DEC 13/GOLD DOWN $2.00 TO $1243.00 BUT SILVER HOLDS IT’S OWN UP 2 CENTS TO $14.77/GOLDMAN SACHS DEALER AND A CUSTOMER ACCOUNT OF JPMORGAN CONTINUE TO TAKE IN GOLD AT THE GOLD COMEX/THERESA MAY SURVIVES AN INTRA PARTY CONFIDENCE VOTE BUT CHAOS REIGNS SUPREME OVER THERE//NO CONFIDENCE VOTE EXPECTED IN FRANCE/TERRORIST IS STILL AT LARGE IN FRANCE/ECB FORMALLY ENDS QE BUT WILL STILL PURCHASE NEW BONDS WITH BONDS THAT COME DUE//USA SENATE WILL NO LONGER BACK TRUMP WITH THE SAUDI WAR IN YEMEN/USA DEFICIT FOR THE NOV. SKYROCKETS TO 205 BILLION DOLLARS/AND FOR TWO MONTHS; 305 BILLION DOLLARS/

 

 

 

GOLD: $1243.00 DOWN $2.00 (COMEX TO COMEX CLOSINGS)

Silver:   $14.77 UP 2 CENTS (COMEX TO COMEX CLOSING)

Closing access prices:

Gold :  1242.90

 

silver: $14.76

 

 

 

 

 

 

 

For comex gold and silver:

DEC

Again, we have Goldman Sachs dealer and JPMorgan customer account stopping (receiving the gold) 49/71 contracts.

EXCHANGE: COMEX
CONTRACT: DECEMBER 2018 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,244.400000000 USD
INTENT DATE: 12/12/2018 DELIVERY DATE: 12/14/2018
FIRM ORG FIRM NAME ISSUED STOPPED
____________________________________________________________________________________________
072 H GOLDMAN 36
323 C HSBC 4
657 C MORGAN STANLEY 1
661 C JP MORGAN 13
690 C ABN AMRO 24
737 C ADVANTAGE 45 12
800 C RCG 2 2
905 C ADM 3
____________________________________________________________________________________________

TOTAL: 71 71
MONTH TO DATE: 7,208

 

 

 

 

NUMBER OF NOTICES FILED TODAY FOR  DEC CONTRACT: 71 NOTICE(S) FOR 7100 OZ (0.2208 tonnes)

 

 

 

SILVER

 

FOR DECEMBER

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

279 NOTICE(S) FILED TODAY FOR  1395,000  OZ/

Total number of notices filed so far this month: 3873 for 19,365,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Bitcoin: OPENING MORNING TRADE  $3404: DOWN 22

 

Bitcoin: FINAL EVENING TRADE: $3304  down  143 

 

end

 

XXXX

 

 

Let us have a look at the data for today

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In silver, the total OPEN INTEREST ROSE BY A GOOD SIZED 1005 CONTRACTS FROM 174,071 UP TO 175,076 WITH YESTERDAY’S 22 CENT GAIN IN SILVER PRICING AT THE COMEX. TODAY WE ARRIVED FURTHER FROM  AUGUST’S  RECORD SETTING OPEN INTEREST OF 244,196 CONTRACTS.

WE HAVE ALSO WITNESSED A LARGE AMOUNT OF PHYSICAL METAL STAND FOR COMEX DELIVERY AS WE NOW HAVE JUST LESS THAN 20 MILLION OZ STANDING IN DECEMBER. 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 VERY STRONG SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP:

2446 EFP’S FOR DECEMBER AND 0 FOR MARCH AND ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE: OF 2446 CONTRACTS. WITH THE TRANSFER OF 2446 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 2446 EFP CONTRACTS TRANSLATES INTO 12.23 MILLION OZ  ACCOMPANYING:

1.THE 22 CENT GAIN IN SILVER PRICE AT THE COMEX AND

2. THE STRONG AMOUNT OF SILVER OUNCES WHICH STOOD FOR DELIVERY IN THE LAST SIX MONTHS:

JUNE/2018. (5.420 MILLION OZ);

FOR JULY: 30.370 MILLION OZ

FOR AUG., 6.065 MILLION OZ

FOR SEPT. 39.505 MILLION  OZ S

FOR OCT.2.525 MILLION OZ.

FOR NOV:  A HUGE 7.440 MILLION OZ STANDING FOR NOVEMBER AND

NOW 20.730 INITIALLY STAND FOR DECEMBER.

 

 

ACCUMULATION FOR EFP’S/SILVER/J.P.MORGAN’S HOUSE OF BRIBES, / STARTING FROM FIRST DAY NOTICE/FOR MONTH OF DEC: 16,394 CONTRACTS (FOR 9 TRADING DAYS TOTAL 16.394 CONTRACTS) OR 81.97 MILLION OZ: (AVERAGE PER DAY: 1821 CONTRACTS OR 9.107 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH OF DEC:  81,97 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 11.71% 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:           2,759.03    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

ACCUMULATION FOR OCTOBER 2018:                                     224.875        MILLION OZ

ACCUMULATION FOR NOVEMBER /2018:                                 247.18         MILLION OZ

RESULT: WE HAD A GOOD SIZED INCREASE IN COMEX OI SILVER COMEX CONTRACTS OF 1005 DWITH THE 22 CENT GAIN IN SILVER PRICING AT THE COMEX //YESTERDAY.. AS THE BOYS CONTINUE WITH THEIR CUSTOMARY MIGRATION OVER TO  ETFS AT THE START OF AN ACTIVE DELIVERY MONTH. THE CME NOTIFIED US THAT WE HAD A STRONG SIZED EFP ISSUANCE OF 2446 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 GOOD SIZED: 3451 TOTAL OI CONTRACTS ON THE TWO EXCHANGES:

i.e 2246 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH INCREASE OF 1005 OI COMEX CONTRACTS. AND ALL OF THIS  DEMAND HAPPENED WITH A 22 CENT RISE IN PRICE OF SILVER  AND A CLOSING PRICE OF $14.75 WITH RESPECT TO YESTERDAY’S TRADING. YET WE HAD A GIGANTIC AMOUNT OF SILVER STANDING AT THE COMEX FOR DELIVERY 

 

 

In ounces AT THE COMEX, the OI is still represented by JUST UNDER 1 BILLION oz i.e. .875 BILLION OZ TO BE EXACT or 125% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT DEC MONTH/ THEY FILED AT THE COMEX: 279 NOTICE(S) FOR 1,395,000 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:  A HUGE 39.505 MILLION OZ./ OCTOBER: 2,520,000 oz  NOV AT 7.440 MILLION OZ./AND NOW DEC. AT 20.730 MILLION 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 ROSE BY A CONSIDERABLE SIZED 2485 CONTRACTS UP TO 404,735 WITH THE RISE IN THE COMEX GOLD PRICE/(A GAIN IN PRICE OF $3.05//.YESTERDAY’S TRADING) 

 

THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A STRONG  SIZED 11080 CONTRACTS:

 

DECEMBER HAD AN ISSUANCE OF 11080 CONTACTS  AND ALL OTHER MONTHS ZERO.  The NEW COMEX OI for the gold complex rests at 404,735. 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 VERY STRONG SIZED GAIN IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 13,565 CONTRACTS:  2485 OI CONTRACTS INCREASED AT THE COMEX AND 11080 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI GAIN: 13.565 CONTRACTS OR 1,356,500 OZ = 42,19 TONNES. AND ALL OF THIS DEMAND OCCURRED WITH A GAIN IN THE PRICE OF GOLD/ YESTERDAY TO THE TUNE OF $3.05

 

 

 

 

YESTERDAY, WE HAD 9745 EFP’S ISSUED.

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF DEC : 76079 CONTRACTS OR 7,607,900 OZ OR 236.63 TONNES (9 TRADING DAYS AND THUS AVERAGING: 8453 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 9 TRADING DAYS IN  TONNES: 236.63 TONNES

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

THUS EFP TRANSFERS REPRESENTS 236.63/2550 x 100% TONNES =  9.27% OF GLOBAL ANNUAL PRODUCTION SO FAR IN JULY ALONE.***

ACCUMULATION OF GOLD EFP’S YEAR 2018 TO DATE:     7001.01  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)

ACCUMULATION OF GOLD EFP FOR OCT. 2018                        543.92 TONNES  (23 TRADING DAYS)

ACCUMULATION OF GOLD EFP FOR NOV 2018:                        552.88 TONNES (21 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 INCREASE IN OI AT THE COMEX OF 2485 WITH THE GAIN  IN PRICING ($3.05) THAT GOLD UNDERTOOK YESTERDAY) //.WE ALSO HAD A HUMONGOUS SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 11080 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 11080 EFP CONTRACTS ISSUED, WE HAD AN HUMONGOUS GAIN OF 14,788 CONTRACTS IN TOTAL OPEN INTEREST  ON THE TWO EXCHANGES:

11080 CONTRACTS MOVE TO LONDON AND 2485 CONTRACTS INCREASED AT THE COMEX. (in tonnes, the GAIN in total oi equates to 42,19 TONNES). ..AND ALL OF THIS  DEMAND OCCURRED WITH THE RISE OF $3.05 IN YESTERDAY’S TRADING AT THE COMEX

 

 

we had: 71 notice(s) filed upon for 7100 oz of gold at the comex.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD...

 

WITH GOLD DOWN $2.00 TODAY

 

NO CHANGE IN GOLD INVENTORY AT THE GLD

 

 

 

 

 

 

 

 

 

/GLD INVENTORY   763.56 TONNES

Inventory rests tonight: 763.56 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 2 CENTs  TODAY:

 

NO CHANGE IN SILVER INVENTORY AT THE SLV

 

 

 

/INVENTORY RESTS AT 318.735 MILLION OZ.

 

 

end

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

1. Today, we had the open interest in SILVER ROSE BY A GOOD SIZED 1005 CONTRACTS from 174,071 DOWN TO 175,076  AND MOVING FURTHER FROM  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:

 

2446 CONTRACTS FOR DECEMBER. 0 CONTRACTS FOR MARCH AND  AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 2446 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 1106 CONTRACTS TO THE 2446 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN A STRONG GAIN  OF 3451 OPEN INTEREST CONTRACTS.  THUS IN OUNCES, THE GAIN ON THE TWO EXCHANGES: 17.26 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… OVER 2 million  OZ STANDING FOR THE NON ACTIVE MONTH OF OCTOBER.,  7.440 MILLION OZ FINALLY STANDING IN NOVEMBER. AND NOW 20.730 MILLION OZ  STANDING IN DECEMBER.

 

 

RESULT: A GOOD SIZED INCREASE IN SILVER OI AT THE COMEX WITH THE 22 CENT PRICING GAIN THAT SILVER UNDERTOOK IN PRICING// YESTERDAY.BUT WE ALSO HAD ANOTHER GOOD SIZED 2446 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)THURSDAY MORNING/ WEDNESDAY NIGHT: 

SHANGHAI CLOSED UP 31.90 POINTS OR 1.23% //Hang Sang CLOSED UP 337.64 POINTS OR 1.29% //The Nikkei closed UP 213.44 OR 0.99%/ Australia’s all ordinaires CLOSED UP 0.14%  /Chinese yuan (ONSHORE) closed UP  at 6.8811 AS TRUCE DECLARED FOR 3 MONTHS /Oil DOWN to 50.58 dollars per barrel for WTI and 59.62 for Brent. Stocks in Europe OPENED MIXED//.  ONSHORE YUAN CLOSED UP AT 6.8764AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED UP ON THE DOLLAR AT 6.8811: HUGE DEVALUATION/PAST SEVERAL DAYS RESUMES// TRADE TALKS NOW ON/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED   : /ONSHORE YUAN TRADING BELOW LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING STRONGER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING STRONGER AGAINST THE DOLLAR /CHINA RETALIATES WITH TARIFFS/ TRUMP RESPONDS TO NEW TARIFFS AND IT NOW A FULL TRADE WAR COMMENCED

 

i

 

 

 

 

 

 

 

 

3A/NORTH KOREA/SOUTH KOREA

i)North Korea/South Korea/USA/

 

 

 

b) REPORT ON JAPAN

 

 

3 C/  CHINA

i)Another indicator highlighting the growth problems inside China.  Today is the total collapse of Chinese auto sales.  It is their first decline in 30 years.

( zero hedge)

ii)We now have a second Canadian citizen who has been suddenly “disappeared” in China

( zerohedge)

4/EUROPEAN AFFAIRS

i)UK

the mess that Gr Britain finds itself today.  May returns to Brussels but she will come back empty handed.  She will lose a vote of no confidence but there is no Conservative willing to take on the job in this quagmire.

( zerohedge)

ii)ITALY

Not sure of the story but it seems that Italy has revised its budgetary deficit to 2.0% and that sent Italian bonds and their stock market higher.  We are also not sure if the EU will accept this.  I am surprised that Italy lowered its budgetary deficit in light of what France wants to do: increase its budgetary deficit to 3.5%

( zerohedge)

iii)FRANCE
Macron faces a vote of no confidence today as protesters reject his economic “crumbs”. France is in total chaos.
( zerohedge)
iii b)FRANCEMassive manhunt for the terrorist responsible for killing innocent citizens of Strasbourg

( zerohedge)

iv)Tom Luongo explains what is going on in Europe right now with France and England in the centre of things( Tom Luongo)

v)GERMANY/MERKEL

seems that the new leader of the CDU is a mirror image of Merkel

( Tom Luongo)

vi)ECB

The ECB today confirms that it will end asset purchases.  However it will reinvest maturities in full and that will help Italy for a short time.  They will probably do a sell short term bonds and buy long term to also help keep Italian bonds yields low.

( zerohedge)

vii)Tom Luongo explains what is going on in Europe right now with France and England in the centre of things

( Tom Luongo)

viii)Investors were not happy with the key words used by Draghi:  there are  now “downside risks” and GDP and inflation forecasts have been cut….down goes the Euro

(courtesy zerohedge_

ix)A multi billion hedge fund just reports a record loss (GAM holdings).  It is one of Eurpe’s largest alternative money managers.  It has frozen withdrawals at some of their bond funds after a huge surge in redemptions.

(courtesy zerohedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

 

 

i)RUSSIA/USA

Butina now admits in court to being a Kremlin agent and it sought to influence politics through the NRA.  She has no influence and did not meet Trump or any of their election staff.

( zerohedge)

ii)SAUDI ARABIA/USA
This will hurt Trump as the Senate votes to end support for the Saudi war in Yemen
(courtesy zerohedge)

 

 

6. GLOBAL ISSUES

CANADA

 

7. OIL ISSUES

 

 

 

 

8 EMERGING MARKET ISSUES

i)Venezuela

Socialism at its finest:

The big Goodyear plant has decided to shutter its sole remaining plant and then as a Christmas bonus it is giving tires out as severance

(courtesy zerohedge)

 

 

9. PHYSICAL MARKETS

i)Finally Barrick is moving closer to resolving the Tanzanian problem which has been crippling the company
( Bloomberg/GATA)
ii)No surprise here:  the CFTC refuses to address questions posed by Chris Powell and myself on the gold and silver rigging(courtesy GATA/ChrisPowell)

iii)A good one tonight from bill Holter as he warns be crash alert as we are no doubt facing the huge global margin call

( Bill Holter)

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

 

 

MARKET TRADING

 

ii)Market data/

The following is a very important data point:  USA import and export prices plunge with fuel prices one of the culprits.  However there is no question that China is sending deflation our way

( zerohedge)

 

iii)USA ECONOMIC/GENERAL STORIES

3 Trump tweet storm:

a)Trump distances himself from Cohen

b) threatens GM again

c) hopes the Fed will not hike interest rates any more:

(zerohedge)

iv)SWAMP STORIES

a)Trump claims that he never directed Michael Cohen to break the law.  He correctly states that Cohen is a lawyer and he ought to know the law. Trump also sstates that Cohen pled guilty to finance issues which were not criminal but used by Mueller to embarrass Trump

( zerohedge)

b)This is getting quite out of hand: now the New York Attorney General   (staunch Democrats) have started a criminal probe into trump inauguration spending’

(courtesy zerohedge)

E)SWAMP STORIES/MAJOR STORIES//THE KING REPORT

Let us head over to the comex:

 

The total gold comex open interest ROSE BY A CONSIDERABLE SIZED 2485 CONTRACTS UP to an OI level 404,735 WITH THE GAIN IN THE PRICE OF GOLD ($3.05 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 DEC..  THE CME REPORTS THAT THE BANKERS ISSUED GIGANTIC SIZED COMEX TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS., THAT IS 11080 EFP CONTRACTS WERE ISSUED:

FOR DECEMBER:  11080 AND  ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE:  11080 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:  13,565 TOTAL CONTRACTS IN THAT 11080 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE GAINED A CONSIDERABLE SIZED 2485 COMEX CONTRACTS.

NET GAIN ON THE TWO EXCHANGES: 13,565 contracts OR 1,356,500 OZ OR 42.19 TONNES.

 

We are now in the active contract month of December and we now have a total of 600 contracts stand in December so we had a loss of 333 contracts.  We had 395 notices served yesterday, so we gained 62 contracts or 6200 oz will stand as these guys refused to  morph into London based forwards and as well negating to accept a fiat bonus.  QUEUE JUMPING RETURNS TO THE GOLD COMEX 

 

The next delivery month after December is January which saw it FALL TO 2883 FOR A LOSS OF 154 CONTRACTS.  February GAINED A CONSIDERABLE 574 contracts to stand at 301,369 contracts

 

FOR COMPARISON TO THE 2017 CONTRACT MONTH:

 

ON FIRST DAY NOTICE DEC 1/2017: 37.035 TONNES STOOD FOR DELIVERY

EVENTUALLY BY DEC 31.2017:  28.592 TONNES STOOD AND THE REST MORPHED INTO LONDON BASED FORWARDS.

AS A REMINDER WE HAVE ONLY 4.000 TONNES OF REGISTERED GOLD READY TO SERVE UPON OUR DEC LONGS.

 

 

 

 

WE HAD 71 NOTICES FILED AT THE COMEX FOR 7100 OZ. (0.2208 tonnes)

 

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And now for the wild silver comex results.

Total silver OI ROSE BY 1005 CONTRACTS FROM 174,071 DOWN TO 175,076 (AND FURTHER FROM 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 WITH A 22 CENT RISE IN PRICING.

 

WE ARE NOW INTO THE ACTIVE DELIVERY MONTH OF DECEMBER AND, WE WERE  INFORMED THAT WE HAD A STRONG SIZED 2446 EFP CONTRACTS:

 

FOR DECEMBER: 2446 CONTRACTS, FOR MARCH 0 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: 2446.  ON A NET BASIS WE GAINED 3451 SILVER OPEN INTEREST CONTRACTS AS WE OBTAINED A  1005 CONTRACT GAIN AT THE COMEX COMBINING WITH THE ADDITION OF 2446 OI CONTRACTS NAVIGATING OVER TO LONDON.

NET GAIN ON THE TWO EXCHANGES:   3451 CONTRACTS...AND ALL OF THIS STRONG DEMAND OCCURRED WITH A 22 CENT GAIN IN PRICING// YESTERDAY

 

 

 

 

We are now in the non active delivery month of DECEMBER and here in this front month of December we now have 552 contracts standing for a LOSS of 78 contracts.  We had 173 contracts stand for delivery yesterday so we gained 95 contract or an additional 475,000 oz will not stand for delivery as these guys morphed into London based forwards as well as  accepting a fiat bonus.

 

After  December we have the non active  January contract month and here we saw a gain of 9 contracts up to 1909 contracts.  February saw its another 16 contract gain to stand at 98. March, the next big delivery month after December saw a gain of 1341 contracts down to 144,759

FOR COMPARISON TO THE COMEX 2017 CONTRACT MONTH:

 

ON FIRST DAY NOTICE DEC 1.2017 WE HAD A RATHER LARGE: 19.47 MILLION OZ STAND FOR DELIVERY

BY THE END OF DECEMBER:  33.295 MILLION OZ AS QUEUE JUMPING WAS THE NAME OF THE GAME IN SILVER.

.

 

 

 

 

 

 

 

 

We had 279 notice(s) filed for 1,395,000 OZ for the DEC, 2018 COMEX contract for silver

 

Trading Volumes on the COMEX

 

PRELIMINARY COMEX VOLUME FOR TODAY: 145,344 contracts,

 

CONFIRMED COMEX VOL. FOR YESTERDAY:  168,279  contracts

volumes at the comex for both gold and silver are much less than usual.

 

 

 

 

 

 

 

 

 

 

 

INITIAL standings for  DEC/GOLD

DEC 13-/2018.

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

 

 

 

Deposits to the Customer Inventory, in oz  

 

 

 

 

 

nil

 

 

 

 

 

 

 

 

 

 

 

No of oz served (contracts) today
71 notice(s)
 7100 OZ
0.2208 TONNES
No of oz to be served (notices)
529 contracts
(52900 oz)
Total monthly oz gold served (contracts) so far this month
7208 notices
720800 OZ
22.419 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 entries:

 

 

total dealer deposits: nil  oz

total dealer withdrawals: 0 oz

We had 0 kilobar entries

 

we had 0 deposits into the customer account

 

total gold customer deposits;  nil oz

 

we had 0 gold withdrawals from the customer account:

 

total gold withdrawing from the customer;  nil oz

 

we had 0  adjustment..

we still have not had any adjustments out of the dealer to the customer account to signify a settlement

FOR THE DEC 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 71 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and XXX notice(s) was (were) stopped/ Received) by j.P.Morgan customer account and XXX notices by the squid  (Goldman Sachs)

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
To calculate the INITIAL total number of gold ounces standing for the DEC/2018. contract month, we take the total number of notices filed so far for the month (7208) x 100 oz , to which we add the difference between the open interest for the front month of DEC. (600 contract) minus the number of notices served upon today (71 x 100 oz per contract) equals 773,700 OZ OR 24.06 TONNES) the number of ounces standing in this  active month of DECEMBER

 

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

No of notices served (7208 x 100 oz)  + {933)OI for the front month minus the number of notices served upon today (71 x 100 oz )which equals 773,700 oz standing OR 24.06 TONNES in this  active delivery month of DECEMBER.

WE GAINED 62 CONTRACTS OR 2800 OZ WILL  STAND AT THE COMEX AS THEY  MORPH INTO A LONDON BASED FORWARDS AS WELL AS NEGATING TO  ACCEPT A FIAT BONUS.

 

 

 

 

 

THERE ARE ONLY 22.597 TONNES OF REGISTERED COMEX GOLD AVAILABLE FOR DELIVERY AGAINST 23.87 TONNES STANDING FOR DECEMBER

 

 

total registered or dealer gold:  726,494.203 oz or   22.597 tonnes*
total registered and eligible (customer) gold;   8,339,015.231 oz 259.37 tonnes
*however we have 22.419 tonnes of gold ALREADY SERVED UPON against dealer inventory of 22.597 tonnes and so far we have had no settlements  as of yet.  We generally get a settlement when we see an adjustment from the dealer side to the customer side..
we have a total of 24.06 tonnes of gold standing for metal against only 22.597 tonnes of dealer gold and nothing has been settled so far…

IN THE LAST 27 MONTHS 95 NET TONNES HAS LEFT THE COMEX.

 

end

And now for silver

AND NOW THE NOV DELIVERY MONTH

DEC INITIAL standings/SILVER

DEC 13, 2018
Silver Ounces
Withdrawals from Dealers Inventory NIL oz
Withdrawals from Customer Inventory
87,842.916 oz
CNT
HSBC
Loomis

 

 

Deposits to the Dealer Inventory
nil oz
Deposits to the Customer Inventory
1,458,834.230
oz
CNT
Delaware
HSBC
No of oz served today (contracts)
279
CONTRACT(S)
1,395,000 OZ)
No of oz to be served (notices)
273 contracts
1,365,000 oz)
Total monthly oz silver served (contracts) 3873 contracts

(19,365,000 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 3 deposits into the customer account

 

i) Into JPMorgan: nil oz

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

JPMorgan now has 150.55 million oz of  total silver inventory or 51.03% of all official comex silver. (152.0 million/292 million)

 

ii) Into CNT:  583,603.400 oz

ii) Into Delaware: 274,864.230  oz

iii) Into HSBC: 600,366.600 oz

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

total customer deposits today: 1.458,834.230  oz

we had 3 withdrawals out of the customer account:
i) Out of CNT:  64,779.406 oz
ii) Out of HSBC: 1,997.600 oz
iii) Out of Loomis: 21,065.910 oz  (first transaction in years)

 

 

 

 

 

total withdrawals: 87,842.916  oz

 

we had 1 adjustments

i) Out of CNT 583,603.400 oz was adjusted out of the customer and this landed into  the dealer account of CNT

 

total dealer silver:  88.477 million

total dealer + customer silver:  297.369  million oz

 

 

 

 

The total number of notices filed today for the DEC 2018. contract month is represented by 279 contract(s) FOR 1,395,000 oz. To calculate the number of silver ounces that will stand for delivery in DEC., we take the total number of notices filed for the month so far at 3873 x 5,000 oz = 19,365,000 oz to which we add the difference between the open interest for the front month of DEC. (552) and the number of notices served upon today (279 x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the DEC/2018 contract month: 3873(notices served so far)x 5000 oz + OI for front month of DEC( 552) -number of notices served upon today (279)x 5000 oz equals 20,730,000 oz of silver standing for the DEC contract month.  This is a strong number of oz standing for an off delivery month.

We gained 95 contract or 475,000 additional oz will stand and these guys refused to accept a London based forward as well as negate receiving a fiat bonus. The EFP route is nothing but a cash settlement process and it is done in London to avoid detection. It is becoming quite obvious that the bankers are in urgent need of silver as we witness the constant queue jumping in silver these past 20 months.

 

 

 

 

 

 

 

 

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

ESTIMATED VOLUME FOR TODAY: 50,358 CONTRACTS  … 

 

 

 

 

CONFIRMED VOLUME FOR YESTERDAY: 73,510 CONTRACTS… 

 

 

 

 

YESTERDAY’S CONFIRMED VOLUME OF 73510 CONTRACTS EQUATES to 368 million OZ  52.53% 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 -3.93-% (DEC 13/2018)
2. Sprott gold fund (PHYS): premium to NAV RISES TO -0.71% to NAV (DEC 13 /2018 )
Note: Sprott silver trust back into NEGATIVE territory at -3.93%-/Sprott physical gold trust is back into NEGATIVE/

(courtesy Sprott/GATA)

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

NAV 12.50/TRADING 12.01/DISCOUNT 3.93

END

And now the Gold inventory at the GLD/

DEC 13/WITH GOLD DOWN $2.00: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 763.56 TONNES

DEC 12/WITH GOLD UP $3.05 A HUGE DEPOSIT OF 3.24 TONNES OF GOLD INTO THE GLD/SOMETHING IS BURNING…/INVENTORY RESTS AT 763.56 TONNES

DEC 11/WITH GOLD DOWN $4.85 A SMALL DEPOSIT OF .59 TONNES OF GOLD INTO THE GLD/INVENTORY RESTS AT 760.32 TONNES

DEC 10/WITH GOLD DOWN $3.05 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 759.73 TONNES

DEC 7/WITH GOLD UP $8.35/A BIG CHANGE IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 1.51 TONNES/INVENTORY RESTS AT 759.73 TONNES

DEC 6/WITH GOLD UP $1.60: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 758.21 TONNES

DEC 5/WITH GOLD DOWN $4.25: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 758.21 TONNES

DEC 4/WITH GOLD UP $7.25: A HUGE WITHDRAWAL OF 3.53 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 758.21 TONNES

DEC 3/WITH GOLD UP $13.25: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 761.74 TONNES

NOV 30/WITH GOLD DOWN $4.00: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 761.74 TONNES

NOV 29/WITH GOLD UP $1.30: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 761.74 TONNES

NOV 28/WITH GOLD UP $9.45 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 761.74 TONNES

NOV 27/WITH GOLD DOWN $8.60 A WITHDRAWAL OF 1.18 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 761.74 TONNES

NOV 26/WITH GOLD DOWN 65 CENTS: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 762.92 TONNES

 

NOV 23/WITH GOLD DOWN $4.25/A HUGE DEPOSIT OF 2.06 TONNES OF GOLD INTO THE GLD/INVENTORY RESTS AT 762.92 TONNES

NOV 21/WITH GOLD UP $6.70 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 760.86 TONNES

NOV 20/WITH GOLD DOWN $3.95: A BIG CHANGE: A GOOD SIZED DEPOSIT OF 1.18 TONNES OF GOLD INTO THE GLD/INVENTORY RESTS AT 760.86 TONNES

NOV 19/WITH GOLD UP $2.05: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 759.68 TONNES

NOV 16/WITH GOLD UP $8.00: A BIG CHANGE IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.48 TONNES/INVENTORY RESTS AT 759.68 TONNES

NOV 15/WITH GOLD UP $5.35/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 761.16 TONNES

NOV 14/WITH GOLD UP $8.15: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 761.16 TONNES

NOV 13/WITH GOLD DOWN $1.75: A HUGE DEPOSIT OF 6.77 TONNES AT THE GLD/THAT SHOULD END THE WHACKING OF GOLD FOR NOW AND A SMALL WITHDRAWAL OF 84 TONNES: INVENTORY RESTS AT 761.16 TONNES

NOV 12/WITH GOLD DOWN $4.65: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 755.23

NOV 9/WITH GOLD DOWN $16.80: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 755.23 TONNES

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

DEC 13.2018/ Inventory rests tonight at 763.56 tonnes

*IN LAST 515 TRADING DAYS: 171.60 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 415 TRADING DAYS: A NET 11.60 TONNES HAVE NOW BEEN REMOVED FROM GLD INVENTORY.

 

end

 

Now the SLV Inventory/

DEC 13/WITH SILVER UP 2 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.735 MILLLION OZ/

DEC 12/WITH SILVER UP 22 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.735 MILLION OZ

DEC 11/WITH SILVER UP ONE CENT TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY ESTS AT 318.735 MILLION OZ/

DEC 10/WITH SILVER DOWN 8 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.735 MILLION OZ/

DEC 7/WITH SILVER UP 16 CENTS: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.735 MILLION OZ/

DEC 6/WITH SILVER DOWN 5 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 2.817 MILLION OZ//INVENTORY LOWERS TO 318.735 MILLION OZ/

DEC 5/WITH SILVER DOWN 6 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY REMAINS AT 321.552 MILLION OZ.

DEC 4/WITH SILVER UP 10 CENTS TODAY: A SMALL CHANGE IN SILVER INVENTORY AT THE SLV:A WITHDRAWAL OF 134,000 OZ//INVENTORY RESTS AT 321.552 MILLION OZ/

DEC 3/WITH SILVER UP 29 CENTS: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 321.686 MILLION OZ/

NOV 30/WITH SILVER DOWN 17 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 1.22 MILLION OZ FROM THE SLV /INVENTORY RESTS AT 321.686 MILLION OZ/

NOV 29/WITH SILVER DOWN 2 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 322.906 MILLION OZ.

NOV 28/WITH SILVER UP 23 CENTS TODAY: A DEPOSIT OF 188,000 OZ/INVENTORY RESTS AT 322.906 MILLION OZ/

NOV 27/WITH SILVER DOWN 14 CENTS TODAY: A HUGE WITHDRAWAL OF 2.301 MILLION OZ FROM THE SLV/INVENTORY RESTS AT 322.718 MILLION OZ/

NOV 26/WITH SILVER DOWN ONE CENT: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 325.019 MILLION OZ

NOV 23/WITH SILVER DOWN 25 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 325.019 MILLION OZ.

NOV 21/WITH SILVER UP 23 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 325.019 MILLION OZ/

NOV 20/WITH SILVER DOWN 14 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 563,000 OZ INTO THE SLV/INVENTORY RESTS AT 325.019 MILLION OZ/

NOV 19/WITH SILVER UP 3 CENTS TODAY:NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 324.456 MILLION OZ/

NOV 16/WITH SILVER UP 9 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 324.456 MILLION OZ/

NOV 15/WITH SILVER UP 21 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 324.456 MILLION OZ

NOV 14/WITH SILVER UP 10 CENTS/NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 324.456 MILLION OZ

NOV 13/WITH SILVER DOWN 15 CENTS; A SMALL CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 328,000 OZ FROM THE SLV/INVENTORY RESTS AT 324.456 MILLION OZ/

NOV 12/WITH SILVER DOWN 10 CENTS/ A SMALL CHANGE IN SILVER INVENTORY A THE SLV: A WITHDRAWAL OF 940,000 OZ/INVENTORY RESTS AT 324.784 MILLION OZ

NOV 9/WITH SILVER DOWN 29 CENTS: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 325.724 MILLION OZ/

 

 

DEC 13/2018:

 

Inventory 318.735 MILLION OZ

LIBOR SCHEDULE AND GOFO RATES:

 

 

THE RISE IN LIBOR IS CREATING A SCARCITY OF DOLLARS BECAUSE FOREIGN EXCHANGE SWAPS (COSTS) ARE SIMPLY PROHIBITIVE

YOUR DATA…..

6 Month MM GOFO 2.59/ and libor 6 month duration 2.89

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

G0LD LENDING RATE: + .30

 

 

XXXXXXXX

12 Month MM GOFO
+ 2.76%

LIBOR FOR 12 MONTH DURATION: 3.10

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.34

end

 

PHYSICAL GOLD/SILVER STORIES

end
i) GOLDCORE BLOG/Mark O’Byrne

Yellen Warns Another Financial Crisis Is Brewing

– ‘Gigantic holes in the system’ warns former Fed Head
– Interest rates will remain lower than they have been in past
– Leveraged loans pose risks and there is unfinished regulation

– “I think things have improved, but then I think there are gigantic holes in the system”
– No new financial crisis in ‘our lifetimes’, Yellen said only last year
– Editors note: Yellen should know as she and her predecessors are responsible for some of the “gigantic holes”


Image Source: Mike Shedlock

Former Federal Reserve Chairperson Janet Yellen told an audience in New York that she fears there could be another financial crisis brewing.

She warned of leveraged loans and the inability for the Fed to bail out banks. She said that banking regulators have seen reductions in their authority to address banking and financial panics and warned of the current push to deregulate.

“I think things have improved, but then I think there are gigantic holes in the system,” Yellen warned Monday evening.

“The tools that are available to deal with emerging problems are not great in the United States,” she said in a discussion moderated by New York Times columnist Paul Krugman at CUNY.

Yellen warned that leverage loans are an area of concern, something also mentioned by the current Fed leadership.

 

Secure Storage Ireland – Click here for information

 

News and Commentary

May Returns to Brexit Front Line After Surviving Tory Ambush (Bloomberg.com)

Gold edges lower, palladium hits record high (Reuters.com)

Asia stocks rally into a second day with Hong Kong markets in the lead (MarketWatch.com)

Gold settles higher as inflation in line and the dollar takes a dip (MarketWatch.com)

Stocks cheered by Trump trade talk; sterling claws off lows (Reuters.com)


Source: Marketwatch

Bitcoin Was a Bubble. And It Popped (IndiaTimes.com)

Bitcoin’s collapse looks familiar to bubble watchers (MarketWatch.com)

S&P 500 lows? We ain’t seen nothing yet, says Gundlach (MarketWatch.com)

Why Gundlach Is “Scared Sick” Of The Global Economy (ZeroHedge.com)

Germany Accelerates Plans For Deutsche Bank-Commerzbank Megamerger (ZeroHedge.com)

Gold Technical Analysis: Gold has formed a bull flag (FXStreet.com)

Listen on SoundCloud , Blubrry & iTunesWatch on YouTube below

Gold Prices (LBMA PM)

12 Dec: USD 1,244.75, GBP 993.31 & EUR 1,098.24 per ounce
11 Dec: USD 1,248.25, GBP 988.99 & EUR 1,096.59 per ounce
10 Dec: USD 1,246.80, GBP 980.61 & EUR 1,092.57 per ounce
07 Dec: USD 1,241.20, GBP 972.98 & EUR 1,091.51 per ounce
06 Dec: USD 1,236.45, GBP 971.48 & EUR 1,091.66 per ounce
05 Dec: USD 1,236.15, GBP 970.13 & EUR 1,090.16 per ounce

Silver Prices (LBMA)

12 Dec: USD 14.66, GBP 11.68 & EUR 12.93 per ounce
11 Dec: USD 14.64, GBP 11.62 & EUR 12.85 per ounce
10 Dec: USD 14.53, GBP 11.48 & EUR 12.73 per ounce
07 Dec: USD 14.49, GBP 11.34 & EUR 12.73 per ounce
06 Dec: USD 14.38, GBP 11.28 & EUR 12.68 per ounce
05 Dec: USD 14.48, GBP 11.34 & EUR 12.75 per ounce


Recent Market Updates

– Gold Krugerrand Coin Worth $1,200 Donated To Charity Again
– EU Recession Imminent – Euro Disunion as Brexit, Italy and End of QE Loom
– Gold and Silver Gained 2% and 3% Last Week While Stocks Dropped Nearly 5%
– Irish Central Bank Refuses To Discuss Gold Reserves In Bank of England Vaults
– “Fake Markets” To Lead to Global Financial Crisis? – Goldnomics Podcast
– Gold Is “Coiled” and Looks Set To Surge Like Natural Gas — Bloomberg Intelligence
– “Collapse Of Civilisation Is On The Horizon” – Attenborough Warns World Leaders
– Deutsche Bank May Cause The Next Global Crisis
– Ireland’s Mr Gold Reveals Nuggets Of Wisdom For When The Next Crash Comes
– BREXIT May Lead to UK Property Crash and Depression

Watch on Youtube here

Mark O’Byrne
Executive Director
 
END
 
ii) GATA stories
Finally Barrick is moving closer to resolving the Tanzanian problem which has been crippling the company
(courtesy Bloomberg/GATA)

Barrick moves closer to resolving Acacia dispute with Tanzania

 Section: 

By Danielle Bochove, Thomas Biesheuvel, and Kenneth Karuri
Bloomberg News
Wednesday, December 12, 2018

Barrick Gold Corp. has reached an agreement with the Tanzanian government on a $300 million payment, a milestone toward resolving a dispute that has crippled the miner’s subsidiary in the African country, according to people familiar with the situation.

Executives from the Toronto-based producer and Randgold Resources Ltd., which is being bought by Barrick, met with Tanzanian negotiators on Dec. 7, said the people, who declined to be identified as the talks are private.

During that meeting the two sides made significant progress on a deal that includes Acacia Mining paying $300 million in installments. The terms are now being handed off to a tax working group in Tanzania for review, the people said. …

… For the remainder of the report:

https://www.bloomberg.com/news/articles/2018-12-12/barrick-gold-is-said-…

END

No surprise here:  the CFTC refuses to address questions posed by Chris Powell and myself on the gold and silver rigging

(courtesy GATA/ChrisPowell)

CFTC refuses to address GATA’s questions about gold and silver market rigging

 Section: 

12:21p ET Thursday, December 13, 2018

Dear Friend of GATA and Gold:

The U.S. Commodity Futures Trading Commission has refused to reply to or even to acknowledge GATA’s questions about manipulation of the gold and silver futures markets that are purportedly regulated by the commission.

By letters in July and September, GATA asked the commission to explain the explosion in the use of the “exchange for physicals” mechanism of settling gold and silver futures contracts on the New York Commodity Exchange; to determine whether gold futures prices had been linked by the Chinese government’s manipulative trading to the value of the yuan; and whether the commission has jurisdiction over manipulative futures trading by the U.S. government itself.

GATA’s letters are posted here:

http://gata.org/node/18405

http://gata.org/node/18512

Having gone months without any acknowledgment from the commission, GATA asked your secretary/treasurer’s U.S. representative, John B. Larson, Democrat of Connecticut’s 1st District, to press the commission to reply, which his office did several times.

Today Larson’s office forwarded a copy of a letter put into the mail to GATA yesterday by the commission’s director of legislative affairs, N. Charles Thornton III. But Thorton’s reply is little more than a form letter, outlining the commission’s general objectives and purposes. Thornton makes no reference to GATA’s questions:

http://gata.org/files/CFTCReply-12-12-2018.pdf

Ordinarily a response so vapid could be considered insulting, but it fairly may be considered confirmation that the U.S. government and other governments are surreptitiously rigging commodity markets, as has been strongly suggested by the official filings of CME Group, operator of the New York Commodities Exchange and other commodities exchanges in the United States. These filings confirm that governments and central banks are among the exchange operator’s clients and receive discounts from the exchanges for their secret trading of all commodity futures contracts:

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

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

GATA’s correspondence with the CFTC shows how easy it is to demonstrate government instigation of or complicity with market manipulation. Since demonstrating this is so easy, the bigger challenge is to persuade mainstream financial news organizations to pursue the issue and to persuade commodity-producing companies and their investors to agitate against it.

You can help by bringing GATA’s work to their attention and urging them to act.

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




iii) Other Physical stories
Due to the criminal conviction of trader Edmonds, the USA prosecution is seeking to halt the civil lawsuit. I was misinformed: all discoveries in a civil suit are public and because of that, the prosecution gives the defendants the right to plead the 5th if their testimony incriminates them
(courtesy zerohedge/Chris Powell)

US seeks halt in civil lawsuit accusing JP Morgan of manipulating metals market, citing criminal case

  • The U.S. wants a federal judge to halt a civil lawsuit accusing J. P. Morgan of manipulating precious metals markets. The Justice Department cited an ongoing criminal case as its reason for the request.
  • A former J. P. Morgan trader pleaded guilty in Connecticut last month to manipulation charges.
  • In the guilty plea, the trader said he had learned to make bogus trade orders from senior traders at the bank and that he used the strategy hundreds of times with the knowledge and consent of his immediate supervisors.

A sign of JP Morgan Chase Bank is seen in front of their headquarters tower in New York.

Amr Alfiky | Reuters
A sign of JP Morgan Chase Bank is seen in front of their headquarters tower in New York.

The Justice Department is asking a judge to put the brakes on a civil lawsuit against J. P. Morgan Chase, citing an ongoing probe into a “related criminal case” that involves alleged manipulation of precious metals markets.

The department wants a six-month postponement in the proceedings of the civil lawsuit, which was filed in 2015 by hedge fund manager Daniel Shak and two commodity traders. The government also says it could ask for a longer delay in the case, according to a court filing on Monday.

The move comes days after Shak’s lawyer, David Kovel, sought permission to reopen questioning of two former J. P. Morgan traders and the bank’s current global head of base and precious metals trading.

Kovel, in making the request with the Manhattan federal judge in the civil case, cited last month’s guilty plea by one of those former traders, John Edmonds, in federal court in Connecticut.

Edmonds admitted making bogus bids on precious metals contracts while working at the bank from 2009 to 2015.

Neither J. P. Morgan Chase nor Kovel’s clients have opposed the Justice Department’s request.

In arguing for a delay, the Justice Department said Shak’s lawsuit is “related” to Edmonds’ criminal case and that Edmonds has “pleaded guilty and acknowledged his own participation in such conduct, as well as that of other traders.”

“Edmonds awaits sentencing, but the broader investigation is ongoing,” the Justice Department said. The U.S. wants to delay the civil case “to protect the integrity of its ongoing criminal investigation,” it said.

J. P. Morgan did not respond to a request for comment by CNBC. Kovel declined to comment.

Tuesday night, after this story first was published, Judge Paul Engelmayer ordered the federal prosecutors to explain in detail by Monday why postponing proceedings in the civil lawsuit would not harm those involved, and why reopening questioning “would be detrimental to the Government’s ongoing criminal investigation.”

Englemayer also wrote that he regards Edmonds’ guilty plea “as potentially highly consequential” to the civil case.

In his guilty plea, the 36-year-old Edmonds said he had learned to make bogus trade orders from senior traders at the bank and that he used the strategy hundreds of times with the knowledge and consent of his immediate supervisors. He admitted to working with “unnamed co-conspirators” at J. P. Morgan, according to the Justice Department.

Kovel wants to question Edmonds again as well as Michael Nowak, the bank’s global head of base and precious metal trading, and former J. P. Morgan Chase Managing Director Robert Gottlieb. The three had previously answered questions under oath in the civil case.

Kovel said in court filings that Nowak was the immediate supervisor of Edmonds, while Gottlieb was Edmonds’ mentor.

In his prior deposition, Edmonds said that Gottlieb sat only a “couple feet” away from him for about five years, and that he was “somebody [he] looked up to in the business,” who helped guide and train him.

Nowak is described by Edmonds as his direct supervisor, with whom he would sometimes discuss trading strategies. Nowak was also the person responsible for overseeing the performance and risk of Edmonds’ portfolio, according to the deposition.

Edmonds also stated in his prior deposition that he would enter precious metals trades for both Nowak and Gottlieb, among others.

The civil lawsuit claims Shak and his fellow plaintiffs lost tens of millions of dollars as a result of actions by J. P. Morgan’s traders.

 A good one tonight from bill Holter as he warns be crash alert as we are no doubt facing the huge global margin call
(courtesy Bill Holter)

People continually ask “when” will it happen? For the last 6 months we have responded “it is happening right before your very eyes”! In fact, as of this morning 52% of global markets are now down over 20% from their highs and qualifying as bear markets. Please understand the financial backdrop these weakening markets are falling into. Bluntly, the world is facing a giant margin call that cannot be met.

Liquidity had become extremely tight even as markets made their high water marks. It is this lack of liquidity which threatens to become a self reinforcing flash crash to hell via margin calls. “Don’t worry” they say, central banks will come to the rescue. There is one fundamental problem with this line of thought, the value of the issued currencies themselves. There is zero mathematical way to service and pay off current debt with current currency values … currencies must be massively printed and thus devalued if they are to pay off the mountains of debt! Central banks created the problem, they will not be the solution. Rather, their demise will be part of the solution.

Looking at the backdrop that a revolving door of “buy the dip(pers)” on CNBC assure us is the right thing to do, the list is many and for the most part the issues are carved in stone. Obviously number one on the list are the levels of consumer, corporate, state and sovereign debt. By any measure, we have never been at current levels. Then we have the current unfunded pension problem. This is not just a US problem, it is a $400 trillion mathematical sinkhole seen worldwide.

We can of course add in “valuations”. Current valuations of everything from stocks, bonds, real estate or nearly everything considered an “asset” are at levels not supported by anything including common sense. A move back to the mean would be considered a crash … but pendulums (markets)rarely work that way. Markets almost always overshoot fair value in both directions up and down. The problem which few talk about is markets have “become” the economy. A huge bet was made in belief higher asset values would produce a “wealth effect” and the real economy would levitate. This only bought time but now time is up, declining markets are now eliciting a reverse effect. We are witnessing the end of a global Ponzi scheme where no new money is entering and players are beginning to leave. Remember, fear is a far greater emotion than greed!

One very important area to address is the latest trade issues with China. They have spent years setting up trade deals/routes, clearing facilities as an alternative to SWIFT, financing facilities and of course buttressing their reserves with physical gold. China’s imports of US goods dropped 25% from last November so tariffs are obviously beginning to bite.

Now for the reason I am issuing this warning, last week we found out Huawei’s CFO was arrested in a Canadian airport over violating US sanctions on Iran  . I cannot stress how important/dangerous this event is! First, is a Chinese citizen running a Chinese company bound by US law? Not to mention the “timing” of her arrest which occurred while Presidents Trump and Xi were meeting in Argentina. Mr. Trump says he was not aware of the arrest at the time. I don’t know which would be more troubling, whether he knew of the arrest and lied or had no clue the arrest was taking place?

Please consider the ramifications here. This is the equivalent of the CFO of Microsoft being arrested in Thailand, thrown in jail without bail awaiting extradition to Beijing! China will retaliate in violent fashion if she is not released and profuse apologies not given publicly. The bottom line is this, we have weaponized the SWIFT system at the very same moment global players are already questioning the use of dollars for trade… Did they really need anything else as a dollar disincentive?

Also understand the connection between trade, GDP and thus cash flow …versus the ability to service the outsized debt. At the very moment more cash flow is needed, this action on trade will act to turn off the spigot! What we now face is a credit freeze up like 2008-09 with no white knight waiting in the wings with a fire hose of needed liquidity. …And the Fed will again raise rates this month and continue to shrink their balance sheet? This would all be hilarious if it didn’t mean our way of life as we “knew” it will be destroyed.

To finish, do we get a bounce and some relief? Markets are very oversold and short term they are certainly due a bounce, but do we get it? It does not matter because the debt (mathematically unpayable in current currency values) is already in place …and debt does not ever go away until it is either paid, restructured or defaulted. The financial snake has already taken its tail into its mouth and has been swallowing for six months or more already. The only question is how long it will take for marginal players to make the decision the snake will in fact eat itself, and liquidate their positions … or alternatively receive margin calls and be forced into liquidation?

This is NOT the time to be a deer in the headlights! We will look back and see this final chapter as one where a massive flight from “liability” took place. The problem of course is that most all assets either are liabilities themselves or have values bid up via liabilities (loaned capital). All past financial panics were best survived by hiding in “cash”. Today, this sector is comprised by a dichotomy where one side is purely liability of a central bank or has no liability at all. The non liability side (gold and silver) also has a rocket booster attached in the form naked sales. Trolls for years have laughed at this fact as it did not matter …until it does. The amount of REAL gold and silver available for delivery is now miniscule at the very moment in time a position of non financial liability is mandatory! COMEX represents a registered gold inventory of a whopping 4 tons. A cash call by China will expose the fractional reserve nature of our ENTIRE SYSTEM!

The coming crash is a mathematical certainty and one that historians will ask in the future “what were they thinking”. While CNBC parades clown after clown to tell you this is a buying opportunity, I would simply advise DON’T BE STUPID and use your own common sense! We lived through the biggest super cycle of credit the world has ever seen …how do you think this ends?

Standing a fearful watch,
Bill Holter
Holter-Sinclair collaboration

end

_________________

 

 

 

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

i) Chinese yuan vs USA dollar/CLOSED UP TO 6.8811/HUGE DEVALUATION FOR THE PAST FOUR WEEKS STOPS ON TRUCE/

//OFFSHORE YUAN:  6.8764   /shanghai bourse CLOSED UP 31.90 POINTS OR 1.23%

HANG SANG CLOSED UP 377.64 POINTS OR 1.29%

 

 

2. Nikkei closed UP 213.44 POINTS OR 0.99%

 

3. Europe stocks OPENED ALL MIXED

 

 

 

 

 

/USA dollar index FALLS TO 96.99/Euro RISES TO 1.1377

3b Japan 10 year bond yield: RISES TO. +.06/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 113.44/ 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:: 50.53 and Brent: 59.62

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

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO +.28%/Italian 10 yr bond yield DOWN to 2.90% /SPAIN 10 YR BOND YIELD UP TO 1.40%…ITALIAN 10 YR BOND YIELD/GERMAN BUND: 2.62: DANGEROUS FOR THE ITALIAN BANKING SYSTEM

3j Greek 10 year bond yield FALLS TO : 4.22

3k Gold at $1242.45 silver at:14.71   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble UP 4/100 in roubles/dollar) 66.41

3m oil into the 50 dollar handle for WTI and 59 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 113.44DESTROYING 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 0.9916 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1282 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.

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

3r the 10 Year German bund now POSITIVE territory with the 10 year RISING to +0.28%

The bank withdrawals were causing massive hardship to the Greek bank. the Greek referendum voted overwhelming “NO”. Next step for Greece will be the recapitalization of the banks and that will be difficult.

4. USA 10 year treasury bond at 2.90% early this morning. Thirty year rate at 3.14%

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

6.  TURKISH LIRA:  UP  TO 5.3626

 

Rally Fizzles: Europe, US Turn Red After Warnings From ECB, PBOC

With algos trying to force a rally for the third day in a row, the “STFR” crowd arrived early as stocks in Europe and S&P futures surrendered early gains as investors initially bought on the latest optimistic developments in America-China trade relations, which however turned into selling after a BBG report that the ECB – as everyone had already expected – will lower its inflation forecast for 2019 when it publishes an updated outlook on Thursday.

Europe’s Stoxx 600 declines were led by energy shares as oil slide back under $51, offsetting gains in raw materials as the index erased an early advance to turn lower. Hong Kong and Chinese stocks outperformed as equities across Asia continued their rebound ignoring news that a second Canadian citizen had “disappeared” in China.

In the U.K., gilts climbed and the FTSE 100 edged lower after May won a vote of confidence in her leadership of the Conservative Party, though it’s likely to be only a temporary reprieve as the embattled premier faces hardened opposition to her Brexit deal.

Earlier, the Nikkei and other Asian stocks had pushed roughly 1 percent higher ahead of several central bank meetings including a landmark one for the ECB which was set to end its quantitative easing program. Gains were concentrated in Chinese shares, with Chinese blue-chips up 1.5 percent and Hong Kong’s Hang Seng index gaining 1.1 percent. Japan’s Nikkei stock index ended 1 percent higher, while Australian shares gained 0.1 percent.

“All eyes will be on the ECB,” said Morgan Stanley FX strategist Hans Redeker. “It may revise its growth projections lower but continue to prepare the markets for allowing QE to end.”

Futures on the S&P 500 initially rose after news broke that Chinese importers have bought U.S. soybeans, though they since hit an air pocket and dropped after US traders got to their desks and after PBOC Governor Yi Gang warned that China’s economy faces rising downward pressure. And since the market is entirely controlled by algos, spoos hit yesterday’s lows before rebounding.

Investor optimism was boosted on Wednesday after China resumed purchases of American soybeans and reiterated its officials were in close contact with U.S. counterparts on negotiating details of a broader deal, while considering revising the controversial “Made in China 2025” strategy. Still, worries for global relations remain after China detained a second citizen of Canada for questioning, further heightening tensions between those two countries. Also on Wednesday, Trump administration officials signaled that Beijing will have to do more to end the tariff war.

Yoshinori Shigemi, a global market strategist at JPMorgan Asset Management, cautioned against reading too much into trade headlines: “U.S.-China trade negotiations are subject to very high uncertainty. So lots of headlines come and go, and markets come and go also,” he said. “We have to see the evolution of this negotiation.”

US Treasuries popped higher as NBC suggested that Trump is increasingly concerned about impeachment, while in Europe Italy’s BTPs resume their upward trend, breaking through 126.00 after PM Conte confirmed that Italy’s proposed budget deficit has been cut to just the laughably precise 2.04% in Italy’s latest concession to the European Commission.

Two-year Italian bond yields tumbled to 0.51 percent which took them back to where they were before a late May eruption of tensions triggered the worst day for short-term Italian debt in 25 years. Italy’s five-year and 10-year government bond yields dropped to their lowest level in 2 1/2 months and the closely watched Italy/Germany 10-year bond yield spread improved to its tightest since the start of October.

“I think the momentum can carry on in the near term as we have a number of supportive factors for Italian debt beyond just the hopes the budget deal can be reached,” said Commerzbank rates strategist Christoph Rieger.

The euro was steady as the ECB was said to be lowering its inflation forecast for 2019 in an outlook due Thursday, while the dollar was little changed. The pound added to its advance after May survived an attempted ouster, although little has changed on the ongoing Brexit impasse. The Norwegian krone was the biggest gainer versus the dollar as the central bank maintained its key rate but said it sees a hike “most likely” in March 2019. The yen weakened against all of its major peers as demand for haven assets waned amid signs of a further thaw in U.S.-China trade ties.

On Brexit UK Prime Minister May was heading to an EU summit in Brussels following her confidence vote win to try and get some additional concessions on the controversial Irish border aspect of the agreement to placate rebels within her own party and Ulster unionist allies. Markets reckon May’s continued premiership for now makes a ‘no deal’ Brexit less likely at the margins and her survival takes at least some of the immediate headline risk out of the market – even if the Brexit impasse is really no clearer.

Elsewhere, WTI oil slipped below $51 a barrel as a smaller-than-expected decline in U.S. crude stockpiles renewed fears a global glut. In terms of recent newsflow, the latest IEA’s monthly report saw the agency cut non-OPEC oil supply growth forecasts by 415,000 BPD to 1.5mln BPD vs. 2.4mln BPD in 2018. The IEA also left global oil demand growth unchanged at 1.3mln BPD and 1.4mln BPD for 2018 and 2019 respectively. This follows yesterday’s monthly OPEC report where demand estimates were left unchanged. Gold is trading flat within a slim USD 2/oz range, as the dollar steadies with the DXY unchanged on the day. Base metals continue to see support after yesterday’s news that China are preparing to increase access for overseas companies with sentiment also bolstered this morning after the Chinese Commerce Ministry stated that they would welcome a US trade delegation visit.

Market Snapshot

  • S&P 500 futures down 0.1% to 2,653.5.50
  • STOXX Europe 600 down 0.2% to 349.21
  • MXAP up 0.6% to 151.37
  • MXAPJ up 0.8% to 488.58
  • Nikkei up 1% to 21,816.19
  • Topix up 0.6% to 1,616.65
  • Hang Seng Index up 1.3% to 26,524.35
  • Shanghai Composite up 1.2% to 2,634.05
  • Sensex up 0.3% to 35,901.53
  • Australia S&P/ASX 200 up 0.1% to 5,661.61
  • Kospi up 0.6% to 2,095.55
  • German 10Y yield unchanged at 0.28%
  • Euro up 0.09% to $1.1379
  • Italian 10Y yield fell 11.9 bps to 2.637%
  • Spanish 10Y yield fell 0.8 bps to 1.421%
  • Brent futures down 0.6% to $59.79/bbl
  • Gold spot little changed at $1,245.01
  • U.S. Dollar Index down 0.1% to 96.96

Top Overnight News from BBG:

  • The European Central Bank is set to lower its inflation forecast for 2019 when it publishes an updated outlook on Thursday, according to people familiar with the matter
  • Theresa May heads for Brussels Thursday to plead for a lifeline after her Brexit plans provoked a revolt from her Conservative Party. “I will be seeking legal and political assurances that will assuage the concern that Members of Parliament have” on the backstop, May said
  • EU27 leaders will affirm after dinner at their meeting in Brussels that the EU stands by the withdrawal agreement “and intends to proceed with its ratification,” Politico reported, citing draft summit conclusions
  • Mario Draghi is about to end an era by halting the European Central Bank’s flagship stimulus program even with an economic outlook that is murky at best
  • China is considering plans to delay some targets in its strategy to dominate high-end technologies as it tries to ease trade tensions with America. Beijing may postpone some aspects of its ambitious industrial program by a decade to 2035, according to people familiar with the matter
  • Chinese importers have purchased 1.5m to 2m metric tons of American soy over the past 24 hours, the U.S. Soybean Export Council said, citing industry sources
  • President Recep Tayyip Erdogan put Turkey on course for another clash with the U.S. by threatening to start a military operation within a few days targeting America’s Kurdish allies in northeastern Syria
  • Italian Prime Minister Giuseppe Conte proposed to cut the deficit target to 2.04% of output for next year in a significant concession to the European Commission
  • Global funds snapped up a record amount of Japanese bonds last week in a trend that threatens to complicate the central bank’s yield-curve-control policy

Asian equity markets traded positively as the region followed suit to the gains on Wall St amid trade-related hopes after news of further potential concessions by China. As such, ASX 200 (+0.1%) and Nikkei 225 (+1.0%) were higher but with gains in Australia capped by losses in the telecoms sector after the competition regulator expressed preliminary concerns regarding proposed TPG Telecom – Vodafone Hutchison Australia merger which resulted to a near-17% drop in TPG shares, while property-related weakness also restricted upside. Hang Seng (+1.3%) and Shanghai Comp. (+1.4%) were lifted amid the encouraging trade-related developments with China preparing to increase access for overseas companies and is working to replace its Made in China 2025 plan with one that tones down its bid to dominate manufacturing, while Chinese importers have also resumed purchases of US soybeans and are said to purchase as much as 2mln tons of US soybeans vs. earlier reports of 500k tons. Finally, 10yr JGBs traded lacklustre amid gains in stocks and similar subdued price action in T-notes, with a mixed 5yr auction result adding to the drab mood.

Top Asian News

  • Philippines Puts Rate Hikes on Pause as Inflation Eases
  • Nissan Said to Be Repatriating Cash as Renault Tensions Brew
  • Air China Is Said to Have Held Talks to Buy HNA’s Airlines
  • Qinghai Provincial Says in Talks With SOEs on Restructuring

Major European Indices are mixed with the FTSE MIB (+1.0%) outperforming due to the indices banks outperforming on Italian PM Conte stating the nations deficit goal is now 2.04%; while the EC comments that good progress has been made on this. FTSE 100 (U/C) is trading flat, with Associated British Foods (-0.6%) and 3I group (-2.1%) trading ex-dividends towards the bottom of the index.  At the top of the index are TUI (+5.0%) expecting 10% underlying earnings growth at constant currencies for 2019. In terms of other notable movers G4S (+9.0%) are reviewing separation options for their cash solution business and Sainsbury’s (+1.3%) are up as they are challenging a refusal for additional time by the regulator regarding their merger with Asda. Sectors are broadly in the red with some underperformance seen in Energy while Utilities are the outperforming sector.

Top European News

  • ECB Is Said to Lower 2019 Inflation Forecast as Bond-Buying Ends
  • Italy Offers 2.04% Budget Deficit Target in EU Peace Gesture
  • France’s Yellow Vests Are Starting to Enjoy the Radical Life
  • Ukraine’s Renewed Privatization Drive Falls at First Hurdle
  • SNB Sees Downside Risks as It Keeps Crisis Policy Settings

In currencies, GBP, EUR – Sterling the major G10 outperformer in the aftermath of PM May’s confidence vote victory last night, with some support also provided by the a draft document including the possibility that the EU are to look into giving more backstop assurances. As such cable remains firmly above 1.2600, albeit off highs of 1.2685 with large options around 1.2650-60 (1.2bln) perhaps hampering further attempts towards 1.2700. Meanwhile, the EUR also feels some benefit from the softer dollar, but is lagging vs. the Pound as EUR/GBP slips below 0.9000 ahead of the ECB policy decision. Note: please refer to the research suite for a full preview.

  • NOK, CHF – Staying with the Central Bank theme, two out of the four end of year meetings have already passed and the Norwegian Crown strengthened in light of the Norges Bank’s current assessment reaffirming that rates will “most likely” be raised in March 2019. This, alongside upgrades to core CPI pulled EUR/NOK to lows of 9.7071 (vs. high of 9.7531).  Conversely, the CHF was largely docile in wake of the SNB keeping its key rate and corridor unchanged, as expected. The Swiss Central Bank also maintained that the Franc is “highly valued” alongside reiterating its preparedness to intervene if required and utilise the balance sheet to react in the event of shocks. Note, SNB Head Jordan stressed the risk of major and sudden exchange rate movements which would significantly alter monetary conditions. As such EUR/CHF remains within a the bottom of a 1.1301-1.1281 range.
  • AUD, NZD – The high-beta currencies continue to prosper in the more positive US-China trade environment, with the with AUD/USD building on gains above 0.7200 to just shy of 0.7250 at one stage, but also wary of big option interest at 0.7200 (1.3bln). Meanwhile NZD/USD remains sub-0.6900, albeit near the top of a 0.6880-42 range despite the downward revisions in the New Zealand HY economic and fiscal updates.
  • JPY – Rangebound trade for the Yen ahead of tonight’s Tankan Survey release with USD/JPY hovering sub-113.50 (with resistance around the figure). In terms of technical, a key fib level sits at 113.61, with 750mln between 113.60-65. In terms of noteworthy option expiries to the downside, 113.00-10 (1.1bln) and 113.30-40 (1bln)
  • TRY – Back to Central Banks, CBRT left its key one-week repo on hold as widely expected and maintained a tightened bias until the inflation outlook displays a significant improvement, though the Bank did acknowledge the recent sub-forecast CPI release, along with import prices and domestic demand condition. As such USD/TRY fell to lows just shy of 5.3000 vs. highs of 5.3837

In commodities, Brent (-0.3%) and WTI (-0.4%) are down on the session in a continuation of yesterday’s price action. In terms of recent newsflow, the latest IEA’s monthly report saw the agency cut non-OPEC oil supply growth forecasts by 415,000 BPD to 1.5mln BPD vs. 2.4mln BPD in 2018. The IEA also left global oil demand growth unchanged at 1.3mln BPD and 1.4mln BPD for 2018 and 2019 respectively. This follows yesterday’s monthly OPEC report where demand estimates were left unchanged. Whereas, non-OPEC oil supply in 2018 is forecast to grow by 2.5mln BPD, which was an upward revision of 190k BPD; with this in mind, some suggest that OPEC will need to make further cuts over the second half of 2019. Gold is trading flat within a slim USD 2/oz range, as the dollar steadies with the DXY unchanged on the day. Base metals continue to see support after yesterday’s news that China are preparing to increase access for overseas companies with sentiment also bolstered this morning after the Chinese Commerce Ministry stated that they would welcome a US trade delegation visit. Copper prices have hit a 1-week high on these trade developments. Separately, steel prices have risen on a potential boost to demand arising from expectations that China are to launch more infrastructure products next year.

US Event Calendar

  • 8:30am: Import Price Index MoM, est. -1.0%, prior 0.5%; YoY, est. 1.3%, prior 3.5%
  • 8:30am: Export Price Index MoM, est. -0.3%, prior 0.4%; YoY, prior 3.1%
  • 8:30am: Initial Jobless Claims, est. 226,495, prior 231,000; Continuing Claims, est. 1.65m, prior 1.63m
  • 9:45am: Bloomberg Consumer Comfort, prior 60.3
  • 2pm: Monthly Budget Statement, est. $199.0b deficit, prior $100.5b deficit

DB’s Jim Reid concludes the overnight wrap

There were high emotions last night as UK PM May now has to write 117 fewer Xmas cards after winning her leadership battle by a vote of 200-117. That result is enough to insulate May from another leadership challenge within the next 12 months from within her party. However, more than a third of her party and likely more than half of her backbenchers voted against her and the result was less supportive than most thought beforehand.

The pound had already gained as much as +1.47% to above $1.265 in advance of the vote, as it became clearer that May would  have sufficient support to win the confidence vote. However, with the actual margin less than expected the currency surrendered around a third of its gains at one stage before closing up +1.14% on the day after the vote. Overnight, it held that advance and is trading around $1.262 as we go to print.

So after all the noise, we’re left where we started. As before, the eventual outcome and the implications for UK assets will depend on May’s approach. Will she allow for modifications to her deal, or press ahead as-is? In her brief speech after the result she acknowledged the opposition in the leadership results and to the deal but didn’t immediately appear inclined to change tact. Her tactic at the moment still seems to get concessions out of Europe. Problem is, it seems quite clear that her European partners will not offer any of note. Basically, it all boils down to the backstop on the Irish situation. On this it’s worth noting that EU leaders are due to meet later today to discuss their position. Let’s see if a rabbit is pulled out of a hat. Seems unlikely. Where this ends is still highly uncertain. If a solution to the backstop can’t be found, we will probably have to pivot to a totally different tactic. Either a much softer Brexit (EEA type arrangement) or maybe a second referendum.

Aside from the Sterling move, this morning in Asia markets are off to a solid start with the Nikkei (+1.08%), Hang Seng (+1.22%), Shanghai Comp (+1.47%) and Kospi (+0.76%) all up. More signs of diffusing trade tensions seem to be the driver. The US Soybean export council said late yesterday night that Chinese importers have purchased 1.5mn to 2mn tons of US soybeans over the last 24 hours thus providing further evidence that the talks are moving in the right direction. Meanwhile, yesterday’s story in the WSJ about China working on a replacement for its ‘Made in China 2025’ plan with one that plays down its bid to dominate manufacturing has also aided sentiment. The article is noteworthy as it is the first sign that we’ve seen on a compromise on issues between the US and China that go beyond the bilateral deficit and focus on specifics. Futures on S&P 500 are also up +0.35% overnight while the CNY is +0.20% stronger.

Those moves overnight come after an impressive first half to the session on Wall Street yesterday but one that saw intra-day gains fade yet again. US markets still rallied +0.5 to +1% but gains of over +1.8% to +3% were seen earlier depending on the indices. Before this we saw another strong day for risk in Europe. Indeed, it felt like you could take your pick from a number of riskfriendly catalysts yesterday. Hopes that Brexit can have a softer bias with a May win, further signs of softening on the budget in Italy, a steady as she goes US CPI print, the WSJ story about China above, and talk of President Trump intervening on the Huawei case to push through a trade deal with China, all played a part. In the end, the S&P 500 (+0.54%), DOW (+0.64%) and NASDAQ (+0.95%) stayed higher after the blip while in Europe the STOXX 600 closed +1.69% to clock up its best two-day run  since July 2016. European banks also bounced +2.99%. Treasuries were well offered with 10y yields climbing +3.1bps, while the 2s10s curve finished +2.2bps steeper. Elsewhere, the FTSE 100 (+1.08%) lagged a bit, which was understandable with the Sterling move, however, the more domestic focused FTSE 250 did rise +1.90%, while the FTSE MIB climbed +1.91% and CAC +2.15% – the latter seemingly still reacting to the budget measures announced by Macron. HY cash spreads in the US and Europe were also -8bps and -11bps tighter respectively.

The more notable moves in Italy yesterday were for Italian Banks, which rallied +3.0% while 2y and 10y BTP yields fell -7.7bps and -11.9bps, respectively. The latter closed back under 3% (at 2.996% to be exact) for the first time since September with the catalyst being the reports about Italian Premier Conte potentially proposing a 2% deficit target for next year. After Europe closed it was confirmed by Conte that the revised budget would be 2.04% of GDP. The euro also gained +0.46% on the day on the news while other bond markets in Europe were more mixed, however 10y Bunds did climb back up +4.6bps to 0.276%. Elsewhere, as noted above, yesterday’s US CPI print didn’t do much to move the dial with the unrounded core reading of 0.2093% for November  more or less bang on expectations. That did, however, confirm a move higher in the year-on-year rate to +2.21%, which puts it at the highest since July. Both the three-month and six-month annualised rates also ticked higher to +2.1% and +2.0%, respectively.

That should alleviate concerns over the slight recent slowdown in core inflation, which had seen the 3m annualized rate dip to 1.6% last month. As markets continue to debate the fallout from last night’s confidence vote, there is at least the distraction of an ECB meeting to look forward to today. As a reminder, our economists expect the ECB to confirm that net asset purchases will cease at year-end. However, they also expect the ECB and Draghi to argue that the policy stance is not tightening. Indeed, they expect a classic ‘dovish tightening’ bias to the event. The team expects Draghi to say that “the market understands the guidance”, meaning the delayed pricing of the first hike is broadly appropriate. They also expect Draghi to hint that the TLTRO2 liquidity will be replaced in 2019. Overall, the risks today are balanced to a more dovish outcome. It is not just that the ECB staff forecasts are likely to be downgraded, the balance of risks could also shift to the downside. At the softer end of options, the ECB could make a dovish revision to the forward guidance on the timing of reinvestment tapering and among the stronger responses are a twist of the asset portfolio. This could come within the details of the reinvestment programme, which are due. We’ll know for certain later with the decision due at 12.45pm BST and Draghi’s press conference shortly after.

Back to yesterday, where, not to be outdone, emerging markets were also back in vogue following the headlines that hit in the morning quoting Turkey President Erdogan as saying that Turkey will “start an operation in Syria within days”. The Turkish Lira immediately sold off as much as -0.54% on the news, but the move appeared to be more kneejerk in reaction than anything else as it ultimately closed slightly stronger, up +0.37% on the day. EM FX more broadly was +0.58% while the MSCI EM equity index ended +1.46%. This came despite another slip in oil prices, with WTI down -0.97% as data showed that US oil inventories fell only -1.2 million barrels last week compared to the expected -3.5 million barrels. That’s the 12th time the inventories data has shown a smaller drawdown than expected over the last three months, the longest such stretch since April 2015.

As for the other economic data that was out yesterday, in the US, mortgage applications data showed a +1.6% week-on-week increase. That’s the third consecutive monthly increase, the best streak since March, and maybe a sign that recent housing sector weakness may be bottoming out. In Europe, October’s industrial production ended up being a bit of a wash with the stronger than expected October reading (+0.2% mom vs. +0.1% expected) offset by a downward revision to September to a sharper -0.6% mom decline (versus -0.3% previously). In Italy, the unemployment rate dipped to 10.2%, a new cycle low and the best print since Q1 2012.

In terms of the day ahead, a combination of the follow through from last night’s confidence vote on UK PM May and the aforementioned ECB meeting later today will no doubt be front and centre. Aside from that we’ve also got the final November CPI revisions due in Germany and France this morning while this afternoon in the US we get the November import price index print and latest weekly initial jobless claims reading. The latter is well worth keeping an eye on in light of the recent uptick in claims. Indeed, the four-week moving average has risen from a multi-decade low of 206k in the middle of September to 228k as of December 1st. Away from all that, EU leaders are also due to meet today in Brussels to discuss the EU budget and Brexit amongst other topics.

 

3. ASIAN AFFAIRS

i)THURSDAY MORNING/ WEDNESDAY NIGHT: 

SHANGHAI CLOSED UP 31.90 POINTS OR 1.23% //Hang Sang CLOSED UP 337.64 POINTS OR 1.29% //The Nikkei closed UP 213.44 OR 0.99%/ Australia’s all ordinaires CLOSED UP 0.14%  /Chinese yuan (ONSHORE) closed UP  at 6.8811 AS TRUCE DECLARED FOR 3 MONTHS /Oil DOWN to 50.58 dollars per barrel for WTI and 59.62 for Brent. Stocks in Europe OPENED MIXED//.  ONSHORE YUAN CLOSED UP AT 6.8764AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED UP ON THE DOLLAR AT 6.8811: HUGE DEVALUATION/PAST SEVERAL DAYS RESUMES// TRADE TALKS NOW ON/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED   : /ONSHORE YUAN TRADING BELOW LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING STRONGER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING STRONGER 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

3 C CHINA

Another indicator highlighting the growth problems inside China.  Today is the total collapse of Chinese auto sales.  It is their first decline in 30 years.

(courtesy zero hedge)

Chinese Auto Sales Accelerate Historic Collapse, Set For First Annual Decline In 30 Years

Progress in the United States/China trade war seems to be happening at just the right time.

The automobile industry in China has been crippled, partly as a result of this trade war, partly due to the ongoing domestic economic slowdown in the mainland, and absent major subsidies – which don’t appear to be coming – the outlook for the rest of 2018 and 2019 is not promising. The collapse has been historic and according to new data, continued through November.

November data confirmed a continuation of the ugly trends that we discussed last month. For instance, passenger vehicle wholesales were down 16.1% on the year, according to the China Association of Automobile Manufacturers. This data includes sedans, SUVs and crossover utility vehicles.

November vehicle wholesales were also down well into the double digits, dropping 13.9% to 2.55 million units year-over-year. Total retail passenger vehicles fell 18% on the year and SUV sales fell 20.6% year-over-year to 854,289 units, according to the Passenger Car Association.

As a result, CICC now expects China’s full year production and sales to drop more than 5% year-over-year for 2018. This would be the first annual decline in Chinese car sales in nearly three decades.

They also predicted that inventory levels at dealerships across the country will likely continue to rise as automakers “stuff channels” in hopes of fooling investors that sales are stronger than they are. The sales data for November suggested “much weaker demand in lower end segments and fears [of] competition in the SUV market” according to the CICC note.

They association concluded that a turnaround for the sector is only likely after Spring Festival, which occurs in the beginning of February. CICC found that domestic brands are becoming more competitive in new energy vehicles and SUV’s, while Japanese carmakers still have the advantage in sedans.

To be sure, this should not come as a surprise to regular readers as we have been reporting on the anemic numbers coming out of China in both October and November, although the severity of the slowdown has caught even the optimists by surprise.

Last month we also noted that China was mentioned very cautiously by automakers, many of whom offered pessimistic forecasts for the remainder of this year. Renault recently blamed its poor numbers on a global slowdown in sales in places like China and Europe, as well new emissions standards. Volkswagen also recently cut its sales forecast for China, citing a slowdown in the country as well as the looming trade war with the United States.

China’s slowdown has also hit names like General Motors which last month reported a 15% drop in China deliveries for the three months ended Sept. 30, the first quarterly report since the trade tensions with the U.S. began escalating in July.

That said, on Tuesday morning it was reported that China is considering cutting its tariffs on US autos, which could potentially serve as a short-term boost to demand.

Bloomberg said China is planning to cut tariffs on US-made cars to 15% from the current 40% has been submitted to China’s Cabinet to be reviewed in the coming days. China boosted tariffs on US-made cars to 40% as part of a raft of retaliatory measures against the US imposed over the summer. To be sure, nothing is set in stone just yet. The decision is being reviewed, and could still change.

END
We now have a second Canadian citizen who has been suddenly “disappeared” in China
(courtesy zerohedge)

Second Canadian Citizen Disappears In China

For a trade war that was supposed to be between the US and China, Canada has found itself increasingly in the middle of the crossfire. And so after the arrest of a former Canadian diplomat in Beijing in retaliation for the detention of the Huawei CFO in Vancouver, Canada said a second person has been questioned by Chinese authorities, further heightening tensions between the two countries.

The second person reached out to the Canadian government after being questioned by Chinese officials, Foreign Minister Chrystia Freeland said, at which point Canada lost contact with him. His whereabouts are currently unknown and Global Affairs Canada said they are in contact with his family.

“We haven’t been able to make contact with him since he let us know about this,” Freeland told reporters Wednesday in Ottawa. “We are working very hard to ascertain his whereabouts and we have also raised this case with Chinese authorities.”

According to the he Globe and Mail, the man was identified as Michael Spavor, a Canadian whose company Peaktu Cultural Exchange brings tourists and hockey players into North Korea. He gained fame for helping arrange a visit to Pyongyang by former NBA player Dennis Rodman, and he met North Korean leader Kim Jong Un on that trip, the newspaper reported. Attempts to reach Spavor on his contact number either in China, or North Korean went straight to voicemail.

Spavor’s personal Facebook page contains several images of him with North Korean leader Kim Jong-un including one of him with both Jong-un and former Dennis Rodman at an undisclosed location.

Michael P. Spavor, right, pictured here with North Korean leader Kim Jong-un, second from right, and Dennis Rodman.Another image shows the two sharing a drink on a boat.

The unexplained disappearance takes place after China’s spy agency detained former Canadian diplomat Michael Kovrig in Beijing on Monday, who was on leave from the foreign service. The arrest came nine days after Canada arrested Huawei Chief Financial Officer Meng Wanzhou at the request of U.S. DOJ. While Canada has asked to see the former envoy after it was informed by fax of his arrest, Canada is unaware of Kovrig current whereabouts or the charges he faces.

“Michael did not engage in illegal activities nor did he do anything that endangered Chinese national security,” Rob Malley, chief executive officer of the ICG, said in a written statement. “He was doing what all Crisis Group analysts do: undertaking objective and impartial research.”

One possibility is that Kovrig may have been caught up in recent rule changes in China that affect non-governmental organizations, according to Bloomberg. The ICG wasn’t authorized to do work in China, Foreign Ministry Spokesperson Lu Kang said during a regular press briefing in Beijing Wednesday.

“We welcome foreign travelers. But if they engage in activities that clearly violate Chinese laws and regulations, then it is totally another story,” he said, adding he had no information on Kovrig specifically.

As Bloomberg further notes, foreign non-governmental organizations are now required to register with the Chinese authorities under a 2017 law that subjects them to stringent reporting requirements. Under the law, organizations without a representative office in China must have a government sponsor and a local cooperative partner before conducting activities. ICG said this is the first time they’ve heard such an accusation from the Chinese authorities in a decade of working with the country. The company closed its Beijing operations in December 2016 because of the new Chinese law, according to a statement. Kovrig was working out of the Hong Kong office.

Meanwhile, realizing that it is increasingly bearing the brunt of China’s retaliatory anger, Trudeau’s government distanced itself from Meng’s case, saying it can’t interfere with the courts, but is closely involved in advocating on Kovrig’s behalf.

So far Canada has declined to speculate on whether there was a connection between the Kovrig and Meng cases, with neither Freeland nor Canadian Trade Minister Jim Carr saying Wednesday that there is any indication the cases are related. Then again, it is rather obvious they are. Indeed, Guy Saint-Jacques, who served as ambassador to China from 2012 to 2016 and worked with Kovrig, says the link is clear. “There’s no coincidence with China.”

“In this case, they couldn’t grab a Canadian diplomat because this would have created a major diplomatic incident,” he said. “Going after him I think was their way to send a message to the Canadian government and to put pressure.”

Even though Meng was granted bail late Tuesday, that did not placate China, whose foreign ministry spokesman said that “The Canadian side should correct its mistakes and release Ms. Meng Wanzhou immediately.”

The tension, according to Bloomberg,  may force Canadian companies to reconsider travel to China, and executives traveling to the Asian country will need to exercise extra caution, said Andy Chan, managing partner at Miller Thomson LLP in Vaughan, Ontario.

“Canadian business needs to look at and balance the reasons for the travel’’ between the business case and the “current political environment,’’ Chan said by email. Chinese officials subject business travelers to extra screening and in some case reject them from entering, he said.

Earlier in the day, SCMP reported that Chinese high-tech researchers were told “not to travel to the US unless it’s essential.”

And so, with Meng unlikely to be released from Canada any time soon, expect even more “Chinese (non) coincidences”, until eventually China does detain someone that the US does care about.

 end
Navarro affirms the arrests of the two 2 Canadian citizens in China was retaliation for Hauwei CFO
(courtesy zerohedge)

Navarro Affirms Arrests Of Canadian Citizens In China Was “Retaliation” For Huawei CFO

With US stocks set to open higher on Thursday, traders’ blood pressure probably spiked when they saw headlines from an interview with White House trade advisor Peter Navarro hitting the tape (who can forget his infamous comments two week ago when he chided traders and Wall Street banks for pushing for a trade detente, warning that talks with China hadn’t yielded any progress).

Fortunately for equity bulls, stock futures remained in the green as Navarro offered a mix of bullish and bearish commentary during a brief chat with Fox Business’s Maria Bartiromo, where the notorious China hawk discussed the Trump administration’s goals in its negotiations with its trade war rival, and advised traders to “focus on March 1” instead of trying to read too deeply into every report “on the front page of the Wall Street Journal” (comments that, on the surface, would seem to undercut the impetus for yesterday’s rally).

“Investors shouldn’t get hung up on the day to day…Just focus on March 1 when we’ll have a complete offer from China that will be negotiated behind closed doors not on the front pages of the Wall Street Journal.”

However, Navarro’s comments weren’t all bad: He affirmed that China had restarted purchases of US soybeans, and that Beijing is making an effort to ease trade tensions with the US. This shouldn’t come as a surprise, Navarro said, because if China doesn’t buy our soybeans “they get inflation…they get riots in Tiananmen Square.”

Instead of focusing on trade policy, Navarro suggested that traders should focus instead on the Federal Reserve and its plans for raising interest rates.

In terms of the administration’s goals for its trade negotiations, Trump is trying for two objectives: pushing China to improve market access (buy more stuff and let us enter markets without forced IP transfer) and – more importantly – implement ‘structural’ reforms like ending cyberintrusions, state-directed investment and intellectual property theft that have been the target of the Section 301 trade investigations launched by the White House.

Moving on to a discussion of national security issues, Bartiromo moved on to the security topic du jour: China’s motives in arresting two Canadian nationals. Asked whether these arrests constituted retaliation for the arrest of Huawei CFO Meng Wanzhou, Navarro responded that “it is.”

That marks the first time a Western official has directly acknowledged what everybody already suspected.

Watch the full interview with Navarro below:

 

 

:

 

 

 

Chinese officials have accused the detained Canadians’ of threatening national security and insisted that the arrests weren’t motivated by politics. Hu Xijin, editor of the state-backed Global Times, a nationalistic tabloid, said on the Weibo social media platform the Chinese government would never concede that the Canadians’ detentions were related to Meng’s case. “But the use of a complete set of laws to prove the rationale for arrest is one and the same as what the U.S. and Canada did to Meng Wanzhou,” he said.

end

4.EUROPEAN AFFAIRS

ITALY

Not sure of the story but it seems that Italy has revised its budgetary deficit to 2.0% and that sent Italian bonds and their stock market higher.  We are also not sure if the EU will accept this.  I am surprised that Italy lowered its budgetary deficit in light of what France wants to do: increase its budgetary deficit to 3.5%

(courtesy zerohedge)

Italian Bonds, Stocks Rally As Prime Minister Confirms Cut To Budget-Deficit Proposal

Italian bond yields moved lower for a second day to touch their lowest level since Sept. 27 while Italian bank stocks lead the country’s benchmark index higher after Italian Prime Minister Giuseppe Conti said that the government would cut its deficit projection in a new version of its budget,confirming that the Italians have offered a concession to the EU amid a tense standoff that recently prompted the bloc’s leadership to threaten its third largest economy with billions of euros in fines.

Though it’s still unclear whether Europe would accept the revised figure of 2.04% (down from 2.4%), at least one senior official – Commissioner Pierre Moscovici – told French lawmakers on Thursday that “constructive talks” were ongoing with Italy. Though conflicting reports have abounded earlier this week, it appears that Conti, Deputy Prime Ministers Matteo Salvini and Luigi di Maio (the two populist party chieftans who are effectively running the country) have agreed on the 2% figure.

Conti

Cutting against the populists’ claims that any budget-deficit reduction must leave its welfare promises untouched (claims that, from the beginning, sounded somewhat suspect given the magnitude of the cuts), one minister said Thursday that cutting “a few billion” euros from its key reforms would require Italy to roll back its plans to cut the retirement age and introduce a “citizens income”.

Italy’s government will cut “a few billion” euros from its two key reforms in order to hit the new deficit target it proposed to the European Commission, deputy industry minister Dario Galli said on Thursday.

The ruling coalition on Wednesday offered to lower its deficit target for next year to 2.04% of gross domestic product from a previous 2.4% to avoid disciplinary action from the EU.

“A few billions (in savings) compared to the original theoretical forecasts will come from the realistic implementation of the (government’s) most relevant measures from a political point of view,” Galli told La7 broadcaster, referring to income support and the introduction of a lower retirement age.

Speaking with reporters Wednesday night, Conti insisted that the EU would seriously consider Italy’s “serious” offer.

“We made a serious and reasonable offer,” Conti said.

However, according to one anonymous government source, negotiations with Brussels are ongoing (per the Guardian).

Newspaper La Stampa cited an EU “source” as saying that there is “still a gap to bridge, hopefully we can do it with the work that will continue in the coming days.”

The yield on the Italian 10-year bond dropped below 3% on Wednesday, leaving it lower than the 10-year Treasury yield. The spread between BTPs and bunds has fallen to its lowest level in 2 months, sliding as low as 260.65bps this morning.

Yields could move higher still if the ECB makes good on expectations that it will announce the end of three-and-a-half years of bond buying, though dovish policy guidance could send spark a reversal.

END
FRANCE
Macron faces a vote of no confidence today as protesters reject his economic “crumbs”. France is in total chaos.
(courtesy zerohedge)

Macron Faces Thursday No Confidence Vote As Protesters Reject Economic “Crumbs”

The majority of French people are not satisfied with a series of new economic policies unveiled by President Emmanuel Macron this week, and say that the Gilets Jaunes (Yellow Vest) protests should continue, according to a new poll.

According to a poll by Odoxa, 59% of French say that they are not convinced by Macron, despite finding his proposal “satisfactory,” according to Le FigaroJust 21% found Macron’s new policies convincing despite viewership for his speech jumping 40% over a speech last month.

That said, while Macron may have failed to win his people over – most of those polled agreed with his specific proposals; 61% favored the minimum wage boost, 55% liked the tax-free year-end bonuses and 85% of those surveyed backed no tax on overtime pay.

54% of those surveyed said the Yellow Vest protests should continue.

Many of the Yellow Vests have flat-out rejected Macron’s proposals, according to European-Views.

He is trying to do a pirouette to land back on his feet but we can see that he isn’t sincere, that it’s all smoke and mirrors,” said Jean-Marc, a car mechanic as a gathering of some 150 Yellow Vests in the southern town of Le Boulou.

It’s just window dressing, for the media, some trivial measures, it almost seems like a provocation,” said Thierry, 55, a bicycle mechanic.

All this is cinema, it doesn’t tackle the problems of substance. “We’re really wound up, we’re going back to battle,” he told AFP before taking part in blocking the Boulou turnpike on the French-Spanish border.

“Maybe if Macron had made this speech three weeks ago, it would have calmed the movement, but now it’s too late. For us, this speech is nonsense,” said Gaetan, 34, one of the “Rennes Lapins Jaunes” (Yellow Rabbits of Rennes).

One 35-year-old French official said that Macron “is being held hostage so he drops some crumbs.

Meanwhile, Macron faces a no confidence vote in parliament on Thursday, after left-of-center lawmakers moved against the President.

Approximately 4,100 of the 4,523 Yellow Vest protesters arrested since the Nov 17 start of the massive demonstrations across France were thrown in jail according to French television broadcaster BFMciting police sources. Nearly 2,000 of those arrested were arrested last Saturday during the movement’s “Act IV” protest, according to the Interior Ministry – over half of which, 1,082, occurred in Paris.

The 48-hour detentions have been criticized for denying citizens their right to demonstrate.

By locking them up for 48 hours, they were denied the opportunity to go to a demonstration and that in a democratic country is shocking” Paris Bar attorney attorney Raphael Kempf told BFM (translated).

END

FRANCE

Massive manhunt for the terrorist responsible for killing innocent citizens of Strasbourg

(courtesy zerohedge)

Elite French Police Launch Strasbourg Operation Amid Christmas Market Manhunt

Dozens of police from France’s elite RAID counterterrorism unit cordoned off an area of southern Strasbourg on Thursday close to where a gunman who attacked the city’s Christmas market was last seen, according to an AFP reporter at the scene.

French officials have not confirmed that the operation is linked to the Tuesday shooting that left three people dead and 13 injured, including one person rendered brain dead.

Embedded video

Remy Buisine

@RemyBuisine

DIRECT – Opération en cours du RAID dans le quartier #Neudorf à Strasbourg. L’endroit où #CherifChekkat a été vu pour la dernière fois après l’attaque mardi soir.

156 people are talking about this

A massive manhunt has been underway for the suspected shooter, 29-year-old French citizen Cherif Chekatt, as some 720 police and gendarmes have been looking for him nearly 36 hours after the incident at the popular Christmas market just a few blocks from the European Parliament.

Chekatt, who was reportedly wounded in the atack, is said to have commandeered a taxi to make his escape.

French officials issued an “urgence attentat” (emergency attack) alert, which temporarily expands police powers and requires officers to maintain “a higher degree of vigilance,” according to the BBC.

The first shots rang out in Strasbourg’s city center at around 8 pm local time (1 pm ET). A French prosecutor said the suspect shouted “Allahu Akbar” – ‘God is great’ in Arabic – during the shooting.

Here’s a brief rundown of what we know about the attacker (text courtesy of RT and the Guardian):

  • The suspect, Cherif Chekatt, 29, was born and raised in Strasbourg
  • His activities within the local radical Islamic community raised red flags and he had been added to a terror watch list
  • He was known as a potential security risk
  • The 29-year-old was sent to jail by a court in the German town of Singen for a violent robbery in Germany. After serving the sentence, Chekatt, a French national with North African roots, was deported back to France in 2017
  • He has also spent time in prison in France and is believed to have been radicalized in prison. He has been described as “notorious” to police, with a long criminal record
  • All told, the public prosecutor said the suspect has been convicted 27 times in France, Germany and Switzerland
  • Police had intended to arrest Chekatt in connection with an armed robbery hours before he allegedly opened fire on the Christmas market – but he was nowhere to be found when they raided his home. Police did, however, discover a grenade
  • Investigators are still working to establish a motive in the attack
  • The suspect fired three separate volleys into the crowds at the Christmas market then engaged twice with patrolling soldiers from Opération Sentinelle, a nationwide security operation established after a series of terrorist attacks in Paris in 2015

Developing…

Tom Luongo explains what is going on in Europe right now with France and England in the centre of things

(courtesy Tom Luongo)

 

“Have They Learned Nothing?” – The End Of France As We Know It?

Authored by Tom Luongo,

When an event grabs headlines like the protests in France have I temper my reactions to it.  I didn’t give the Yellow Vest protests much thought at first wanting to see where they would lead.

Protests like this and even bigger ones like Catalonian independence are invariably betrayed by the European political establishment.  They become an excuse to move towards tighter control — more cops, more surveillance, crackdowns on free speech, etc.

So, sometimes it’s hard to separate the manufactured reality show from the spontaneous uprising of human frustration.

But after the past two weekends of violent protests, after the French government backed down on the new diesel tax which was the inciting incident of this story, it’s safe to say this is real and there is real fear brewing among the political elite of Europe.

As Rev. Steve Turley points out in this video, the media across Europe and the U.S. are scared of where this leads.

A return of national sovereignty across Europe is no longer coming.  I think it’s here.  This can no longer be stage-managed as a relief valve of the massive discontent at neoliberal policies rammed down Europeans’ throats as it has in the past.

Something far more significant is here.  They can’t cordon off this movement in France and use it to demonize the leadership and, by extension, the people.

It’s jumped borders.  It’s part of the zeitgeist now.

No matter how many times rags like The Guardian, Der Spiegel and Politico call these people ‘far-right’ or ‘alt-right’ and link them to Nazism it doesn’t stop them because the protestors don’t see themselves that way.

And well they shouldn’t because they aren’t.

Macron made numerous mistakes in handling this protests.  But the biggest one was opening up his conversation with the French people with the same, tired insults used in the past to smear them and sow division.

Have they learned nothing in the past three years? 

Brexit was not a fluke.

Trump was not a fluke. 

Salvini isn’t a fluke. 

Orban isn’t a fluke.  

France is not a fluke.

These elections represent gut level revulsion to the path the political and economic discourse is on.  And crying Nazi wolf too many times eventually gets you eaten.

These people are sick of the corruption and demand results, not words.  Not campaign speeches, but results. 

And if these men don’t deliver quickly they will be on a short leash.  A very short one in Macron’s case.  Because it isn’t like 35% of France wasn’t willing to turn hard away from the status quo last year and vote for Marine Le Pen.

Macron was sold as the outsider, the reformer, who wasn’t in office a week before he began betraying the people who voted for him.  And now he’s stuck.

The media turned against him quickly because they know he is done.  Their job now will be to prep the narrative to puff up his replacement.

Kicking the can down the road means replacing the old boss with a new boss who is also just another globalist, neoliberal shill.

It’s what’s happening in Germany as Angela Merkel passes the torch of the CDU to a woman even more on board with Merkel’s agenda than Merkel was.

Theresa May’s attempted cynical betrayal of Brexit could actually fall apart as parliament looks ready to *gasp* do its job.

We’ve become used to France being the epicenter of nearly all the bad ideas coming out of Europe for decades.  But, that may be changing rapidly for the better.

The villain always looks unbeatable when the second act closes and yet, more often than not, the heroes eventually prevail.  The French people are ready for something different.  They’ve donned vests and gas masks, picked up live grenades and thrown the crumbs Macron has thrown them back in his smug face.

Now the question is, what comes next?  Because political unrest leads to financial unrest really quickly and the market hasn’t even begun pricing France into Europe’s evolving troubles.

*  *  *

Join my Patreon if you like charting the demise of a dying political culture.

end

 

ECB

The ECB today confirms that it will end asset purchases.  However it will reinvest maturities in full and that will help Italy for a short time.  They will probably do a sell short term bonds and buy long term to also help keep Italian bonds yields low.

(courtesy zerohedge)

ECB Confirms It Will End Asset Purchases, Will Reinvest Maturities In Full

As expected, the ECB – which obviously is keeping its rates unchanged – confirmed it would end its asset purchases in December 2018, while clarifying that it would “continue reinvesting, in full, the principal payments from maturing securities purchased under the APP for an extended period of time past the date when it starts raising the key ECB interest rates.

Also of note, the ECB announced it “expects interest rates to remain at their present levels at least through the summer of 2019” which however the market no longer believes, having priced out a full rate hike in 2019.

In any case look for more clarity in 45 minutes when Draghi speaks.

Full statement below:

At today’s meeting the Governing Council of the European Central Bank (ECB) decided that the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.00%, 0.25% and -0.40% respectively. The Governing Council expects the key ECB interest rates to remain at their present levels at least through the summer of 2019, and in any case for as long as necessary to ensure the continued sustained convergence of inflation to levels that are below, but close to, 2% over the medium term.

Regarding non-standard monetary policy measures, the net purchases under the asset purchase programme (APP) will end in December 2018. At the same time, the Governing Council is enhancing its forward guidance on reinvestment. Accordingly, the Governing Council intends to continue reinvesting, in full, the principal payments from maturing securities purchased under the APP for an extended period of time past the date when it starts raising the key ECB interest rates, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation.

The President of the ECB will comment on the considerations underlying these decisions at a press conference starting at 14:30 CET today.

As usual, much more during the presser at 830am ET when Draghi is expected to cut both the ECB’s inflation and GDP forecasts.

END

Investors were not happy with the key words used by Draghi:  there are  now “downside risks” and GDP and inflation forecasts have been cut….down goes the Euro

(courtesy zerohedge_

 

Euro Slides As Draghi Warns Of “Downside Risks”; Cuts GDP, Inflation Forecasts

As expected, Mario Draghi managed to deliver yet another dovish “end of QE”, because while in less than three weeks the European Central Bank will no longer engage in government bond QE (although it will reinvest maturities for an “unspecified” period of time), the reason the Euro tumbled is that, as previewed overnight by Bloomberg, Draghi not only uttered the magic, for algos, words that the “balance of risks is moving to the downside”, but also cut both the ECB’s GDP and inflation forecasts.

This is the sentence that pushed the Euro lower at first:

Risks surrounding the euro area growth outlook can still be assessed as broadly balanced. However, the balance of risks [to the growth outlook] is moving to the downside owing to the persistence of uncertainties related to geopolitical factors, the threat of protectionism, vulnerabilities in emerging markets and financial market volatility”

… followed promptly by the cut to both 2018 and 2019 GDP and HICP inflation:

GDP forecasts:

  • 2018 at 1.9% (prev. 2.0%),
  • 2019 at 1.7% (Prev. 1.8%),
  • 2020 at 1.7% (Prev 1.7%),
  • 2021 at 1.5%

HICP forecasts:

  • 2018 at 1.8% (prev. 1.7%),
  • 2019 at 1.6% (Prev. 1.7%),
  • 2020 at 1.7% (Prev 1.7%),
  • 2021 at 1.8%

And visually:

On the other hand, the ECB’s inflation forecast has been roughly in range for the past year.

In kneejerk reaction, the EURUSD tumbled 40 pips and was trading at day lows.

GERMANY/MERKEL

seems that the new leader of the CDU is a mirror image of Merkel

(courtesy Tom Luongo)

Meet The New Merkel, Same As The Old Merkel

Authored by Tom Luongo,

So Angela Merkel is out as leader of the Christian Democratic Union (CDU).  In comes Annegret Kramp-Karrenbauer, Merkel’s close allywho won the party’s support with a very narrow victory over more conservative Friedrich Merz.

The goal , as always in Europe, was to maintain the status quo politically. Change needed to change nothing.  Brexit negotiations are all about handing Britons a Brexit that changes as little as possible, for example.

French political elites created Emmanuel Macron out of whole cloth to marginalize Francois Melanchon, a more independent French leftist. The goal was continuity of agenda with Macron the globalist puppet.  But Macron is in serious trouble politically as he revealed himself to be as bad as the departed Francois Hollande.

So far this gambit seems to have worked for Merkel and the CDU as snap polls have the CDU/CSU Union up three points and taking those points from the Greens, who have surged as the face of the dissatisfied Left in Germany.

This surge by both the Greens and Alternative for Germany (AfD) is what prompted this change in the CDU, the major parties are now in a fight for survival as German voters are deeply unhappy with their leadership.

But, this change may also quell some of that discontent (at least for now).  With Merkel exiting the stage on one level, it has blunted the growth of AfD who have positioned themselves as the Anti-Merkel party.  

That’s not a path to long-term success, as I’ve explained in the past.  AfD needs to rebrand itself beyond the anti-Merkel party because, once Merkel’s gone, the reason for their existence goes with her.

And it is clear that AfD is struggling with this mightily.  The polls have them topped out at 17-18% for a while and now backing off to 13-14%.  I never bought the Greens’ move to 15%, it always looked like a protest vote against the Social Democrats (SPD).

Merkel keeps winning these small battles as she disengages herself from the stage in Berlin, outfoxing her competition.  But, with a sovereign debt crisis on the horizon will she be able to weather it or will it finally be too much for her?

 

*  *  *

*  *  *

END

UK

the mess that Gr Britain finds itself today.  May returns to Brussels but she will come back empty handed.  She will lose a vote of no confidence but there is no Conservative willing to take on the job in this quagmire.

(courtesy zerohedge)

‘Weakened’ May Returns To Brussels As Cabinet Pushes For ‘Doomed’ Vote Before Christmas

Theresa May is in power. But she’s not in charge.

That’s essentially the takeaway from last night’s ‘no confidence’ vote, where more than half of the Tory backbenchers who aren’t on the PM’s payroll (i.e. don’t hold formal positions within the government) voted against the PM, narrowing her margin of victory to just 83 votes, which was hardly the overwhelming margin of victory for which the PM had hoped.

And even this number doesn’t accurately reflect the waning enthusiasm for the prime minister; to avoid an even narrower victory, which might have prompted May to resign, May was forced to offer a serious concession on Wednesday: During a speech ahead of the secret ballot, May indicated that she would step down before the next general election (set for 2022), prompting speculation that she could resign as soon as early next year.

May

And while Brexiteers – who have been criticized by some pro-government MPs for their poor timing in orchestrating the vote – are reportedly “hunkering down” for “trench warfare” (suggesting that few will break ranks to back May’s draft deal), according to the Times of London, some former members of May’s government – including former Brexit Secretary Dominic Raab – said during an early Thursday interview that it’s “hard to see” how the PM can continue to lead.

Here’s Reuters:

“We will have to back her as best we can but problem is that both in relation to Brexit and wider sustainability of the government given likelihood of any changes to the deal, given the likely scale of opposition, it looks very difficult to see how this PM can lead us forward,” Raab told reporters.

In another sign that May has been seriously weakened by the vote, the Times reported that several senior cabinet ministers are pushing May to bring back a vote on her deal before Christmas so that it can be voted down, and Parliament could proceed with holding a series of “indicative” votes on every conceivable deal option. This could give May leverage with the EU, while also demonstrating to intransigent MPs that there is sufficient political will to avoid ever triggering the backstop.

Cabinet Brexiteers and Remainers were agreed last night that Mrs May should push ahead with the vote on her Brexit plan before Christmas, both camps expecting her to lose heavily, according to the Times of London (though rumors of this plan first surfaced last month).

Five cabinet ministers – David Gauke, Amber Rudd, David Lidington, Greg Clark and Mr Hammond – want Mrs May to bring back her deal for a vote as early as next week. They then want the Commons to hold a series of “indicative” votes on every conceivable option, from a no-deal Brexit, a Canada-style agreement, a single market and customs union to a second referendum.

“They will all fail,” one cabinet minister said. “At that point we will probably be able to rule out no-deal and Canada.”

Though Commons leader Andrea Leadsome denied reports that a ‘meaningful vote’ will be called before Christmas.

With May heading back to Brussels on Thursday, EU leaders are reportedly digging in their heels, warning that, while they would be willing to agree to some minor “clarifications” and “legal assurances” about the backstop, the deal text – as it stands – must remain unchanged. According to one report, EU leaders are only planning to give May “ten minutes of their time” (after all, there are other burgeoning crises in Europe that are dividing the bloc’s attention).

This should surprise nobody. Because, as one analyst told RT, what incentive does Europe have to fold? After two years of fraught negotiations, May has failed to unify her party. Given that any concessions could still face rejection, the only sensible approach for the EU is “take it or leave it.”

Speaking shortly after the Wednesday vote, May said she is determined to fight for changes to her Brexit deal at an upcoming EU meeting on Thursday.

But it’s unlikely that Brussels won’t soften its stance on that, Szamuely said: “They figured that even if they make more concessions, there’s really no guarantee that she’ll be any more successful in winning the vote for Brexit.”

And even if May lost the confidence vote, finding somebody else to lead the Tories might be difficult. Because, given the quagmire that the party has found itself in, what sane politicians would really want the job?

“What’s really worked for her is that nobody wants that job because it’s one of the worst jobs in the world,”says George Szamuely, Senior Research Fellow of London Metropolitan University.

Unless May can pull off a miracle in Brussels, it’s very likely that May’s deal will eventually be voted down. And after that (as Deutsche Bank analysts noted the other day) the probability of either a second referendum or – worse – a general election triggered by a Labour-led vote of no confidence (there have been several anxiety-provoking reports about a possible DUP alliance with Labour to sabotage the government) will continue to climb.

end

A multi billion hedge fund just reports a record loss (GAM holdings).  It is one of Eurpe’s largest alternative money managers.  It has frozen withdrawals at some of their bond funds after a huge surge in redemptions.

(courtesy zerohedge)

Multi-Billion Hedge Fund Reports Record Loss, Shocking Outflows, Mass Layoffs

Back in August, Swiss multi-billion asset manager, GAM Holdings – one of Europe’s largest alternative money managers – announced it has frozen withdrawals at some of its bond funds after a surge in redemptions from clients who sought to withdraw their money following the suspension of the firm’s star manager Tim Haywood, the latest in a series of setbacks that had sent the company’s shares into a tailspin.

Tim HaywoodThe troubles started in July, when there was market speculation that a market neutral quant fund GAM had purchased recently,  Cantab Capital Partners, was in trouble, and GAM warned of a writedown due to losses at the quant hedge fund. The announcement launched a slide in its shares that only accelerated after the suspension of Haywood, who headed the firm’s second-largest strategy which focused mostly on illiquid investments, and a warning by CEO Alex Friedman that “clients may allocate less money to the firm” because of volatile market conditions.

In retrospect, the CEO’s caution was just a tad optimistic, because between the partial withdrawal freeze, the fund’s ongoing troubles and overall deterioration of the hedge fund industry, on Thursday GAM stock plunged a record 31% when the multi-billion asset manager shocked investors with the forecast of a record loss and news of a mass layoff, while confirming that it was struggling to contain the accelerating outflows prompted by the fund’s ongoing troubles. In total, the stock is down a massive 78% YTD.

GAM said it would post a record loss of 925 million francs ($931 million) for the year compared with a net profit of 123.2 million francs in 2017,after massive outflows forced it to write down the value of its business. As Bloomberg notesthe loss erases eight years of earnings since GAM went public, and is mainly related to a series of goodwill charges at the group and its Cantab quant funds.

Additionally, as it suddenly scrambles to ensure its survival amid dwindling assets and lower fees, the group announced the layoff of 10% of its workers.

While interim CEO David Jacob has been seeking to move beyond the tumult created by the suspension of bond manager Haywood in July and reverse the downward spiral of bad news and client outflows, he has found this next to impossible. Meanwhile, GAM reportedly held informal talks with potential buyers with a view to stabilizing the business, although none emerged and the CEO is now focused on cleaning house.

“Today is about facing our financial reality so that we can move on and build a future for this business,” Jacob said on a conference call. “We are absolutely focused on the structure of this business, looking internally, and making sure this business is positioned for growth in future.”

Furthermore, with its stock having lost much of its value in 2018, GAM also said it will probably suspend its dividend for 2018 to help rebuild capital.

And so, following the suspension of star manager Haywood in July, the risk of staff departures, the possibility of regulatory fines and the ongoing performance challenges which dissuaded any potential buyers, GAM was hit with what Bloomberg called “a perfect storm” of the two worst things that could happen to a hedge fund: even greater losses and soaring client redemptions.

“It is almost unnerving how GAM is once again able to outdo itself with negative reports this year,” said Michael Kunz, an analyst at Zuercher Kantonalbank in Zurich. “There is still no reason to touch this share.”

A main culprit for the latest disappointing performance was hidden in the list of unexpected writedowns in the form of a $62 million charge for a volatile quant hedge fund unit that GAM acquired just two years ago. Cantab Capital Partners, a quant fund which was purchased in 2016, plunged 29% this year through November, wiping out all of last year’s gains, according to investor letters seen by Bloomberg. Another fund is down about 15% in the same time frame.

While Cantab’s writedown is small compared to the loss GAM said it will post for 2018, it is a key business for the firm. Acquired in 2016 as interest in algorithm-driven funds boomed, the unit generated shocking losses as it struggled with market volatility in February and again in recent months. GAM was already forced to take an impairment charge on the unit in the first half according to Bloomberg.

Meanwhile, the shock from Haywood’s suspension has refused to fade amid the firm’s clients, who pulled another 4.2 billion francs in October and November, In total, AUM declined by a further 7 billion francs since the end of September when accounting formarket losses and currency movements, which contributed a further 1.6 billion francs of erosion to the investment management division’s assets. All told, the company expects its performance to deliver just 3 million francs of fees this year, down from 44.1 million francs last year. No wonder its clients continue to head for the exit.

As Bloomberg notes“losing almost 10% of your assets under management in the space of eight weeks isn’t a good look in an industry where scale is increasingly important.” And while that shrinkage makes a cost-cutting program inevitable  – it is safe to say that the 10% layoffs just announced is only the beginning – there’s only so much interim CEO David Jacob can trim without harming the firm’s recovery prospects.

“It’s very difficult to predict flows,” the dejected CEO admitted. “October and November were particularly bad months for the industry in general, with added difficulty for European asset managers.”

Overall, GAM’s assets declined by about $18 billion in the third quarter as Haywood’s funds were liquidated and clients pulled money from other strategies. Additional redemptions came as a result of volatile returns and an investor flight to low-fee products which have squeezed profits both at GAM and elsewhere, forcing many money managers to consolidate.

As Bloomberg concludes, looking at the overnight news that another hedge fund, Geneva-based Philippe Jabre, decided to shut up shop (after his flagship “global balanced fund” plunged more than 40% year-to-date), life isn’t getting any easier for the active fund management crowd. Meanwhile, in the absence of either easier-to-trade markets or a brave suitor, it’s hard to see what can reverse GAM’s decline.

Ironically, Wall Street’s active management crowd – which is rapidly becoming extinct – still thinks that central banks are their best friends. As for who replaces the human traders… Jabre’s parting words said it best:

“Financial markets have significantly evolved over the last decade, driven by new technologies, and the market itself is becoming more difficult to anticipate as traditional participants are imperceptibly replaced by computerized models.”

Unless of course, the computerized model belongs to GAM where it was responsible for a crushing, perhaps terminal, loss.

5.RUSSIAN AND MIDDLE EASTERN

AFFAIRS

RUSSIA/USA

Butina now admits in court to being a Kremlin agent and it sought to influence politics through the NRA.  She has no influence and did not meet Trump or any of their election staff.

(courtesy zerohedge)

Butina Admits To Being Kremlin Agent; Sought To Influence American Politics Through NRA Connections

Russian firearms enthusiast Maria Butina admitted on Wednesday in US District Court in Washington that she conspired with an unnamed American to act at the direction of a Russian official “to establish unofficial lines of communication with Americans having power and influence over U.S. politics…for the benefit of the Russian Federation.”

After initially claiming innocence after her July arrest, the 30-year-old Butina accepted a deal with prosecutors and flipped her plea to guilty – agreeing to work with authorities who accused her of gathering intelligence on American officials as well as conservative political organizations. She has been in jail without bail since her arrest.

The American Butina worked with has been identified as Paul Erickson, a longtime GOP operative based in South Dakota with strong ties to the National Rifle Association and the Russian gun rights community. Erickson, who was in a romantic relationship with Butina, allegedly attempted to establish a backchannel between the NRA and Russian Government – while also reaching out to Trump campaign members Rick Dearborn and then-Senator Jeff Sessions in a 2016 email with the subject “Kremlin connection.” The email sought a meeting between then-candidate Donald Trump and Russian President Vladimir Putin at an annual NRA convention.

The Trump campaign declined the invitation, however Butina allegedly worked with Erickson to try and arrange a meeting between Trump and her boss, former Russian central banker Alexander Torshin – who is believed to be her handler.

Butina, a former graduate student at American University, became a fixture in conservative circles in recent years and a constant presence at functions organized by the NRA, a group closely aligned with Republicans lawmakers and President Trump.

The charges against Butina were brought by federal prosecutors in Washington, and her case was unrelated to special counsel Robert Mueller’s investigation into Russian interference in the 2016 election.

However, the Siberian native, who twice met with a Trump campaign aide and has been photographed with Donald Trump Jr., has reportedly agreed to cooperate with Mueller’s team of investigators. –NY Daily News

Following Butina’s arrest, the Russian embassy complained that Butina was being subjected to unwarranted strip searches and denial of proper medical care in an effort to “break her will.” Her defense attorney, Robert Driscoll, claims she has suffered health problems in jail and has been denied proper treatment.

end
This will hurt Trump as the Senate votes to end support for the Saudi war in Yemen
(courtesy zerohedge)

In Stinging Rebuke To Trump, Senate Votes To End Support For Saudi War

The US Senate approved a resolution to end U.S. support for the Saudi-led war in Yemen, dealing a stinging rebuke to President Trump amid heightened tensions over the death of U.S.-based Saudi journalist Jamal Khashoggi. Senators voted 56-41 on the resolution, which would require the president to withdraw any troops in or “affecting” Yemen within 30 days unless they are fighting al Qaeda; in doing so the Senate defied a veto threat from the White House which has vowed it would block the legislation.

However, beyond sending a symbolic message, the vote is largely moot as on Wednesday, as part of the Farm Bill passage, the House voted to block members from forcing a war powers vote this year. Still, the Senate vote Thursday underscored the depth of frustration with Saudi Arabia on Capitol Hill, as well as the escalating gap between the White House and Congress on the relationship between the U.S. and the kingdom.

Senators said passage sends a strong message to the Saudi crown prince because it targets his most important foreign policy priority. And just to make sure the Senate was heard loud and clear, the Senate also passed a measure which said that the Saudi Crown Prince was behind Khashoggi’s death.

“I hope … we send a loud and powerful message by passing this resolution. That we’re going to bring peace to that country and that the United States Congress is going to reassert its constitutional authority to make the body that makes war not the president,” Sen. Bernie Sanders (I-Vt.), one of the sponsors of the resolution, told reporters.

“A strong denouncing of a crown prince and holding them responsible for the murder of a journalist. It’s a pretty strong statement for the United States Senate to be making, assuming we can get a vote on it,” Senator Bob Corker told reporters this week.

It’s a dramatic U-turn from less than nine months ago when the chamber pigeonholed the exact same resolution, refusing to vote it out of committee and onto full Senate. At the time, 10 Democrats joined 45 Republicans in opposing it.

The resolution’s passage comes less than a day after Trump maintained that he would stand by the Saudi government and specifically Crown Prince Mohammed Bin Salman, whom U.S. intelligence officials reportedly believe ordered Khashoggi’s killing inside the Saudi consulate in Istanbul in early October.

Trump told Reuters on Tuesday that Riyadh has been “a very good ally” and “at this moment” sticking with Saudi Arabia means standing by the crown prince.

The Trump administration had led a lobbying effort to try to squash the Senate resolution. In addition to a veto threat, they sent Defense Secretary James Mattis and Secretary of State Mike Pompeo to brief senators and privately urge them to oppose the resolution.

Foreign Relations Committee Chairman Bob Corker (R-Tenn.) said Wednesday that he couldn’t support the resolution but “I know that Lee-Sanders has the votes.”

According to The Hill, Majority Leader Mitch McConnell (R-Ky.) urged opposition to the measure hours ahead of the vote, while acknowledging members have “legitimate concerns” about Yemen and share “grave concerns” about Khashoggi’s death. “[But] we also want to preserve the 70-year partnership between the United States and Saudi Arabia and we want to ensure it continues to serve American interests and stabilizes a dangerous and critical region,” McConnell said.

The House is expected to get the same briefing on Thursday.

6. GLOBAL ISSUES

CANADA

 

end

 

7  OIL ISSUES

 

8. EMERGING MARKETS

Venezuela

Socialism at its finest:

The big Goodyear plant has decided to shutter its sole remaining plant and then as a Christmas bonus it is giving tires out as severance

(courtesy zerohedge)

Goodyear Shutters Venezuela Plant, Gives Out Tires As Severance

Venezuela’s economic depression has claimed yet another victim, as Goodyear Tire announced it would shutter its Venezuela operations and lay off its entire local workforce, the latest foreign corporation to close shop in the crisis-torn county. On Monday, employees arrived at the company’s lone plant in the industrial city of Valencia to find it closed with a letter posted on the door. “Goodyear Venezuela has been forced to cease operations,” according to a copy seen by Bloomberg.

The departure of foreign companies from Venezuela is hardly surprising: in fact, it is remarkable that Goodyear manages to last as long as it did. What was more notable was how the company said goodbye to its employees one last time.  According to Eduar Bremo, a member of Goodyear’s factory-workers union, the company is not only paying (token) severance packages to its more than 1,200 employees but is also giving each 10 tires, which have become hugely valuable in the shortage-wracked socialist paradise. According to Bremo, the plant produced some 1,000 tires a day, but a lack of materials and soaring costs forced it to shut its doors.

Years of economic depression and a hostile government have forced companies such as Kellogg and Kimberly-Clark to abandon Venezuela as hyperinflation rendered most of their business conducted in local currency unsustainable.

Other companies have slashed their work forces and limited their product offerings as they hold out for better days. Last week, Ford Motor began offering its employees buyouts as it further scaled back its remaining Venezuela operations. It was unclear if Ford would give out cars as a parting gift to its local employees.

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

Euro/USA 1.1377 UP .0005 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 ALL MIXED

 

 

 

 

 

USA/JAPAN YEN 113.44  UP 0.040 (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 1.2664 UP   0.0040  (Brexit March 29/ 2017/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED

USA/CAN 1.3363  UP .0014 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 THURSDAY morning in Europe, the Euro ROSE by 5 basis point, trading now ABOVE the important 1.08 level RISING to 1.1377/ Last night Shanghai composite CLOSED UP 31.90 POINTS OR 1.23%

 

//Hang Sang CLOSED UP 337.69 POINTS OR 1.29%

 

/AUSTRALIA CLOSED UP  0.14% /EUROPEAN BOURSES MIXED 

 

 

 

 

 

The NIKKEI: this THURSDAY morning CLOSED  UP 213.44 POINTS OR 0.99%

 

 

 

Trading from Europe and Asia

1/EUROPE OPENED MIXED 

 

 

 

 

 

 

 

 

 

 

2/ CHINESE BOURSES / :Hang Sang CLOSED UP 337.64 POINTS OR 1.29% 

 

 

/SHANGHAI CLOSED UP 31.90  POINTS OR 1.23%

 

 

 

Australia BOURSE CLOSED UP  .14%

Nikkei (Japan) CLOSED UP 213.44 POINTS OR 0.99%

 

 

 

INDIA’S SENSEX  IN THE GREEN

Gold very early morning trading: 1243.00

silver:$14.72

Early THURSDAY morning USA 10 year bond yield: 2.90% !!! DOWN 1 IN POINTS from WEDNESDAY’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 3.14 DOWN 0  IN BASIS POINTS from WEDNESDAY night. (POLICY FED ERROR)/

USA dollar index early THURSDAY morning: 96.99 DOWN 6  CENT(S) from  WEDNESDAY’s close.

This ends early morning numbers THURSDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

And now your closing THURSDAY NUMBERS \1: 00 PM

 

Portuguese 10 year bond yield: 1.68% DOWN 4    in basis point(s) yield from WEDNESDAY/

JAPANESE BOND YIELD: +.06%  UP 0  BASIS POINTS from WEDNESDAY/JAPAN losing control of its yield curve/EXTREMELY VOLATILE YESTERDAY…

 

SPANISH 10 YR BOND YIELD: 1.42% DOWN 1  IN basis point yield from WEDNESDAY

ITALIAN 10 YR BOND YIELD: 2.96 DOWN 4     POINTS in basis point yield from WEDNESDAY/

 

 

the Italian 10 yr bond yield is trading 153 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: RISES UP TO +.28%   IN BASIS POINTS ON THE DAY//

THE IMPORTANT SPREAD BETWEEN ITALIAN 10 YR BOND AND GERMAN 10 YEAR BOND IS 2.65% AND NOW ABOVE THE  THE 3.00% LEVEL WHICH WILL IMPLODE THE ENTIRE ITALIAN BANKING SYSTEM. AT 4% SPREAD THERE WILL BE A MASSIVE BANK RUN…

 

END

IMPORTANT CURRENCY CLOSES FOR THURSDAY

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

Euro/USA 1.1366 DOWN  .0006 or 6 basis points

 

 

USA/Japan: 113.59 UP  0 .307 OR 31 basis points/

Great Britain/USA 1.2652 UP .0029( POUND UP 29  BASIS POINTS)

Canadian dollar UP 4 basis points to 1.3346

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

The USA/Yuan,CNY closed DOWN AT 6.8816-  ON SHORE  (YUAN UP)

THE USA/YUAN OFFSHORE:  6.8776(  YUAN DOWN)

TURKISH LIRA:  5.3357

the 10 yr Japanese bond yield closed at +.06%

 

 

 

Your closing 10 yr USA bond yield UP 1 IN basis points from WEDNESDAY at 2.91 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 3.16 UP 2 in basis points on the day /

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

Your closing USA dollar index, 97.05 DOWN 12 CENT(S) ON THE DAY/1.00 PM/

 

Your closing bourses for Europe and the Dow along with the USA dollar index closing and interest rates for THURSDAY: 4:00 PM 

London: CLOSED DOWN 2.69 POINTS OR 0.04%

German Dax : CLOSED DOWN 4.73 POINTS  OR 0.04%
Paris Cac CLOSED DOWN 12.53 POINTS OR 0.26%
Spain IBEX CLOSED UP 72.90 POINTS OR 0.82%

Italian MIB: CLOSED UP: 103.03 POINTS OR 0.54%/

 

 

WTI Oil price; 51.93 1:00 pm;

Brent Oil: 60.74 1:00 EST

USA /RUSSIAN /   ROUBLE CROSS:    66.32  THE CROSS LOWER BY .12 ROUBLES/DOLLAR (ROUBLE HIGHER BY 12 BASIS PTS)

USA DOLLAR VS TURKISH LIRA:  5.3375 PER ONE USA DOLLAR.

TODAY THE GERMAN YIELD RISES +.28 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 :53.13

 

BRENT:61/84

USA 10 YR BOND YIELD: 2.91%..

 

 

USA 30 YR BOND YIELD: 3.17%/.

 

 

 

EURO/USA DOLLAR CROSS: 1.1363 ( DOWN 10 BASIS POINTS)

USA/JAPANESE YEN:113.58 UP 0.291 (YEN DOWN 29 BASIS POINTS/ .

 

USA DOLLAR INDEX: 97.06 UP 2 cent(s)/

The British pound at 5 pm: Great Britain Pound/USA: 1.2661 UP 37 POINTS FROM YESTERDAY

the Turkish lira close: 5.3363

the Russian rouble:  66.22 UP .22 Roubles against the uSA dollar.( UP 22 BASIS POINTS)

 

Canadian dollar: 1.3353 DOWN 3 BASIS pts

USA/CHINESE YUAN (CNY) : 6.8816  (ONSHORE)

USA/CHINESE YUAN(CNH):  6.8776 (OFFSHORE)

German 10 yr bond yield at 5 pm: ,0.28%

 

The Dow closed  UP 70.11 POINTS OR 0.29%

 

NASDAQ closed DOWN 27,98 POINTS OR 0.29%

 


VOLATILITY INDEX:  20.60 CLOSED DOWN 0.86 

 

LIBOR 3 MONTH DURATION: 2.777%  .LIBOR  RATES ARE RISING/

 

 

 

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

TRADING IN GRAPH FORM FOR THE DAY/WEEKLY SUMMARY/FOLLOWED BY TODAY

 

Draghi Dud But Banks Break, Trannies Tumble, & Cryptos Crash

BTFD has transformed into STFR – maybe it’s better not to play…

 

..

 

China was well bid overnight (extraordinarily so)…but faded in the afternoon session…

 

European stocks gapped up at the open but faded

“Constructive” was the word of the day in Europe as everyone read from the same script on Italy…

 

US futures rallied into the European Open and rallied into the US Open, but were dumped after each…

Trannies tanked on the day (see Airlines below), but all major indices gave up early gains as Secretary Ross warned that China’s current actions are not enough… By the close The Dow managed to get back green and S&P unchanged…

Short interest on SPY, the world’s largest exchange-traded fund with more than $250 billion in assets, has jumped to 5.3 percent or shares outstanding, according to data compiled by Markit.

This is the 5th “sell the f**king rip” day in a row…

Airline stocks crashed after Delta’s 2019 profit view missed analysts’ estimates, prompting concerns about weakening pricing power

 

Bank stocks resumed their downtrend after a brief respite yesterday…

 

GE soared pre-market as JPMorgan’s analyst took his foot off its throat…but faded from the open…

 

FANG stocks sold off…

 

Treasuries were mixed today with the long-end underperforming and the belly and short-end bid (but all very modestly)…

 

10Y Yields bounced off the 2.80% support once again…

 

The Bill curve is getting more perturbed through the potential shutdown date as liquidity preferences have bid the shortest-dated bills…

 

 

The Dollar managed gains on the day retracing yesterday’s losses…

 

Draghi is losing his touch as EUR ended the day unchanged…

 

Yuan faded after China closed…

 

Cable held on to yesterday’s May confidence vote gains…

 

Cryptos crashed late in the day amid headlines of a Bitcoin Bomb-Scare scam…

 

Crude soared back to the early week high, copper, gold and silver lagged…

 

WTI was well bid after Saudi export cut headlines…WTI tagged $53 high stops

 

Gold in Yuan also fell into the red on the week…

 

Finally, we note that The Fed is back in the position of being more hawkish than The ECB… just barely…

 

END

market trading

 

market data/

The following is a very important data point:  USA import and export prices plunge with fuel prices one of the culprits.  However there is no question that China is sending deflation our way

(courtesy zerohedge)

US Import, Export Prices Plunge In November As Fuel Prices Plummet

After re-accelerating in October, US Import and Export price growth slowed dramatically in November to the lowest since Nov 2016 and July 2017 respectively…

Import prices fell 1.6% MoM (well below expectations of a 1.0% decline) slamming the YoY growth to just +0.7%.

Export prices also fell, down 0.9% MoM (well below the -0.3% expectation) pushing the YoY gains to just +1.8%.

Under the hood:

  • Import prices ex-petroleum fell 0.3% after rising 0.2% in Oct.
  • Import prices ex-food and fuel rose 0.4% y/y in Nov.
  • Import fuel prices fell 11%, most since Jan. 2016, after a 3.2% increase in Oct.
  • Industrial supplies prices fell 5.3% after rising 1.4% in Oct.
  • Auto prices unchanged after no change in Oct.
  • Consumer goods prices unchanged after falling 0.3% in Oct.

As China’s import price index slumps, exporting the most deflation since 2007…

Dear Jay Powell, still want to hike rates next week?

USA ECONOMIC STORIES OF INTEREST

3 Trump tweet storm:

a)Trump distances himself from Cohen

b) threatens GM again

c) hopes the Fed will not hike interest rates any more:

(zerohedge)

Trump Distances From Cohen, Threatens GM, “Hopes” Fed Won’t Hike Any More

In his latest wide-ranging interview President Trump on Thursday lashed out at three adversaries du jour, starting with his former attorney Michael Cohen was Trump claimed a “low-level” employee who did limited legal work as he sought to distance himself from his longtime associate.

“He did very low-level work,” Trump said in an interview with Fox News. “He did more public relations than he did law. You would see him on television and he was OK on television.”

Embedded video

John Whitehouse@existentialfish

Trump on Michael Cohen: “It happens” .also says Cohen did “very low level work … more public relations than he did law”

The comments appeared to undercut Trump’s claim made hours earlier that Cohen who yesterday was sentenced to three years in prison, “was a lawyer” and as a result “has great liability” for campaign finance law violations, according to The Hill.

Asked why he hired Cohen in the first place, Trump pointed to a favor from “years ago” when Cohen was on a condominium committee that oversaw the approval of Trump World Tower in Manhattan. “I thought he was a great guy. I thought he was really a nice guy,” Trump said. “He was really supportive, and I liked him, and he was a lawyer, and because of that I did it. And you know what, in retrospect, I made a mistake.”

Separately, in the same interview Trump once again criticized General Motors’ plan to cut jobs and said the automaker won’t be “treated well.”

“I think she’s making a big mistake,” Trump said of GM CEO Mary Barra, adding “I don’t like what she did, it was nasty. It doesn’t really matter because Ohio is under my leadership from a national standpoint. Ohio is going to replace those jobs in like two minutes.”

The largest U.S. automaker’s recent decision to cut up to 14,000 jobs that span three states has brought the company controversy with lawmakers from the region and drawn the president’s ire.

“To tell me a couple of weeks before Christmas that she’s going to close in Ohio and Michigan, not acceptable to me,” Trump told Fox News. “General Motors is not going to be treated well.”

Turmp then took aim at GM’s plan to focus on electric cars, predicting that “all electric is not going to work.”

Trump then said he would seek further reductions in the tariff China charges on U.S.-made automobiles. “It’s not acceptable, 15 is still too high.”

* * *

Finally, Trump took aim at his adversary in the Marriner Eccles building, saying that “he hopes the Fed won’t be raising rates anymore.”

Trump explained that according to him the U.S. is almost at a “normalized interest rate, and yet” the economy is “soaring”, which of course is confusing considering the same “soaring” economy can’t handle rates above 2.25%.

It was Trump’s latest criticism of the central bank’s policy, which came in just one week before the next Fed meeting. According to consensus the Fed is likely to raise its benchmark interest rate by a quarter-point to a range between 2.25% and 2.5% at the end of their meeting on Dec. 19, while the Fed has telegraphed it will keep rising rates at least three more times in 2019 although the market has now largely priced out any more Fed hikes next year.

end

US Reports Biggest Ever Budget Deficit For November

Nov. hit the biggest recorded deficit in its history at 205 billion dollars.  For two months:  305 billion dollars and well on its way to a 1 trillion dollar deficit for 2018

(courtesy zerohedge)

Two months after the US Treasury reported the widest annual deficit in six years for fiscal 2018, moments ago the US posted the biggest November budget deficit on record as total government spending came in twice as much as revenue.

November outlays surged 18.4% to $411 billion last month from $347 billion a year ago, while receipts actually declined 1% to $206 billion from $208 billion in 2017, the Treasury Department said in a monthly report on Thursday. The biggest spending categories were Social Security ($84BN), Medicare ($77BN), National Defense ($62BN), Income security ($46BN) and Health ($42BN). Net interest on the US debt of nearly $22 trillion came in at a hefty $33BN. Meanwhile, Individual Income Taxes and Social Security Taxes both generated $93BN in income each.

The result was a November deficit of $205 billion, a 48% increase from the $139 billion shortfall a year earlier, and the biggest November deficit on record.

For the first two months of the fiscal year which began Oct. 1, the deficit widened to $305.4 billion, up 50% compared with $201.8 billion the same period a year earlier.

On a LTM basis, the US deficit has more than doubled from the $405BN it hit in February 2016 to $883BN as of the 12 months ended November. It was the second highest LTM number since early 2013.

In Fiscal 2018, the first full year of Donald Trump’s presidency in which he enacted a tax-cut package and enacted a $1+ trillion stimulus, the U.S. ran the largest deficit in six years. The various spending programs and tax cuts have added to the growing federal deficit, which is expected to hit $1 trillion some time in fiscal 2019, one year sooner than disclosed in the CBO’s most recent forecast ; in April the agency didn’t expect the deficit to reach $1 trillion until 2020.

Then again, over the long run none of this matters…

SWAMP STORIES

Trump claims that he never directed Michael Cohen to break the law.  He correctly states that Cohen is a lawyer and he ought to know the law. Trump also sstates that Cohen pled guilty to finance issues which were not criminal but used by Mueller to embarrass Trump

(courtesy zerohedge)

Criminal Probe Launched Into Trump Inauguration Spending, Donor Pay-To-Play Claims

After denying Michael Cohen’s claims in a tweetstorm today, and being told my Nancy Pelosi that Dems have started the process of trying to get his tax returns, it appears President Trump has yet more legal issues as The Wall Street Journal reports that federal prosecutors in Manhattan are investigating whether his 2017 inaugural committee misspent some of the record $107 million it raised from donations.

The committee raised more than double what former President Barack Obama’s first inaugural fund reported raising in 2009, the previous record.

The inaugural committee has publicly identified vendors accounting for $61 million of the $103 million it spent, and it hasn’t provided details on those expenses, according to tax filings. As a nonprofit organization, the fund is only required to make public its top five vendors.

According to the ubiquitous ‘people familiar with the matter’, WSJ reports that the criminal probe by the Manhattan U.S. attorney’s office, which is in its early stages, also is examining whether some of the committee’s top donors gave money in exchange for access to the incoming Trump administration, policy concessions or to influence official administration positions, some of the people said.

President Trump’s funds came largely from wealthy donors and corporations who gave $1 million or more – including casino billionaire Sheldon Adelson, AT&T and Boeing, according to Federal Election Commission filings. There is no sign that those three donors are under investigation.

All of which sounds like a deep state reach into possible Trump-Saudi connections (now that the Russia collusion narrative has collapsed).

The criminal probe reportedly arose from materials seized in Michael Cohen’s business dealings, after raids of his home, office, and hotel room which included a recorded conversation between Mr. Cohen and Stephanie Winston Wolkoff, a former adviser to Melania Trump, who worked on the inaugural events. In the recording, Ms. Wolkoff expressed concern about how the inaugural committee was spending money, according to a person familiar with the Cohen investigation.

The same ‘people familiar’ also note that prosecutors have asked Richard Gates, a former campaign aide who served as the inaugural committee’s deputy chairman, about the fund’s spending and its donors, and in recent months asked Tennessee developer Franklin L. Haney for documents related to a $1 million donation he made to Mr. Trump’s inaugural committee in December 2016.

The committee was headed by Thomas Barrack Jr., a real-estate developer and longtime friend of Mr. Trump. There is no sign the investigation is targeting Mr. Barrack, and he hasn’t been approached by investigators but WSJ reports that Mr. Barrack has said that an external audit was completed of the inaugural committee’s finances, but the organization has declined to make that audit available.

The White House didn’t respond to requests for comment on the investigation. A lawyer for Mr. Cohen didn’t respond to requests for comment, but the inaugural committee confirmed that it hasn’t been asked for records or been contacted by prosecutors, according to a lawyer close to the matter, who said:

“We are not aware of any evidence the investigation the Journal is reporting actually exists.”

So while this all sounds like yet another legally questionable aspect of the Trump administration, as is clear by the sparcity of The Wall Street Journal’s reporting, there is little – if anything – here so far and it once again appears more fishing expedition in search of a crime. And obviously, it builds on the public perception of corruption which we are sure Mueller’s report will strongly hint at – although being completely unable to prosecute t

SWAMP STORIES/MAJOR STORIES//THE KING REPORT
AND SPECIAL THANKS TO CHRIS POWELL OF GATA FOR SENDING THIS TO US:
Total Setup? FBI Told Michael Flynn to Ditch Lawyer during Interview With Strzok
McCabe, by his own account, urged Flynn to talk to the agents alone, without a lawyer present. “I explained that I thought the quickest way to get this done was to have a conversation between [Flynn] and the agents only,” McCabe wrote. “I further stated that if LTG Flynn wished to include anyone else in the meeting, like the White House counsel for instance, that I would need to involve the Department of Justice. [Flynn] stated that this would not be necessary and agreed to meet with the agents without any additional participants.”… Footnotes in the Flynn memo say the 302 report cited was dated Aug. 22, 2017 — nearly seven months after the Flynn interview. It is not clear why the report would be written so long after the interview itself.
 
@ChuckRossDC: Strzok interviewed Cheryl Mills and Huma Abedin when they both denied knowing about Hillary Clinton’s server until after leaving State Department. But emails show both discussed the server. Difference w/ Flynn is they both had teams of lawyers present.
 
Comey admitted that he sandbagged Flynn and the WH by avoiding the WJ counsel’s office during the WH transition.
 
James and the Giant Impeachment
Comey then dropped this bombshell: He admitted that he bypassed normal White House protocol when he sent two FBI agents to interrogate Flynn. “[It’s] something I probably wouldn’t have done or wouldn’t have gotten away with in a more organized administration,” Comey said. “In the George W. Bush Administration or the Obama Administration . . . if the FBI wanted to send agents into the White House itself to interview a senior official, you would work through the White House counsel, there would be discussions and approvals and who would be there. And I thought, it’s early enough let’s just send a couple guys over.” The audience laughed [Sickening that people think police state tactics are amusing!]
 
Comey can remember tons when in front of an anti-Trump audience; but last week he went Sgt. Schultz in front of a Congressional Committee.  He will return on December 17 for more interrogation. 
 
@seanmdav: On January 24, 2017, FBI agents Peter Strzok and Joe Pientka interviewed Flynn.
On August 2, 2017, Rosenstein issued new instructions to Mueller.
On August 16, 2017, ABC News reported Peter Strzok had been fired by Mueller.
On August 22, 2017, the FBI 302 on Flynn was written.
 
@TomFitton: Curious.  The Rosenstein memo detailing Mueller’s authority was issued August 2, 2017, also months after the fact.  Papering the record to get @RealDonaldTrump?
 
WSJ Editorial Board: The Flynn Entrapment
A court filing shows the ugly tactics employed by James Comey’s FBI.
 
The details of the malicious prosecution of Flynn induced his sentencing judge, Emmet Sullivan, to demand all FBI 302s and memos on Flynn’s interview.  Legal eagles warn that Sullivan could toss Flynn’s conviction if the FBI documentation is questionable – or worse.
 
Christopher Steele disclosed information from his infamous dossier to Strobe Talbott, a longtime Clinton insider and former State Department official… [Per court filing]
    Talbott’s link to the dossier has not been previously reported. His brother-in-law, another Clinton insider, compiled an anti-Trump dossier of his own during the campaign…
 
@julie_kelly2: Senate staffer [Wolfe] who hooked up with a journo 30 years younger, fed her classified info to smear Carter Page, then LIED about it to the FBI gets defended by 3 US Senators but they want Flynn in jail? Where’s the equal media coverage of this story? What Wolfe did was much worse.
 
@ByronYork: Incoming NY state attorney general promises to ‘use every area of the law to investigate President Trump and his business transactions and that of his family,’ as well as ‘anyone’ in Trump circle. From NBChttp://ow.ly/rmLm30mXFQu   No  surprise; AG race was get-Trump contest.
 
@Barnes_Law: Imagine if an AG had said this about Obama?
 
National Enquirer Parent Co Reaches Non-Prosecution Deal for Non-Crime with SDNY in Deep State Effort to ‘Get Trump’ –  The New York Prosecutors also revealed that they reached a non-prosecution agreement (for a non-crime) with the National Enquirer’s parent company AMI over Trump’s hush payment to Playboy bunny Karen McDougal…   https://www.thegatewaypundit.com/2018/12/national-enquirer-parent-co-reaches-non-prosecution-deal-for-non-crime-with-sdny-in-deep-state-effort-to-get-trump/
 
Flashback: Obama Offered $150,000 Bribe to Silence Crackpot Preacher Jeremiah Wright – No Charges Were Filed    https://www.thegatewaypundit.com/2018/12/flashback-obama-offered-150000-bribe-to-silence-crackpot-preacher-jeremiah-wright-no-charges-were-filed/
 
California Dem [Rep. Ted Lieu] Admits “I’d Love to Regulate the Content of Speech”
 
Police-state tactics are escalating in the USA.  The fact that few people care and many people, due to political orientation, advocate for such egregious abuses is a sign that the US has devolved into a banana republic or worse.  PS – The silence from the GOP Establishment is very telling and appalling.

 

-END-

I WILL YOU ON FRIDAY
H
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