that he has no plan B

(courtesy zerohedge)

In Unprecedented Step, EU Tells Italy To

Resubmit Budget As Conte Says No “Plan B”

Update: the gloves are officially off, with Europe not only telling Italy to revise its budget, but threatening it may impose disciplinary action on the Mediterranean nation:

  • EUROPEAN COMMISSION REJECTS ITALY’S DRAFT 2019 BUDGET, ASKS FOR REVISED PLAN IN THREE WEEKS
  • DOMBROVSKIS SAYS ITALIAN GOVERNMENT IS OPENLY AND CONSCIOUSLY GOING AGAINST PAST COMMITMENTS MADE ON BUDGET
  • DOMBROVSKIS SAYS EU COMMISSION MAY REASSESS ITS DECISION IN MAY NOT TO PUT ITALY UNDER DISCIPLINARY ACTION
  • EU’S DOMBROVSKIS SAYS ITALY’S CLARIFICATIONS ON 2019 DRAFT FROM MONDAY NOT CONVINCING
  • DOMBROVSKIS SAYS EU BUILT ON TRUST, SAME RULES FOR EVERYBODY, IF TRUST IS ERODED, ALL IN EU SUFFER
  • DOMBROVSKIS SAYS EXPERIENCE HAS SHOWN HIGHER FISCAL DEFICITS, DEBT DO NOT BRING LASTING GROWTH, MAKE ECONOMY VULNERABLE
  • EU’S DOMBROVSKIS SAYS WE NOW HAVE 3 WEEKS OF INTENSIVE DIALOGUE WITH ITALY, BALL IN ITALY’S COURT

Earlier:

One day after Italy responded to the EU’s critical reception of Rome’s budget proposal, all eyes were back on Brussels which some feared may implement the unprecedented step of demanding revisions to the budget as soon as today, something the European Commission has never done before.

Well, moments ago Brussels did respond, and just as the worst case scenario predicted, Europe officially rejected the Italian budget proposal telling Rome to take back, revise and resubmit its budget.

Stand offThe rejection follows months of discord and tension over the spending targets, which Italy yesterday accepted breach EU rules but refused to adjust.

As Bloomberg adds, while actual sanctions are still improbable and wouldn’t be levied for months, European officials have been wary of handing ammunition to Italy’s euroskeptic government that already waged one successful election campaign by blaming the EU for many of the country’s ills.

Europe’s response came just moments after Italian Prime Minister Giuseppe Conte said in a Bloomberg News interview that his government has no “Plan B” to change its budget, despite the skeptical responses of the European Commission and investors.

Conte told Bloomberg that he was looking forward to talking with European commissioners and explaining the 2019 budget to them. He suggested that Italy has some leeway to tweak aspects of the plan, and not actual spending. But if he is asked to change the substance, “it will be difficult for me because I cannot accept that.”

“There isn’t any B plan,” Conte said in the interview in English at his Rome office on Tuesday. “I said that the deficit at 2.4 percent of GDP is the cap. I can say this will be our cap,” he said, in reference to the planned budget deficit for next year.

“We are ready to reduce maybe, to operate a spending review if necessary,” Conte said. “You have to consider that we are not gamblers that are betting on our kids’ future on the roulette.” Economic growth is “the best way in order to take us out of a debt trap.”

Conte dismissed the prospect of the spread with German bunds reaching 400 basis points, a level that Credit Suisse AG said could put unsustainable pressure on Italy’s banking system. He also reaffirmed Italy’s commitment to the euro. “I have the evidence that part of the spread is due to the prospect of Italexit,” Conte said.

“I can assure that this executive will not accompany this country, Italy, out of Europe,” he said. “We feel very comfortable, we feel at home in Europe and we think that the euro is our currency and will be our currency, the currency of my kid, he’s 11 years old, and the currency of my grandchildren.”

That… or the ruble. According to press reports, Salvini is already testing the ground for Russia to buy Italian bonds if and when the ECB’s QE ends (or when Rome withdraws from the Euro).

As a result of both sides’ adherence to their bargaining position, Italy’s populist government remains on collision course with Brussels as its spending targets far exceed EU limits, and with neither side willing to budge. The commission, the EU’s executive, is due to respond to Italy’s spending plans later on Tuesday, when it may opt to formally demand that Rome takes back, revises and resubmits its budget.

Meanwhile, after posting gains earlier in the session, Italian bonds fell for the fourth time in five sessions earlier on Tuesday after Europe’s response, drifting as wide as 3.53%, as Italian stocks have continued sliding and the EURJPY dropped to session lows

5.RUSSIAN AND MIDDLE EASTERN AFFAIRS

 

SAUDI ARABIA
Turkey claims that the killing of Khashoggi was planned and the killing was extremely savage
(courtesy zerohedge)

Turkey Says Saudi Arabia Planned “Extremely

Savage” Khashoggi Killing

Prior to Monday, official leaks to Western and Turkish media regarding the ongoing investigation into the murder of Saudi dissident journalist Jamal Khashoggi have only obliquely placed the blame on the Crown Prince and other senior Saudi officials, as President Erdogan has erred on the side of diplomacy – though that could all change tomorrow, when Erdogan has promised to share the results of Turkey’s investigation into the killing of Khashoggi, presumably including what role, if any, that Crown Prince Mohammad bin Salman had in the plot.

And in a sign that the Turks might soon abandon their diplomatic facade, the latest round of leaks to Turkish media have suggested that the murder of Khashoggi “was planned in an extremely savage manner.” For those who haven’t closely parsed every update published by the Turkish press, this is the first time that Turkey has indicated that Ankara believes that Khashoggi’s murder was planned in advance.

Khashoggi

And in the first official indication that Turkey believes Riyadh actively orchestrated a cover-up, AKP Spokesman Omer Celik complained that “we are faced witha  situation where there has been a lot of effort to whitewash this.” Erdogan’s advisor Yasin Aktay wrote in the Yeni Safak daily that it “feels like our intelligence is being mocked.”

With Turkey seemingly on the verge of officially blaming Riyadh and MbS for Khashoggi’s death, the following warning sounded even more ominous.

“From the start, the line of our president has been clear. Nothing will remain secret in this case,” presidential spokesman Ibrahim Kalin told reporters, a day ahead of a key speech by Erdogan on the case.

Safak pointed out that Saudi security official Maher Abdulaziz Mutreb had lead a team of 15 Saudis to Istanbul on the day that Khashoggi disappeared and that he called the head of Prince Mohammed’s office, Bader al-Asaker, “four times after the murder.”

Meanwhile, Abdulkadir Selvi, whose columns in the Hurriyet newspaper columns are closely watched for clues about Erdogan’s thinking, alleged that Khashoggi had been slowly strangled to death for eight minutes inside the consulate before a Saudi autopsy specialist cut his body into 15 pieces while listening to music. In the most forthright criticism levied at MbS by a Turkish official since the diplomatic crisis exploded into public view two weeks ago, Selvi called for MbS to be “removed from his post”

“We cannot close this file until the crown prince is brought to account and removed from his post. For 50 years we cannot live with a crown prince who is an enemy of Turkey,” said Selvi.

Meanwhile, Khashoggi’s remains have yet to be found, though Turkish investigators are said to be conducting a thorough search. But regardless of what they find, the tonal shift represented by these editorials is difficult to ignore. The Turkish stance toward Saudi Arabia is hardening, which suggests that Erdogan may be preparing to blow up the Saudis’ alibi that Khashoggi’s death was the result of an “interrogation gone wrong.”

END
It seems that the remains of Khashoggi have been discovered in the Saudi Consul General’s home
(courtesy Sky News/zerohedge)

Bombshell: Khashoggi Remains Discovered In

Garden Of Saudi Consul General’s Home: Sky

News

Hours after Turkish President Erdogan demanded that Saudi Arabia disclose the whereabouts of journalist Jamal Khashoggi’s remains, body parts reportedly belonging to Khashoggi have been found, according to Sky sources, though the exact location wasn’t revealed. According to anonymous sources cited by Sky News, the writer had been “cut up” and his face “disfigured.”

One source suggested that Khashoggi’s remains had been discovered in the garden of the Saudi consul general’s home. “Why has the body of someone who was officially said to be killed not been found yet?” Erdogan asked during his speech at Turkey’s parliament on Tuesday.

Khashoggi

He added that all 18 of the Saudi nationals arrested in connection with the killing should stand trial in Istanbul.

The circumstances surrounding the discovery of Khashoggi’s body parts both contradict Saudi Arabia’s explanation for his death. According to the Saudis, Khashoggi’s body was handed off to a local fixer after being wrapped in a rug. Though Erdogan didn’t mention Crown Prince Mohammad bin Salman in his speech, the kingdom and the prince have denied his involvement.

If accurate, the discovery of Khashoggi’s remains will likely unleash a new round of international pressure on the Saudis, who have seen foreign investors pull money from their stock market while Wall Street CEOs and a handful of industrialists and tech titans have pulled out of the kingdom’s “Davos in the Desert.”

END

Turkish Police Find Two “Suspicious” Suitcases In Abandoned Saudi Consular Car; Chemical Mask Recovered

According to Turkish media outlet Hürriyet and CNN Turk, two suitcases full of clothes believed to belong to slain Saudi journalist Jamal Khashoggi were found in the trunk of a Saudi consular car abandoned in an Istanbul parking lot.

Also found were a computer and documents which were said to belong to Khashoggi as well, according to CNN Turk.

Saudi consulate car similar to abandoned MercedesThe car, a Mercedes with diplomatic plates, matched the description of another vehicle seen outside the Saudi consulate in Istanbul where journalist Jamal Khashoggi disappeared on October 2.

A Reuters witness said a Saudi team was accompanying the Turkish investigators as they carried out the search in a car park where the vehicle was found in Istanbul’s Sultangazi district on Monday.

On its website, CNN Turk said the investigators found a computer and documents in the car which were said to belong to Khashoggi. –Reuters

The abandoned car was discovered after a reader tipped off Hürriyet reporters.

According to an employee who spoke to Hürriyet, the Mercedes with the diplomatic plate of 34 CC 1736 was driven into the parking lot by one of the attachés of the consulate, identified only as Muhammed O., on Oct. 7. –Hürriyet

We know him as he has been using our parking lot sometimes. However, normally his Turkish driver uses this car. But on Oct. 7, the attaché was driving it himself,” said the employee.

Meanwhile, the same Saudi attaché returned to the parking lot on October 18 with a BMW bearing diplomatic license plate 34-CC-2665, parked it in front of the Mercedes and unloaded three suitcases – “two of them quite large,” according to a lot employee who helped him load the bags into the Mercedes.

Khashoggi’s body is not inside the suitcases, is it?” the employee quoted himself as jokingly asking the attaché. “He laughed and answered no,” he said, according to Hürriyet.

Chemical mask

The lot employee also told Hürriyet that a chemical face mask had fallen on the ground while unloading the suitcases into the trunk.

“The attaché took it and put it in a trash bin before leaving the parking lot with the BMW,” said the employee. “I was very suspicious. I took the mask and showed it to a doctor. He told me that it was a mask that is used by those who work with heavy chemicals. I was so scared that I instantly put it away.”

The consulate’s Mercedes remained in the parking lot with the suspicious suitcases in its trunk, as well as an iPhone box and a kettle, which can be seen in its back seat.

Turkish police went to the parking lot on Oct. 22 but could not search the car due to its diplomatic immunity.

After receiving a waiver from Saudi authorities, security forces returned to the site and conducted the search on Oct. 23.

According to the initial findings, two suitcases full of clothes were found in the trunk.

The clothes will be analyzed for DNA traces, a security source said. –Hürriyet

More suitcases?

An unconfirmed report from Gulf Institute terrorism expert Ali AlAhmed purports to show agents of the Saudi monarchy moving large bags outside the consulate on October 2, postulated to contain Khashoggi’s dismembered body parts.

Ali AlAhmed

@AliAlAhmed_en

Video of #Saudi monarchy agents moving #JamalKashoggi body parts in large bags outside the consulate October 2. You can see AndulAziz Almutreb who was Khashoggi’s colleague in Saudi embassy in #London @jaketapper @AC360

View image on Twitter
View image on TwitterView image on Twitter

Ali AlAhmed

@AliAlAhmed_en

Ali AlAhmed

@AliAlAhmed_en

that’s Maher AlMutreb, not Abdulaziz. Just horrified by this and angry.

end

Turkish police find this missing saudi car plus two suitcases containing the clothes of the Khashoggi

(courtesy zerohedge)

 

Turkish Police Find Two “Suspicious” Suitcases In Abandoned Saudi Consular Car; Chemical Mask Recovered

According to Turkish media outlet Hürriyet and CNN Turk, two suitcases full of clothes believed to belong to slain Saudi journalist Jamal Khashoggi were found in the trunk of a Saudi consular car abandoned in an Istanbul parking lot.

Also found were a computer and documents which were said to belong to Khashoggi as well, according to CNN Turk.

Saudi consulate car similar to abandoned MercedesThe car, a Mercedes with diplomatic plates, matched the description of another vehicle seen outside the Saudi consulate in Istanbul where journalist Jamal Khashoggi disappeared on October 2.

A Reuters witness said a Saudi team was accompanying the Turkish investigators as they carried out the search in a car park where the vehicle was found in Istanbul’s Sultangazi district on Monday.

On its website, CNN Turk said the investigators found a computer and documents in the car which were said to belong to Khashoggi. –Reuters

The abandoned car was discovered after a reader tipped off Hürriyet reporters.

According to an employee who spoke to Hürriyet, the Mercedes with the diplomatic plate of 34 CC 1736 was driven into the parking lot by one of the attachés of the consulate, identified only as Muhammed O., on Oct. 7. –Hürriyet

We know him as he has been using our parking lot sometimes. However, normally his Turkish driver uses this car. But on Oct. 7, the attaché was driving it himself,” said the employee.

Meanwhile, the same Saudi attaché returned to the parking lot on October 18 with a BMW bearing diplomatic license plate 34-CC-2665, parked it in front of the Mercedes and unloaded three suitcases – “two of them quite large,” according to a lot employee who helped him load the bags into the Mercedes.

Khashoggi’s body is not inside the suitcases, is it?” the employee quoted himself as jokingly asking the attaché. “He laughed and answered no,” he said, according to Hürriyet.

Chemical mask

The lot employee also told Hürriyet that a chemical face mask had fallen on the ground while unloading the suitcases into the trunk.

“The attaché took it and put it in a trash bin before leaving the parking lot with the BMW,” said the employee. “I was very suspicious. I took the mask and showed it to a doctor. He told me that it was a mask that is used by those who work with heavy chemicals. I was so scared that I instantly put it away.”

The consulate’s Mercedes remained in the parking lot with the suspicious suitcases in its trunk, as well as an iPhone box and a kettle, which can be seen in its back seat.

Turkish police went to the parking lot on Oct. 22 but could not search the car due to its diplomatic immunity.

After receiving a waiver from Saudi authorities, security forces returned to the site and conducted the search on Oct. 23.

According to the initial findings, two suitcases full of clothes were found in the trunk.

The clothes will be analyzed for DNA traces, a security source said. –Hürriyet

More suitcases?

An unconfirmed report from Gulf Institute terrorism expert Ali AlAhmed purports to show agents of the Saudi monarchy moving large bags outside the consulate on October 2, postulated to contain Khashoggi’s dismembered body parts.

Ali AlAhmed

@AliAlAhmed_en

Video of #Saudi monarchy agents moving #JamalKashoggi body parts in large bags outside the consulate October 2. You can see AndulAziz Almutreb who was Khashoggi’s colleague in Saudi embassy in #London @jaketapper @AC360

View image on Twitter
View image on TwitterView image on Twitter

Ali AlAhmed

@AliAlAhmed_en

6. GLOBAL ISSUES

The entire global banking stocks (system) is crashing hard just like it did in 2008

a must see…

(courtesy zerohedge)

Global Banking Stocks Are Crashing Hard – Just Like They Did In 2008

“Fortress balance sheets?”…  “It’s different this time”… “Greatest economy ever.”

If all of that is true, then why are the stocks of the most systemically important banks in the world collapsing?

 

And the banking collapse is leading global stocks lower – probably not coincidentally as global central bank balance sheets contract…

 

As The Economic Collapse blog’s Michael Snyder notes, if this reminds you of 2008, it should, because that is precisely what we witnessed back then.  Banking stocks collapsed as fear gripped the marketplace, and ultimately many large global banks had to be bailed out either directly or indirectly by their national governments as they failed one after another.  The health of the banking system is absolutely paramount, because the flow of money is our economic lifeblood.  When the flow of money tightens up during a credit crunch, the consequences can be rapid and dramatic just like we witnessed in 2008.

So let’s keep a very close eye on banking stocks.  Global systemically important bank stocks surged in the aftermath of Trump’s victory in 2016, but now they are absolutely plunging.  They are now down a whopping 27 percent from the peak, and that puts them solidly in bear market territory.

U.S. banking stocks are not officially in bear market territory yet, but they are getting close. 

At this point, they are now down 17 percent from the peak…

Monday early afternoon, the US KBW Bank index, which tracks large US banks and serves as a benchmark for the banking sector, is down 2.5% at the moment. It has dropped 17% from its post-Financial Crisis high on January 29.

As Wolf Richter notes, while that may be a nerve-wracking decline for those who have not experienced bank-stock declines, it comes after a huge surge that followed the collapse during the Financial Crisis:

Of course European banking stocks are doing much worse.  Right now they are down 27 percent from the peak and 23 percent from a year ago.

The following comes from Wolf Richter

But unlike their American brethren, the European banks have remained stuck in the miserable Financial Crisis mire – a financial crisis that in Europe was followed by the Euro Debt Crisis. The Stoxx 600 bank index, which covers major European banks, including our hero Deutsche Bank, has plunged 27% since February 29, 2018, and is down 23% from a year ago

I wish that we didn’t have a global economic system that was so dependent on the “too big to fail” banks, but we do.

If they aren’t healthy, nobody is going to be healthy for long, and it is starting to look and feel a whole lot like 2008. As Wolf Richter concludes,

It’s not exactly a propitious sign that the banks in the US, after nearly recovering to their pre-Financial Crisis highs – “Close, but no cigar!” – are once again turning around and heading south as the Fed is “gradually” removing accommodation, which results in higher funding costs for banks and greater credit risks on outstanding loans.

And the European banks remain a mess and have an excellent chance of getting still get messier.

But unlike 2008, we also have a global trade war to contend with.  The CEO of one yacht company recently told USA Today that tariffs have had a “catastrophic” effect on his company…

Tariffs imposed on goods by the European Union, and the Chinese and American governments on boats, cribs, bourbon, and more have put Wisconsin businesses between a rock and a hard place. The tariffs imposed are already damaging a bloated bubble economy and the hardships are just beginning.

“It’s been catastrophic,” said Rob Parmentier, who is the president and CEO of Marquis-Larson Boat Group, which builds Carver yachts in Pulaski, Wisconsin. According to USA Today, the first “hand grenade,” as Parmentier described it, tossed during the trade wars at him specifically, was a 25 percent tariff the European Union placed this year on boats built in the United States, along with scores of other products including Harley-Davidson motorcycles.

I have previously warned my readers that the damage caused by this trade war would get progressively worse the longer that it lasts.

Many companies have been trying to ride it out, but eventually the money runs out and layoffs start happening

“We’ve had a lot of order cancellations. Canada and Europe have essentially stopped buying boats,” Parmentier said according to USA Today.“We’ve been absorbing some of the additional costs … hoping the tariffs will go away. But we can only do that for so long,” he saidThe next step is layoffs.

Anyone that thought that this trade war would not have very serious consequences was just fooling themselves.  According to one source, tariffs paid by U.S. businesses are up 45 percent compared to a year ago…

“For the most recent months available, August 2018, the amount of tariffs paid increased by $1.4 billion — or 45% — as compared to tariffs paid in August 2017. Tariff costs in Michigan tripled to $178 million and more than doubled in multiple states — to $424 million in Texas, $193 million in Illinois, $50 million in Alabama, $29 million in Oklahoma, $23 million in Louisana, and $7.3 million in West Virginia.

These costs strain businesses of all sizes but are particularly painful for small business, manufacturers, and consumers who bear the burden of tariff increases in the form of higher prices,” via the data compiled by The Trade Partnership and released by Tariffs Hurt the Heartland.

And it doesn’t look like this trade war is going to end any time soon.  In fact, one key Chinese official recently made it very clear that China is not afraid of a long trade war…

On Monday in Beijing, Zhang Qingli, a leading member of a Chinese committee tasked with forging alliances with other nations, told a small group of U.S. business leaders, lobbyists and public relations executives that China refuses to be intimidated by an ongoing trade war with the Trump administration.

“China never wants a trade war with anybody, not to mention the U.S., who has been a long term strategic partner, but we also do not fear such a war,” Zhang said through a translator, according to a meeting attendee who declined to be named.

We are entering a time when the economy was likely to slow down anyway, but if stocks continue to crash and global banking woes escalate, that is going to spread fear and panic like wildfire.

And when there is fear and panic in the air, lending tends to really tighten up, and a major credit crunch is just about the last thing that we need right now.

It’s been a really bad October for global markets so far, and more trouble is brewing.  Hold on to your hats, because it looks like it is going to be a bumpy ride ahead.

end

7  OIL ISSUES

Crude crashes

(courtesy zerohedge)

Crude Crashes To 2-Mo Lows After Saudi/OPEC Promise

Oil futures tumbled to the lowest level since August after Saudi Arabia pledged to meet any supply shortfall that materializes resulting from Iranian sanctions and as tumbling equities weakened sentiment.

Saudi Energy Minister Khalid Al-Falih said OPEC and its allies are in “produce as much as you can mode.”

Coincidence that they would do this (as Trump demanded) as the Khashoggi chaos continues?

Nomura’s Charlie McElligott earlier noted significant de-leveraging expected of a massively skewed positioning in crude would occur around $67.70…

And sure enough, WTI puked as it hit that level…

“There are several reasons for the slide in crude oil, chief among them is it’s a risk-off day across all financial markets,”said Bob Yawger, director of the futures division at Mizuho Securities USA.

“You’re seeing people flee the commodities and equities space to most likely put their money in safe haven.”

WTI held – for now – perfectly at its 200DMA…

We will see if it can hold that critical level after tonight’s API inventory data.

 

 

end

8. EMERGING MARKETS

BRAZIL

 

 

 

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

Euro/USA 1.1477 UP .0013 REACTING TO MERKEL’S FAILED COALITION/ 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 DEEPLY IN THE RED

 

 

 

 

 

USA/JAPAN YEN 112.19  UP 0.577  (Abe’s new negative interest rate (NIRP), a total DISASTER/NOW TARGETS INTEREST RATE AT .11% AS IT WILL BUY UNLIMITED BONDS TO GETS TO THAT LEVEL

GBP/USA 1.3029 UP   0.0065  (Brexit March 29/ 2017/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED

USA/CAN 1.3107  UP .0009 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 ROSE by 13 basis point, trading now ABOVE the important 1.08 level FALLING to 1.1474; / Last night Shanghai compositeCLOSED DOWN 60.06 POINTS OR 2.26%

 

//Hang Sang CLOSED DOWN 806.60 POINTS OR 3.08% 

 

 

/AUSTRALIA CLOSED DOWN  1.02% / EUROPEAN BOURSES ALL RED 

 

 

 

The NIKKEI: this TUESDAY morning CLOSED DOWN 604.04 POINTS OR 2.67%

 

 

 

Trading from Europe and Asia

1/EUROPE OPENED  RED 

 

 

 

 

 

 

 

 

2/ CHINESE BOURSES / :Hang Sang CLOSED DOWN 806.60 POINTS OR 3/08% 

 

 

/SHANGHAI CLOSED DOWN 60.05 POINTS OR 2.26%

 

 

 

Australia BOURSE CLOSED DOWN 1.02%

Nikkei (Japan) CLOSED DOWN 604.04 POINTS OR 2.67%

 

 

 

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1238.40

silver:$14.76

Early TUESDAY morning USA 10 year bond yield: 3.14% !!! DOWN 6 IN POINTS from MONDAY’S night in basis points and it is trading WELL ABOVE resistance at 2.27-2.32%. (POLICY FED ERROR)/

The 30 yr bond yield 3.34 DOWN 5  IN BASIS POINTS from MONDAY night. (POLICY FED ERROR)/

USA dollar index early TUESDAY morning: 95.86 DOWN 15  CENT(S) from MONDAY’s close.

This ends early morning numbers TUESDAY MORNING

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And now your closing TUESDAY NUMBERS \4: 00 PM

 

Portuguese 10 year bond yield: 2.01% DOWN 0    in basis point(s) yield from MONDAY/

JAPANESE BOND YIELD: +.15%  UP 0  BASIS POINTS from MONDAY/JAPAN losing control of its yield curve/EXTREMELY VOLATILE YESTERDAY…DANGEROUS!!

SPANISH 10 YR BOND YIELD: 1.66% DOWN 4 IN basis point yield from MONDAY/

ITALIAN 10 YR BOND YIELD: 3.59 UP 10   POINTS in basis point yield from MONDAY/

 

 

the Italian 10 yr bond yield is trading 192 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: FALLS UP TO +.41%   IN BASIS POINTS ON THE DAY//

 

END

IMPORTANT CURRENCY CLOSES FOR TUESDAY

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

Euro/USA 1.1483 UP .0018 or 18 basis points

 

 

USA/Japan: 112.14 DOWN .622 OR 62 basis points/

Great Britain/USA 1.2983 UP .0018( POUND UP 18 BASIS POINTS)

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

This afternoon, the Euro was ROSE BY 18 BASIS POINTS  to trade at 1.1483

The Yen ROSE to 112.14 for a GAIN of 63 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 18 basis points, trading at 1.2983/

The Canadian dollar LOST 3 basis points to 1.3101

 

 

The USA/Yuan,CNY closed UP AT 6.9380-  ON SHORE  (YUAN down)

THE USA/YUAN OFFSHORE:  6.9466(  YUAN down)

TURKISH LIRA:  5.7621

the 10 yr Japanese bond yield closed at +.15%

 

 

 

Your closing 10 yr USA bond yield DOWN 7 IN basis points from MONDAY at 3.12 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 3.32 DOWN 6 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, 95.88 UP 43 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: 4:00 PM 

London: CLOSED DOWN 87.59 POINTS OR 1.24%

German Dax : CLOSED DOWN 250.06 POINTS  OR 2.17%
Paris Cac CLOSED DOWN 85.62 POINTS OR 1.69%
Spain IBEX CLOSED DOWN 80.40 POINTS OR 0.91%

Italian MIB: CLOSED DOWN:  163.75 POINTS OR 0.86%/

 

 

WTI Oil price; 66.84 1:00 pm;

Brent Oil: 76.47 1:00 EST

USA /RUSSIAN /   ROUBLE CROSS:    65.63  THE CROSS HIGHER BY .43 ROUBLES/DOLLAR (ROUBLE LOWER by 43 BASIS PTS)

USA DOLLAR VS TURKISH LIRA:  5.7621 PER ONE USA DOLLAR.

TODAY THE GERMAN YIELD RISES +.41 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, 4:00 pm/and 10 year USA interest rate:

WTI CRUDE OIL PRICE 4:30 PM:66/31

 

BRENT:76.33

USA 10 YR BOND YIELD: 3.17%..

 

USA 30 YR BOND YIELD: 3.37%/..

 

EURO/USA DOLLAR CROSS: 1.1472 ( UP 8 BASIS POINTS)

USA/JAPANESE YEN:112.43 DOWN ,330 (YEN UP 33 BASIS POINTS/ .

 

USA DOLLAR INDEX: 95.95 DOWN 7 cent(s)/

The British pound at 5 pm: Great Britain Pound/USA: 1.2986 UP 21 POINTS FROM YESTERDAY

the Turkish lira close: 5.7443

the Russian rouble:  65.50 DOWN 0.29 Roubles against the uSA dollar.( DOWN 29 BASIS POINTS)

 

Canadian dollar: 1.3078 UP 21 BASIS pts

USA/CHINESE YUAN (CNY) : 6.9380  (ONSHORE)

USA/CHINESE YUAN(CNH):  6.9419 (OFFSHORE)

German 10 yr bond yield at 5 pm: ,0.41%

 

The Dow closed  DOWN  125.98 POINTS OR 0.50%

NASDAQ closed DOWN 31.09  points or 0.42% 4.00 PM EST


VOLATILITY INDEX:  19.58  CLOSED DOWN  0.31

LIBOR 3 MONTH DURATION: 2.487%  .LIBOR  RATES ARE RISING/big jump today

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

TRADING IN GRAPH FORM FOR THE DAY

 

US Plunge Protection Team Rescues Market As

Global Stocks Turn Red For 2018

The message to the bears today…

 

 

Global Central Bank balance sheets have never fallen this much (almost one trillion dollars in six months)…

 

No National Team last night in China… did not end well…

 

European stocks extended yesterday’s losses…

Saudi Stocks rolled over today after another buying panic at the open…

 

Global equity markets are now negative for the year…

This is the worst start to a year since 2011.

As the US markets start to catch down to the rest of the world…

 

BTFD!!! So last week it was Saudi’s Sentiment-Savers, Monday of this week was China’s National Team, and today was NYFRB’s Plunge Protection Team…Nasdaq even briefly managed to get into the green (after being down 2.75% in early trading!)

 

Futures show the fun and games best…

 

It’s been an ugly month that got a lot worse today before the panic-bid…

  • Small Caps lowest since April down 12.5% from highs.
  • Dow Transports lowest since April – down 11.7% from highs.
  • Nasdaq  lowest since May – down 8% from highs.
  • S&P lowest since May- down 7% from highs.
  • Dow lowest since July – down 6.5% from highs.

 

Small Caps went red for 2018 intraday today…

 

After the first hour which saw nothing but selling (no positive TICK until 1030ET), markets began to accelerate with huge positive TICKs in the last hours…before some serious late day selling hit…

 

And in case you wondered – yes it was a giant short-squeeze…

 

VIX was monkeyhammered back down to spark some momentum in stocks (but the VIX term structure inverted further on the day)

 

The Dow ramped all the way back to its 200DMA but none of the other majors did…

 

FANG stocks were miraculously bid back into the green…

 

Tilray – the pot stock – is today’s best example of utter idiocy – it was down 18% at the open and ramped all the way green…

 

Materials and Financials are 2018’s biggest losers for now (followed closely by Communication Services)… Tech leads….

 

Financials hit 13-month lows today, confirming the massive double-top…

 

Semi stocks massive double-top looks set with SOX hitting a 12-month lows today…

 

And while the fallback excuse that everything is still awesome is that credit markets are still tight – things are starting to crack in the junk bond space with spreads spiking back to 5-month highs…

 

Treasury yields staged a v-shaped recovery on the day but did end lower…

 

5Y yield dropped back below then ripped back above 3.00%..

 

Meanwhile the short-end of the rates curve is starting to price out Fed hikes…

 

The Dollar ended the day lower, fading notably after China closed…

 

Offshore Yuan was modestly lower on the day (after a lower fix)…

 

 

Despite a modest dollar drop oil was pummeled and PMs managed gains…

 

WTI Crude futures crashed today (to a $65 handle at the lows) after OPEC headlines squeezed spec longs…

It tested down to its 200DMA and bounced

 

But Silver and Gold spiked and held gains even as stocks were levitated…

 

Gluskin Sheff’s David Rosenberg highlighted the chart of the day showing American firms never having found it so hard to find qualified (or drug-free willing workers who are ready to step off welfare)…

David Rosenberg@EconguyRosie

Richmond Fed: “Firms were unable to find workers with skills they needed, as the skills index dropped to an all-time low of −22. Respondents expect this struggle to continue…”

Finally, with President Trump’s approval rating at record highs, will that mean another leg higher for the dollar?

And given President Trump’s hate of a strong dollar, will be pushing for a lower approval rating?

 

 

market trading

LAST NIGHT/CHINA OPENING TOGETHER WITH USA FUTURES

US Equity Futures Tumble As Asia Opens

The ugly drop into the US cash market close has reaccelerated as Asia markets open with The Dow, S&P, and Nasdaq futures all tumbling 0.6% after-hours…

Dow futures are down 140 points testing the 200DMA once again…

Offshore yuan is also reversing late-day gains…

Better hope ‘The National Team’ is back tonight…

 

END
Bellwether Caterpillar crashes after a huge earnings disappoints and that sets off the sea of red ink
(courtesy zerohedge)

Dow Tumbles 400 Points After 3M, Caterpillar Crash After Earnings

The earnings disappointments continue with CAT and 3M the latest to add to fears about “peak earnings” after 3M not only missed Q3 earnings but slashed its full year EPS guidance, while CAT warned about rising material and freight costs.

Starting with 3M, the multinational conglomerate reported 3Q EPS $2.58, which while a 10.7% increase Y/Y, missed estimates of $2.70 on net sales $8.15 billion, also missing estimates of $8.40 billion.

3M reported operating cash flow of $2.1 billion, almost was almost entirely handed over to shareholders, with $794 million paid in cash dividends and $1.1 billion in stock repurchases. On a geographic basis, core results were ok with sales growing 1.6% in Asia Pacific and 1.3% in the U.S.; however, total sales declined 3.9% in EMEA (Europe, Middle East and Africa) and 5.5 percent in Latin America/Canada.

The top-line was ugly: industrial net sales were $3.02 billion, increasing 2.2% in local currency terms but down 2.1% after the foreign currency translation. Operating income was $667 million, a decrease of 0.7 percent year-on-year; operating margins were 22.1 percent.

The revenue pain continued:

  • Healthcare revenues of $1.45 billion were even worse, down 2.8% in U.S. dollars.
  • Electronics and energy sales were $1.4 billion, down 4.8% in U.S. dollars.
  • Consumer sales were $1.2 billion, down 3.4% in U.S. dollars.

But the biggest disappointment was the company’s guidance, which now sees full year adjusted EPS of $9.90 to $10.00, below the consensus est. $10.28, and down versus the prior expectation of $10.20 to $10.45. The cut reflects an estimated full-year earnings headwind of $0.05 per share from foreign currency versus a prior expectation of a benefit of $0.10 per share.

Separately, Caterpillar reported Q3 results which beat on adj EPS $2.86, vs the estimate $2.85 and revenue $13.5 billion, also above the estimate $13.31 billion.

But while earnings were strong, what traders were worried about was the company’s warnings that “manufacturing costs were higher due to increased material and freight costs,” adding that “Material costs were higher primarily due to increases in steel prices and tariffs.”

Specifically, CAT said that the impact of recently-imposed tariffs was about $40 million in third quarter, and the company sees full-year impact of the tariffs at the low-end of $100 million to $200 million range. The company warned that its manufacturing costs were higher due to increased material and freight costs, primarily due to increases in steel prices and tariffs.

CAT also cautioned that the ramp in demand, with sales and revenues for the first nine months of 2018 up 24 percent, has led to supply chain “challenges” across the industry.

“Although the company is making efforts to improve material flows, constraints remain for some parts and components that are impacting lead times and availability.”

CAT also notified dealers of upcoming price action of 1 to 4 percent worldwide on machines and engines with exceptions on specific products and regions. “This price action will be effective in January 2019, and is a result of current industry factors and general economic conditions.”

The price drop despite an earnings beat was covered yesterday in “Stocks Are Doing Something They Haven’t Done Since The Dot Com Bubble”, in which we noted that for the first time in 18 years, the average stocks is punished after bearing earnings.

Also hitting CAT stocks was the company 2018 EPS guidance, which while in line with the prior range of $11.00 to $12.00 adjusted, with the lower range of that forecast falling short of the $11.65 EPS estimated by analysts.

After earnings, CAT – which beat – is down 6% while 3M is tumbling over 7%…

… and the two key Dow members are dragging the Dow Jones even lower, with the industrial index now down over 400 points in the pre market.

end
Late morning trading:
(courtesy zerohedge)

US Stocks Blow Through Critical Support, Bond Yields Plunge Below 3.00%

The Dow is down 500 points this morning, practically unchanged for 2018, as all major US equity indices tumbled back below their 200DMAs…

Selling has been extreme all day with TICK negative since the open…

Remember yesterday’s early bounce? It’s gone…

 

Having bounced and found resistance at the 50% retracement, The Dow has collapsed back below last week’s lows…

 

Pushing The Dow to almost unchanged for 2018 (and Nasdaq to 6-month lows)…

 

As all major indices blow through the 200DMA…

“Most Shorted” Stocks are tumbling after the short-squeeze relief rally last week…

Or in other words…

And as stocks tumble, bonds are rallying with 5Y yields plunging back below 3.00%…

end

 

market data/

 

USA economic/general stories
interesting:  Ford states that due to the Trump tariffs, USA steel is the highest priced steel in the world
(courtesy zerohedge)

Ford Says US Steel Most Expensive In The World Due To Trump’s Tariffs

John Hinrichs, Ford’s head of global operations, said the Trump administration’s metal tariffs have made U.S. steel prices the most expensive in the world thanks to the President’s trade war with China, reported The Detroit News.

“U.S. steel costs are more than anywhere else in the world,” Hinrichs said Monday at a Michigan Assembly plant marking the start of Ranger pickup production. Hinrichs said Ford officials have been communicating with the Trump administration about the tariffs: “The government knows our position about where we need to be in order to be competitive globally. We tell them that we need to have competitive costs in our market to be able to compete around the world.”

Ford CEO Jim Hackett called on President Trump last month to resolve trade disputes, warning that the second-largest American automaker could experience severe financial damage. He said the steel and aluminum tariffs were projected to cost Ford roughly $1 billion because it sources most of its metals from U.S. companies.

Ford, General Motors Co., and Fiat Chrysler Automobiles have all readjusted full-year earnings outlooks in the second quarter due to soaring costs of domestic sourced metals.

“Domestic hot-rolled coil — the benchmark price for American-made steel — has gained 28% in 2018 as the Trump administration implemented tariffs on imports. The levies helped push prices to about $920 a metric ton earlier this year, the highest in a decade. U.S. steel currently costs about $260 more per short ton than steel in China, which accounts for more than half of global demand,” said Bloomberg.

President Trump has called American companies “babies” for complaining about the tariffs. He accused Harley-Davidson, which just reported its biggest revenue drop in more than 8 years, using them as an excuse to move some operations to Europe and Asia.

Rising steel and aluminum prices make Ford less competitive in global markets, which have not been the Trump administration’s only policy that has damaged the company. In August, the automaker abandoned plans to sell a new model called the Focus Active in America. Ford cited a 25% tax on vehicles imported from China, where the car would have been built.

Ford also reduced American exports to China because President Xi Jinping has played a tit-for-tat game with President Trump, matching his 40% tariff on imported vehicles.

Ford’s sales in China have declined in 14 of the last 15 months and collapsed 43% in September.

Whether the Trump administration stops the trade war based on feedback from Ford officials remains an open question.

Hinrichs concluded his speech on Monday by saying: “We encourage all countries — but especially the U.S. and China — to work together…We think it’s in the global economy’s interest to do so.”

As for Ford, expect massive layoffs and possible restructuring in the near term. One look at Ford’s bonds shows that they they are now offering junk-bond spreads. As we discussed in August in “Is Ford’s Downgrade The “Spark” That Crashes The Bond Market“, a should Ford become a “fallen angel” after its recent downgrade by Moody’s from Baa3 to Baa2 – meaning one more downgrade would push it to junk status – it would rock the US high yield market.

Ford’s equity looks even worse, down -32% YTD and trading in the low 8-handle. A buying opportunity or a complete bust? We’ll find out shortly.

end

This makes sense:  the Trump 10% tax cut for the middle class is to be advanced only if the Republicans take the house

(courtesy zerohedge)

Brady: Trump’s 10% Tax Cut To Be Advanced Only If Republicans Retain Control Of House

If there was any doubt what was the purpose behind Trump’s unexpected proposal for a 10% tax cut unveiled over the weekend, moments ago House Ways and Means Committee Chairman, Kevin Brady, essentially explained that it is motivation for republicans to come out and vote in the midterm elections, because while work on the proposed tax cut will begin in the ‘coming weeks’ it will only be advanced if republicans retain control of the House and Senate. In other words, if Democrats win the House – as most now expect – no tax cuts for you…

  • HOUSE WAYS AND MEANS COMMITTEE CHAIRMAN BRADY SAYS WORK ON TRUMP 10% CUT TO COME IN `COMING WEEKS’
  • BRADY SAYS WILL WORK WITH WHITE HOUSE OVER COMING WEEKS TO DEVELOP PLAN FOR 10 PCT TAX CUT FOR MIDDLE CLASS FAMILIES
  • BRADY SAYS TAX CUT PLAN “TO BE ADVANCED” IF REPUBLICANS RETAIN CONTROL OF U.S. HOUSE AND SENATE IN NOVEMBER 6 ELECTIONS

Separately, Trump told reporters at the Oval Office that his proposal for a 10% tax cut for the middle class would be “net neutral” because the administration is “doing other things.”

The president explained that the move won’t impact corporate taxes, and refused to acknowledge that the original tax cut was unfairly benefiting wealthy.

Ultimately the point is moot: according to the latest online odds from PredictIt, the probability of republicans holdings the House is about 37%.

end

 

SWAMP STORIES

This ought to go over well with our creepy porn lawyer: he just been hit with a $4.85 million judgement.

(special thanks to G for sending this to us)

 

California Judge Hits Creepy Porn Lawyer with $4.85 Million Judgement…

Posted on October 22, 2018 by sundance

Creepy Porn Lawyer and potential 2020 Democrat presidential candidate, Michael Avenatti, was hit with a $4.85 million judgement today awarding the settlement to an attorney for his former law firm.

Last week CPL said it was unlikely he would lose, stating: “nothing’s gonna happen on Monday” and the claims against him were “bogus”; whoopsie.

Today’s judgement is in addition to a previous award of $10 million to the same lawyer, Jason Frank.

Today’s loss comes on the heels of a financial defeat last week when Creepy and his client Stormy had their case against President Trump dismissed and that judge ordered CPL to pay all of Donald Trump’s defense costs. Another bad week for the Creepy Porn Lawyer.

LOS ANGELES — A California judge on Monday ordered Stormy Daniels’ lawyer Michael Avenatti to pay $4.85 million to an attorney at his former law firm, the first time the potential presidential candidate is being held personally liable in the case.

Los Angeles Superior Court Judge Dennis Landin issued the ruling after turning down a request from Avenatti to have the matter moved to federal court, which the opposing side called a delay tactic.

Avenatti did not appear at the court hearing and never filed opposing arguments in the case.

The judge said Avenatti must pay the money because he personally guaranteed a settlement with Jason Frank, who had worked at his former firm.

Frank had alleged the firm misstated its profits and that he was owed millions.  (read more)

end

The real Michael Avenatti comes to life:  he lived a lavish lifestyle while owing millions to the IRS

(courtesy zerohedge)

“Private Jets & 5-Star Hotels” – Explosive Report Alleges Avenatti Lived Lavish Lifestyle While Owing Millions To IRS

Michael Avenatti, the LA-based lawyer who was largely unknown on the national stage until he sued President Trump and his former Attorney Michael Cohen on behalf of his client, former porn star Stormy Daniels, who claims she had an affair with Trump back in 2006, has been relentlessly pressing his case in the media about why he should be the Democratic candidate to challenge President Trump in 2020. All the while, Avenatti has been dogged by a legal dispute with a former attorney at his collapsed law firm, Eagan Avenatti, over what the former employee, California lawyer Jason Frank, claims are millions of dollars in unpaid wages owed to him by Avenatti.

But on Monday, a judge ruled against Avenatti, ordering him to pay $4.85 million to Frank, per Bloomberg. The judgment begs the question: What happened to all of Avenatti’s money? His firm once booked tens of millions of dollars a year in revenue and Avenatti, as a named partner, was one of the first to the trough. Well, in a wide-ranging expose, the Daily Beast published the most intensive report to date about Avenatti’s finances, his lavish lifestyle and the fallout from his contentious divorce. All of which suggests that the LA lawyer lived the high life while owing millions in taxes to the IRS, before he took on Daniels as a client, was desperately looking for his next venture.

Avenatti

As the report suggests, it appears Avenatti has also been less than truthful with the press, repeatedly lying about his ownership stake in Eagan Avenatti and insisting that his new firm, Avenatti and Associates is a completely separate entity when, in fact, the two firms are conjoined by an ownership stake.

On Friday, Avenatti told The Daily Beast that he currently has no interest in Eagan Avenatti. In a July filing in Eagan Avenatti’s bankruptcy case, however, Avenatti indicated he owns the firm through Avenatti & Associates.

“The simple fact is that I have an ownership interests [sic] in two separate law firms,” Avenatti stated in one July declaration. “One is EA. The other is not. I maintain both of my office [sic] at EA’s Newport Beach office.”

Avenatti testified at a July 25 bankruptcy hearing (from which the media was barred) that Avenatti & Associates now owns a 100-percent stake in Eagan Avenatti, according to documents filed in Frank’s case.

As the DB reported, Avenatti owes millions in back taxes, public records show.

But the questions over his finances remain—and could become a sore spot on the campaign trail, as creditors pursue him and his former companies. Both the Eagan Avenatti law firm and a shuttered Seattle coffee chain, which Avenatti says he no longer owns, owe millions in unpaid taxes and judgments, according to court documents and filings with local recorder’s offices.

Tax liens filed in Orange County also show that Avenatti has personally owed at least $1.2 million in federal taxes on top of the corporate debts. One lien, filed in February 2018, was for $308,396, while another filed in August 2015 showed a balance of $903,987. The Daily Beast did not find records showing the liens were released, but Avenatti claims both debts were “fully paid.”

So where did all of Avenatti’s money go? Details from his divorce from his wife Lisa Storie-Avenatti reveal that the couple lived a lavish lifestyle that featured multi-million dollar homes, international and domestic travel on private jets and an exotic collection of art and cars.

In one declaration, filed in January, Storie-Avenatti said, “Petitioner and I enjoyed a very extravagant marital lifestyle. In October 2011, we bought a home in Laguna for $7.2 million and sold it in September 2015 for $12.6 million.”

“We traveled extensively throughout the world, and, when not flying privately, we always flew business class and stayed at five-star hotels,” Storie-Avenatti said in the court filing, adding that they regularly visited Cabo (where they held their destination wedding and paid expenses for 20 guests), the French Riviera, and Paris.

“I had unfettered use of credit cards that were in my name. My American Express bill was historically on average of $60,000 to $70,000 per month, and was paid in full each month,” Storie-Avenatti added in court papers.

Avenatti has repeatedly accused Trump of being a “scumbag”, yet, after his wife filed for divorce, he cut her off financially, forcing her to dip into her savings to support herself and the couple’s son.

She said that since 2010, Avenatti raced in about 33 professional sports car races in the United States and Europe, including the 24 Hours of Le Mans in France, where his team included Saudi Prince Abdulaziz bin Turki Al Saud. “We spend a large amount of money on Petitioner’s racing activities,” Storie-Avenatti continued, the emphasis hers.

Storie-Avenatti was asking for $215,643 a month in family support and provided a rundown of the couple’s alleged monthly expenses including, among other things, $12,000 for nannies, $19,779 for groceries and household supplies, $19,849 for clothing, and $27,257 for entertainment, gifts and vacations.

Avenatti employed a full-time pilot hired at $100,000 a year, and owned two private jets worth about $9 million, Storie-Avenatti claimed. He also retained a full-time driver paid through his firm, but she didn’t know his pay rate.

She claimed that since they separated in October 2017, after more than six years of marriage, Avenatti cut her off from his income and she was forced to use her savings to pay for expenses for herself and the couple’s 3-year-old son.

“The parties’ marital lifestyle was funded by [Avenatti’s] earnings and income—over which [he] continues to exercise exclusive control,” Avenatti-Storie’s attorney said in one court filing.

Adding a supremely ironic twist to Avenatti’s presidential ambitions, the lawyer has evaded questions about his tax returns and refused to guarantee that he would release a cache of tax returns if he were to run against President Trump.

During one August appearance on ABC’s This Week, Avenatti remained noncommittal on whether he’d release a cache of his tax returns as a presidential candidate. “I don’t know yet,” Avenatti told correspondent Jonathan Karl. “I haven’t decided. I’ll look at the issue. But here’s what I do know…”

“You don’t know if you’ll release your tax returns?” Karl asked. “This was a major issue with Trump.”

So there you have it: In addition to believing he was under “no obligation” to provide evidence to back up the claims of his client Julie Swetnick against Judge Brett Kavanaugh – claims that Swetnick herself contradicted in a public interview – Avenatti believes he’s not obligated to release his tax returns, despite repeatedly demanding that Trump release his. These are just two reasons why even the liberals that Avenatti hopes to court during the Democratic primary have already written his candidacy off as an unserious political stunt.

end

SWAMP STORIES COURTESY OF THE KING REPORT

and special thanks to Chris Powell of GATA for sending this down to us:

@realDonaldTrump: Guatemala, Honduras and El Salvador were not able to do the job of stopping people from leaving their country and coming illegally to the U.S. We will now begin cutting off, or substantially reducing, the massive foreign aid routinely given to them.
    Sadly, it looks like Mexico’s Police and Military are unable to stop the Caravan heading to the Southern Border of the United States.Criminals and unknown Middle Easterners are mixed in. I have alerted Border Patrol and Military that this is a National Emergency. Must change laws!
 
Rep. Louie Gohmert (R-TX) on the caravan: “It’s called an invasion.  The president has to close the border until this threat is over.
 
Twenty-some years ago, pollsters were stunned when the Response Rate to polling fell below 30%.  A NYT poll last week had a 1.6% Response Rate.  How scientific or valid is the poll?!
 
Gallup’s data indicates that response rates for its Gallup Poll Social Series plunged from 28% in 1997 to a low of 5% in 2015, before increasing a couple of points to 7% last year.
 
We noted in 2016 how MSM polls typically show large GOP deficits during the summer and into early fall.  Then, during the last two weeks, the polls narrow.  This has occurred for decades – and there has been no change in methodology to remedy the bias.  This is not an accident; it suggests that the polls for the most part are intended to form and nudge opinion and not to measure opinion.
 
NBC: Republicans outpacing Democrats in early voting in key states; Data suggests enthusiasm among early GOP voters that could put a dent in Democratic hopes for a ‘blue wave’ in midterms. http://ow.ly/pJup30mkCMl
 
[WaPo’s] Politico: Dem Senate hopes shift from winning majority to limiting losses – Republicans could lock up a multi-cycle Senate majority by winning Indiana and other states like it this fall.
 
The [left-leaning] Hill: Democrats slide in battle for Senate
 
Erdogan Seizes on Saudi Murder as Chance to Upend Middle East
  • This scandal is a gift from God for Erdogan, diplomat says
  • Erdogan is taking aim at rival Saudi Arabia’s leadership…
 
The above story articulates why it is imprudent to trust the parties involved in L’affaire Khashoggi. 
 
Why Is Khashoggi Being Made The Defining Issue Of U.S. Foreign Policy?
The alleged killing of Jamal Khashoggi reveals far more about the nature of the American press and political establishment than it does foreign policy.
    Khashoggi is not a U.S… citizen… He previously served… as a mouthpiece for, and adviser to, the alleged al-Qaeda-tied Saudi intelligence leader Turki bin Faisal. Khashoggi mourned the death of Osama bin Laden, whom Khashoggi had been granted unusual levels of access for numerous interviews. Khashoggi was also an ardent proponent of political Islam and the Muslim Brotherhood…
 
Obama moved the US from Israel and KSA toward Iran.  Trump has done the opposite.  This is very upsetting to BHO loyalists, including his many minions in the MSM.

 

END-

I HOPE TO SEE YOU ON WEDNESDAY

Harvey

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