JAN 22/GOLD UP 85 CENTS STO $1284.10/SILVER IS DOWN 5 CENTS TO $15.33: THE CROOKS ARE DESPERATE TO HOLD THE PRECIOUS METALS AT THESE PRICES/ THE BIG NEWS: CHINA AND USA CALL OFF TRADE TALKS/ANOTHER BIG NEWS: THE USA IS READY TO GIVE A DEATH SENTENCE TO HUAWEI AND ZTE/10TH STRAIGHT WEEKEND OF VIOLENCE IN FRANCE–SPREADS TO BELGIUM AS WELL//RIOTS IN GREECE ON THE RENAMING OF MACEDONIA TO NORTHERN REPUBLIC OF MACEDONIA/ISRAEL RAIDS IRANIAN WEAPONS DEPOT IN SYRIA SUNDAY NIGHT/

 

 

 

GOLD: $1284.10 UP $0.85 (COMEX TO COMEX CLOSINGS)

Silver:   $15.33 DOWN 5 CENTS (COMEX TO COMEX CLOSING)

Closing access prices:

Gold :  1285.10

 

silver: $15.33

 

 

 

 

 

 

 

 

For comex gold and silver:

JANUARY

 

 

 

NUMBER OF NOTICES FILED TODAY FOR  JAN CONTRACT: 2 NOTICE(S) FOR 200 OZ (0.006 tonnes)

TOTAL NUMBER OF NOTICES FILED SO FAR:  544 NOTICES FOR 54400 OZ  (1.6922 TONNES)

 

 

SILVER

 

FOR JANUARY

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

 

13 NOTICE(S) FILED TODAY FOR 65,000  OZ/

 

total number of notices filed so far this month: 804 for 4,020,000

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Bitcoin: OPENING MORNING TRADE $3589: UP 14

 

Bitcoin: FINAL EVENING TRADE: $3576 UP   $1 

 

end

 

XXXX

JPMorgan or Goldman Sachs are taking a huge issuance (stopping) of gold at the comex.

today 2/2

EXCHANGE: COMEX
CONTRACT: JANUARY 2019 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,281.300000000 USD
INTENT DATE: 01/18/2019 DELIVERY DATE: 01/23/2019
FIRM ORG FIRM NAME ISSUED STOPPED
____________________________________________________________________________________________
661 C JP MORGAN 2
905 C ADM 2
____________________________________________________________________________________________

TOTAL: 2 2
MONTH TO DATE: 544

 

 

 

Let us have a look at the data for today

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

In silver, the total OPEN INTEREST FELL BY A CONSIDERABLE SIZED 2527 CONTRACTS FROM 193,226 DOWN TO 190,699 WITH FRIDAY’S 13 CENT LOSS  IN SILVER PRICING AT THE COMEX. TODAY WE ARRIVED SLIGHTLY CLOSER TO  AUGUST’S  RECORD SETTING OPEN INTEREST OF 244,196 CONTRACTS.

WE HAVE ALSO WITNESSED A LARGE AMOUNT OF PHYSICAL METAL STAND FOR COMEX DELIVERY AS WE NOW HAVE JUST LESS THAN 22 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 TINY SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP:

488 EFP’S FOR MARCH,  0 FOR APRIL AND ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE: OF 488 CONTRACTS. WITH THE TRANSFER OF 488 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 488 EFP CONTRACTS TRANSLATES INTO 2.44 MILLION OZ  ACCOMPANYING:

1.THE 13 CENT FALL 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

 21.925 MILLION OZ FINALLY STAND FOR DECEMBER.

AND NOW: INITIALLY 5.725 MILLION OZ STAND IN JANUARY.

 

 

ACCUMULATION FOR EFP’S/SILVER/J.P.MORGAN’S HOUSE OF BRIBES, / STARTING FROM FIRST DAY NOTICE/FOR MONTH OF JANUARY: 30,677 CONTRACTS (FOR 14 TRADING DAYS TOTAL 30,677 CONTRACTS) OR 153.385 MILLION OZ: (AVERAGE PER DAY: 2191 CONTRACTS OR 10.956 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH OF JAN:  153.385 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 21.90% 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 2019 TO DATE SILVER EFP’S:           153.385    MILLION OZ.

 

 

 

RESULT: WE HAD A CONSIDERABLE SIZED DECREASE IN COMEX OI SILVER COMEX CONTRACTS OF 2527 WITH THE 13 CENT FALL IN SILVER PRICING AT THE COMEX //YESTERDAY..THE CME NOTIFIED US THAT WE HAD A TINY SIZED EFP ISSUANCE OF 488 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 LOST A GOOD SIZED: 2039 TOTAL OI CONTRACTS ON THE TWO EXCHANGES:

i.e 488 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH DECREASE OF 2527 OI COMEX CONTRACTS. AND ALL OF THIS  DEMAND HAPPENED WITH A 13 CENT FALL IN PRICE OF SILVER  AND A CLOSING PRICE OF $15.38 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. .896 BILLION OZ TO BE EXACT or 128% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT JANUARY MONTH/ THEY FILED AT THE COMEX: 13 NOTICE(S) FOR 65,000 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./ DEC. AT 21.925 MILLION OZ  AND NOW JANUARY AT  5.725 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 FELL BY A CONSIDERABLE SIZED 1699 CONTRACTS DOWN TO 508,398 DESPITE THE LOSS IN THE COMEX GOLD PRICE/(A FALL IN PRICE OF $9.65//FRIDAY’S TRADING)

 

THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A STRONG  SIZED 8815 CONTRACTS:

 

FEBRUARY HAD AN ISSUANCE OF 8815 CONTACTS  AND ALL OTHER MONTHS ZERO.  The NEW COMEX OI for the gold complex rests at 508,398. 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 STRONG SIZED GAIN IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 7116 CONTRACTS:1699 OI CONTRACTS DECREASED AT THE COMEX AND 8815 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI GAIN: 7166 CONTRACTS OR 723,800 OZ = 22.13 TONNES. AND ALL OF THIS STRONG DEMAND OCCURRED WITH A FALL IN THE PRICE OF GOLD/ FRIDAY TO THE TUNE OF $9.65???

 

 

 

 

 

YESTERDAY, WE HAD 3423 EFP’S ISSUED.

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF JANUARY : 110,444 CONTRACTS OR 11,044,400 OZ  OR 343.51 TONNES (14 TRADING DAYS AND THUS AVERAGING: 7888 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 14 TRADING DAYS IN  TONNES: 343.51 TONNES

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

THUS EFP TRANSFERS REPRESENTS 343.51/2550 x 100% TONNES = 13.47% OF GLOBAL ANNUAL PRODUCTION SO FAR IN DECEMBER ALONE.***

ACCUMULATION OF GOLD EFP’S YEAR 2019 TO DATE:     343.51  TONNES

 

 

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

Result: A CONSIDERABLE SIZED DECREASE IN OI AT THE COMEX OF 1699 WITH THE LOSS IN PRICING ($9,65) THAT GOLD UNDERTOOK FRIDAY) //.WE ALSO HAD A STRONG SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 8815 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 8815 EFP CONTRACTS ISSUED, WE HAD ANOTHER GOOD GAIN OF 7238 CONTRACTS IN TOTAL OPEN INTEREST  ON THE TWO EXCHANGES:

8815 CONTRACTS MOVE TO LONDON AND 1699 CONTRACTS DECREASED AT THE COMEX. (IN TONNES, THE GAIN IN TOTAL OI EQUATES TO 22.13 TONNES). ..AND ALL OF THIS  DEMAND OCCURRED WITH THE LOSS OF $9.65 IN YESTERDAY’S TRADING AT THE COMEX??????????.  THIS IS THE 6TH STRAIGHT DAY THAT WE RECORDED STRONG RISES IN OI ON BOTH EXCHANGES!

 

 

we had: notice(s) filed upon for 200 oz of gold at the comex.

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD...

 

WITH GOLD UP $0.85 TODAY 

 

A HUGE CHANGE IN GOLD INVENTORY AT THE GLD

 

A MASSIVE DEPOSIT OF 12.06 TONNES INTO THE GLD

WITH NO REAL PHYSICAL GOLD AROUND??

NOTHING BUT A PAPER ENTRY…

 

 

/GLD INVENTORY   809.76 TONNES

Inventory rests tonight: 809.76 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 DOWN 5 CENTS IN PRICE  TODAY:

 

 

A HUGE CHANGE IN SILVER INVENTORY/

A DEPOSIT OF 1.079 MILLION OZ INTO THE SLV

 

 

 

 

 

/INVENTORY RESTS AT 308.189 MILLION OZ.

 

 

end

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

1. Today, we had the open interest in SILVER FELL BY A CONSIDERABLE SIZED 2527 CONTRACTS from 193,226 DOWN TO 190,699  AND MOVING CLOSER TO THE NEW COMEX RECORD SET LAST IN AUG.2018 AT 244,196 WITH A SILVER PRICE OF $14.78/(AUGUST 22/2018)..THE PREVIOUS RECORD WAS SET ON APRIL 9/2018 AT 243,411 OPEN INTEREST CONTRACTS WITH THE SILVER PRICE AT THAT DAY: $16.53). AND PREVIOUS TO THAT, THE RECORD  WAS ESTABLISHED AT: 234,787 CONTRACTS, SET ON APRIL 21.2017 OVER  1 1/3 YEARS AGO.  THE PRICE OF SILVER ON THAT DAY: $17.89.  AS YOU CAN SEE, WE HAVE RECORD HIGH OPEN INTERESTS IN SILVER  ACCOMPANIED BY A CONTINUAL LOWER PRICE WHEN THAT RECORD WAS SET…..

 

.

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

 

488 CONTRACTS FOR MARCH. 0 CONTRACTS FOR APRIL AND  AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 488 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON.  IF WE TAKE THE  OI LOSS AT THE COMEX OF 2527 CONTRACTS TO THE 488 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN A CONSIDERABLE LOSS  OF 2039  OPEN INTEREST CONTRACTS.  THUS IN OUNCES, THE LOSS ON THE TWO EXCHANGES: 10.195 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.  21.925 MILLION OZ  STANDING IN DECEMBER AND 5.725 MILLION OZ STANDING IN JANUARY..

 

 

RESULT: A GOOD SIZED DECREASE IN SILVER OI AT THE COMEX DESPITE THE 13 CENT PRICING FALL THAT SILVER UNDERTOOK IN PRICING// YESTERDAY.BUT WE ALSO HAD A GOOD SIZED 488 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE STRONG  SIZED AMOUNT OF SILVER OUNCES STANDING FOR SEPTEMBER, DEMAND FOR PHYSICAL SILVER CONTINUES TO INTENSIFY AS WE WITNESS SEVERE BACKWARDATION IN SILVER IN LONDON.

 

 

(report Harvey)

.

2.a) The Shanghai and London gold fix report

(Harvey)

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY: Bloomberg

3. ASIAN AFFAIRS

i)TUESDAY MORNING/ MONDAY NIGHT: 

SHANGHAI CLOSED DOWN 30.81 PTS OR 1.18% //Hang Sang CLOSED DOWN 191.09 POINTS OR 0.70% /The Nikkei closed DOWN 96.42  PTS OR 0.47%/ Australia’s all ordinaires CLOSED DOWN 0.49%

/Chinese yuan (ONSHORE) closed DOWN  at 6.8078 AS TRUCE DECLARED FOR 3 MONTHS /Oil UP to 52.88 dollars per barrel for WTI and 61.63 for Brent. Stocks in Europe OPENED /RED 

//ONSHORE YUAN CLOSED DOWN AT 6.8078 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.8144: HUGE DEVALUATION/PAST SEVERAL DAYS RESUMES// TRADE TALKS NOW ON/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED   : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /CHINA RETALIATES WITH TARIFFS/ TRUMP RESPONDS TO NEW TARIFFS AND IT NOW A FULL TRADE WAR COMMENCED

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3A/NORTH KOREA/SOUTH KOREA

 

 

i)North Korea//USA/Sweden

 

 

b) REPORT ON JAPAN

 

 

 

3 C/  CHINA

i)CHINA/USA/HUAWEI

This is extremely important:  Trump is said to prepare an executive order restricting Chinese telecoms Huawei and ZTE.  If  they restrict them from doing business in the USA as well as provide products to adversarial countries. or other foreign entities not to the liking of the USA:   that is the equivalent to a death sentence.

( zerohedge)

b)The real truth behind 5 G technology being developed by leader Huawei and why the uSA is so adamant that it wants to take them off line. The reason:  the internet will now become decentralized and the USA wil no longer be able to control what is going on in the world.
( Tom Luongo)
c)Tuesday/CHINA/USA HUAWEI
China continues to threaten retaliation as the USA now confirms it will go ahead with its plan to extradite Meng
( zerohedge)

d)SUNDAY

e)Not good:  Taiwan is getting scared and they are holding live fire military exercises amid fears of a Chinese invasion
( zerohedge)
f)A good look as to why the bottom fell out of demand in China in many sectors
( Wolf Richter/WolfStreet)

g)Monday;  China’s 2018 GDP growth weakens to only 6.6%.  China is slowing down dramatically

( zerohedge)

h)TUESDAY/CHINA

This is a little scary! Xi warns of serious dangers to communist party rule as China’s economy is faltering.  He is very worried about social protests that will be forthcoming

( zerohedge)

 

 

4/EUROPEAN AFFAIRS

i)FRANCE

For the 10th straight weekend, the yellow vest movement continues in France and also in Belgium. The protesters battled against tear gas and aggressive riot cops

( zerohedge)

ii)UK
Rebel; backbenchers are planning to seize power from Theresa May and queue jump in  formulating legislation
(courtesy zerohedge)

iii)May outlines her new plan by stating that the original Good Friday agreement will not be changed but states that Parliament will have more control over trade negotiations

( zerohedge)

iv)SWITZERLAND/UBS/LARGEST BANK IN SWITZERLAND

UBS falters in Europe/NYSE on very poor results as clients pull a huge 13 billion from their accounts

( zerohedge)

v)GREECE/MACEDONIA

Riots in Greece today because Macedonia is changing its name to the Republic of Northern Macedonia. The reason for the rioting:  Greece has a northern province called Northern Macedonia and this why the populace are angry.
( zerohedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

i)SYRIA/USA/RUSSIA ETC

An excellent commentary as to what is going on with respect to the various parties inside Syria

( Elijah Magnier)

ii)Monday/Israel/Syria/Iran

Israel attacks Iranian sites next to the Damascus airport.  The Israelis have demanded that the Syrian should back away but that was to no avail as Syria launched its own missiles only to be intercepted by the Israeli defense iron dome.  This is an ongoing story.

( zerohedge)

iii)The rhetoric between Iran and Israel getting stronger by the minute. Israel must have administered considerable damage to Iran’s military weapons infrastructure inside Iraq

( zerohedge)

iv)RUSSIA/KERCH STRAIT (SEPARATING CRIMEA FROM MOTHER RUSSIA)

Let us hope that this was not a blast from the Ukraine but instead was a faulty transfer of fuel

( zerohedge)

 

 

6. GLOBAL ISSUES

a)A good article by Brandon Smith as he outlines how the globalists (deep staters) will sacrifice the dollar to get their new world order and one currency.  It will first start off with the SDR’s and then they will morph into a one currency blockchain type of event

( Brandon Smith)

b)Take a look at the following two charts:  earning expectations are falling badly not only in Europe but also in the uSA,,,,and stocks go up????

(courtesy zerohedge)

c)The IMF has just slashed global GDP growth to a 3 year low.  As we have pointed out to you; global growth has slowed which began in November 2018.

( zerohedge)

7. OIL ISSUES

 

 

 

8 EMERGING MARKET ISSUES

i)Zimbabwe

A good look at the devastation inside Zimbabwe right now;  the country is in total shutdown with unemployment at 90%

( Bloomberg/ Freeth/Campbell Foundation/zerohedge)

ii)VENEZUELA

Attempted coup in Venezuela foiled
( zerohedge)

 

9. PHYSICAL MARKETS

i)Anglo Gold Ashanti has been advised to give up on South Africa.  I wonder why?
( Bloomberg/GATA)
ii)The Indian’s government’s scheme to paperize citizen’s gold has failed.  To tell you the truth I am surprised that 23 tonnes of gold was handed in.( Singh/Deccan Herald/GATA)

iii)A really good commentary from Ambrose Evans Pritchard as he describes how China may have reached its Minsky moment which it least downturn. Prof Rogoff thinks that the Chinese downturn will call him a lot of its funding for European, Asian and African projects.  Europe will be hit the hardest as rates will climb noticeably there.  The big problem of course to watch for is Italy.

( Ambrose Evans Pritchard/GATA)

iv)Dan Oliver explains the problem with exploding debt and what will happen to the uSA dollar

(Dan Oliver/GATA)

v)A must watch interview: Bill Murphy and Rob  Kirby discuss the manipulation of the metals with Phil  Kennedy.

( GATA/Philip Kennedy)

vi)Venezuela recovers the gold it swapped with Deutsche bank.

( Reuters/GATA)

 

vii)Now you know how manipulation is done//through these dark pools and are totally unregulated

( Pam Martens/Wall Street on Parade/GATA)

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

 

 

MARKET TRADING

Monday

USA futures tumble on reports that the USA China trade talks have stalled

(courtesy zerohedge)

ii)Market data/

This is a shocker:  existing home sales crash 6.4% month over month in December from last month.  The economy is now in a tailspin

( zerohedge)

 

 

iii)USA ECONOMIC/GENERAL STORIES

a)Another good commentary from Tom Luongo as he explains how the Democrats are moving much more to the left. They are also love the war machine exactly what the Republicans stood for.  Now the Democrats are facing a new challenge from Tulsi Gabbard who wants to end uSA involvement in foreign wars.  She is a liberal molded from the cloth of Rand Paul.  She however is very weak in uSA economic affairs.

( Tom Luongo)

b)Wow!! Illinois has the highest property taxes in the country despite stagnant incomes. The average is 2.7% of the value of the home compared to the average of around 1.3%. No wonder many are leaving the state…simply that they could not afford to pay the taxes.

(courtesy Dabroski/Klingner))

c)The following is what we must watch for:  when the Fed stops hiking, no doubt we will see another round of QE.  That is when the yield curve steepens and that is when the economy will be in recession.

( zerohedge)

iv)SWAMP STORIES

Kim Strassel outlines beautifully how everyone at the FBI know unequivocally that the Steele dossier was biased and paid for by the Clinton campaign.  She also debunks the Democratic time line of when the FBI received the dossier

Thus 3 things are apparent:

“First, it further demonstrates the accuracy of the House Intelligence Committee Republicans’ memo of 2018 – which noted Mr. Ohr’s role and pointed out that the FBI had not been honest about its knowledge of the dossier and failed to inform the court of Mrs. Ohr’s employment at Fusion GPS.

Second, the testimony also destroys any remaining credibility of the Democratic response,in which Mr. Schiff and his colleagues claimed Mr. Ohr hadn’t met with the FBI or told them anything about his wife or about Mr. Steele’s bias until after the election.

And third, the testimony raises new concerns about Mr. Mueller’s team. Critics have noted Mr. Weissman’s donations to Mrs. Clinton and his unseemly support of former acting Attorney General Sally Yates’s obstruction of Trump orders. It now turns out that senior Mueller players were central to the dossier scandal. The conflicts of interest boggle the mind.

And Strassel concludes unequivocally, the Ohr testimony is evidence the FBI itself knows how seriously it erred. The FBI has been hiding and twisting facts from the start.”

 

(courtesy zerohedge)

b)We reported to you on Friday night that the Cohen affair with respect to he being told to lie to Congress about the Moscow project was false.  Late Friday night, the Special Counsel provided a rare statement denying the report’s validity.  Guiliani goes on a rant. He demands the Dept of Justice to reveal the false leakers…( zerohedge)

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

 

 

 

 

 

Let us head over to the comex:

 

THE TOTAL COMEX GOLD OPEN  FELL BY AN CONSIDERABLE SIZED 1699 CONTRACTS DOWN TO A LEVEL OF 508,398 DESPITE THE FALL IN THE PRICE OF GOLD ($9.65) IN FRIDAY’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  NON ACTIVE DELIVERY MONTH OF JANUARY..  THE CME REPORTS THAT THE BANKERS ISSUED A STRONG SIZED COMEX TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS., THAT IS 8815 EFP CONTRACTS WERE ISSUED:

FOR FEBRUARY:  8815 AND  ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE:  8815 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:  7116 TOTAL CONTRACTS IN THAT 8815 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST A CONSIDERABLE SIZED 1699 COMEX CONTRACTS.

NET GAIN ON THE TWO EXCHANGES: 7116 contracts OR 711,600  OZ OR 22.13 TONNES.

 

We are now in the NON active contract month of JANUARY and here the open interest stands at 50 contracts as we LOST 2 contracts. We had 1 notice filed on yesterday so we LOST 1 contract or 100 ADDITIONAL oz will NOT stand for delivery as these guys morphed into London based forwards as well as accepting a fiat bonus.

 

 

The next active delivery month is February and here the OI LOST  8394 contracts DOWN to 225.930 contracts.  After February, March GAINED 353 contracts to stand at 1044.  After March, the next big delivery month is April and here the OI rose by 5805 contracts up to 184,655 contracts.

 

 

 

FOR COMPARISON TO THE  January 2018 contract month

 

 

ON JANUARY 1/2018: 1.297 TONNES STOOD FOR DELIVERY  (Jan 1 2019 initial standing 1.306 tonnes)

EVENTUALLY ON JAN 31.2018: 2.17 TONNES STOOD FOR DELIVERY AS QUEUE JUMPING STARTED IN EARNEST AT THE GOLD COMEX

 

 

WE HAD 2 NOTICES FILED AT THE COMEX FOR 200 OZ. (0..00620 tonnes)

 

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And now for the wild silver comex results.

Total silver OI FELL BY A CONSIDERABLE SIZED 2527 CONTRACTS FROM 193,266 DOWN TO 190,699(AND CLOSER TO THE NEW RECORD OI FOR SILVER SET ON AUGUST 22.2018.  (THE PREVIOUS RECORD WAS SET APRIL 9.2018/ 243,411 CONTRACTS) AND TODAY’S OI COMEX GAIN  OCCURRED DESPITE A 13 CENT LOSS IN PRICING.

 

WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF JANUARY AND THE  AMOUNT OF OPEN INTEREST READY TO STAND IS 367 CONTRACTS HAVING LOST 10 CONTRACTS FROM FRIDAY.  WE HAD 23 NOTICES FILED ON FRIDAY, SO WE GAINED 13 CONTRACTS OR  65,000 ADDITIONAL OZ OF SILVER WILL STAND FOR SILVER AS THESE GUYS REFUSED TO  MORPH INTO LONDON BASED FORWARDS AS WELL AS NEGATING A FIAT BONUS. QUEUE JUMPING IS THE NORM AT THE SILVER COMEX AS THE DEALERS SCRAMBLE FOR WHATEVER PHYSICAL THEY CAN OBTAIN.

 

 

 

THE NEXT NON ACTIVE DELIVERY MONTH IS FEBRUARY AND HERE THE OI FELL BY 8 CONTRACTS DOWN TO 446. AFTER FEBRUARY IS THE VERY BIG AND ACTIVE DELIVERY MONTH OF MARCH AND HERE THE OI FELL BY 2804 CONTRACTS DOWN TO 141,792 CONTRACTS.

 

 

ON A NET BASIS WE LOST 2039 SILVER OPEN INTEREST CONTRACTS AS WE OBTAINED A  2527 CONTRACT LOSS AT THE COMEX COMBINING WITH THE ADDITION OF 488 OI CONTRACTS NAVIGATING OVER TO LONDON.

NET LOSS ON THE TWO EXCHANGES:  2039 CONTRACTS...AND ALL OF THIS OCCURRED WITH A 13 CENT FALL IN PRICING// FRIDAY

 

 

 

 

 

FOR COMPARISON TO THE COMEX 2017 CONTRACT MONTH AND JANUARY 2018 CONTRACT MONTH

 

 

 

ON FIRST DAY NOTICE JAN 1/2018 CONTRACT MONTH WE HAD A GOOD 2.695 MILLION OZ STAND FOR DELIVERY’

AT THE CONCLUSION OF JAN/2018 WE HAD 3.650 MILLION OZ STAND AS QUEUE JUMPING WAS THE NORM FOR SILVER

.

 

 

 

 

 

 

 

 

We had 13 notice(s) filed for 65,000 OZ for the FEB, 2018 COMEX contract for silver

 

 

Trading Volumes on the COMEX TODAY:  371,205 CONTRACTS

 

 

CONFIRMED COMEX VOL. FOR YESTERDAY:  265.854  contracts

 

 

 

 

 

 

 

 

 

 

 

INITIAL standings for  JAN/GOLD

JAN 22/2019.

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

 

 

 

 

 

Deposits to the Customer Inventory, in oz  

 

NIL

 

OZ

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

No of oz served (contracts) today
2 notice(s)
 200 OZ
No of oz to be served (notices)
48 contracts
(4800 oz)
Total monthly oz gold served (contracts) so far this month
544 notices
54400 OZ
1.6922 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  adjustments….

FOR THE JAN 2019 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 2 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 2 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account and 0 notices by the squid  (Goldman Sachs)

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
To calculate the INITIAL total number of gold ounces standing for the JANUARY/2019. contract month, we take the total number of notices filed so far for the month (544) x 100 oz , to which we add the difference between the open interest for the front month of JAN. (50 contract) minus the number of notices served upon today (2 x 100 oz per contract) equals 59,200 OZ OR 1.841 TONNES) the number of ounces standing in this NON  active month of JANUARY

 

Thus the INITIAL standings for gold for the JAN/2019 contract month:

No of notices served (544 x 100 oz)  + {52)OI for the front month minus the number of notices served upon today (2 x 100 oz )which equals 59,200 oz standing OR 1.841 TONNES in this NON  active delivery month of JANUARY.

Today we LOST 1 contract or an additional 100 oz will stand in this non active month of January

.

 

 

 

 

 

THERE ARE ONLY 23.11 TONNES OF REGISTERED COMEX GOLD AVAILABLE FOR DELIVERY AGAINST 1.841 TONNES STANDING FOR JANUARY

LAST MONTH WE HAVE 23.37 TONNES OF GOLD SUPPOSEDLY DELIVERED UPON BUT THIS AMOUNT OF GOLD DID NOT LEAVE THE REGISTERED GOLD CATEGORY AT THE COMEX.

 

 

total registered or dealer gold:  743,019.277 oz or   23.11 tonnes
total registered and eligible (customer) gold;   8,405,974.987 oz 261.46 tonnes

IN THE LAST 27 MONTHS 93 NET TONNES HAS LEFT THE COMEX.

 

end

And now for silver

AND NOW THE NOV DELIVERY MONTH

JAN INITIAL standings/SILVER

JAN 22, 2019
Silver Ounces
Withdrawals from Dealers Inventory NIL oz
Withdrawals from Customer Inventory
519,909.208 oz
Delaware
CNT
Scotia
Brinks

 

 

Deposits to the Dealer Inventory
619,094.98 oz
Brinks
Deposits to the Customer Inventory
598,902.180 oz
Scotia
No of oz served today (contracts)
13
CONTRACT(S)
65,000 OZ)
No of oz to be served (notices)
354 contracts
1,770,000 oz)
Total monthly oz silver served (contracts) 804 contracts

(4,020,000 oz)

Total accumulative withdrawal of silver from the Dealers inventory this month NIL oz
Total accumulative withdrawal of silver from the Customer inventory this month

we had 1 inventory movement at the dealer side of things

i) Into Brinks:  619,094.98 0z

 

total dealer deposits:  619,094.98  oz

total dealer withdrawals: 0 oz

we had 1 deposits into the customer account

 

i) Into JPMorgan: nil  oz

 

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

JPMorgan now has 147.7 million oz of  total silver inventory or 50.51% of all official comex silver. (147.7 million/293 million)

ii) into Scotia:  598,902.180 oz

 

 

 

 

 

 

 

 

 

 

 

 

 

total customer deposits today: 598,902.180   oz

we had 4 withdrawals out of the customer account:
i) Out of DELAWARE:  15,060.173 oz
ii) Out of CNT: 16,196.225 oz
iii) Out of Scotia; 288,627.310 oz
iv) Out of Brinks: 200,023.500 oz

 

 

 

 

 

total withdrawals:  519,908.208   oz

 

we had 0 adjustments

 

 

total dealer silver:  86.677 million

total dealer + customer silver:  296.101 million oz

 

 

 

 

The total number of notices filed today for the JANUARY 2019. contract month is represented by 13 contract(s) FOR 65,000  oz

To calculate the number of silver ounces that will stand for delivery in JAN., we take the total number of notices filed for the month so far at 804 x 5,000 oz = 4,020,000 oz to which we add the difference between the open interest for the front month of JAN. (367) and the number of notices served upon today (13x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the JANUARY/2019 contract month: 804(notices served so far)x 5000 oz + OI for front month of JAN( 367) -number of notices served upon today (13)x 5000 oz equals 5,790,000 oz of silver standing for the JANUARY contract month.  This is a strong number of oz standing for an off delivery month. We gained 13 contracts or an additional 65,000 oz will  stand for delivery and these guys refused to morph into London based forwards as well as negating a fiat bonus.

 

 

 

 

 

 

 

 

 

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

TODAY’S SILVER VOLUME:  82,222 CONTRACTS

 

 

CONFIRMED VOLUME FOR YESTERDAY: 58,407 CONTRACTS… 

 

 

 

 

YESTERDAY’S CONFIRMED VOLUME OF 58,407 CONTRACTS EQUATES to 292 million OZ  41.7% 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 -3.94% (JAN 22/2019)
2. Sprott gold fund (PHYS): premium to NAV FALLS TO -0.74% to NAV (JAN 22 /2019 )
Note: Sprott silver trust back into NEGATIVE territory at -3.94%-/Sprott physical gold trust is back into NEGATIVE/

(courtesy Sprott/GATA)

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

NAV 13.01/TRADING 12.58/DISCOUNT 3.37

END

And now the Gold inventory at the GLD/

JAN 22/WITH GOLD UP A TINY $.85 A MASSIVE PAPER DEPOSIT OF 12.06 TONNES OF GOLD INTO THE FRAUDULENT GLD/INVENTORY RESTS AT 809.76 TONNES

JAN 18/WITH GOLD DOWN $9.65: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 797.71

JAN 17/WITH GOLD DOWN $1.10: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 797.71

JAN 16/WITH GOLD UP $5.40 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 797.71

JAN 15/WITH GOLD DOWN $1.65: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 797.71 TONNES

JAN 14/WITH GOLD UP $1.60/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 797.71 TONNES

JAN 11/WITH GOLD UP $2.30 TODAY ANOTHER WITHDRAWAL OF 1.47 TONNES OF GOLD/INVENTORY RESTS AT 797.71 TONNES

JAN 10/WITH GOLD DOWN $4.00/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 799.18 TONNES

JAN 9/WITH SILVER UP $6.00/ TWO TRANSACTIONS: a) A TINY WITHDRAWAL OF .25 TONNES TO PAY FOR FEES ETC b) A HUGE DEPOSIT OF 2.65 TONNES INTO THE GLD INVENTORY./INVENTORY RESTS AT 799.18 TONNES

JAN 8/WITH GOLD DOWN $3.70 TODAY, A WITHDRAWAL OF 1.47 TONNES AND THIS GOLD WAS USED IN THE RAID/INVENTORY RESTS AT 796.78 TONNES

JAN 7/WITH GOLD UP $4.45 TODAY: A HUGE DEPOSIT OF 2.94 TONNES OF GOLD ENTERED THE GLD/INVENTORY RESTS AT 798.25 TONNES

JAN 4/WITH GOLD DOWN $8.65 TODAY; NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 795.31 TONNES

JAN 3/2019/WITH GOLD UP $10.65 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY REMAINS AT 795.31 TONNES

JAN 2.2019/WITH GOLD UP $3.35 TODAY: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 7.64 TONNES/INVENTORY RESTS AT 795.31 TONNES

DEC 31/WITH GOLD DOWN $2.20 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 787.67 TONNES

DEC 28/WITH GOLD UP $2.20 STRANGELY A WITHDRAWAL OF 2.35 TONNES FROM THE GLD/INVENTORY RESTS AT 787.67 TONNES

DEC 27/WITH GOLD UP $8.65: A MASSIVE 15.88 TONNES WAS ADDED INTO THE GLD/INVENTORY RESTS AT 790.02 TONNES

DEC 26/WITH GOLD UP $0.15: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 774.14 TONNES

DEC 24/WITH GOLD UP $15.15: A HUGE DEPOSIT OF 5.00 TONNES INTO THE GLD/INVENTORY RESTS AT 774.14 TONNES

DEC 21/WITH GOLD DOWN $10.15 TODAY: A HUGE WITHDRAWAL OF 2.65 TONNES/INVENTORY RESTS AT 769.14 TONNES

DEC 20/WITH GOLD UP $11.50 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY AT 771.79 TONNES

DEC 19/WITH GOLD UP $3.15 TODAY: A HUGE DEPOSIT OF 8.23 TONNES OF GOLD ENTERED THE GLD/INVENTORY RESTS AT 771.79 TONNES

DEC 18/WITH GOLD UP $1.50 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 763.56 TONNES

DEC  17 WITH GOLD UP $10.60 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 763.56 TONNES

DEC 14/WITH GOLD DOWN $5.60: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 763.56 TONNES

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

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

JAN 22/2019/ Inventory rests tonight at 809.76 tonnes

*IN LAST 538 TRADING DAYS: 125.39 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 438 TRADING DAYS: A NET 34.64 TONNES HAVE NOW BEEN ADDED INTO THE GLD INVENTORY.

 

end

 

Now the SLV Inventory/

JAN 22/WITH SILVER DOWN 5 CENTS: A HUGE DEPOSIT OF 1.179 MILLION OZ INTO THE SLV/SLV IS A FRAUDULENT VEHICLE/INVENTORY RESTS AT 308.189 MILLION OZ/

JAN 18/WITH SILVER DOWN 13 CENTS: NO CHANGE IN SILVER INVENTORY/NO DOUBT THE MASSIVE WITHDRAWAL OF PAPER SILVER WAS USED IN THE RAID TODAY/INVENTORY RESTS AT 307.110

JAN 17/WITH SILVER DOWN 9 CENTS TODAY:ANOTHER BIG CHANGE IN SILVER INVENTORY AT THE SLV; A MASSIVE WITHDRAWAL OF 3.895 MILLION OZ./INVENTORY RESTS AT 307.110 MILLION OZ/

JAN 16/WITH SILVER FLAT TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV

A WITHDRAWAL OF 2.158 MILLION OZ/INVENTORY RESTS AT 311.005 MILLION OZ/

JAN 15/WITH SILVER DOWN 4 CENTS TODAY: A SMALL CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 469,000 OZ FROM ITS INVENTORY/INVENTORY RESTS AT 313.163 MILLION OZ/

JAN 14/WITH SILVER UP ONE CENT TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 313.632 MILLION OZ/

JAN 11/WITH SILVER UP 4 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 313.632 MILLION OZ/

JAN 10/WITH SILVER DOWN 11 CENTS TODAY; NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 313.632 MILLION OZ/

JAN 9/WITH SILVER  UP 4 CENTS TODAY; A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 1.126 MILLION OZ/INVENTORY LOWERS TO 313.632 MILLION OZ/???

JAN 8/WITH SILVER DOWN 4 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 314.758 MILLION OZ

JAN 7/WITH SILVER DOWN ONE CENT: A HUGE WITHDRAWAL OF 2.347 MILLION OZ FROM THE SLV/INVENTORY RESTS AT 314.758 MILLION OZ/

JAN 4/WITH SILVER DOWN 3 CENTS: NO CHANGE IN SILVER INVENTORY AT THE SLV.INVENTORY RESTS AT 317.105 MILLION OZ

JAN 3/2019/WITH SILVER UP 22 CENTS A SMALL CHANGE TODAY: A WITHDRAWAL OF 118,000 OZ TO PAY FOR FEES:  INVENTORY RESTS AT 317.105 MILLION OZ/

JAN 2/2019/WITH SILVER UP 10 CENTS TODAY/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 317.233 MILLION OZ/

DEC 31/WITH SILVER UP 6 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 317.233 MILLION OZ/

DEC 28/WITH SILVER UP 10 CENTS TODAY/NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 317.233 MILLION OZ/

DEC 27/WITH SILVER UP 22 CENTS TODAY: A SMALL CHANGE IN SILVER INVENTORY AT THE SLV: AN ADDITION OF 94,000 OZ/INVENTORY RESTS AT 317,233

DEC 26/WITH SILVER UP 27 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 317.139 MILLION OZ

DEC 21/WITH SILVER DOWN 14 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 317.139 MILLION OZ/

DEC 20/WITH SILVER UP 4 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 1.408 MILLION OZ OF SILVER FROM THE SLV/ INV. RESTS AT 317.139 MILLION OZ/

DEC 19/WITH SILVER UP 10 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 751,000 OZ INTO THE SLV./INVENTORY RESTS AT 318.547 MILLION OZ/

DEC 18/WITH SILVER DOWN 4 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 317.796 MILLION OZ/

DEC 17/WITH SILVER UP 13 CENTS TODAY/ A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 939,000 OZ FROM THE SLV/INVENTORY RESTS AT 317.796 MILLION OZ/.

DEC 14/WITH SILVER DOWN 22 CENTS: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 318.735 MILLION OZ/

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

 

 

JAN 22/2019:

 

Inventory 308.189 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 2.23/ and libor 6 month duration 2.85

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

G0LD LENDING RATE: + .62

 

 

XXXXXXXX

12 Month MM GOFO
+ 2.56%

LIBOR FOR 12 MONTH DURATION: 3.04

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.48

end

 

PHYSICAL GOLD/SILVER STORIES

end
i) GOLDCORE BLOG/Mark O’Byrne

Gold May Return 25% In 2019 Given Brexit, Trump and Other Risks – IG TV Interview GoldCore

– Outlook for gold in 2019: IG TV Victoria Scholar interviews GoldCore
– Given Brexit & Trump risk, trade wars & fragile economic growth, gold may gain 20%-25% in 2019
– Palladium has surged to record highs and gold will play catch up in coming years and reach record highs again; Both nominal highs near $1,900/oz and inflation adjusted at much higher prices
– Global demand will be strong in 2019 and gold production globally is plateauing
– Focus on gold not just in dollars but in euros, pounds & local currency terms in which gold made gains in 2018 and will likely do again in 2019
– Year-end 2019 forecast for gold is 1500 $/oz but gold’s value is as a safe haven

Courtesy of IG Markets

 

Listen on iTunes,Blubrry & SoundCloud  & watch on YouTube above

 

News and Commentary

Gold near 3-wk lows as firmer dollar sees speculators sell (Reuters.com)

Venezuela gold holdings in Bank of England soar on Deutsche deal (Reuters.com)

Asian markets slip on global growth worries (MarketWatch.com)

AngloGold Faces South Africa Doubt as M&A Gold Rush Quickens (Bloomberg.com)

British PM to try to break Brexit deadlock with EU concessions (Reuters.com)

Copper prices slide on weak Chinese data (MarketWatch.com)


Gold ETF Holdings Near Highest Level Since 2013: BMO. Source: Bloomberg

China’s Xi Warns Party of ‘Serious Dangers’ as Risks Mount (Bloomberg.com)

A Truly Terrible Idea for Deutsche Bank (Bloomberg.com)

Wyoming Legislators Want State to De-Risk Investments by Holding Gold and Silver (SoundMoneyDefense.org)

Indian government’s scheme to paperize citizens’ gold has failed (Gata.org)

The silence on Wall Street’s Dark Pools is deafening (WallStreetOnParade.com)

Gold Prices (LBMA PM)

21 Jan: USD 1,278.70, GBP 995.08 & EUR 1,124.11 per ounce
18 Jan: USD 1,285.05, GBP 993.34 & EUR 1,126.86 per ounce
17 Jan: USD 1,294.00, GBP 1,004.92 & EUR 1,135.87 per ounce
16 Jan: USD 1,290.50, GBP 1,002.46 & EUR 1,130.99 per ounce
15 Jan: USD 1,289.35, GBP 1,002.99 & EUR 1,127.67 per ounce
14 Jan: USD 1,293.70, GBP 1,007.02 & EUR 1,129.27 per ounce
11 Jan: USD 1,298.80, GBP 1,012.91 & EUR 1,123.96 per ounce

Silver Prices (LBMA)

21 Jan: USD 15.26, GBP 11.86 & EUR 13.42 per ounce
18 Jan: USD 15.47, GBP 11.96 & EUR 13.56 per ounce
17 Jan: USD 15.57, GBP 12.08 & EUR 13.66 per ounce
16 Jan: USD 15.54, GBP 12.09 & EUR 13.66 per ounce
15 Jan: USD 15.60, GBP 12.13 & EUR 13.65 per ounce
14 Jan: USD 15.61, GBP 12.13 & EUR 13.61 per ounce
11 Jan: USD 15.68, GBP 12.23 & EUR 13.60 per ounce

Recent Market Updates

– Brexit, EU, Germany, China and Yellow Vests In 2019 – Something Wicked This Way Comes
– Three Reasons Gold May Embark On An Extended Rally
– Political Turmoil in UK & US Sees Gold Hit 2 Week High
– Gold Holds Steady Over €1,100/oz – Increased Possibility Of A Disorderly Brexit
– Turbulence and Brexit Make Safer Options Like Gold and Cash Essential
– Where Will The “Pending” Financial Crisis Originate?
– Gold and Silver Prices To Rise To $1,650 and $30 By 2020? Video Update
– Gold Outlook 2019: Uncertainty Makes Gold A “Valuable Strategic Asset” – WGC
– Blackrock Say Gold Will Be A “Valuable Portfolio Hedge” In 2019
– Financial Advice In 2019: Own Gold To Hedge $250 Trillion Global Debt Bubble – GoldCore In Irish Times
– China Adds 320,000 Ounces To Gold Reserves – First Central Bank Purchase Since October 2016
– Gold At 6 Month High At $1,300 and All Time Record Highs In Australian Dollars Over $1,870
– Gold Hedges Stock Market Falls In 2018 – Gains 2.7% In Euros and 3.8% In Pounds

Mark O’Byrne
Executive Director
GATA STORIES AS IT RELATES TO PHYSICAL GOLD/SILVER
Anglo Gold Ashanti has been advised to give up on South Africa.  I wonder why?
(courtesy Bloomberg/GATA)

AngloGold Ashanti advised to give up on South Africa

 Section: 

AngloGold Faces South African Dilemma as M&A Gold Rush Quickens

By Felix Njini
Bloomberg News
Sunday, January 20, 2019

Two decades ago Anglo American Plc created the world’s No. 1 gold miner by merging its South African assets. Having long since been eclipsed by its rivals, AngloGold Ashanti Ltd. may need to leave home to keep up.

Newmont Mining Corp. and Barrick Gold Corp. have forged mega deals that will extend their lead over AngloGold. Saddled with Mponeng, the world’s deepest mine in a dying South African industry that’s struggling to contain costs, the third-biggest producer could boost its value by leaving the country, according to Rene Hochreiter, analyst at Noah Capital Markets in Johannesburg.

Their best bet is to get out of South Africa and leave Mponeng behind,” he said. “The costs never come down in South African gold.”

That would be the final step in AngloGold’s gradual withdrawal from South Africa. The country contributed just 14 percent of its output in the third quarter of last year, down from 26 percent a year earlier, after the company sold and shut mines to stem losses.

Now AngloGold is considering hiving off its South African operations and listing in London or Toronto, people familiar with the matter said last month. Listing in London would give the company exposure to a big pool of investors with very few options to buy into gold equities, following Barrick’s acquisition of Randgold Resources Ltd.

A spokesman for AngloGold declined to comment.

To exit South Africa, the company would need to offer a steep discount on its assets, said Leon Esterhuizen, an analyst at Nedcor Securities Ltd. That still wouldn’t be enough to interest international companies.

“They are not going to invest here,” Esterhuizen said. “Whether it’s AngloGold or anybody else in South Africa gold, it makes sense to go and find other places to make money.”

… For the remainder of the report:

https://www.bloomberg.com/news/articles/2019-01-20/anglogold-faces-south…

END

The Indian’s government’s scheme to paperize citizen’s gold has failed.  To tell you the truth I am surprised that 23 tonnes of gold was handed in.

(courtesy Singh/Deccan Herald/GATA)

Indian government’s scheme to paperize citizens’ gold has failed

 Section: 

Centre’s Gold Bond Scheme Fails to Glitter

By Annapurna Singh
Deccan Herald, Bangalore, India
Sunday, January 20, 2019

The central government’s ambitious plan to mobilise an estimated 22,000 tonnes of gold lying idle with households appears to have fallen flat, with its own statistics showing that the collection has nearly halved to merely 6,500 kilograms in 2017-2018 from close to 11,500 kilograms in 2016-2017.

The sovereign gold bond scheme was launched by Prime Minister Narendra Modi in 2015. Since then the authorities have barely collected 23 tonnes of gold.

The government has issued sovereign gold bonds worth Rs 6,661.42 crore for 22.88 tonnes till March 2018, according to the latest report released on the Centre’s debt management.

Now the government’s policy think tank Niti Aayog has suggested that the scheme be made more attractive.

The sovereign gold bond is a government security denominated in grams of gold. The idea behind its launch was to migrate investment from physical gold to paper gold. …

However, the gold bond, which comes with a five-year lock-in period, has not been able to replace physical gold buying. The overall maturity of the scheme is eight years and one has to pay capital tax on redeeming it before maturity. The scheme offers no liquidity to its buyer. …

… For the remainder of the report:

https://www.deccanherald.com/business/centres-gold-bond-scheme-fails-713…

end

Dan Oliver explains the problem with exploding debt and what will happen to the uSA dollar

(Dan Oliver/GATA)

Myrmikan’s Dan Oliver: Our currency is now OUR problem

 Section: 

8:37p ET Saturday, January 19, 2019

Dear Friend of GATA and Gold:

With its debt exploding and its international position weakening, the United States will choose to weaken the dollar as it has done before, Dan Oliver of Myrmikan Capital in New York (http://www.myrmikan.com) writes in his firm’s brilliant letter for January.

“Thinking strategically,” Oliver argues, “the best course for the United States may now be a radical devaluation of the dollar. Such an action would relieve the government of its debt burden (not to mention large financial institutions), devalue the enormous hoard of Treasury bonds the Chinese hold, pop their credit bubble, and allow strategically important countries to escape the China debt trap. It would also act as a protectionist measure, destroying the Chinese export model and boosting temporarily domestic demand for American labor. The cost would be soaring retail prices, especially for the middle class, but what is the alternative?”

Oliver’s letter is titled “Our Currency and Our Problem” and with his kind permission it is posted in PDF format at GATA’s internet site here:

http://www.gata.org/files/MyrmikanResearch-01-14-2019.pdf

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

end

Venezuela recovers the gold it swapped with Deutsche bank.

(courtesy Reuters/GATA)

Venezuela recovers gold swapped with Deutsche Bank and it lands at Bank of England

 Section: 

Venezuela Gold holdings at Bank of England Soar on Deutsche Deal, Sources Tell Reuters

By Mayela Armas and Corina Pons
Reuters
Monday, January 21, 2019

https://www.reuters.com/article/venezuela-gold/venezuela-gold-holdings-i…

CARACAS, Venezuela — Venezuela’s gold holdings at the Bank of England have jumped after the country closed out a gold swap deal with Deutsche Bank, according to two sources, as Britain remains reluctant to release gold held for the troubled OPEC nation.

The government of Nicolas Maduro since last year has been seeking to repatriate about $550 million in gold from the Bank of England on fears it could be caught up in international sanctions on the country.

… 

 

Its holdings at the bank more than doubled in December to 31 tonnes, or around $1.2 billion, after Venezuela returned funds it had borrowed from Deutsche Bank through a financing arrangement that uses gold as collateral, known as a swap, one of the sources said.

Under the deal struck with Deutsche Bank in 2015, Venezuela put up 17 tonnes of gold in exchange for a loan, according to one of the sources who asked not to be identified because it is not authorized to speak publicly about the issue.

The country’s gold holdings fell to 134 tonnes in November compared with 150 tonnes at the start of 2018, according to central bank statistics.

This is in part because Venezuela last year started carrying out gold barter operations with Turkey to import food following U.S. sanctions that have made international banks reluctant to handle Venezuelan transactions.

The motivation for paying back the funds from the Deutsche swap was not immediately evident. But redeeming the swap would give Venezuela more gold for barter operations with Turkey.

Deutsche Bank declined to comment. Venezuela’s central bank did not reply to an email seeking comment.

The Bank of England did not immediately respond to a request for comment. When queried about Venezuela issues in the past, it has said it does not comment on customer operations.

The Bank of England is facing political pressure from Venezuela’s opposition and from members of British parliament to not assist Maduro, whose just-begun second term has been widely described as illegitimate.

Losing the gold would be a significant blow to the country’s finances by undermining Venezuela’s ability to obtain hard currency crucial to importing items ranging from food and medicine to auto parts and consumer electronics.

But refusing to hand over the gold, which belongs to Venezuela’s central bank, could cause alarm among countries that store their own bullion in the Bank of England’s coffers.

Maduro’s government is struggling under hyperinflation now approaching 2 million percent annually, and a broad economic collapse has fueled an exodus of some three million people since 2015.

Opposition critics, including exiled leader Julio Borges, have argued that the gold should not be repatriated because it could be used to finance corruption.

Calixto Ortega, president of Venezuela’s central bank, met with Bank of England officials in December to discuss repatriating the gold but was unable to convince them, according to sources familiar with the situation.

Venezuela for decades stored gold that makes up its central bank reserves in foreign bank vaults, which is common among developing nations.

The country’s late socialist leader Hugo Chavez, citing the need for Venezuela to have physical control of central bank assets, in 2011 repatriated around 160 tonnes of gold from banks in the United States and Europe to the central bank in Caracas.

Maduro says his government is victim of an “economic war” led by the opposition and fueled by Washington’s sanctions. His critics blame the country’s struggles on a state-led economic model, stringent exchange controls, and nationalization of private companies.

end

A really good commentary from Ambrose Evans Pritchard as he describes how China may have reached its Minsky moment which it least downturn. Prof Rogoff thinks that the Chinese downturn will call him a lot of its funding for European, Asian and African projects.  Europe will be hit the hardest as rates will climb noticeably there.  The big problem of course to watch for is Italy.

(courtesy Ambrose Evans Pritchard/GATA)

Ambrose Evans-Pritchard: Moment of ‘Minsky’ reckoning may be near for China, banking guru warns

 Section: 

By Ambrose Evans-Pritchard
The Telegraph, London
Monday, January 21, 2019

China is in the grip of an increasingly dangerous downturn and may be forced to rescue large parts of its financial and economic system, the world’s leading expert on debt crises has warned.

Harvard professor Ken Rogoff said the key policy instruments of the Communist Party are losing traction and the country has exhausted its credit-driven growth model. This is rapidly becoming the greatest single threat to the global financial system.

… 

“People have this stupefying belief that China is different from everywhere else and can grow to the moon,” said Harvard professor Ken Rogoff, a former chief economist at the International Monetary Fund. “China can’t just keep creating credit. They are in a serious growth recession and the trade war is kicking them on the way down,” he told the Telegraph, speaking before the World Economic Forum in Davos.

“There will have to be a de facto nationalisation of large parts of the economy. I fear this really could be ‘it’ at last and they are going to have their own kind of Minsky Moment,” he said.

This refers to the financial instability hypothesis of Hyman Minsky. It is when a seemingly unstoppable debt bubble suddenly collapses under its own weight in a cascade of falling asset and property prices. The authorities can cushion the crash but they cannot escape the brutal mechanics of reversion.

Prof Rogoff is co-author of a magisterial history of debt delusions, This Time is Different: Eight Centuries of Financial Folly, written with former IMF firefighter Carmen Reinhart.

He said it was an error to think that China’s current slowdown is entirely deliberate and calibrated. While the People’s Bank undoubtedly wishes to curb the credit boom it is also riding a tiger that it cannot fully control.

“I fear this will be the third leg of the global debt supercycle, after subprime in the US and the debt crisis in the eurozone. Nobody knows how this is going play out but it could be on the scale of 2008 and it is will be very bad for Asia, and there will be spillovers in Europe,” he said.

The eurozone is already suffering the fall-out from the Asian downturn. Most of the region is in industrial recession. Germany and Italy buckled in the second half of 2018, and confidence has slumped to crisis-level lows in France.

“I am very sceptical that the eurozone system can handle another big shock. It is a house half built and if there is something like 2008, it is all going to blow up. Some countries will have to be ring-fenced with capital controls,” he said.

The eurozone has little policy powder left to fight deflation. Interest rates are already minus 0.4 percent and the European Central Bank’s €2.6 trillion blitz of bond purchases has pushed the institution’s balance sheet to 43 percent of GDP. The political bar to renewing quantitative easing is very high.

Europe’s leaders have yet to build a crisis machinery fit for purpose. There is still no proper banking union with shared deposit insurance, let alone a fiscal union. The rigid rules of the Stability Pact inhibit use of budget stimulus a l’outrance in a recession.

Prof Rogoff said there is a danger that China and Asian tigers could be forced to pull in some of their trillions of offshore global funds to cover urgent needs at home, drying up or even reversing the so-called Asian ‘savings glut’.

This would have the unpleasant effect of driving up ‘real’ interest rates across the world, which would be awkward for the US at a time when President Donald Trump’s trillion dollar deficits risking crowding out bond markets. Higher real rates would would trial by fire for parts of Europe.

This is the Achilles Heel for Italy. Real borrowing costs could go by 2-3 percentage points,” he said.

Italy’s debt dynamics could not withstand a regime shift of this sort. Markets would see the trouble coming and precipitate events.

Prof Rogoff says China still has room for manoeuvre but at the end of the day it cannot escape from the forces of economic gravity. Debt ratios have doubled to 270 percent of GDP in barely more than a decade. Surges of this kind in a developing economy invariably lead to imbalances that prove malign when the cycle turns.

The one thing the Chinese have in their favour is state control over the banking system. “They will be able to socialise the losses in a much fairer way then we did in the US and Europe, where it was just intractable,” he said.

The country has begun to pay a price for abandoning market reform and reverting to the iron-control of the Maoist state under Xi Jinping. The tariff will rise with time.

Official GDP figures today clocked in at 6.6 percent last year, the slowest since 1990. While in line with analyst expectations, it was slower than the 6.8 percent posted the year prior.

The economy faltered most at the end of the year, recording 6.4 percent growth for the fourth quarter. But true growth has already slipped to near 4 percent in this downturn based on proxy measures. Capital Economics thinks the rate will slow ineluctably to nearer 2 percent by the early 2020s. There lies the middle income trap.

China’s corporate debt levels would be manageable if the torrid catch-up rates of growth of the past were still plausible. It is a harsher story in a future of structural stagnation.

END

A must watch interview: Bill Murphy and Rob  Kirby discuss the manipulation of the metals with Phil  Kennedy.

(courtesy GATA/Philip Kennedy)

GATA Chairman Bill Murphy and Rob Kirby interviewed on gold and silver market rigging

 Section: 

5:48p ET Monday, January 21, 2019

Dear Friend of GATA and Gold:

Interviewed by Philip Kennedy of Kennedy Financial (https://www.philipkennedy.com/), market analyst Rob Kirby of Kirby Analytics in Toronto and GATA Chairman Bill Murphy discuss gold and silver market manipulation, the refusal of mainstream financial news organizations to report about it, the recent interventions of the U.S. government’s “plunge protection team,” the prospects for returning gold to the world financial system, and other subjects. The interview is 53 minutes long and can be viewed at You Tube here:

https://www.youtube.com/watch?v=bytGFu2jCTw&feature=youtu.be

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

END

Now you know how manipulation is done//through these dark pools and are totally unregulated

(courtesy Pam Martens/Wall Street on Parade/GATA)

Pam Martens: The silence on Wall Street’s Dark Pools is deafening

 Section: 

By Pam Martens
Wall Street on Parade
Monday, January 21, 2019

It is destined to go down as one of the greatest journalistic and regulatory failures of our time — the lack of serious attention by investigative business reporters and the U.S. Department of Justice to the glaring fact that the largest Wall Street banks continue to trade their own and each other’s bank stocks in their own Dark Pools.

Dark Pools function as unregulated stock exchanges inside the bowels of the largest Wall Street banks. Making the situation even more dicey, some of the big banks own more than one Dark Pool, raising the possibility that there could be cross-trading between those pools to artificially inflate or depress stock prices.

JPMorgan Chase owns two Dark Pools; Citigroup currently owns at least two although it owned a lot more in the past; Morgan Stanley owns three; and then there is the Dark Pool that a consortium of Wall Street banks quietly own together. That one is called Level ATS. According to Wall Street’s self-regulator, FINRA, Level ATS is owned by Citigroup, Credit Suisse, LB I Group, Merrill Lynch LP Holdings, and Fidelity Global Brokerage Group.

After being repeatedly charged with collusion, should global banks be allowed to team up on the darkest of trading markets — that is, Dark Pools? Should felon banks like Citigroup and JPMorgan Chase be allowed to trade the stocks of their own bank? Should any Wall Street bank be allowed to trade its own stock in darkness?

… For the remainder of the commentary:

http://wallstreetonparade.com/2019/01/the-silence-on-wall-streets-dark-p…





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.

 

end

 

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

i) Chinese yuan vs USA dollar/CLOSED DOWN TO 6.8078/HUGE DEVALUATION FOR THE PAST FOUR WEEKS STOPS ON TRUCE/

//OFFSHORE YUAN:  6.8144   /shanghai bourse CLOSED DOWN 30.81 PTS OR 1.18%

 

HANG SANG CLOSED DOWN 191.09 POINTS OR 0.70%

 

 

2. Nikkei closed DOWN 96.42  POINTS OR 0.47%

 

 

 

 

 

3. Europe stocks OPENED ALL RED 

 

 

 

 

 

 

 

/USA dollar index RISES TO 96.36/Euro FALLS TO 1.1361

3b Japan 10 year bond yield: FALLS TO. +.00/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 109.44/ 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:: 52.88 and Brent: 61.63

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

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO +.24%/Italian 10 yr bond yield DOWN to 2.74% /SPAIN 10 YR BOND YIELD DOWN TO 1.33%…ITALIAN 10 YR BOND YIELD/GERMAN BUND: 2.50: DANGEROUS FOR THE ITALIAN BANKING SYSTEM

3j Greek 10 year bond yield FALLS TO : 4.14

3k Gold at $1282.60 silver at:15.27   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 9/100 in roubles/dollar) 66.36

3m oil into the 52 dollar handle for WTI and 61 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 109.44 DESTROYING JAPANESE CITIZENS WITH HIGHER FOOD INFLATION

30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning 0.9975 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1325 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.

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

3r the 10 Year German bund now POSITIVE territory with the 10 year FALLING to +0.24%

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 2.76% early this morning. Thirty year rate at 3.07%

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

6.  TURKISH LIRA:  UP  TO 5.3491

 

It’s A “Sea Of Red” As Global Stocks, S&P Futures Tumble

Monday’s selloff, which spared the US cash market which was closed for MLK day, has stretched for a second day, with US traders walking in to a sea of red in Asian and European markets, while S&P futures are down over 20 points following a pessimistic economic assessment by the IMF, renewed trade concerns after the US submitted a formal request to extradite the Huawei CFO from China and “very poor” results from UBS.

The appetite for risk is exceptionally low,” Ajay Kapur, head of Asia-Pacific and global emerging market strategy at Bank of America Merrill Lynch, told Bloomberg Television. “Most of the time, when you buy when sentiment is this depressed, you tend to make money,” unless there’s a recession, he said. “If you’re confident there will be no recession in the next year or so, I think this is a good indicator.”

Europe’s Stoxx 600 Index pared an early drop after Swiss banking giant UBS reported disappointing results and $13 billion in outflows, compounding what had been a catastrophic 2018 for Europe’s banking sector which lost nearly 30 percent of its value over the year, and sending UBS stock sliding while setting up a pessimistic tone for the continent’s banks which are set to begin reporting Q4 earnings.

After stocks rallied to the strongest start of the year since 1938, investors now find their conviction tested anew as a familiar litany of concerns weigh on sentiment. Adding to the sense of gloom, on Monday in its World Economic Outlook report, the IMF downgraded the global economy for the second time in three months when it predicted the global economy would grow at 3.5% in 2019 and 3.6% in 2020, down 0.2 and 0.1 percentage point respectively from last October’s forecasts.

In the latest confirmation that Europe’s economy is on the verge of a recession, today’s German ZEW Current Situation report printed at 27.6, a huge miss to the 43.0 exp. and the lowest in 4 years.

The downgrades heavily reflected weakness in Europe though, with Germany hurt by new car emission rules, Italy under market pressure due to Rome’s recent budget standoff with the European Union and Brexit worries aplenty too.  As a result, European stocks struggled to stay positive as U.S. futures pointed to a sharply lower open after Monday’s holiday.

“We have seen a little bit of a pull back, but whether it’s the IMF growth downgrade or China related is neither here nor there,” said CMC Markets’ senior analyst Michael Hewson. “We are at the top end of the range for this year and given the global uncertainty investors are probably taking the view that it is probably wise to take a bit of profit off the table.”
Earlier in the session, shares declined across Asia, with losses led by Chinese shares, as the Shanghai Composite slumped 1.2%, while Japan’s Nikkei skidded 0.5 percent, Hong Kong’s Hang Seng index closed down 0.8 percent and Sydney faltered 0.5 percent.  Without any direction offered from American markets that were shut Monday for a holiday, the focus turned to comments from Chinese President Xi Jinping stressing the need to maintain political stability and news that the U.S. will move forward with a formal request to extradite Huawei CFO from Canada, sending Chinese equities and the yuan lower. The Offshore yuan weakened 0.20% to 6.8145 per dollar, the weakest level since Jan. 10

In another sign of risk aversion, the Australian dollar, often used as a liquid proxy for China investments, eased 0.3 percent to $0.7134, putting it on track for a third straight session of losses. The same worries had also sent copper, used in electrical wires and vehicles, drifting lower in the metals markets.

In FX markets, the dollar climbed for a sixth day, holding at a near three-week high as investors sought the relative safety of the U.S. currency. That knocked the euro and most emerging market currencies, many of which have had a decent start to the year. Sterling was slightly higher at $1.29 after data showed British workers’ pay growth hit a new 10-year high and employment had grown by much more than expected in the three months to the end of November. There was demand too for the safe-haven yen with the Japanese currency last buying at 109.41 per dollar. The euro was near the floor of its recent trading range at $1.1358. Against a basket of currencies, the dollar was barely changed at 96.393.

Otherwise traders were still waiting to see whether UK Prime Minister Theresa May can push her Brexit plans through the country’s bitterly divided parliament.  May had offered tweaks on Monday by seeking further concessions from the European Union on a backup plan to avoid a hard border between the British-administered province of Northern Ireland and the Irish Republic. But she had also refused to rule out leaving the EU at the end of March without any deal.

In bonds, Bunds traded a round-trip back to unchanged on the day, cash 10s stalling around 0.23% early in the session before rebounding. UST yields are ~2bp lower across the curve, with 10s grinding lower after Monday’s market closure as curves flatten. Peripheral bonds tighten slightly to core. The 20Y Gilt auction was well received, bouncing off session lows are robust auction metrics.

In commodities, the global growth worries pulled oil prices lower with Brent down 55 cents at $62.19 and U.S. crude futures off 39 cents at $53.41. Euro zone government bond yields also fell. Most 10-year yields were down two basis points on the day with Germany’s at 0.225 percent compared to Friday’s one-month high close to 0.28 percent. The European Central Bank holds its first meeting of the year on Thursday.

Expected data include existing homes sales. J&J, Prologis, Travelers and IBM are among companies reporting earnings.

Top Overnight News

  • U.K. Prime Minister Theresa May’s Brexit Plan B turns out to be a re-run of her Plan A — seeking EU concessions on the deal she’s already negotiated with Brussels. But even if she succeeds, it’s not at all clear she could get the modified terms through Parliament
  • The U.K.’s main opposition party is backing a plan that could open the door to a second EU referendum, bringing the possibility of stopping Brexit a step closer
  • At a meeting of euro-zone finance ministers on Monday, the Irish central-bank governor Philip Lane became the first nominee to replace Peter Praet on the ECB’s Executive Board in June. That puts him in prime position to take on Praet’s powerful role of overseeing economic projections and writing monetary-policy recommendations
  • CME Group Inc. will move its FX forwards and swaps venue, which has trading volumes of about $15b a day, from London to Amsterdam, while Cboe Global Markets Inc. will shift most European equities trading to its market in the Dutch capital after Brexit
  • Confidence across the energy industry is now where it was in 2010, when Brent soared to $95 a barrel, according to a survey by Det Norske Veritas, incorporating the views of 791 senior oil and gas industry professionals between October and November
  • German Jan. ZEW Current Situation 27.6 vs 43.0 est; Expectations -15.0 vs -18.5 est
  • China CSRC Vice Chair doesn’t see China significantly cutting U.S. bond holdings
  • Trump says China should stop “playing around,” do “real” trade deal
  • U.S. to proceed in seeking Huawei CFO extradition, Globe says
  • China’s Xi warns of ’serious dangers’ to stability as risks mount

Market Snapshot

  • S&P 500 futures down 0.7% to 2,654.00
  • Lebanon’s Debt Urgency Prompts Moody’s Downgrade on Default Risk
  • Chinese Stocks Decline as Investors’ Outlook on Economy Darkens
  • Saudi Arabian Energy Minister Al-Falih Set to Cancel Davos Trip
  • Philippines Central Bank Governor Takes Indefinite Medical Leave
  • STOXX Europe 600 up 0.02% to 356.42
  • German 10Y yield unchanged at 0.255%
  • Euro down 0.02% to $1.1363
  • Brent Futures down 1.3% to $61.93/bbl
  • Italian 10Y yield rose 2.8 bps to 2.4%
  • Spanish 10Y yield fell 1.4 bps to 1.352%
  • Brent futures down 1.5% to $61.81/bbl
  • Gold spot up 0.3% to $1,284.41
  • U.S. Dollar Index little changed at 96.35

Asian equity markets were negative as the region lacked impetus following the non-existent lead from the US due to Martin Luther King Jr. Day and as the slowest growth in China in nearly 3 decades continued to reverberate across risk sentiment. ASX 200 (-0.5%) was led lower by underperformance in its largest weighted financials sector and with miners dampened following softer output numbers by BHP, while Nikkei 225 (-0.5%) was also pressured with losses later exacerbated by currency flows. Hang Seng (-0.7%) and Shanghai Comp. (-1.2%) conformed to the downbeat tone in the aftermath of the recent Chinese growth figures which some expect to further deteriorate this year and after the PBoC refrained from open market operations for a 2nd consecutive day which resulted to a net daily drain of CNY 80bln, while there were also reports the US is to proceed with the formal extradition of Huawei’s CFO. Finally, 10yr JGBs were underpinned amid the uninspiring risk tone in the region and as yields also declined in the super long-end in which the 40yr yield drop to its lowest since 2016.

Top Asian News

  • Lebanon’s Debt Urgency Prompts Moody’s Downgrade on Default Risk
  • Chinese Stocks Decline as Investors’ Outlook on Economy Darkens
  • Saudi Arabian Energy Minister Al-Falih Set to Cancel Davos Trip
  • Philippines Central Bank Governor Takes Indefinite Medical Leave

Major European equities extended losses [Euro Stoxx 50 -0.6%] after briefly pairing back opening losses as the risk sentiment continued to deteriorate. The European banking sector is underperforming, with the sector weighed on by UBS (-4.3%) following poor results; with this dragging other banking names down in sympathy such as Credit Suisse (-1.0%) and Deutsche Bank (-3.6%). Deutsche Bank also impacted by reports that they, alongside another bank, have been accused of fraud with a EUR 11bln lawsuit filed against them. Other notable movers include IG Group (-6.7%) who are at the bottom of the Stoxx 600 after stating that their HY net revenue and profit are down by 6% and 18% respectively. At the other end of the Stoxx 600 are Hugo Boss (+5.0%) who reported a beat on their Q4 sales.

Top European News

  • Deutsche Bank Sued for $12 Billion by Sabet Over Lost Lawsuit
  • U.K. Wages Grow at Fastest Pace Since 2008 in Tight Labor Market
  • Italy’s Populists Make France Nemesis Ahead of European Vote
  • Thiam Says Things Looking Up After ‘Difficult’ Fourth Quarter
  • Auchan May Pay Up for Bond as French Unrest Adds to Challenges

In FX, the DXY is relatively flat on the day but choppy within a 96.300-480 range following an uneventful Asia-Pac session. The buck experienced a bout of Dollar demand in earlier European trade which coincided with comments from the Chinese Foreign Ministry regarding the extradition of Huawei’s Executive Meng wherein China strongly opposed the decision by the US and stated they will retaliate in accord with US lawmakers’ decisions. This saw the DXY push higher to intraday highs and levels just shy of 96.500 before a tweet by China’s Global Times Editor stating that China will not yield to an unequal deal from the US sent the index lower to around the middle of today’s range. On the States-side data front, today sees a scarce calendar with the release of existing home sales scheduled.

  • GBP – Mixed trade as the Pound benefits from the pullback in the buck alongside optimistic jobs data in which headline average earnings beat expectations while the ILO unemployment rate ticked lower. Cable showed some strength in the run-up to the release and as the numbers provided further impetus for the Sterling, GBP/USD extended gains and breached its 100 DMA to the upside at 1.2891 to reclaim 1.2900 and print session highs of 1.2930. On the Brexit front, in yesterday’s statement PM May said she will to head back to the EU for dialogue, while The Telegraph reported that her chief Brexit negotiator is privately doubtful on her ability to renegotiate the Irish backstop. Furthermore, she dismissed the idea of extending Article 50 with reports emerging by BBC’s Assistant Political Editor Smith stating that Ministers will have to sit through the February recess and weekends to achieve in deal in by the Brexit date, which markets could perceive as a positive as it potentially gives them more time to achieve an appropriate deal. Meanwhile, Tory lawmaker Rudd warned that the Premier could face a dozen resignations if Tory MPs get no vote on plans to stop a no-deal Brexit, though analysts at JPM see the likelihood of a no-deal at 5%.
  • EUR – Little changed against the Dollar as the single currency fails to benefit from the receding buck as gains are capped by the Sterling-induced decline in EUR/GBP following the aforementioned UK jobs data and Brexit developments, while the release of mixed ZEW number did little to move the single currency. EUR/USD remains flat around 1.1360 while EUR/GBP resides close to session lows under 0.8800 with no notable option expiries today.
  • JPY – A positive day for the Yen amid overnight strength from the risk-averse tone and as the BoJ began their 2-day policy meeting (full preview available on the Research Suite). USD/JPY hovers under 109.50 (vs. low of 109.34) with the pair’s 50 and 200 DMAs poised to form a death-cross.

In commodities, Brent (-1.9%) and WTI (-1.8%) extended losses as the complex is impacted by the negative risk tone and US absence from market yesterday. The energy complex saw another leg lower after Saudi Energy Minister Al Falih has reportedly cancelled his trip to Davos; Al Falih was due to speak on Wednesday on the New Energy Equation but more importantly, the Energy Minister was due to hold talks on the recent OPEC+ production cuts with the Russian Eenergy Minister. Elsewhere, the Canadian province of Alberta is expected to announce a CAD 2bln oil sector investment plan. Separately, as yesterday was a US holiday API weekly data will be released tomorrow. Gold (+0.3%) is in the green, trading towards the top end of the sessions range as markets continue to be impacted by the negative risk tone and a receding dollar. Elsewhere, China’s top steel-making city of Tangshan has issued a level 2 smog alert; to be effective until January 25th. BHP, the world’s biggest miner, reported a 9% fall in iron ore production, as well as highlighting USD 600mln impact due to iron and copper operations disruptions.

Looking at the day ahead, the lone release is December existing home sales which is expected to show a small decrease (-1.5% mom) during the month. Elsewhere the annual Davos shindig kicks off today while the earnings highlights include Johnson & Johnson and IBM in the US, and UBS in Europe.

US Event Calendar

  • 10am: Existing Home Sales, est. 5.24m, prior 5.32m; MoM, est. -1.5%, prior 1.9%

DB’s Jim Reid concludes the overnight wrap

Well we hope you survived Blue Monday yesterday, supposedly the most depressing day of the year. The guy who decided upon this used the following equation to denote it where W = weather, D = debt, d = monthly salary, T = time since Christmas, Q = time since failing our New Year’s resolutions, M = low motivational levels, Na = the feeling of a need to take action. If there are any quants out there that would like to tighten up this equation then feel free. For it to work for me I may need to add days since I was last injury free and days since our builder last increased the price of our renovations. These would be T-0 and T-1 respectively.

((W + (D – d)) x T^Q) / (M x Na)

To be fair Blue Monday was very quiet with the US on holidays. The latest Brexit developments were the focal point but in truth nothing much happened on that front. In her House of Commons speech yesterday, May ruled out a second referendum, which was largely as expected, and reiterated the greater role for parliament on the future relationship, as well as making assurances over EU worker rights. May specifically said that she will be “more flexible, open and inclusive in the future” as to how the government engages Parliament showing a slight move to embrace wider views. However in essence this is Plan A, but with hope that the Tories and DUP can coalesce around a better solution for the Irish problem and then persuade Brussels (and of course the Irish) to accept it. So not a huge amount of new news. What will be important now is what amendments get tabled ahead of Tuesday’s vote and whether or not they get a majority when voted on. That may give us a guide as to what Parliament can agree on and what is a non-starter. I can’t help feeling that if Parliament takes over this process it might actually give the two main parties a way of saving face. At the moment it’s difficult for either to back down for various reasons (splits within their parties) but if Parliament chooses the path for them and takes over it may allow for blame to shift.

The latest news in today’s Times suggests that the government divisions remain. Cabinet minister Amber Rudd has apparently warned No 10 that it could face 25-40 resignations from the government if Tory MPs are banned from voting for a plan that helps stop a no-deal Brexit. This is based on an amendment drafted by Labour’s Yvette Cooper and the Tory backbenchers Sir Oliver Letwin and Nick Boles. Ms Rudd is trying to persuade the PM to allow a free vote to allow a consensus to form. This perhaps fits with my view that Parliament taking over might be the best way of saving face and getting a deal. It’s worth noting that overnight opposition leader Corbyn has proposed the amendment of a second referendum.

May’s comments did at least help to lift Sterling marginally as it touched an intraday high of $1.291 before it settled down to trade broadly flat overnight at $1.288. Gilts were actually stronger through much of yesterday and ultimately finished -2.9bps lower in yield while the FTSE 100 and FTSE 250 finished a rather tepid +0.03% and -0.01% respectively. Overnight, sentiment more broadly in Asia is weaker with the majority of bourses in the red as we go to print. That’s the case for the Nikkei (-0.56%), Hang Seng (-1.01%), Shanghai Comp (-0.73%) and Kospi (-0.58%). Futures on the S&P 500 are also down -0.72% with the US market set to reopen today following yesterday’s holiday while EM FX is also struggling. Comments from China’s Xi (more below) appears to be playing a part while Bloomberg is also reporting that the US is to proceed in seeking the extradition of Huawaei’s CFO from Canada.

That US holiday meant it was predictably quiet for markets in Europe yesterday with equity bourses limping to small losses for the most part during a low volume session. That was the case for the STOXX 600 which ended -0.19% and so brought to an end a four-day winning run. Banks (-0.46%) – hot on the heels of four straight weekly gains – struggled as did utilities (-1.08%). The DAX (-0.62%), CAC (-0.17%), IBEX (-0.17%) and FTSE MIB (-0.35%) also closed lower while in contrast it was a slightly stronger day for cash credit – albeit modestly so – with IG and HY spreads both 1bp tighter. Bond markets were similarly unexciting. Bunds closed -0.7bps lower in yield while the periphery was 1bp to 3bps higher. Elsewhere WTI oil touched the highest level in two months intraday yesterday before fading overnight to trade down -0.69% versus Friday’s close.

While there might have been an element of the lull before the storm in markets yesterday with a packed rest of the week calendar ahead of us, if you did have to point the finger then the ever so slight risk-off tone could be attributed to comments made by China President Xi Jinping at a seminar of provincial leaders and ministers in Beijing. He said that “the (Communist) Party is facing long-term and complex tests in terms of maintaining long-term rule, reform and opening-up, a market-driven economy, and within the external environment”. The President also said that “the party is facing sharp and serious dangers of a slackness in spirit, lack of ability, distance from the people, and being passive and corrupt”. To counter all this Xi signalled that China will maintain economic operations “within a reasonable range”. This all appeared largely consistent with previous comments but adds to the slew of slowdown concerns coming from China now. On that note, post yesterday’s data, our Chinese economists reiterated their forecasts for GDP growth to fall to as low as 5.9% in Q2 before rebounding post policy loosening in March. See their report here.

Elsewhere, the IMF’s latest global growth forecasts were released yesterday. The Fund now expects 2019 growth to be 3.5% which compares to the 3.7% forecast made in October. That would also mark the slowest rate of growth in three years while the 2020 forecast now is for 3.6%, a small downward revision of one-tenth. At a regional level the forecast for emerging markets was revised down two-tenths this year to 4.5% while advanced economies are expected to grow 2.0% (one-tenth downward revision). The US is expected to grow 2.5% and 1.8% this year and next (both unrevised) which is broadly in line with the consensus on Bloomberg.

Finally, as for the day ahead, it’s a busy morning for data here in the UK with November and December employment stats due out (no change in the 4.1% unemployment rate or 3.3% yoy average weekly earnings prints expected) and December public sector net borrowing data. Also due out is the January ZEW survey in Germany. This afternoon in the US the lone release is December existing home sales which is expected to show a small decrease (-1.5% mom) during the month. Elsewhere the annual Davos shindig kicks off today while the earnings highlights include Johnson & Johnson and IBM in the US, and UBS in Europe.

 

3. ASIAN AFFAIRS

i)TUESDAY MORNING/ MONDAY NIGHT: 

SHANGHAI CLOSED DOWN 30.81 PTS OR 1.18% //Hang Sang CLOSED DOWN 191.09 POINTS OR 0.70% /The Nikkei closed DOWN 96.42  PTS OR 0.47%/ Australia’s all ordinaires CLOSED DOWN 0.49%

/Chinese yuan (ONSHORE) closed DOWN  at 6.8078 AS TRUCE DECLARED FOR 3 MONTHS /Oil UP to 52.88 dollars per barrel for WTI and 61.63 for Brent. Stocks in Europe OPENED /RED 

//ONSHORE YUAN CLOSED DOWN AT 6.8078 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.8144: HUGE DEVALUATION/PAST SEVERAL DAYS RESUMES// TRADE TALKS NOW ON/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED   : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /CHINA RETALIATES WITH TARIFFS/ TRUMP RESPONDS TO NEW TARIFFS AND IT NOW A FULL TRADE WAR COMMENCED

 

3 a NORTH KOREA/USA

 

 

 

 

i)North Korea//USA/Sweden

 

end

3 b JAPAN AFFAIRS

3 C CHINA

i)CHINA/USA/HUAWEI

This is extremely important:  Trump is said to prepare an executive order restricting Chinese telecoms Huawei and ZTE.  If  they restrict them from doing business in the USA as well as provide products to adversarial countries. or other foreign entities not to the liking of the USA:   that is the equivalent to a death sentence.

(courtesy zerohedge)

“Huawei Death Sentence”: Trump Said To Prepare Executive Order Restricting Chinese Telecoms

In the media frenzy surrounding Special Counsel Mueller rare statement slamming Buzzfeed’s “report” that Trump had instructed his former lawyer Michael Cohen to lie to Congress, an important development in the US-China saga quietly snuck under the radar. Because one day after the WSJ reported a since denied story that the US, or rather Steven Mnuchin, is seeking to lift China tariffs (to boost the market), and on the same day that Bloomberg reported China had offered a path to slash its US trade surplus by importing up to $1 trillion more in US goodsBloomberg also reported late in the day, that the Trump administration is preparing an executive order that would “significantly restrict Chinese state-owned telecom companies from operating in the U.S. over national security concerns”, the latest escalation at the heart of the ongoing US-China feud, namely China’s ongoing technological theft, pardon, “transfer.”

While the order, which hasn’t yet been presented to the president, does not explicitly mention Chinese telecom giants such as Huawei Technologies or ZTE by name, and would not outright ban U.S. sales by the firms, it would give greater authority to the Commerce Department to review products and purchases by companies connected to “adversarial countries”, including China, reported Bloomberg citing “people familiar with the matter.”

The underlying tension is familiar to everyone who has followed the recent arrest of Huawei’s CFO in Canada, who is pending extradition to the US: Huawei has been pushing to take a global leadership position in 5G, but many American and foreign officials suspect the company’s products are being used by Beijing to spy on Western governments and companies (despite the rare denial by its reclusive founder Ren Zhengfei who said he would “never do anything to harm any country”). Both Huawei and ZTE have also been targeted by the U.S. for alleged schemes to dodge American sanctions on Iran.

To be sure, the report is hardly a surprise: after all rumors have abounded for months that the Trump administration would target Chinese telecom companies with an executive order to ban their U.S. sales. Last December, Reuters reported in December that Trump would consider an order declaring a national emergency related to the firms.

However, what is notable is the timing, which comes just as various reports suggest a renewed push for a ceasefire in the trade war with China and which in turn helped send the Dow Jones some 500 points higher in just the past two days.

So while it remains to be seen if this particular report will lead to anything more actionable, Bloomberg reports that some U.S. companies are already preparing for a possible executive order by the Trump administration in the next few weeks that could inflict serious harm on Huawei, perhaps making it impossible for the company to operate, according to James Mulvenon, a China specialist who works for defense-contractor SOS International.

The maximal version is that they would have a death sentence for Huawei like they threatened to do to ZTE,” which of course is the Chinese network-equipment supplier that President Trump spared last year from a threatened cutoff from crucial U.S. parts which nearly led to a collapse in one of China’s largest companies. The minimal version is that Huawei will be banned from sales in the U.S.”

Citing another “person familiar”, Bloomberg said that an order could be presented to Trump as soon as next month. The order the person outlined would give the Commerce Department discretion to decide which companies and which products to scrutinize.

The preparation of the order comes against the backdrop of Trump’s trade war with Beijing. But national security, not economic concerns, are driving the discussion, the person said.

Reached by Bloomberg, a spokesman for the White House National Security Council wouldn’t confirm whether an order is in the works, but did state that “the United States is working across government and with our allies and like-minded partners to mitigate risk in the deployment of 5G and other communications infrastructure.” In the statement, spokesman Garrett Marquis also said that “communications networks form the backbone of our society and underpin every aspect of modern life. The United States will ensure that our networks are secure and reliable.”

It is unclear if and when Trump will actually pull the plug; what is absolutely certain is that when he does, not only will diplomatic tensions between Washington and Beijing escalate to a new level, but any hopes for a swift resolution in the trade war between the US and China will be crushed (along with the market).

END
The real truth behind 5 G technology being developed by leader Huawei and why the uSA is so adamant that it wants to take them off line. The reason:  the internet will now become decentralized and the USA wil no longer be able to control what is going on in the world.
(courtesy Tom Luongo)_

5G, Huawei, and Us – America Hates Competition

Authored by Tom Luongo,

While no one, including me, doubts that the intensity of corporate espionage that goes on in the tech industry the latest news in the Trump Administration’s assault on Chinese telecom giant Huawai should dispel any doubts as to what the real issue is.

The Trump administration is preparing an executive order that could significantly restrict Chinese state-owned telecom companies from operating in the U.Sover national security concerns, according to people familiar with the matter.

Reached by Bloomberg, a spokesman for the White House National Security Council wouldn’t confirm whether an order is in the works, but did state that “the United States is working across government and with our allies and like-minded partners to mitigate risk in the deployment of 5G and other communications infrastructure.”In the statement, spokesman Garrett Marquis also said that “communications networks form the backbone of our society and underpin every aspect of modern life. The United States will ensure that our networks are secure and reliable.”

As always with statements in stories planted in major U.S. media houses like these what isn’t said is more important than what is said.

There are two major bones of contention with Huawei from the U.S. government’s perspective.

First is that Huawei is way ahead of everyone else in 5G technology.

They have the only end-to-end technology stack in the industry. Turnkey 5G networks from antennas and chips to the power stations needed to operate them. Simply peruse their website to see what I’m talking about.

All across the “Five Eyes” countries we have seen announcement after announcement of their banning Huawei 5G equipment from their networks. This is as much economic protectionism as it is about ‘national security.’

But, the real issue here is that, in very short order, Huawei has become a global leader in 5G infrastructure technology which the U.S. is falling behind on.  And now with this arrest [Huawei CFO Weng Wanzhou] Trump is betting that he can scare everyone else into not buying their superior products through the ruinous application of sanctions policies.

The West has been systematically cutting Huawei out of the global 5G rollout because of ‘security’ concerns. More like profit concerns.  It is, simply, typical protectionism by Mr. Tariff himself.

And he’s made no bones about any of this.  Trump has stated quite emphatically that all a policy has to do is pass his ‘America First’ sniff test and it’ll get implemented.

And since he’s not a deep thinker, all he cares about are first-order effects and how he can sell it on his Twitter feed to his now brain-dead base who believes all of this ‘China hacked muh everything’ narrative we’re being inundated with all of a sudden.

So that’s the first angle on this.

But, the real issue isn’t just Huawei’s technological advantage which will put it in the driver’s seat to connect most of the unconnected world.

The real issue is that nothing has changed since a 2014 report from The Register that Huawei categorically refuses to install NSA backdoors into their hardware to allow unfettered intelligence access to the data that crosses their networks.

However, documents disclosed by Edward Snowden this year suggest Huawei may be more sinned against than sinner. The US National Security Agency’s ‘Tailored Access Operations’ unit broke into Huawei’s corporate servers, and by 2010 was reading corporate email and examining the source code used in Huawei’s products.

“We currently have good access and so much data that we don’t know what to do with it,” boasted one NSA briefing. The slides also disclose the NSA intended to plant its own backdoors in Huawei firmware.

So, make no mistake, the China hawks in the Trump administration are willing to derail a much-needed technology rollout in order to maintain complete control over data flow which four years ago was beyond their ability to process.

John Bolton is willing to start WWIII over a couple of pipe bombs thrown at the U.S. embassy in Baghdad, for pity’s sake. Is it so far-fetched to believe he doesn’t want us to have 5G data access without the security blanket of spying on anyone he wants at any time?

Never forget that when they are presenting you with one bogeyman it is to distract you from the real one — them. We know from the myriad of leaks and data breaches that all of our data winds up in the hands people we didn’t give consent to.

We know that the NSA has access to any information it wants, obtained via the fiction of ‘legal channels.’ So why should we go through the fiction of pretending like Huawei is the real threat?

They may very well be, but it hasn’t been proven and it would be bad business for them to actually do so.

The national security angle is simply about Huawei refusing the U.S. repeatedly on granting backdoor access to our information.

It reveals both an insecurity and an insanity that grips every society in the late stages of Imperialism. As the competitive edge is lost the threat of competition fuels paranoia and the need to control everything.

But it is this need for control and the diverting of an ever-increasing proportion of the country’s resources to it that drives further loss of competitive edge.

Simply put capital isn’t going into innovation, it’s going into defending your moats, as Warren Buffet would put it. Moats around your business aren’t permanent. They require maintenance and innovation to remain strong.

Banning Huawei’s 5G network technology will ensure the communications gap between the U.S. and the rest of the world remains since the best products will not be on the market to spur competition, drive prices and costs down which fuel the next round of innovation.

Even as patriots worried about China’s most nefarious schemes we should not be applauding this. Because 5G itself is technology so far in advance of where we are now it means a completely different Internet architecture.

We’re staring at one capable of resisting the ham-fisted control techniques currently in place to keep us bottled up behind pay-walls, app-stores and, most importantly, hub and server connectivity.

Bandwidth so wide it means peer-to-peer networks so fast we won’t need sites like YouTube or Periscope to do citizen journalism. Deplatforming will become harder and harder. Decentralized data storage on blockchains which they can’t hack, etc.

And that’s what truly scares these people. What happens when the net itself becomes so decentralized they won’t be able to pick up a phone and take you offline?

As always, regulators and generals like John Bolton are fighting the last war. And if history tells us anything those people always lose.

*  *  *

Please support the production of independent and alternative political and financial commentary by joining my Patreon and subscribing to the Gold Goats ‘n Guns Investment Newsletter for just $12/month.

end
Tuesday/CHINA/USA HUAWEI
China continues to threaten retaliation as the USA now confirms it will go ahead with its plan to extradite Meng
(courtesy zerohedge)

China Threatens Retaliation As US Confirms Plan To Extradite Huawei CFO

Despite China’s demands that the US government use the shutdown as an excuse not to make a formal extradition request for Huawei CFO Meng Wanzhou, DOJ officials have reportedly told a Canadian diplomat that the DOJ will submit its formal extradition request by the Jan. 30 deadline (the US has 60 days from the day of Meng’s arrest in Vancouver to formally ask for extradition).

The news, which was first published Tuesday by Canadian newspaper Globe and Mail, sent the offshore yuan lower as Chinese officials accused the US of “abusing” the extradition system in the Meng case. According to the report, David MacNaughton, Canada’s ambassador to the US, met with senior White House and State Department officials about the Meng case.

Meng

MacNaughton also reportedly expressed to Washington Canada’s unhappiness that it had been drawn into the dispute, and that several of its citizens are now facing retaliation from Beijing.

“We do not like that it is our citizens who are being punished,” he was quoted as saying. “[The Americans] are the ones seeking to have the full force of American law brought against [Meng] and yet we are the ones who are paying the price. Our citizens are.”

He also said the US had expressed its appreciation that Ottawa would honor the extradition agreement, and said that Canada would continue to press Beijing about releasing Michael Spavor and Michael Kovrig, the two Canadian nationals arrested on vague “national security” charges in the wake of Meng’s arrest.

In a warning issued after the report, Chinese Foreign Ministry spokeswoman Hua Chunying threatened that China would “take action” in response to the US’s decision, adding that the extradition convention was “an abuse” of power.

“Everyone has to be held responsible for their own actions. Both the US and Canada should be aware of the seriousness of the case and take steps to rectify the mistake.”

A Huawei executive speaking in Davos also vaguely accused the US of trying to exercise “supremacy”. Deputy Chairman Ken Hu told a panel that no one country should exercise “supremacy” in the global economy, a comment apparently directed at the US and its attempts to push Huawei out of Western markets.

“We are at the turning point of the restructuring of the global economy…the current globalization is the result of competition and cooperation based on comparative advantage. It’s not the pursuit of any single country for absolute primacy.”

Meng’s next court appearance is set for Feb. 6, which will be to set a date for her extradition hearing. Once the US submits its formal extradition request, the Canadian Department of Justice will have 30 days to decide whether to approve the request and begin extradition proceedings.

END

SUNDAY
Not good:  Taiwan is getting scared and they are holding live fire military exercises amid fears of a Chinese invasion
(courtesy zerohedge)

Taiwan Holds Live-Fire Military Exercise Amid Fears Of China Invasion 

Taiwan on Thursday conducted live-fire war drills along its west coast amid mounting fears that Chinese President Xi Jinping could use military force to annex the democratic island.

Artillery batteries, self-propelled artillery weapons, attack helicopters, and main battle tanks fired at targets off the west coast city of Taichung, while the island’s air force operated French-made Dassault Mirage 2000 fighter jets.

The war exercise followed a new report from the Pentagon outlining concerns about Beijing’s expanding military might, including a possible invasion of Taiwan.

“China … believes that U.S. military presence … in Asia seeks to constrain China’s rise and interfere with China’s sovereignty, particularly in a Taiwan conflict scenario,” the Pentagon report said.

In a meeting with US Chief of Naval Operations Admiral John Richardson in Beijing on Tuesday, China’s chief of staff Li Zuocheng warned about foreign forces coming to Taiwan’s help.

The US is Taiwan’s primary source of heavy military hardware and legally bound to respond if China invades the island.

China’s armed forces will “pay any price” to ensure China’s sovereignty, Zuocheng told Richardson at their meeting. China considers Taiwan, which split from the mainland amid civil war in 1949, as part of Chinese territory.

The trigger for the military drills could have been due to Taiwan President Tsai Ing-wen, recently rejected requests from President Xi for the island to move towards “unification” with China.

Major General Chen Chung-chi, the spokesman for Taiwan’s Defense Ministry said the military is updating its exercises to reflect the possibility of an amphibious invasion by China.

“We exercise the way wars are fought … so that we will be capable and confident in the defense of our country,” Chen told journalists in Taipei on Wednesday. “We are ready to face an enemy threat at any time.”

The drills come amid rising pressure from President Xi declaring, “Reunification is the historical trend and the right path, Taiwan independence is…a dead end,” during an address this month.

China Uncensored provides an informational video showing how China has a plan to invade Taiwan by 2020.

END
A good look as to why the bottom fell out of demand in China in many sectors
(courtesy Wolf Richter/WolfStreet)

Bottom Suddenly Falls Out of Demand in China in Many Sectors

“What we witnessed in November and December was just extraordinary.”

“I’ve been a manager for almost half a century, but this is the first time I’ve seen such a large single-month drop in orders for us,” said Nidec CEO Shigenobu Nagamori. “What we witnessed in November and December was just extraordinary.”

Nidec, a Japanese company with $14 billion in revenues last year, makes a wide range of electric motors, from tiny devices that make the iPhone vibrate to industrial motors. It’s the world’s largest manufacturer of motors for disk drives. For the automotive industry, it makes things like engine and transmission oil pumps, coolant pumps, control valves, and fans and blowers. It makes motors for industrial robots, etc.

It’s a supplier to Apple, other electronics makers such as hard-drive makers, but also appliance makers, automakers, robotics manufacturers, industrial equipment manufacturers, etc. In other words, the company is a key supplier of advanced parts to Chinese factories.

The company slashed production at the end of 2018 for Chinese automakers and appliance makers by over 30% because of weak demand, Nagamori said.

“We saw big slumps in November and December,” he told reporters. “We have faced extraordinary changes.”

Nidec reversed its previous forecast of record revenues and profits, lowering its revenue forecast by 10% for its fiscal year that is almost over (ending March 31). The revenue forecast leads to the first year-over-year revenue decline in nine years.

And not just in China: “Orders, sales and shipments in all business segments around the world saw major shifts,” he said.

But one of the sectors that is still strong in China is demand from EV makers, Nidec said. EV production is surging, propped up by heavy government incentives. Nidec has been building a factory in China for its newly developed EV traction-motor systems. Last month, it announced that it would also build factories for these systems in Poland and Mexico, and not just China as previously planned, hoping that this strategy will get it around the US-China trade dispute.

Nidec’s debacle in November and December isn’t based on smartphones, where there had been a slew of warnings from Apple and Samsung on down, with Apple warning two weeks ago that it “did not foresee the magnitude of the economic deceleration.”

Components for smartphones aren’t a large part of Nidec’s revenues. Instead, the company is getting rattled by manufacturers in the automotive sector, the home-appliance sector, and other sectors. So this is far broader than just smartphones.

And other companies have chimed in.

Yaskawa Electric Corp., one of the world’s major manufacturers of industrial robots, including for the auto industry, cut its earnings forecast a week ago for the second time in three months, this time by 10%, blaming weak demand from China and the semiconductor industry.

Kuka Group, the biggest German industrial robots manufacturer — 95% of which was acquired by a Chinese company in a hostile takeover — issued a second profit warning on January 10, after having already warned at the end of October. It blamed “primarily” the “stronger slowdown in the automotive and electronic industry in the fourth quarter 2018, ongoing uncertainties in the Chinese automation market and negative impacts from the project business.”

On Thursday, Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, warned that revenues would fall over 9% in the quarter compared to a year ago, the largest year-over-year decline since 2009.

The company blamed an “overall weakening of the macroeconomic outlook, including seasonally weaker demand for mobile products and high inventory levels.”

CEO C.C. Wei cited a “sudden drop in demand” for high-end smartphones, according to the Nikkei, and lamented the plunge in demand for chips used in cryptocurrency mining.

Among its customers are Apple, Huawei’s semiconductor arm HiSilicon Technologies, Nvidia, Qualcomm, Broadcom, AMD, MediaTek, NXP Semiconductors, and Xilinx.

CFO Lora Ho told reporters after the conference that TSMC had imposed a “hiring freeze” and is implementing strict cost controls in response to this situation.

The situation with the suddenly weakening demand in China has now transcended company-specific issues, such as Apple’s new generation of iPhones being too expensive or a sudden reluctance by Chinese consumers to buy American brands.

It has spread to the industrial sector that is supplying Chinese consumers with all kinds of Chinese-branded products, including electronics, cars, and appliances. This situation has deteriorated over the past few months at whirlwind speed, taking these companies by surprise, and creating deeply worrisome signals for the Chinese economy going forward.

In December, light new-vehicle sales in China plunged 13%, the fourth months in a row of double-digit year-over-year declines. Despite a stronger first half, auto sales for the whole year fell 4.1%, the first annual decline going back to 1990. Welcome to the big club of saturation and decline. Read...  China’s Consumers Rattle Global Automakers as Sales Plunge
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end

Monday;  China’s 2018 GDP growth weakens to only 6.6%.  China is slowing down dramatically

(courtesy zerohedge)

China 2018 GDP Growth Slows To Weakest In 28 Years

Update: Not wanting to bury the lead, here is some context for the mixed bag tonight from China. China’s annual GDP growth in 2018 was +6.6% – that is the weakest annual GDP growth since 1990…

*  *  *

After downbeat headlines over US-China trade talks, and following China’s greatest liquidity injection ever (over 1.1 trillion yuan last week) after weak Chinese macro data in the last few months (including the collapse of China trade data), all eyes were on tonight’s avalanche of China economic data.

The Q3 bounce in macro data was extremely weak...

And yuan has oddly strengthened…

Despite constant easing by fiscal and monetary authorities

After the weakest trade data since 2016, which reflects an end to export front-loading and the start of payback effects…

China just injected a record 1.16 trillion yuan into the financial system… (yea trillion with a ‘t’)

We’ve had no shortage of warning signs in recent weeks and months that the slowdown was becoming more broad based, including the official manufacturing PMI dipped below 50 into contractionary territory for the first time since March 2016.

China’s car sales, for example, declined last year for the first time in more than two decades.

Here’s another sign that China’s economy is slowing:GDP in the southern manufacturing hub of Shenzhen grew at 7.5 percent in 2018, Xinhua reported Friday. That compared with a growth rate of 8.8 percent in 2017, and 9.1 percent in 2016.

So what does tonight hold?

  • China Retail Sales YoY BEAT+8.2% (+8.1% exp)
  • China Industrial Production YoY BEAT +5.7% (+5.3% exp)
  • China Fixed Asset Investment YoY  MISS +5.9%(+6.0% exp)
  • China Property Investment YoY SLOWED +9.5% YoY
  • China Surveyed Jobless Rate WORSENED 4.9%

And last but not least the big one:

  • China GDP YoY SLOWED +6.4% (+6.4% exp)

And visually…

These figures at first glance should alleviate concerns that China’s slowdown would continuously get worse,although the question of course will be how reliable these figures are, but they do suggest that China’s efforts to support growth are already starting to have some effect.

There was no dramatic impact as yet in markets.

The question is – is good new, bad news? We have already seen how unsuccessful China’s easing efforts have been in stimulating any economic rebound… and the PBOC explicitly stated last week that there will be no blanket easing policies.

But, what really matters is China’s credit impulse and its lagged effect on the economy and market… and it just hit a new cyclical low…

China will set its 2019 growth target officially at the annual gathering of the legislature in March, known as the National People’s Congress. Reuters has reported that the plan is a range of 6 to 6.5%. But, as Bloomberg’s Chris Anstey notes, many economists would applaud if China abandoned the target entirely. In the past it has been faulted for giving officials the incentive of pursuing growth regardless of cost — leading to a build-up of bad loans and under-performing assets, weighing down on productivity and ultimately hurting the economy.

Of course, much like in the US, regardless of today’s numbers, the story has already moved on. That’s because the trade talks will determine whether or not there’s another dose of tariffs or other barriers to investment. They will also dictate any near term reforms that China will need to push through to sate the trade hawks in Washington.

end

 

TUESDAY/CHINA

This is a little scary! Xi warns of serious dangers to communist party rule as China’s economy is faltering.  He is very worried about social protests that will be forthcoming

(courtesy zerohedge)

In Unprecedented Speech, President Xi Warns Of “Serious Dangers” To Communist Party Rule

Since the days of Deng Xiaoping, the Chinese Communist Party has maintained its absolute authority over China’s roughly 1.4 billion people via an explicit social contract: the CCP would engineer an economic miracle that would lift hundreds of millions of people into the middle class, and in return, the Chinese people would accept the limitations on political freedoms demanded by the CCP.

But with China’s economy growing at its slowest pace in three decades and private sector businesses struggling with an unprecedented credit squeeze, President Xi Jinping must scramble to find a way to stabilize the country’s economy in the face of the US’s trade war escalation threats in order to ensure his legitimacy in the eyes of the public.

Xi

And in the latest sign that another crackdown on dissenters might lie ahead (remember when China started locking up short-sellers a few years ago?), Xi called an abrupt meeting of top party officials in Beijing on Monday, where he issued a warning about the need to maintain “political stability” in what Bloomberg described as “a fresh sign the ruling party is growing concerned about the social implications of the slowing economy.” The Communist Party, Xi said, must redouble its efforts “to prevent and resolve major risks”, with areas of concern facing the leadership ranging from politics and ideology to the economy, environment and external situation.

“The party is facing long-term and complex tests in terms of maintaining long-term rule, reform and opening-up, a market-driven economy, and within the external environment,” Xi said, according to Xinhua. “The party is facing sharp and serious dangers of a slackness in spirit, lack of ability, distance from the people, and being passive and corrupt. This is an overall judgment based on the actual situation.”

Suggesting that even more stimulus might be ahead, Xi said the country will maintain economic operations “within a reasonable range”. Though his isn’t the first time Xi has warned about the risks of slowing economic growth, this is the first time on record where he has warned about the “serious” threats to the party’s “long-standing rule.” The meeting was unusual in that, while Xi has occasionally assembled the country’s 200-member Central Committee, this is the first time he has called for a meeting of top officials without assembling the entire body.

One analyst said the Chinese leader wanted to draw attention to the preponderance of internal and external threats to stability in China.

“Xi is seeing more and more red flashes on his monitor as things on many fronts go wrong,” said Ether Yin, partner at Beijing based consultancy Trivium China. “He wanted to draw the whole system’s attention to that.”

Underscoring Xi’s point, China recently reported the slowest annual GDP growth in 28 years. The president’s remarks also coincided with data showing quarterly growth in Q4 decelerated to its slowest rate since 2009.

Analysts at Deutsche Bank argued that Xi’s comments could be behind the slight risk-off tone in global markets early Tuesday. Though they were “largely consistent” with previous comments, they added to a slew of slowdown concerns coming from China. DB also reiterated its economists’ call for Chinese GDP growth to slide to 5.9% in Q2, before rebounding.

With two key anniversaries approaching this year – the 30th anniversary of Tiananmen Square in June and 70th anniversary of the country’s founding in October – a wide-ranging crackdown on dissidents is looking increasingly likely.

end

As I promised you that this would happen:  The USA cancels trade talks as they are getting nowhere on the forced transfer of technology and I P theft.

stocks plummet late in the afternoon.

(courtesy zerohedge)

US Rejects Chinese Offer For Preparatory Trade Talks; Stocks Slide

This is the last thing investors worried about slowing growth in China wanted to see

Stocks took another leg lower Tuesday afternoon after the Financial Times reported that the US had effectively canceled the next round of US-China trade talks, which were expected to take place between senior officials. The talks were expected to set the table for a visit by a delegation led by China’s Liu He later this month. The report also calls into question President Trump’s rosy outlook on the trade talks.

This week’s planned trip by Wang Shouwen and Liao Min was intended to pave the way for a higher-level meeting in Washington on January 30 and 31 by Liu He, China vice-premier, and Robert Lighthizer, US trade representative.  But, according to people briefed on the negotiations, US officials cancelled this week’s face-to-face meetings with Mr Wang, a vice-minister of commerce, and Mr Liao, a vice-minister of finance, because of a lack of progress on “forced” technology transfers and potentially far-reaching “structural” reforms to China’s economy. 

The US refused the offer because Beijing has refused to offer concrete proposals about how they would curb IP theft and also implement certain structural reforms.

Trump’s negotiators wanted Mr Liao, one of Mr Liu’s closest aides, and Mr Wang to come to face-to-face talks in Washington with a written offer outlining how Beijing intended to address US complaints about technology transfers and structural reforms.

But, according to the people briefed on the stalemate, Mr Xi’s negotiators are refusing to alter their long-standing position that foreign companies are not forced to transfer technology to Chinese companies.

They also argue that Beijing’s recent offer to improve market access for foreign investors in certain sectors — and strengthen protection of intellectual property — should address US concerns.

Notably, the report follows a WSJ report earlier in the day which cited the work of independent business groups who found that China is moving ahead with its “Made in China 2025” initiative despite rumors late last year that China would move away from the policy. The Trump administration has repeatedly criticized the policy as an example of anti-competitive state support for domestic industry.

Dow futures are down over 400 points, accelerating losses on the trade headlines…

China

And the two-day gains from last week on trade hopes are almost entirely erased…

China

Yuan is dropping back towards the day’s lows…

 

4.EUROPEAN AFFAIRS

FRANCE

For the 10th straight weekend, the yellow vest movement continues in France and also in Belgium. The protesters battled against tear gas and aggressive riot cops

(courtesy zerohedge)

Yellow Vests Battle Tear Gas And Aggressive Riot Cops During 10th Week Of Chaotic Protests

Despite freezing temperatures and rain, tens of thousands of Yellow Vest protesters took to streets across France on Saturday for a tenth consecutive week of demonstrations, completely ignoring French President Emmanuel Macron’s call for a “national debate” – the latest scheme we can add to the pile of failed gimmicks aimed at stopping the movement.

And while the MSM is largely ignoring the size and scope of the protests, independent journalists, select foreign news outlets and others have been documenting the mayhem.

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Paul Joseph Watson

@PrisonPlanet

It’s kicking off in France for a 10th weekend running. pic.twitter.com/nQb3OuGPwQ

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Stéphanie Roy@Steph_Roy_

Intervention des forces de l’ordre et interpellation.

Partisan FB🏴@PartisanDE

🚨 ℹ 🔴 : The Situation out of control, it pulls in all directions !!

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Partisan FB🏴@PartisanDE

🚨 ℹ 🔴 explosive SITUATION 💥 right now ongoing between and regime forces during

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Protesters assembled by the Invalides plaza near the National Assembly and marched through the city’s Left Bank in freezing temperatures. The demonstrations were largely peaceful but, according to reporters, clashes broke out late in the afternoon between police and demonstrators, some wearing masks, in Paris’ central Invalides district.

Protesters threw firecrackers, bottles and stones at the police who responded with water cannon and tear gas to push them back.

Authorities said there were around 7,000 protesters in Paris, some of whom gathered near the world-famous Champs Elysees, while there were similar demonstrations in major cities across France. Rallies took place in Toulouse, Lyon, Rouen and other cities.

According to the French Interior Ministry, there were less protestors across France on Saturday, with the official number standing at 27,000 at around 2pm local time.

Embedded video

nonouzi@Gerrrty

’s Regime advance on .

A fire broke out at the Joan of Arc station in Toulouse, causing people to rush out and evacuate. The cause of the fire is currently unknown.

Bellingdog@Bellingdawg

Alert-Joan of Arc station, at , is on fire. The users are evacuated. The street medic’s going to get those trapped. Flames are escaping. The cause of the fire is unknown. very tense-10,000 demonstrators.

La Plume Libre@LPLdirect

🔴🇫🇷 ALERTE – La station Jeanne d’Arc, à #Toulouse, est en feu. Les usagers sont évacués. Les street medic vont chercher ceux qui sont piégés. Des flammes s’échappent. On ignore la cause de l’incendie. #ActeX très tendu – 10.000 manifestants. #19Janvier

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See Bellingdog’s other Tweets

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Compact News@NewsCompact

🚨 ℹ 🔴 Fires 🔥 are currently in progress during the

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Stéphanie Roy@Steph_Roy_

Twitter user @Bellingdawg is a highly recommended follow – both tweeting and retweeting footage you’ll never see on the evening news.

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Bellingdog@Bellingdawg

This fine has rich aromas of tear gas and burning flares, with a water-cannony freshness that is easy on the palate.

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Bellingdog@Bellingdawg

find another big door to burn in .

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Partisan FB🏴@PartisanDE

🚨 ℹ️ 🔴 First tensions at the Jean Jaurès station where the police force has just fired chemical weapons against members of the during

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32 people are talking about this

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Clashes between cops and members of the international on the Place Pey-Berland

Partisan FB🏴@PartisanDE

🚨 ℹ Vitry le François 🔴Macron’s regime forces strangled a protester at the , this . The young man tries to defend himself: “Why are you strangling me? I’m 20 years old !!

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32 people are talking about this

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Humain du capitalisme tardif@humainducapital

: situation tendue devant le commissariat de police.

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Luke Rudkowski

@Lukewearechange

Just a whole population getting tear gassed!

Did you know many major cities have BANNED the use of tear gas in populated areas because of effects on innocent bystanders which could include children and the elderly

END
UK
Rebel; backbenchers are planning to seize power from Theresa May and queue jump in  formulating legislation
(courtesy zerohedge)

Rebel UK MPs Are Planning To Seize Power From Theresa May

As Prime Minister Theresa May struggles to hash out a deal during the cross-party talks she promised after her Brexit withdrawal agreement was defeated by a stunning 230-vote margin, marking the worst defeat for a British government since the 1920s, a group of MPs are apparently so frustrated with this whole Brexit trainwreck that they’re willing to risk being effectively expelled from their parties (or what Brits call “deselection”) for a shot at a workable solution.

Case in point: According to reports published by Buzzfeed and CNN an influential cross-party group of MPs lead by Tory Remainer and former Attorney General Dominic Grieve is moving to table an amendment that would effectively tear up the parliamentary rule book and allow a mass of backbencher MPs to seize power from the government – something that would be practically unprecedented in the history of British politics – to decide what business comes before the Commons.

May

Ultimately, the measure would be intended to allow Parliament to pass legislation to delay Article 50 and put off Brexit, something that May is reportedly quietly considering as an option but has continued to publicly oppose. This comes after MPs earlier this month passed two amendments that limited May’s ability to run out the clock to force MPs to vote for her deal by threatening a ‘no deal’ scenario as the only alternative.

If the new amendment, which the group plans to table on Monday, the same day when May is expected to present her “Plan B”, which is expected to be put to a vote the following week. If the motion is brought for a vote, it would mark the fifth high stakes vote in the House of Commons this month (the two prior amendments, the deal vote, the no confidence vote and now this).

Here’s Buzzfeed with a synopsis of the plan…

Rebels are now coalescing around a new amendment which would overturn centuries of constitutional rules that give government business precedence in the Commons.

If the amendment succeeds, it would allow a motion put forward by a minority of 300 MPs across five parties – including 10 MPs from the governing party – to stand as the first order of business.

This would let a cross-party coalition of backbench MPs to grab power from the government and allow bills to be brought up and considered by the House.

Legislation could then be tabled by backbenchers to block a no-deal Brexit – something for which there is likely to be a Commons majority.

…and a draft of the amendment.

Brexit

The plan, which MPs are calling European Withdrawal 3.0, backbenchers would be able to compel the government to request that Article 50 be delayed.

A critical part of the bill – dubbed European Withdrawal 3.0 – would postpone the UK’s departure from the European Union on March 29 if parliament fails to agree on a way forward by then. That is the day on which Article 50 – the timetable for the UK’s withdrawal – expires. Any extension would have to be agreed by the other 27 members of the EU.

According to a research paper just published by the House of Commons library, the bill means that “the government would be compelled to request an extension of the two-year negotiating period under Article 50.” It says “the drafters of the Bill specifically contemplate an extension of just over 9 months, from 29 March 2019 to 31 December 2019.”

But it’s still unclear whether this plan has a strong chance of passing, given that no clear consensus alternative to May’s plan has emerged. One MP who opposed the plan told CNN that he believes seizing power from the government would be an affront to the British people, who voted for Brexit. The notion that the amendment would allow a minority of 300 MPs to control what business is brought in front of the House of Commons is also controversial as it cuts against the constitutional principal mandating that only a government with a majority be able to control business.

“I cannot think of any precedent for Parliament giving itself control over the government. It is genuinely historic. We used to take power from kings and peers and now we are arguably taking it away from the British people, and we are doing it in an arbitrary way because we do not like what they have said.”

However, one MP who apparently supports the effort said the notion that it would be somehow undemocratic isn’t accurate, because any final decision would still require the support of a majority MPs.

“…An MP involved in the plan insisted: “The idea that there’s something undemocratic about this when anything that ultimately happens will require a majority is cobblers.”

Regardless of what happens, while US markets are closed on Monday for the Martin Luther King Jr. Day holiday, it’s looking like it will be another extremely eventful day in the UK.

end
May outlines her new plan by stating that the original Good Friday agreement will not be changed but states that Parliament will have more control over trade negotiations
(courtesy zerohedge)

May Rules Out Changes To Good Friday Agreement, Offers Parliament More Control Over Trade Negotiations

Update 3: In his rebuttal, Labour Leader Jeremy Corbyn declared that “nothing has changed” on May’s end, and that a deal will only become workable when the Prime Minister agrees to surrender some of her infamous “red lines” – presumably a reference to Tories insistence that the UK leave the single market and customs union.

There is a clear majority in this House to support a deal in principle and ratify results, but it would require face reality and accept that her deal has been defeated.

Before moving forward, May must rule out ‘no deal’ and stop the ‘collossal waste of public money’ being spent preparing for a no deal outcome.

Today, heralds the start of a Democratic process where this House will debate amendments that will determine how we navigate Brexit. I believe there may be a majority in the House for a proposal that would include a customs union a single market and an agreement that would ensure no race to the bottom on workers rights.

Corbyn said Labour will back amendments that seek to rule out the prospect of no deal…and also remain open to the prospect of a second referendum.

The pound has moved higher on May’s deal outline as the lack of progress has raised the likelihood that Brexit will be delayed.

Brexit

* * *

Update 2: After acknowledging that this weekend’s car bombing in Derry was a stunning reminder of the high stakes of the Brexit process, May laid out her “Plan B” Brexit deal by setting forth six key issues that have dominated talks to date:

The right way to rule out ‘no deal’ would be for the House to pass a deal, not delaying Article 50.

  1. No second referendum (May believes there isn’t a majority for the second referendum, and even if there was, it would sow chaos and would strengthen the hand of those hoping to break up our United Kingdom. It would also require delaying Article 50 which – see point 1).
  2. We must respect the Good Friday Agreement and not allow the return of a hard border. This government will not reopen the Good Friday Agreement.
  3. We must figure out what kind of deal would pass Parliament then take this back to the EU. Ensuring Parliament has a “proper say” in the outcome of the eventual trade deal between the UK and EU to help assure the EU that an agreement won’t be sabotaged by Parliament at the last minute. As the negotiations progress, we will look to deliver confidential committee sessions to avoid undermining negotiations.
  4. Finally, we will reach out beyond this House and engage more fully with businesses, civil society and trade unions.
  5. We must provide Parliament with a guarantee that we will not erode workers rights.
  6. A number of members have made powerful representations about anxieties facing EU citizens in the UK and UK citizens in the EU. We have already committed to allowing EU citizens to stay in the UK and continue to access benefits in both a deal and no deal scenario. When we role out the scheme in full on March 30, the government will waive the application fee so there is no financial barrier for any EU nationals who wish to stay.

The vote on the motion to pass the updated deal will be held on Jan. 29. May will continue meeting with representatives from all parties as well as representatives from trade unions and the business community.

* * *

Update: With May expected to begin speaking any minute, the BBC’s Deputy Political editor has some updates on what May’s expected to say:

Laura Kuenssberg

@bbclaurak

May on her feet in Commons shortly – she ‘ll say more work to do on backstop, but hearing also she might scrap the fee for EU nationals who want to stay after Brexit, and promise select committees and other parties a bigger role in second phase of the negotiations

Laura Kuenssberg

@bbclaurak

May expected to promise ‘she will consider how we might meet our obligations to the people of Northern Ireland and Ireland in a way that can command the greatest possible support in the House, and then take these conclusions of these discussions back to the EU’

Laura Kuenssberg

@bbclaurak

PM also expected absolutely to rule out reopening the Good Friday agreement – statement soon on @BBCNews

 

After days of increasingly fraught – and ultimately fruitless – ‘cross party’ talks, Prime Minister Theresa May will offer a motion to move ahead with her “Plan B” Brexit deal, which is widely expected to mostly resemble “Plan A”, with a few minor tweaks. On Tuesday, the Commons voted down May’s deal by a historic 230 vote margin, the most crushing defeat endured by a British government since the 1920s. But May’s hope that the defeat would help bring the EU27 to the table has been dashed. The bloc’s leaders have affirmed that, while they might be willing to make adjustments to the political statement setting out a framework for the trade deal that is expected to be negotiated during the post-Brexit Day transition period.

According to Reuters, the proposals that May is expected to bring before Parliament on Tuesday will focus on winning more concessions from the EU. May will make a statement in parliament at 1530 GMT (10:30 am ET), where she is expected to put forward a motion on her proposed next steps on Brexit.

“It is clear already that a significant number of colleagues have expressed concerns around the backstop and that is one of the areas that we are going to be looking at,” May’s spokesman told reporters.

However, a ‘cross party’ group of rebel MPs who are reportedly plotting to seize power from May’s government with an amendment that, if passed, would defy centuries of precedent could throw a wrench in the works.

end

SWITZERLAND/UBS/LARGEST BANK IN SWITZERLAND

UBS falters in Europe/NYSE on very poor results as clients pull a huge 13 billion from their accounts

(courtesy zerohedge)

UBS Tumbles On “Very Poor” Results As Clients Pull $13 Billion

The parade of weak bank earnings continued on Tuesday when UBS, one of the first major European banks to report, announced that it had missed analysts’ profit estimates (though it did record a rise in full-year profits) due to outflows from its key global wealth management division.

UBS

Here’s a summary of its earnings report courtesy of Bloomberg:

  • UBS reports $7.9b in net new money outflows in global wealth management in 4Q, while asset management business saw outflows of $4.9b.
  • UBS says seen some normalization in markets in early 2019
  • Expects 1Q client activity affected by volatility, geopolitics, trade disputes
  • Market volatility remains muted, which is less conducive to client activity
  • 2018 dividend CHF0.70/shr
  • Targets to buy back $1b worth of shares in 2019 vs CHF750m in 2018
  • 4Q adj. pretax profit (excl. litigation costs) $1.01b vs company- compiled est. $1.04b
  • Global wealth management adj. pretax $912m vs est. $943m
  • Investment bank adj. pretax $30m vs est. $229m
  • Challenging markets affected equities, corporate client solutions revenues
  • 4Q adj. cost/income ratio 97%
  • Personal & corporate banking adj. pretax $375m vs est. $397m
  • Asset management adj. pretax $134m vs est. $119m
  • Investment bank adj. pre-tax profit $30 million vs $229 million company compiled est.
  • 4Q net $696m vs est. $729m
  • End-Dec. CET1 capital ratio 13.1%; CET1 leverage ratio 3.8%

The bank’s net profit attributable to shareholders for 2018 was $4.897 billion, compared with $969 million in 2017. That’s compared with a Reuters estimate of $4.906 billion. The bank warned about further weakness in its wealth management unit as it expects investors will continue to pull money out due to rising protectionism, increased market volatility and geopolitical tensions. Withdrawals at the bank’s global wealth management unit totaled almost $8 billion in Q4, while another $5 billion flowed out of it asset-management business.

UBS shares (-4.7%) led a drop in European bank shares…

UBS

…after its earnings report, which Citigroup analysts described as “very poor.”

“These are very poor results, and come as somewhat of a negative surprise so soon after the upbeat investor day,” analysts including Andrew Coombs at Citigroup wrote in a note to investors. In wealth management “the fourth quarter is usually seasonally weak, but this is disappointing.”

UBS CEO Sergio Ermotti, who is expected to face questions on succession planning on Tuesday, said the “normalization” in markets in early 2019 could benefit the bank’s bottom line for Q1.

“We have seen sine normalization in markets early in 2019, we will stay focused on balancing efficiency and investments for growth, in order to keep delivering our capital return objectives while creating sustainable long-term value for shareholders,” Sergio Ermotti, UBS chief executive officer, said in a statement Tuesday.

In an attempt to boost its sagging share price, the bank also announced its plans to purchase $1 billion of its shares in 2019, above the $751 million purchased in 2018.

END

GREECE/MACEDONIA
Riots in Greece today because Macedonia is changing its name to the Republic of Northern Macedonia. The reason for the rioting:  Greece has a northern province called Northern Macedonia and this why the populace are angry.
(courtesy zerohedge)

“Our Name Is Our Soul” – Greek Protesters Hurl Molotov Cocktails At Police Over Macedonia Name

In one of the most violent protests on the streets of Athens since the Greeks last narrowly avoided an all-out economic collapse back in 2015, thousands of angry Greeks gathered outside the Parliament in Athens on Sunday to protest an agreement between the Greek government and the government of Macedonia that aimed to put to rest a long-simmering conflict between the two neighbors over – of all things – the formal name of the former constituent of Yugoslavia.

Fire

In an accord that will help clear the way for Macedonia to potentially join the EU, Macedonia has agreed to change its name from the “Republic of Macedonia” to the “Republic of Northern Macedonia” under a deal between the two countries that was ratified in both Athens and Skopje.

Protesters tossed Molotov cocktails and attacked police, who responded by tear gassing the crowd.

Greece

Greece

Greece

Greece

But nationalist Greeks, who have long objected to Macedonia claiming the name “Macedonia” (which is also the name of a province in Northern Greece), have been infuriated by the deal. Many believe that the use of the name Macedonia implies a territorial claim on the Greek province, according to CNN.

“Giving away the name Macedonia means giving away our land. The aim of the protest rally is to send a message to politicians. Our name is our soul,” Giorgos Tatsios, a member of the rally’s organizing committee, said.

The protesters waved flags and chanted slogans including “Macedonia is Greece” and “Hands off Macedonia.”

Giorgos Golas, 46, who traveled to Athens for the day to attend, said living in the northern Greek town of Ptolemaida made him feel “vulnerable.”

“We don’t want an agreement that does not protect us from minority issues being raised or territorial claims.”

Greek police said 60,000 people took part in the rally, which was held ahead of a vote in Parliament that could take place as early as next week. The agreement is widely expected to be ratified, despite all opposition parties opposing the deal. Prime Minister Alexis Tsipras said he believes its his “patriotic duty” to ratify the agreement, despite its unpopularity

end

5.RUSSIAN AND MIDDLE EASTERN AFFAIRS

Monday/Israel/Syria/Iran

 

Israel attacks Iranian sites next to the Damascus airport.  The Israelis have demanded that the Syrian should back away but that was to no avail as Syria launched its own missiles only to be intercepted by the Israeli defense iron dome.  This is an ongoing story.

(courtesy zerohedge)

Israel Announces Sustained Strikes On Damascus; Syria Fires Back In Major Escalation

It’s the first time that Israel has ever announced strikes against Iran inside Syria and in real time. Moments after a massive wave of rockets were fired on Damascus, activating Syrian anti-air defenses Sunday night, the Israeli Defense Forces (IDF) announcedWe have started striking Iranian Quds targets in Syrian territory. We warn the Syrian Armed Forces against attempting to harm Israeli forces or territory.”

Sustained Israeli attack on Damascus overnight Sunday, via local Syrian sources. 

This is unprecedented given that in every other among the dozens of prior recent Israeli attacks on Syria, the IDF has never acknowledged responsibility so quickly and certainly not while they are ongoing, usually declining to confirm or deny after the event.

Israel Defense Forces

@IDF

We have started striking Iranian Quds targets in Syrian territory. We warn the Syrian Armed Forces against attempting to harm Israeli forces or territory.

Twelve hours prior the IDF said its Iron Dome Aerial Defense System intercepted a Syrian rocket fired into the northern Golan Heights after Israel launched a prior rare daylight raid on Syria on the “international airport, southwest of Damascus,” according to Syrian military officials. In what marks a major escalation, it appears Damascus responded to that attack with what Israeli media has called an “intentionally fired offensive surface-to-surface attack.”

The Israeli intercept of that inbound Syrian surface-to-surface missile was caught on dramatic video, per The Times of Israel:

The interception of the incoming Syrian projectile was seen over Mount Hermon, Israel’s tallest peak, which was full of visiting skiers, following a stormy period that dusted the mountain with snow.

Embedded video

החדשות

@NewsChannelIL

צפו: כיפת ברזל מיירטת רקטה שנורתה לחרמון – מנקודת מבטם של הגולשים | @guyvaron http://bit.ly/2RCQEOd

Israel’s Sunday night attack has involved dozens of strikes reportedly from F-16 jets flying over Lebanon targeting locations in and around southern Damascus. Syria’s Pantsir and Buk air defense missile systems have reportedly shot down an unknown number of inbound Israeli rockets according to early unconfirmed video.

Embedded video

maytham@maytham956

SyAAD is engaging enemy projectiles in Southern Syria.

We also have unconfirmed reports of Syrian Air Force first response squadron’s participation.

Israel also reportedly launched multiple cruise missiles during the sustained assault. Local Syrians have described prolonged sustained explosions both overhead and on the ground, but it remains unclear how many Israeli rockets actually made it past Syrian defenses.

Embedded video

Babak Taghvaee@BabakTaghvaee

That was a successful hit on an ‘s a Delilah cruise missile by 57E6 missile launched from a Arab Air Defense Force SA-22 Pantsir over .

The IDF has warned Syria not to respond, which appears to be unheeded as Israeli media is reporting thatanti-air defenses have been activated by inbound Syrian rockets over northern Israel and the Golan Heights.

Majd Fahd 🇸🇾

@Syria_Protector

air-defenses systems have been activated in the Golan Heights and northern Israel. https://twitter.com/alonbd/status/1087134849687797760 

As of 1:45 AM Beirut time Al-Masdar News reports the following:

The Israeli Defense Forces (IDF) unleashed a massive attack on the Damascus countryside at 1:05 A.M. (local time), tonight, hitting a number of targets in and around the town of Al-Kisweh.

According to a military source, Israeli jets were first spotted over Jabal Sheikh-Golan Heights area; they would then fire several missiles towards Al-Kisweh.

The Syrian military then activated their air defense units, but were unable to stop all the missiles that were fired at the Damascus countryside.

The reported added, “The Israeli Air Force is now launching another wave of strikes on Damascus, with some reports claiming they are hitting targets near the Damascus International Airport.”

Strikes appeared to have subsided an hour or more after they began, and are reported to have included in total over 40 rockets launched in four waves.

developing…

end

 

The rhetoric between Iran and Israel getting stronger by the minute. Israel must have administered considerable damage to Iran’s military weapons infrastructure inside Iraq

 

(courtesy zerohedge)

Iran Ready To “Eliminate Israel From The Earth”; IDF Trolls Tehran Over Twitter

The head of Iran’s air force said on Monday that the Islamic Republic’s pilots are looking forward to facing Israel, and will “eliminate it from earth” after Israeli airstrikes on alleged Iranian targets inside Syria killed 11 people, including four Syrian soldiers. 

Brigadier General Aziz Nasirzadeh, commander of the Islamic Republic of Iran Air Force (IRIAF) made the comments to the Young Journalist Club news agency following Israel’s strike on munition storage facilities within Damascus International Airport, a military training camp and an Iranian intelligence site, according to The Independent.

The young people in the air force are fully ready and impatient to confront the Zionist regime and eliminate it from the Earth,” said Nasirzadeh.

Israel claims it launched the strikes in retaliation for a surface-to-surface rocket fired on Sunday by Iran’s Quds Force from within Syria at a ski resort in the Israeli-occupied Golan Heights, which was intercepted by Israeli air defenses.

“That’s a civilian site and there were civilians there,” said Israeli army spokesman Lt. General Jonathan Conricus Monday morning, adding “We saw that as an unacceptable attack by Iranian troops, not proxies in Syria.”

In addition to that, the area from which the Iranians fired their missile is an area we have been promised that the Iranians would not be present in. We know it was not done in the spur of the moment, it was a premeditated attack.”

The Israeli military said the sorties hit Iran’s “main storage hub in Syria” used to transport Iranian weapons to allies in Syria including Lebanese militant group Hezbollah.

Israel recently acknowledged carrying out hundreds of strikes in Syria over the last few years but has previously refrained from commenting for fear of triggering a reaction and being drawn into the deadly fighting in Syria, which is in the grips of an eight-year civil war.

Monday’s announcement marked the first time they had reported strikes in real time and released detailed information since last May 2018, when Israel claimed to have struck almost all of Iran’s military infrastructure in Syria, following another rocket attack on its positions in the Golan. –The Independent

Israel said on Monday that Syria had ignored its warning over the upcoming strikes, so they were forced to target Syria’s aerial defense batteries which fired “dozens” of surface-to-air missiles at Israel’s planes.

Israeli military release graphic of the targets in Syria their warplanes struck on Monday (Israeli army / handout )

The [army] holds the Syrian regime responsible for everything taking place within Syria and warns the Syrian regime against targeting Israel or permitting it to be targeted,” read a statement by the Israeli army.

“Israel is determined to continue to prevent Iranians from building an independent war machine in Syria and is ready to take the risk of exchange of fire,” he told reporters in a briefing,” said retired Israeli Maj. Gen Yaakov Amidror, who was Prime Minister Benjamin Netanyahu’s national security adviser until 2013 – calling the airstrikes a signal to Iran about how far Israel is willing to go.

“The more Iranians try to launch rockets into Israel the more severe will be the attack in response,” he added. “It is about a strong signal to Iranians. We’re ready to escalate if you don’t stop.”

The Israel Defense Force, meanwhile, trolled Iran over Twitter with a map of the Middle East showing an arrow to Syria labeled “where Iran is,” and arrows over Iran which read “where Iran belongs.”

Israel Defense Forces

@IDF

Iran, you seem to be lost.

end

An excellent commentary as to what is going on with respect to the various parties inside Syria

(courtesy Elijah Magnier)

Iran’s General Soleimani Ramping Up Efforts To Counter Trump In Iraq And Syria

Authored by Elijah Magnier, Middle East based chief international war correspondent for Al Rai Media

“Trump will pull out US forces in 30 days”… “Trump won’t withdraw now”… “Trump will pull out from Syria in four months”… “The US forces began withdrawing military equipment but not the personnel”… “Trump will maintain a 20 mile buffer zone in Syria”All these contradictory announcements have come from the White House in the last month or so, indicating some combination of the current occupant of the White House’s lack of experience in foreign policy, or lack of control of his own administration.

Nobody in the Middle East believes Trump. Only President Erdogan confirmed the serious intention of the US to withdraw from Syria but was knocked down by Trump’s threat to “cripple the Turkish economy if Turkey attacks the Kurds”. But soon after Trump’s threat to Erdogan, he again changed his mind and suddenly announced a new plan for a buffer zone “to protect the Kurds”, Turkey’s worse enemies in the Levant. Trump is signaling a high degree of confusion about his intention to stay or leave Syria.

It doesn’t matter if the world doesn’t understand what Trump’s plan is. There is no point in trying to analyse and predict the next step because Trump himself doesn’t seem to know what to do next. He wakes up with one decision and seems to change it hours later or the following day.

Nevertheless, Trump’s continuously changing plans are not preventing his adversary the Iranian General Qassem Soleimani  the head of the Iranian Revolutionary Guard Corps in the al Quds Brigade which perceives itself responsible for supporting all movements of the oppressed peoples in the world, mainly the Lebanese Hezbollah, Iraqi, Palestinian and Afghan groups, but others as well  from making plans to counter Trump in Syria and Iraq.

Well informed sources say “Soleimani is holding meetings with various of his allies’ groups in the Middle East to stand against US forces and push them away from Iraq and Syria”. According to these sources, neither Iran nor Russia believe in Trump’s declared intention to withdraw and both are convinced that at least some US forces will remain in the Levant.

Soleimani is planning to move more aggressively with his allies once the last ISIS stronghold east of the Euphrates is reconquered. ISIS maintains an area of around 15 sq km with several villages on the Euphrates and is currently under attack by Kurdish forces supported by the coalition.

President Bashar al-Assad agreed with the Iraqi National Security Advisor Faleh al-Fayyad to reactivate coordination of tribal groups in northeast Syria with Iraqi forces. “Assad gave the green light to Iraq to coordinate with the Arab tribes in Syria and to push Iraqi security forces into Syria when and if needed to end ISIS control if the US is not willing to finishing the job quickly”.

Such an arrangement has potential disadvantages Syria and Iraq are aware of. The US forces occupying Northeast Syria could attack Iraqi-Syrian forces attacking ISIS controlled areas as they did in the past. Last year, Israeli jets bombed the Hashd al-Shaabi command and control headquarters on the borders with Syria and US jets twice destroyed Syrian forces trying to attack ISIS, one group crossing the Euphrates, and other advancing towards al-Tanf.

“If and when the US attack Iraqi forces, such an act of aggression will put pressure on the Iraqi government to ask for the total withdrawal of the US forces from Iraq. If this doesn’t happen, another source of leverage will be to make sure US forces in Iraq are under continuous threat. There are many groups in Mesopotamia unfriendly to the US, determined to see their country free from any foreign troops, particularly the US forces, considered the source of all the troubles the Middle East suffers from”, say the sources.

Thus, the “Axis of the Resistance” is planning to face down US hegemony in the Levant and Mesopotamia. Iraq and Syria are not friends of Washington and will never act like the Gulf monarchies propped up by US protection. If the US establishment decides to stay in Syria and continue its occupation of the country or establish a “buffer zone”, the cards will be reshuffled again.

Site Wednesday’s horrific ISIS suicide bombing targeting a US patrol in the northern Syrian city of Manbij. Four Americans were among 20 killed in the attack on a restaurant known to be “frequented” by US troops and officials. 

If this happens, Turkey, considered to date a friend of Russia, may become an enemy by occupying northeast Syria and deploying forces in the buffer zone suggested by Trump. If and when Turkey does that, it will pass into the hostile camp by opposing Russia’s plan to protect the integrity of Syria. Such an accommodation with the US might help Turkey fulfill its dream of occupying part of Syria.In this case, Turkey will be considered an enemy and will suffer attacks from the Syrians, supported by Damascus. Local Arab tribes and Kurds will be armed, enough to defend themselves and to counter attack Turkish forces or their allies in al-Hasaka.

The Kurds and Damascus will then have the same objective, i.e. the return of northeast Syria to Syrian army control rather than subject to Turkish control or a US-Turkish understanding. And Iran will fight the US through its allies in the Middle East, including Iraq.

What is unclear is why the Syrian Democratic Front (SDF – led by Kurds) announced its readiness to support the creation of a safe-zone, a zone Turkey is gathering for it over 80,000 men and is hoping to control around 420 km wide and 32 km deep (bigger than the seize of Lebanon) in Kurdish controlled provinces of Raqqa and al-Hasaka.

The US establishment has asked the Iranians to mediate with the Taliban to spare US forces from lethal attacks. The US establishment also asked Iran to refrain from attacking its troops in Iraq. Assent to these requests will be forthcoming if the US responds to one important request from Iran: total withdrawal from Syria.

If Trump cannot do it, the US president may be sweating through a hot summer this year.

end

 

 

RUSSIA/KERCH STRAIT (SEPARATING CRIMEA FROM MOTHER RUSSIA)

Let us hope that this was not a blast from the Ukraine but instead was a faulty transfer of fuel

(courtesy zerohedge)

 

11 Dead After 2 Ships Catch Fire In Kerch Strait, One “Struck By A Blast”

At least 11 sailors have died after two ships caught fire while moving through the Kerch Strait separating Crimea from mainland Russia  – the location of the latest escalation in tensions between Russia and Ukraine in November – after one of them was apparently rocked by an explosion the Russian Maritime Agency said. One vessel was “allegedly struck by a blast” RT reported, which caused the fire that then spilled over to another ship, an official with the Russian Maritime and River Transport Agency said.

Clouds of black smoke could be seen billowing over a vessel engulfed by a blaze on YouTube footage, which shows the scene of the incident. Another ship can be seen floating nearby.

The fire reportedly broke out as the two ships were transferring fuel from one to the other. According to RT, approximately three dozen sailors managed to escape the burning ships by jumping into the sea but at least 11 people died in the incident and 12 have so far been rescued from the sea.

The crews of the affected ships included Turkish and Indian nationals, the emergency services said, adding that there were no Russian sailors. Turkey confirmed that 16 of its citizens were aboard the affected vessels.

Emergency services said that between eight and ten ships have been sent to the rescue and are picking up the sailors. The explosion might have been caused by a safety rules violation during the fuel transfer, according to some reports.

One of the ships was a liquefied natural gas carrier and another one was a tanker; both vessels were flying Tanzanian flags.

According to the director of the Crimean Sea Ports, the maritime traffic through the strait was not affected by the incident and navigation across Kerch remains open.

END

6. GLOBAL ISSUES

A good article by Brandon Smith as he outlines how the globalists (deep staters) will sacrifice the dollar to get their new world order and one currency.  It will first start off with the SDR’s and then they will morph into a one currency blockchain type of event

(courtesy Brandon Smith)

Will Globalists Sacrifice The Dollar To Get Their ‘New World Order’?

Authored by Brandon Smith via Alt-Market.com,

Trade is a fundamental element of human survival. No one person can produce every single product or service necessary for a comfortable life, no matter how Spartan their attitude. Unless your goal is to desperately scratch an existence from your local terrain with no chance of progress in the future, you are going to need a network of other producers. For most of the history of human civilization, production was the basis for economy. All other elements were secondary.

At some point, as trade grows and thrives, a society is going to start looking for a store of value; something that represents the man-hours and effort and ingenuity a person put into their day. Something that is universally accepted within barter networks, something highly prized, that is tangible, that can be held in our hands and is impossible to replicate artificially. Enter precious metals.

Thus, the concept of “money” was born, and for the most part it functioned quite well for thousands of years. Unfortunately, there are people in our world that see economy as a tool for control rather than a vital process that should be left alone to develop naturally.

The idea of “fiat money”, money which has no tangibility and that can be created on a whim by a central source or authority, is rather new in the grand scheme of things. It is a bastardization of the original and much more stable money system that existed before that was anchored in hard commodities. While it claims to offer a more “liquid” store of value, the truth is that it is no store of value at all.

Purveyors of fiat, central banks and globalists, use ever increasing debt as a means to feed fiat, not to mention the hidden tax of price inflation. When central bankers get a hold of money, it is no longer a representation of work or value, but a system of enslavement that crushes our ability to produce effectively and to receive fair returns for our labor.

There are many people today in the liberty movement that understand this dynamic, but even in alternative economic circles there are some that do not understand the full picture when it comes to central banks and fiat mechanisms. There is a false notion that paper currencies are the life blood of the establishment and that they will seek to protect these currencies at all costs. This might have been true 20 years ago or more, but it is not true today. Things change.

The king of this delusion is the US dollar. As the world reserve currency it is thought by some to be “untouchable”, a pillar of the globalist structure that will be defended for many decades to come. The reality, however, is that the dollar is nothing more than another con game on paper to the globalists; a farce that they are happy to sacrifice in order to further their goals of complete centralization of world trade and therefore the complete centralization of control over human survival.

That is to say, the dollar is a stepping stone for them, nothing more.

The real goal of the globalists is an economic system in which they can monitor every transaction no matter how small; a system in which there is eventually only one currency,a currency that can be tracked, granted or taken away at a moment’s notice. Imagine a world in which your “store of value” is subject to constant scrutiny by a bureaucratic monstrosity, and there is no way to hide from them by using private trade as a backstop. Imagine a world in which you cannot hold your money in your hand, and access to your money can be denied with the push of a button if you step out of line. This is what the globalists really desire.

Some people might claim that this kind of system already exists, but they would be fooling themselves. Even though fiat currencies like the dollar are a cancer on free markets and true production, they still offer privacy to a point, and they can still be physically allocated and held in your hand making them harder to confiscate. The globalists want to take a bad thing and make it even worse.

So, the question arises – How do they plan to make the shift from the current fiat paper system to their “new world order” economy?

First and foremost, they will seek a controlled demolition of the dollar as the world reserve currency.They have accomplished this in the past with other reserve currencies, such as the Pound Sterling, which was carefully diminished over a period of two decades just after WWII through the use of treasury bond dumps by France and the US, as well as the forced removal of the sterling as the petro-currency. This was done to make way for the US dollar as a replacement after the Bretton Woods agreement in 1944.

The dollar did not achieve true world reserve status, though, until after the gold standard was completely abandoned by Nixon in the early 1970’s, at which point a deal was struck with Saudi Arabia making the dollar the petro-currency. Once the dollar was no longer anchored to gold and the world’s energy market was made dependent on it, the fate of the US economy was sealed.

Unlike Britain and the sterling, the US economy is hyper-dependent on the dollar’s world reserve status. While Britain suffered declining conditions for decades after the loss, including inflation and high interest rates, the US will experience far more acute pain. A complete lack of adequate manufacturing capability within US borders has turned our nation into a consumer based society rather than a society of producers. Meaning, we are dependent on the demand for our currency as a reserve in order to enjoy affordable goods from outside sources (i.e. other manufacturing based countries).

Add to this lack of production ability the fact that for the past decade the Federal Reserve has been pumping trillions of dollars into financial markets around the globe. This means trillions of dollar held overseas only on the promise that those dollars will be accepted by major exporters as a universal store of value. If faith in that promise is lost, those trillions could come flooding back into the US through various channels, and the buying power of the currency would crumble.

There is a delusion within the American mainstream that even if such an event were to occur, the transition could be handled with ease. It’s fantastical, I know, but never underestimate the cognitive dissonance of people blinded by bias.

The rebuilding of a production base within the US to offset the crisis of losing the world reserve currency would take many years; perhaps decades. And this is in the best case scenario. With a plummeting currency and extreme price inflation, the cost of establishing new production on a large scale would be immense. While local labor might become cheap (in comparison with inflation), all other elements of the economy would become very expensive.

In the worst case scenario there would be complete societal breakdown likely followed by an attempted totalitarian response by government. In which case, forget any domestically funded economic recovery. Any future recovery would have to be funded and managed from outside the US. And here is where we see the globalist plan taking shape.

The banking elites have hinted in the past how they might try to “reset” the global economy. As I’ve mentioned in many articles, the globalist run magazine The Economist in 1988 discussed the removal of the dollar to make way for a global currency, a currency which would be introduced to the masses by 2018. This introduction did in fact take place as The Economist declared it would. Blockchain and digital currency systems, the intended foundation of the next globalist monetary structure, received unprecedented coverage the past two years.  They are now a part of the public consciousness.

Here is how I believe the process will unfold:

The 2008 crash in credit and housing markets led to unprecedented stimulus by central banks, with the Federal Reserve leading the pack as the greatest source of inflation. This program of bailouts and QE stimulus conjured an even bigger bubble, which many alternative analysts have dubbed “the everything bubble”.

The growing “everything bubble” encompasses not just stock markets or housing, but auto markets, credit markets, bond markets, and the dollar itself. All of these elements are now tied directly to Fed policy. The US economy is not only addicted to stimulus measures and near-zero interest rates; it will die without them.

The Fed knows this well. Chairman Jerome Powell hinted at the crisis that would evolve if the Fed ever cut off stimulus, unwound its balance sheet and hiked rates in the October 2012 Fed minutes.

Without constant and ever expanding stimulus measures, the false economy will implode. We are already seeing the effects as the Fed cuts tens-of-billions per month in assets from its balance sheet and hikes interest rates to their “neutral rate of inflation”. Auto markets, housing markets, and credit markets are in reversal, and stocks are witnessing the most instability since the 2008 crash. All of this was triggered by the Fed simply exerting incremental rate hikes and balance sheet cuts.

It is also important to note that almost every US stock market rally the past several months has taken place while the Fed’s balance sheet cuts were frozen.  For example, for the past two-and-a-half weeks the Fed’s assets have only dropped by around $8 billion; this is basically a flatline in the balance sheet.  It should not be surprising given this pause in cuts (in tandem with convenient stimulus measures by China) that stocks spiked through early to mid-January.

That said, Fed tightening will start again, either by rate hikes, asset cuts, or both at the same time. The Fed’s purpose is to create a crisis. The Fed’s goal is to cause a crash. The Fed is a suicide bomber that does not care what happens to the US system.

But what about the dollar, specifically?

The Fed’s tightening policies do not only translate to crisis for US stocks or other markets. I see three primary ways in which the dollar can be dethroned as the world reserve.

1) Emerging economies have become addicted to Fed liquidity over the past ten years. Without continued access to the Fed’s easy money, nations like China and India are beginning to seek out alternatives to the dollar as a world reserve. Contrary to the popular belief that these countries would “never” be able to decouple from the US, the process has already begun. And, it is the Fed that has actually created the necessity for emerging markets to seek out other sources of liquidity besides the dollar.

2) Donald Trump’s trade war is yet another cover event for the loss of reserve statusI would note that the primary rationale for tariffs was to balance the trade deficit.  The trade deficit with China has done the opposite and is continually expanding each month.  This suggests much higher tariffs on China would be required to reduce the imbalance.

It must also be understood that the trade deficit with China has long been part of a larger agreement.  China is one of the largest buyers of US debt in the world and has continued to utilize the dollar as the world reserve currency.  If the trade war continues through this year, it is only a matter of time before China, already seeking dollar alternatives as the Fed tightens liquidity, will start using its US treasury and dollar holdings as leverage against us.

Bilateral agreements between multiple nations that cut out the dollar are being established regularly today. If China, the largest exporter/importer in the world, stops accepting the dollar as the world reserve, or if they start accepting other currencies in competition, then numerous other nations will follow their lead.

3) Finally, if the war of words between Trump and the Fed becomes something more, then this could be used by the establishment to undermine faith in US credit. If Trump seeks to shut down the Fed entirely, the globalists are handed yet another perfect distraction for the death of the dollar. I can see the headlines now – The “reset” could then be painted as a “rescue” of the global economy after the “destructive actions of populists” who “bumbled into fiscal destruction” because they were blinded by an “obsession with sovereignty” in a world that “requires centralization to survive”.

The specifics of the shift to a global currency are less clear, but again, we have hints from the globalists. The Economist suggests that the US economy will have to be taken down a few pegs, and that the IMF would step in as the arbiter of forex markets through its SDR basket system. This plan was echoed recently by globalist Mohamed El-Erian in an article he wrote titled “New Life For The SDR?”. El-Erian also suggests that a global currency would help to combat the “rise of populism”.

The Economist notes that the SDR would only act as a “bridge” to the new global currency. Paper currencies would still exist for a time, but they would be pegged to the SDR exchange rates. Currently, the dollar is only worth around .71 SDR’s. In the event of the loss of world reserve status, expect this exchange rate to drop significantly.

As the global crisis deepens the IMF will suggest a “reset” to a more manageable monetary framework, and this framework will be based on blockchain technology and a cryptocurrencywhich the IMF has likely already developed. The IMF hints at this outcome in at least two separate white papers recently published which herald a new age in which crypto as the next phase of evolution for global trade.

I predict according to the current pace of the trade war, Fed liquidity tightening and de-dollerization that threats to the dollar’s world reserve status will hit the mainstream by 2020.  The process of “resetting” the global monetary system would likely take at least another decade to complete.  The globalist preoccupation with their “Agenda 2030” sustainable development initiatives suggests a decade long timeline.

Without ample resistance, the introduction of the cashless society will be presented as a natural and even “heroic” response by the globalists to save humanity from the “selfishness” of destructive nationalists. They will strut across the world stage as if they are saviors, rather than the villains they really are.

*  *  *

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end

Take a look at the following two charts:  earning expectations are falling badly not only in Europe but also in the uSA,,,,and stocks go up????

(courtesy zerohedge)

 

“Probably Nothing…”

Please be advised, the following two charts may not be good for your wealth…

The almost unprecedented surge in stocks off the Mnuchin Massacre lows that bracketed Xmas Day has reinvigorated investors, commission-takers, and asset-gatherers worldwide in some Pavlovian belief that all is well in the world once again and it’s just a matter of time before wealth is back at record highs and retirement walks along sandy beaches are being advertised on TV.

Sadly, as the following two charts show… there’s no ‘there’, there.

While investors wish that three weeks of gains for the Stoxx Europe 600 meant that the market was getting ready for a stellar earnings season? Here’s the reality: neither investors nor analysts are expecting much good news from European companies…

In fact, European profit downgrades exceeded upgrades by the most since 2011.

We can see what happens when stocks attempt to “know better” than the earnings estimates.

“Market sentiment on earnings is cautious and fourth-quarter results are widely expected to disappoint,” said Emmanuel Cau, head of European equity strategy at Barclays Plc in London.

“Fourth-quarter estimates have been lowered and the sharp p/e de-rating of 2018 lowers the bar for positive surprises, but we believe that full-year 2019 estimates are still too high and will see further downgrades.

And US markets are no cleaner a dirty shirt to pin your hopes on as forward earnings expectations have plummeted (and continue to plummet) despite the v-shaped recovery in stock prices…

So, hey, BTFD, why not? Everyone else is doing it… after all, the slump in earnings expectations is “probably nothing.”

end

The IMF has just slashed global GDP growth to a 3 year low.  As we have pointed out to you; global growth has slowed which began in November 2018.

(courtesy zerohedge)

 

IMF Slashes Global GDP Forecast To 3 Year Low

Just as it warned it would several days ago, as part of its latest quarterly economic outlook report the IMF just slashed its forecast for 2019 global GDP to just 3.5% from 3.7% as of October, its lowest forecast in three years, while warning that trade tensions pose further downside risks to global growth.

In its second growth downgrade in three months, the IMF blamed softening demand across Europe and recent stock market volatility, and while its US GDP forecast remained somewhat surprisingly unchange, still seeing a solid 2.5% in 2019 GDP growth, the IMF took a machete to its German GDP forecast, which the IMF now sees growth only 1.3% this year, down 30%, or 0.6% from its forecast last October. The Monetary Fund blamed soft consumer demand and weak factory production after the introduction of stricter emission standards for cars was behind the shift. To be sure, recent German economic data has been disastrous, and confirmed the sharp slowdown in the economy, and it will be up to Q1 data to confirm or deny whether a German recession has arrived.

Despite seeing sharp slowdowns to other key European economies, including Italy, where it cited weak demand and higher sovereign borrowing costs, and France, where the so-called Yellow-Vest protests have hurt the economy…

… the overall outlook was somewhat more upbeat than some had feared especially as many investors openly fear a U.S-led slowdown taking hold, the fund left its projections for the U.S. and China unchanged and even anticipates a pickup in worldwide expansion to 3.6 percent next year.

Nonetheless, risks “tilt to the downside” said the IMF just hours after China revealed the slowest expansion since 2009 last quarter. It will set the tone for this week’s World Economic Forum meeting in Davos, Switzerland.

“The global growth forecast for 2019 and 2020 had already been revised downward in the last WEO, partly because of the negative effects of tariff increases enacted in the United States and China earlier that year” the report said.

The further downward revision since October in part reflects carry over from softer momentum in the second half of 2018—including in Germany following the introduction of new automobile fuel emission standards and in Italy where concerns about sovereign and financial risks have weighed on domestic demand—but also weakening financial market sentiment as well as a contraction in Turkey now projected to be deeper than anticipated.”

“It is important to take stock of the many rising risks,” said Gita Gopinath, the fund’s new chief economist.

The IMF also said that “a range of triggers beyond escalating trade tensions could spark a further deterioration in risk sentiment with adverse growth implications, especially given the high levels of public and private debt. These potential triggers include a “no-deal” withdrawal of the United Kingdom from the European Union and a greater-than-envisaged slowdown in China.”

Among the threats cited in the report were more trade tariffs, a renewed tightening of financial conditions, a “no deal” Brexit and a deeper-than-anticipated slowdown in China. And while some of the key issues the IMF flagged in Europe may be temporary, the IMF said that they came amid a backdrop of global trade policy uncertainty and concerns about China’s outlook.

“The possibility of tensions resurfacing in the Spring casts a shadow over global economic prospects,” the IMF said, which also predicted that global trade will grow by 4.0% in 2019 and remain unchanged in 2020, a 0.1% cut from its prior forecast. As recently as 2017, the IMF predicted global trade would grow 5.3%.

In addition to slashing Europe’s GDP prospects, the IMF also cut Mexico’s GDP by up to half a percentage point, while admitting that the slump in Venezuela may be deeper than previously anticipated.

While the IMF’s U.S. forecast was unchanged at 2.5% in 2019, it said growth in the world’s biggest economy will cool to 1.8% in 2020 as stimulus from tax cuts fades and the economy responds to higher Federal Reserve interest rates.

Finally, as for China, the IMF still expects GDP to grow 6.2% in 2019 after 6.6% in 2018 – the lowest since 1990 – and to continue slowing due to the trade war and the government’s failing attempts to reduce systemic leverage.

end

 

7  OIL ISSUES

 

8. EMERGING MARKETS

Zimbabwe

A good look at the devastation inside Zimbabwe right now;  the country is in total shutdown with unemployment at 90%

(courtesy Bloomberg/ Freeth/Campbell Foundation/zerohedge)

“It Feels Apocalyptic” – A Letter From Zimbabwe, Where The Country Remains In Total Shutdown

Zimbabwe is once again at the brink of economic collapse, making a mockery of President Emmerson Mnangagwa’s claim that the country is open for business.

As Bloomberg reports,  many shops and factories have shut their doors because of a lack of customers and those that continue to trade are open to haggling over prices to secure hard currency. At an appliance shop in the capital, Harare, a salesman whispers that a Whirlpool Corp. washing machine priced at about $5,000 if paid for electronically will sell for $1,500 in cash, while at a nearby electrical warehouse, a $600 invoice is whittled down to $145 for payment in dollar bills.

But, as OilPrice.com’s Tsvetana Paraskova reports, Zimbabwe is on a three-day nationwide strike and protests are erupting in the streets after the government of the southern African country doubled fuel prices, making gasoline sold in Zimbabwe the most expensive gasoline in the world. 

Via Namibia Economist blog,

We are now in our third day of complete shutdown throughout the whole of Zimbabwe.

Banks are closed, schools are closed, roads are closed in and out of the main towns and transport systems have shut down.

There are no newspapers to be bought, the Internet has been shut down by the government and everything is at a complete standstill.

People are too afraid to move around as a result of the burning of vehicles by vigilante groups and the complete dearth of any updated information or warnings due to the total social media blackout. This means that no WhatsApp messages or photos can be sent, no one can access Facebook or Messenger, and the situation is very tense.

In some centres it almost feels apocalyptic. We have heard gunfire, and before the Internet was closed down, saw pictures of dead and wounded people. It is unclear how many people have died but before the media blackout, it was reported that there had been five deaths and more than 200 people had been arbitrarily arrested.

Elements of the police and military are also involved in ensuring that there is a complete shutdown.People in civilian dress armed with AK-47 rifles have been seen in some areas. It is clear that these are military personnel.

Amnesty International has condemned the military crackdown and has called on the Zimbabwean authorities to ensure restraint by security forces and respect the public’s right to protest.

Zimbabwe Lawyers for Human Rights reported prior to the blackout that they had received reports of soldiers and police breaking into homes in townships overnight and assaulting suspected demonstrators.

Contacts in the diplomatic corps and the political opposition are also completely in the dark, along with the rest of us.

This morning I spoke to Nelson Chamisa, leader of the opposition Movement for Democratic Change (MDC) Alliance, and it is clear that no one knows what is going on because the entire country has been effectively silenced.

I have also spoken to lawyers regarding the arrest once again of Pastor Evan Mawarire who inadvertently triggered the highly successful #ThisFlag social media protest action in April 2016 because he could no longer afford to pay school fees. This led to his arrest on trumped up charges and his high profile court case. Since then, his activities have been under constant surveillance.

Police officers arrive at his flat this morning in central Harare and took him to the Law and Order section, charging him under a false charge of incitement to commit public violence.

The crisis was precipitated on Sunday (January 13) by President Emmerson Mnangagwa when he announced a shock increase of 200 percent in the fuel price – this in a country with more than 90 percent unemployment and where the struggle to survive escalates daily. Mr Mnangagwa promptly left the country for Russia and has not returned. Reports say that he has gone there to “discuss Russian assistance to modernise the military”.

Right now the situation remains eerie and uncertain. If this goes on for much longer, the humanitarian crisis will escalate. We cannot buy food because the shops are all closed and transport systems have closed down. Most of the hospitals are without essential medicines and also staff because doctors and nurses can’t even get to work.

This is an unprecedented situation in Zimbabwe and internationally. Even in wartime Europe, the people could get newspapers, transport systems operated, retail outlets were still open and people could communicate.

I cannot send you an e-mail or a photograph – it is a very weird situation.

The only thing we can do at this point is to ask for your prayers as we face this time of escalating fear and uncertainty.

Ben Freeth

Executive Director

Mike Campbell Foundation

Harare, Zimbabwe

END
VENEZUELA
Attempted coup in Venezuela foiled
(courtesy zerohedge)

Overnight Clashes Follow Venezuelan Officers’ Failed Attempt To Lead Anti-Maduro Coup

Venezuela remains on edge after in the pre-dawn hours of Monday morning a small group of soldiers attempted to launch a military coup against the Maduro regime, but failed, resulting in the arrests of 25 members of the Venezuelan National Guard who temporarily gained control of a police station located a short distance from the presidential palace in Caracas, and the apprehension of two others at another location, in total 27 detained  all of which sparked riots in local neighborhoods, some of which appear to have continued throughout the night.

Barricade erected during a protest Monday near to a National Guard outpost in Caracas, Venezuela. Image source: Reuters

Following the mutiny and subsequent successful government crackdown, which further involved the rebellious unit briefly kidnapping several officials and stealing weaponry in the Cotiza neighborhood, pockets of anti-Maduro protests were sparked in the capital city demanding the release of the detained soldiers, whose actions the government condemned as “treasonous” and “motivated by the dark interests of the extreme right,” according to a statement announced on state TV. Maduro’s right-hand man, Diosdado Cabello, also boasted on Twitter while speaking of the rebels: “They were neutralized, surrendered and captured in record time.”

Hours prior to the crackdown on the coup attempt, a series of videos were published to social media showing what are purported to be the coup leaders standing in darkness with a spokesman demanding that Venezuelans rise up to support the coup. In one video a man who identified himself as Luis Bandres said“You all asked that we take to the streets to defend the constitution. Here we are. Here we have the troops, it’s today when the people come out to support us.”

And in another video a heavily armed man appeals to the public with “You wanted us to light the fuse, so we did. We need your support.” This appears to have driven at least some in the vicinity of where the military rebellion was launched to the streets, angry at what’s being called President Nicolas Maduro’s “illegitimate” election to a second six-year term, as the AP reports:

At daybreak in the adjacent neighborhood of Cotiza, a group of shirtless young men, some with their faces covered, built a barricade across the street with a burning car, heavy sewer grates and a large chunk of concrete.

An angry group of women shouted that they have lived for too long without running water and tear gas fired by security forces choked their children.

“Freedom! Freedom!” they chanted. “Maduro has to go!”

“We must defend our homeland,” Maria Fernanda Rodriguez, a 36-year-old manicurist, told The Associated Press, her eyes welling from the tear gas.

International reports suggest some of these initial protests were snuffed out by riot police, but sporadic clashes continued in some places through the evening.

Embedded video

Ruptly

@Ruptly

Military officials arrested for weapons theft

But the socialist country, currently suffering from what’s being widely described as “inflation approaching 2 million percent” and a shortage of everything from food to medicine to diapers and baby formula, remains on edge as opposition leaders are now calling for mass protests in the coming days in the wake of the defeated attempt at triggering a broader military revolt.

Embedded video

NTN24 Venezuela

@NTN24ve

Otro video de la protesta de vecinos del barrio El Limón, en la autopista Caracas- La Guaira , en contra de Maduro la noche de este lunes

Embedded video

Cristian Crespo F.@cristiancrespoj

NO TENEMOS MIEDO!!!!!!!!!!

Clashes appeared ongoing through the night in the neighborhood in which the military revolt began.

Embedded video

NTN24 Venezuela

@NTN24ve

La Guardia Nacional llegó a disolver la protesta contra Maduro en el Cuartel de Catia, la media noche de este lunes.

Specifically, opposition leaders in the legislature have called for nation-wide protests to be held Wednesday following the government-stacked Supreme Court declaring it would throw out recent measures by the National Assembly that declared Maduro’s presidency illegitimate.

But thus far the brief military uprising appears to have been a very isolated event as the officers involved are low-ranking with little sway to start a domino effect of defections, which would have to dent the higher ranks first. The televised government statement following the arrests emphasized that the military remains loyal to the state with the words, “The armed forces categorically reject this type of action…”.

Unconfirmed videos circulating on social media throughout Monday evening appear to show citizens erecting barricades in Cotiza and possibly other neighborhoods while setting fires to objects amidst a continuing police crackdown seeking to tame the unrest. But the unrest could grow as opposition congressional leader Juan Guaido becomes bolder in his denunciations of Maduro.

Embedded video

NTN24 Venezuela

@NTN24ve

Otro video de El Valle, donde reportan intento de saqueos, protestas y enfrentamientos la noche de este lunes / video cortesía

Throughout the night their appeared intermittent violence on Caracas’ streets between protesters, police, and what some say are the “colectivo armado”  fiercely loyal pro-regime militias that typically move in packs on motorcycles targeting anti-Maduro opposition activists.

Embedded video

recinto del pueblo@Recintodlpueblo

Llegaron los colectivos malparios

According to the AP, Guaido is fanning the flames while stopping short of condoning any violent acts, however he’s appealing straight to the military ranks:

Juan Guaido, a 35-year-old newly seated as president of congress, appealed to the military, urging them to demand Maduro abandon power in a nationwide protests Wednesday — a historic date commemorating the end of Venezuela’s military dictatorship in 1958.

“We are not asking you to mount a coup. We are not asking you to shoot,” Guaido said in a video circulated on social media. “On the contrary, we are asking you not to shoot at us, but rather to defend together with us the right of our people to be heard.”

Earlier this month Guaido was arrested and briefly detained by secret police following a speech wherein he implied he was the only legitimate authority in Venezuela.

This comes after months of both the Trump administration and US Congressional leaders becoming increasingly unrestrained in publicly calling for outright regime change.

After Monday’s coup attempt Florida Senator Marco Rubio went so far as to encourage more such military defections.

Marco Rubio

@marcorubio

Under constitution of Maduro not legitimately elected President. When vacancy exists it is filled by National Assembly President until new election called. Last night a National Guard unit pledged it would follow constitution & regime responded with its own forces.

Jonathan Villarroel@JonaRoel

Cotiza

Embedded video

Rubio claimed military forces have been deployed to the streets amidst protests and internet access had been cut across parts of the country.

Marco Rubio

@marcorubio

It appears citizens in several areas of areas are taking to streets in support of military forces that have pledged to defend constitution & not follow orders from illegitimate Maduro. Regime has cut off internet access in parts of country & deploying forces to streets

Amir Richani@amir_richani

Civilians protests in #Cotiza in support of a group of soldiers that rebelled against #venezuela‘s government and Maduro. The soldiers have been detained.

Police have tried to disperse the protest with teargas. #21ene #breaking https://twitter.com/NTN24ve/status/1087323869004943360?ref_src=twsrc%5Etfw 

Meanwhile Venezuelan Foreign Minister Arreaza just days ago told Democracy Now that “Nothing that the opposition does is without the permission or authorization of the State Department… They say, ‘We have to make consultations with the embassy. We have to make consultations with the Dept of State.'”

Monday’s short-lived mutiny was not the first time the Maduro government has faced military insurrection. There’s been a series of significant incidents over the past few years, including last August’s explosive-laden drone attack as Maduro addressed a military parade in Caracas, and a firefight between three rebel military members and security forces at Fort Paramacay in the northern city of Valencia in 2017.

Perhaps the most extreme and notable attack came in June of 2017, when ex-policeman Oscar Perez dropped grenades on the regime loyalist-dominated Supreme Court while flying above in a stolen helicopter.

END

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

Euro/USA 1.1361 DOWN .0008 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 RED

 

 

 

 

USA/JAPAN YEN 109;44  DOWN 0.229 (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…DEADLY TO OUR YEN SHORTERS

GBP/USA 1.2894     UP   0.0004  (Brexit March 29/ 2017/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED

USA/CAN 1.3320 UP .0020 CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA/CANADA HAS A HUGE HOUSEHOLD DEBT/GDP PROBLEM)

Early THIS TUESDAY morning in Europe, the Euro FELL by 8 basis points, trading now ABOVE the important 1.08 level RISING to 1.1401/ Last night Shanghai composite CLOSED  DOWN 30.91 POINTS OR 1.18% 

 

 

//Hang Sang CLOSED DOWN 191.09 POINTS OR 0.70%

 

/AUSTRALIA CLOSED DOWN 0.49%  /EUROPEAN BOURSES RED

 

 

 

 

 

 

The NIKKEI: this TUESDAY morning CLOSED DOWN 96.42 POINTS OR 0.47%

 

 

 

 

 

 

 

Trading from Europe and Asia

1/EUROPE OPENED GREEN

 

 

 

 

 

 

 

 

 

 

 

2/ CHINESE BOURSES / :Hang Sang CLOSED DOWN 191.09 POINTS OR 0.70% 

 

 

 

/SHANGHAI CLOSED DOWN 30.81 PTS OR 1.18%

 

 

 

 

Australia BOURSE CLOSED DOWN 49%

 

Nikkei (Japan) CLOSED  DOWN 96.42 PTS OR 0.47%

 

 

 

 

 

 

 

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1283.15

silver:$15.29

Early TUESDAY morning USA 10 year bond yield: 2.76% !!! DOWN 3 IN POINTS from FRIDAY’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 3.07 DOWN 3  IN BASIS POINTS from FRIDAY night. (POLICY FED ERROR)/

USA dollar index early TUESDAY morning: 96.36 UP 3 CENT(S) from  FRIDAY’s close.

This ends early morning numbers TUESDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

And now your closing TUESDAY NUMBERS \12: 00 PM

 

Portuguese 10 year bond yield: 1.73% DOWN 0    in basis point(s) yield from  FRIDAY/

JAPANESE BOND YIELD: +.00%  DOWN 2   BASIS POINTS from FRIDAY/JAPAN losing control of its yield curve/

 

 

SPANISH 10 YR BOND YIELD: 1.33% DOWN 0   IN basis point yield from FRIDAY

ITALIAN 10 YR BOND YIELD: 2.74 UP 0     POINTS in basis point yield from FRIDAY/

 

 

the Italian 10 yr bond yield is trading 131 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: FALLS UP TO +.24%   IN BASIS POINTS ON THE DAY//

THE IMPORTANT SPREAD BETWEEN ITALIAN 10 YR BOND AND GERMAN 10 YEAR BOND IS 2.50% 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 TUESDAY

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

Euro/USA 1.1364 DOWN   .0005 or 5 basis points

 

 

USA/Japan: 109.36 DOWN  0.308 OR 31 basis points/

Great Britain/USA 1.2959 UP .0069( POUND UP 69  BASIS POINTS)

Canadian dollar DOWN 32 basis points to 1.3330

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

The USA/Yuan,CNY closed UP AT 6.8080 0N SHORE  (YUAN DOWN)

THE USA/YUAN OFFSHORE:  6.8134(  YUAN DOWN)

TURKISH LIRA:  5.3336

the 10 yr Japanese bond yield closed at +.00%

 

 

 

Your closing 10 yr USA bond yield DOWN  6 IN basis points from FRIDAY at 2.73 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 3.06 DOWN 5  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, 96.31 DOWN 2  CENT(S) ON THE DAY/1.00 PM/

 

Your closing bourses for Europe and the Dow along with the USA dollar index closing and interest rates for TUESDAY: 12:00 PM 

London: CLOSED DOWN 69.20 OR 0.99%

German Dax : DOWN 96.09 POINTS OR 0.41%

Paris Cac CLOSED DOWN 20.25 POINTS OR 0.42%

Spain IBEX CLOSED DOWN 16.30 POINTS OR  0.180%

Italian MIB: CLOSED DOWN 201.37 POINTS OR 1.03%

 

 

 

 

WTI Oil price; 52.18 12:00 pm;

Brent Oil: 60.98 12:00 EST

USA /RUSSIAN /   ROUBLE CROSS:    66.44  THE CROSS HIGHER BY 0.05 ROUBLES/DOLLAR (ROUBLE LOWER BY 5 BASIS PTS)

USA DOLLAR VS TURKISH LIRA:  5.3336 PER ONE USA DOLLAR.

TODAY THE GERMAN YIELD FALLS +.24 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 :   52.57

 

BRENT :  61.48

USA 10 YR BOND YIELD: 2.74%…

 

 

USA 30 YR BOND YIELD: 3.06%/

 

 

 

EURO/USA DOLLAR CROSS: 1.1359 ( DOWN   9 BASIS POINTS)

USA/JAPANESE YEN:109.43 DOWN 0.248 (YEN UP 25 BASIS POINTS/..

 

.

 

USA DOLLAR INDEX: 96.34 UP 1 cent(s)/

The British pound at 4 pm: Great Britain Pound/USA: 1.2953 UP 62 POINTS FROM FRIDAY

the Turkish lira close: 5.3401

the Russian rouble:  66.52 DOWN .13 Roubles against the uSA dollar.( DOWN 13 BASIS POINTS)

 

Canadian dollar: 1.3349 DOWN 51 BASIS pts

USA/CHINESE YUAN (CNY) : 6.8080  (ONSHORE)

USA/CHINESE YUAN(CNH):  6.8151 (OFFSHORE)

German 10 yr bond yield at 5 pm: ,0.24%

 

The Dow closed DOWN 301.87 POINTS OR 1.22%

 

NASDAQ closed DOWN 136.87 POINTS OR 1.91%

 


VOLATILITY INDEX:  20.99 CLOSED UP 3.19 

 

LIBOR 3 MONTH DURATION: 2.773%  .LIBOR  RATES ARE RISING/

 

FROM 2.775

 

 

 

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

 

Stocks Suffer Most Since Xmas Eve As ‘Big Trouble’ In China Spreads

But, but, but last week the China talks were going great and everything was awesome? Now, talks are off and The IMF says the global economy has shit the bed?

China stocks started badly and never got any better after the shitty data hit… No National Team?

 

European stocks extended yesterday’s losses…

 

US markets were weak overnight after dismal China data (worst annual GDP growth in 28 years) and trade talks headlines (confirming “little progress”) but when the U.S. TURNS DOWN CHINA OFFER OF PREPARATORY TRADE TALKS” headline hit, stocks tanked…

And then – as if on cue with the dow down 450 points – Larry Kudlow shows up on TV and proclaims: “REPORT THAT WHITE HOUSE CANCELED CHINA MTG NOT TRUE… KUDLOW REJECTS FT REPORT ON U.S. TURNING DOWN CHINA PREP TALKS” which sent stocks spiking higher.. but that did not last…

 

By the close, Nasdaq and Trannies were worst (both down over 2%)…some panic buying in the last few seconds…

 

From Friday’s cash open, the Nasdaq has erased all the trade hope gains…

 

“Most Shorted” stocks fell over 3% today – their biggest drop in six weeks…

Volume was above average today but not huge.

But…95% of S&P 500 stocks were to the downside today – this is the worst tumble, breadth-wise, since December 24.

From a volume perspective, it’s also an ugly day... 88% of NYSE volume is in declining stocks, which rivals the 88.4% seen on December 24…

 

All the major US equity indices broke back below their 50-day moving averages…but bounced back above it thanks to Kudlow and some panic-buying at the bell.

 

Equity (VIX) and Credit (CDX) protection markets soared higher today…

 

Treasury yields tumbled between 3 and 5bps on the day…

 

30Y Yields fell to one-week lows before Kudlow hit…

 

The dollar is up from Friday’s close but roundtripped today to close almost unchanged (The dollar was bid as China data hit)…

 

 

Cryptos bounced today pushing Litecoin and Bitcoin Cash green for the week…

 

PMs managed modest gains as copper and crude were clubbed after China data…

 

WTI rebounded to $53 after sliding all day…

 

Finally, history appears to be written as the lagged effects of China’s collapsing credit impulse (not offset by central bank balance sheet expansion) are not sending happy signals for global shareholders…

But in the US, it’s time for some catch down…

END

market trading/

Monday

USA futures tumble on reports that the USA China trade talks have stalled

(courtesy zerohedge)

US Futures Tumble After US-China Trade Talks Headlines

 

Seemingly confirming what Senator Chuck Grassley said last week had been relayed to him, Bloomberg is reporting that US-China trade talks are faltering as China refutes American claims of IP theft and USTR lighthizer has reportedly told US lawmakers that “little progress” has been made on the critical IP protections.

Bloomberg reports that, according to people close to the discussions, the two sides have so far made little progress on the issue any deal Trump strikes with China may ultimately be judged on: ending what the U.S. has dubbed as decades of state-coordinated Chinese theft of American intellectual property.

The reaction is not positive in the equity futures market…

Bloomberg reports that the discussions that took place earlier in January amounted more to an airing of grievances than constructive negotiations, according to participants and others briefed on the talks.

The lack of progress in discussions on structural issues such as IP was confirmed by Robert Lighthizer, the U.S. trade representative, in a meeting with lawmakers last week, according to congressional aides. His office declined to comment.

As Chinese leader Xi Jinping prepares to send top economic emissary Liu He to Washington for Jan. 30-31 talks, the IP stalemate gets to the heart of Trump’s trade wars and questions over his ability to turn the leverage he’s created with tariffs into meaningful Chinese policy changes. It also points to the potential political fallout.

end
TUESDAY /TRADING
MID- AFTERNOON

Dow Dumps 300Pts, Stocks Erase Friday ‘Trade-Hope’ Gains

US equity markets have been a one-way trade lower since the open, erasing all of Friday’s gains as China macro disappointed and trade-deal headlines spooked investors…

Dow Futures are down over 300 now…

And all the majors have erased Friday’s gains…

Notably, all the major US indices remain above their 50DMAs but those are critical levels to watch if today’s selloff accelerates…

end

Late afternoon

Dow Tumbles 450 Points, All Major US Indices Break Key Technical Support

But, but, but, we thought everything was awesome again?

Dow futures down 450 points accelerating on US-China trade talks headlines…

 

And all of the major US equity indices are back below their 50-day moving average…

The question is – will they close below? Or will a well-timed quote from Trump or Mnuchin about how well things are going spark another buying panic for the algos?

MARKET DATA

This is a shocker:  existing home sales crash 6.4% month over month in December from last month.  The economy is now in a tailspin

(courtesy zerohedge)

Existing Home Sales Crash In December

After NAHB’s optimism rebounded earlier in the month, all eyes are on this morning’s existing home sales data for any signs of optimism.

With some expecting a crash (and consensus expecting a modest 1.5% MoM drop), after rebounding in October and November (in the face of declining new and pending home sales), December existing home sales did indeed collapse – down a shocking 6.4% MoM..

With SAAR crashing below 5mm for the first time since 2015…

Regional breakdown:

  • December existing-home sales in the Northeast decreased 6.8 percent to an annual rate of 690,000, 6.8 percent below a year ago. The median price in the Northeast was $283,400, up 8.2 percent from December 2017.
  • In the Midwest, existing-home sales fell 11.2 percent from last month to an annual rate of 1.19 million in December, down 10.5 percent overall from a year ago. The median price in the Midwest was $191,300, unchanged from last year.
  • Existing-home sales in the South dropped 5.4 percent to an annual rate of 2.09 million in December, down 8.7 percent from last year. The median price in the South was $224,300, up 2.5 percent from a year ago.
  • Existing-home sales in the West dipped 1.9 percent to an annual rate of 1.02 million in December, 15 percent below a year ago. The median price in the West was $374,400, up 0.2 percent from December 2017.

The latest results brought the 2018 tally to 5.34 million, the weakest pace since 2015. This is the biggest annual drop in existing home sales in 8 years…

The median sales price rose 2.9 percent from a year earlier, the least since February 2012, to $253,600, while inventory increased.

“Affordability is more important than jobs,” NAR Chief Economist Lawrence Yun said at a briefing in Washington, referring to the softer results despite the strong labor market.

“The housing market is obviously very sensitive to mortgage rates. Softer sales in December reflected consumer search processes and contract signing activity in previous months when mortgage rates were higher than today. Now, with mortgage rates lower, some revival in home sales is expected going into spring.”

But Yuan was quick to blame the government shutdown too and offer some optimism…

“The partial shutdown of the federal government has not had a significant effect on December closings, but the uncertainty of a shutdown has the potential to harm the market,” said NAR President John Smaby, a second-generation Realtor from Edina, Minnesota and broker at Edina Realty.

“Once the government is fully reopened, I am hopeful that housing transactions will increase.”

Time for some more rate-hikes Mr.Powell?

 

USA ECONOMIC STORIES OF INTEREST

Another good commentary from Tom Luongo as he explains how the Democrats are moving much more to the left. They are also love the war machine exactly what the Republicans stood for.  Now the Democrats are facing a new challenge from Tulsi Gabbard who wants to end uSA involvement in foreign wars.  She is a liberal molded from the cloth of Rand Paul.  She however is very weak in uSA economic affairs.

(courtesy Tom Luongo)

 

Luongo: Pelosi Fiddles While The Democrats Burn

Authored by Tom Luongo,

Nancy Pelosi (D – Boomers) has a problem. Scratch that, she has a number of problems, not counting her own ethical and moral shortcomings.

Pelosi is the Queen of Projection. She projects an air of invincibility while also projecting her weaknesses onto her political opponents. So, even though Nasty Nancy just got back her Speaker’s gavel, she does so at the weakest moment in the Democratic party’s history since World War II.

Democrats Are Close to Terminal Decline

The traditional three-headed coalition of the Democrats has been shattered. The middle class Union guys are gone.By the time Trump is done with her over border security Pelosi’ll lose a bigger swath of the Hispanic vote than she already has.

All that will be left is her warmongering, globalist, shills for the MIC and the Deep State. Bicoastal Smug Liberals.

Internal Revolt

But, the hollowing out of the middle class is Pelosi’s biggest problem. Betraying the former Bernie Bros was the beginning. The Democrats under her leadership give lip service to bank reform which, in turn, has the hard-core Socialist left fired up.

That’s what rock-star Alexandria Ocasio-Cortez represents. She is the face of what’s left of Occupy Wall St. And she has a strong, knee-jerk, anti-incumbent, anti-establishment momentum behind her.

It doesn’t matter that she’s 28 years old, has little to no life experience or a firm grasp on reality. This is politics and these are chaotic times. She already has an acronym (AOC) and a nickname. She’s important.

Warhorses like Pelosi don’t know how to change their ways this late in their game. They think they can buy off people like AOC and outmaneuver her.

Pelosi faced a serious challenge to her party leadership in the run up to being elected Speaker of the House again. And she paid for that smooth vote with AOC’s appointment to the House Financial Services Committee.

When you’re going for the kill-shot on Trump there can be no weaknesses perceived.

But the big betrayal by the Pelosi Set is on war and empire. The same arguments animating the GOP insurrection against Trump by neoconservatives keeps Pelosi’s Smug Liberal interventionists happy.

The leadership of both parties love the Empire. They work non-stop to keep that gravy train flowing. It’s how they stay in power, amass incredible personal fortunes and why the country at large — left, right and center — hates their guts.

Do you think AOC wins her primary if the DNC hadn’t been so thoroughly despicable to Bernie Sanders’ supporters?

Or such full-throated supporters of questionable foreign interventions?

Pelosi is betting her political farm on border security. She does so because it is the one issue which galvanizes both her corrupt leadership with the populist, socialist Left represented by AOC.

They all hate what they perceive as bigotry.

Gabbard: The Anti-Pelosi

And it is also a distraction from the real issue that Trump put front and center, the Democrats’ weakness on foreign policy.

By announcing the pull out of U.S. troops from Syria and Afghanistan he reminded everyone just how much Pelosi et.al. love spending your money bombing brown people overseas for their profit.

As I said, appearance of strength is all that matters in politics at this level. Pelosi cannot afford to look at all weak during a government shutdown she started to oppose Trump and regain the White House in 2020.

So, while Pelosi is focused on being the establishment’s mouthpiece for taking down Trump to regain control over the vast government machinery, rebellions are happening within her own party.

Enter Tulsi Gabbard. Gabbard has real promise as the anti-war/anti-empire insurrectionist within the Democrats. She is a leftist version of Ron Paul in that she’s hated by everyone who thinks they are someone.

Because nothing unites the DNC and the RNC like the threat of peace getting an audience on the national stage.

When “anti-incumbent” is the watchword of the day, Gabbard throwing her hat into the 2020 Presidential race is a big deal. Gabbard will get support from anti-war Republicans, Independents and Libertarians.

They will cross party lines to vote for her in primaries, hurting the anointed ones.

She will successfully fund-raise on ending useless and counter-productive engagements in the Middle East. With her part of the Presidential conversation it forces her opposition to adopt her positions while simultaneously supporting Trump’s struggle against his own staff.

Trump should give her a lifetime membership to Mar-a-Lago.

Yes, she’s a mess economically, but that’s not where her value lies. She’s everything the current Democratic party isn’t: attractive, conscientious, brave and committed to peace.

Pelosi’s Corner

And that is a nightmare for Pelosi. She’s positioned herself as being against whatever Trump is for. That makes her an easy foil for him.

With Gabbard in the race Trump can go hard on foreign policy and create havoc in the Democratic primaries. As long as he stays in the game, Gabbard is his stalking horse.

Don’t underestimate the political points he scored with canceling Pelosi’s overseas trip. This is the Donald Trump we asked for — end politics as usual.

Confront the banal hypocrisy of our ruling class.

And, most importantly, call out the cheap virtue signaling hacks like Pelosi get a free pass on every day in the media.

Trump made it clear that if Pelosi wants to conspire with foreign leaders against him that she can do it on her own dime.

And having the shutdown as the excuse in a perfect game of brinkmanship made it even more effective.

Pelosi acts like she has Trump dead to rights on petty corruption thanks to Mueller’s songbird Michael Cohen. I don’t discount how hard they are gunning for Trump now. But like Theresa May in the U.K. over Brexit, there is only so much people will take in service of petty party infighting.

Eventually a real political revolt occurs. Just ask Italian Democrats or Emmanuel Macron.

So Pelosi has to be careful how she plays her hand here. She’s losing to Trump on the wall. Every day the argument against it looks both silly and hysterical. $5.7 billion is less than one week’s interest on the national debt.

But, she’s pot committed to her position that ‘walls are immoral.’ What she may find out here is that if you back someone like Trump into a corner and promise to destroy everything he has, then he then has nothing left to lose.

And that is when he is most dangerous to not only her but to everyone she’s beholden to. After that her own people’s knives come out.

end

It did not take long for the Democrats to reject Trump’s “Bridge Act”.

(courtesy zerohedge)

 

Democrats Reject Trump’s “BRIDGE Act” Deal, Say “Not A Good Faith Effort”

Well that didn’t take long.

In fact, even before President Trump has issued his “major announcement,” Democratic leaders were pre-emptively rejecting his ideas.

Trump’s BRIDGE Act made two offers to Democrats in exchange for $5.7 billion in funds for a border wall: Extend DACA protections for Dreamers, who were brought to the U.S. illegally as children, and extend the legal status of Temporary Protected Status (TPS) holders.

Half an hour before the speech, House Speaker Nancy Pelosi said in a statement:

Democrats were hopeful that the President was finally willing to re-open government and proceed with a much-need discussion to protect the border.

Unfortunately, initial reports make clear that his proposal is a compilation of several previously rejected initiatives, each of which is unacceptable and in total, do not represent a good faith effort to restore certainty to people’s lives.”

Pelosi further slammed the deal for not including “the permanent solution for the Dreamers and TPS recipients that our country needs and supports.

Additionally, Democratic Whip Dick Durbin also issued a statement:

“First, President Trump and Senate Majority Leader McConnell must open the government today.  Second, I cannot support the proposed offer as reported and do not believe it can pass the Senate.  Third, I am ready to sit down at any time after the government is opened and work to resolve all outstanding issues.”

A Democratic aide characterized the forthcoming offer from Trump as “non-serious product.”

“Dems were not consulted on this and have rejected similar overtures previously. It’s clearly a non serious product of negotiations amongst [White House] staff to try to clean up messes the president created in the first place. [The President] is holding more people hostage for his wall,” the aide said.

Day 30 of the shutdown seems inevitable…

end

Wow!! Illinois has the highest property taxes in the country despite stagnant incomes. The average is 2.7% of the value of the home compared to the average of around 1.3%. No wonder many are leaving the state…simply that they could not afford to pay the taxes.

(courtesy Dabroski/Klingner))

 

Illinois’ Lethal Combination: Rising Property Taxes & Stagnant Incomes

Authored by Ted Dabrowski and John Klingner via WirePoints.com,

A lethal combination of rising property taxes and stagnant incomes has forced many Illinoisans to rethink their relationship with their state. More than 1.5 million net residents have already fled the state since 2000 – and you can’t blame others for thinking about joining them.

Property taxes have become punitive in Illinois. We’ve written about how these taxes have destroyed the equity in people’s homes across the state. Many families have done the math, and whether they’re in the struggling south suburbs of Chicago or the affluent North Shore, they’ve decided to leave Illinois behind.

The traditional method for measuring the burden of property taxes is to look at a household’s property tax bill and compare it to a home’s value. Under this method, Illinoisans pay the highest property taxes in the nation. At 2.7 percent, Illinoisans pay far more than residents in neighboring states – twice more than those in Missouri and three times more than residents in Indiana.

That fact is outrageous on its own.

But to really understand the pain that these taxes inflict on Illinoisans, it’s important to compare property tax bills to household incomes. After all, those bills are paid straight from people’s earnings.

The unfortunate reality is that Illinois incomes have been stagnant for years – and falling when you consider the impact of inflation.

Between 2000 and 2017, Illinois median household incomes increased just 34 percent, far short of inflation. In contrast, household property tax bills are up 105 percent, according toIllinois Department of Revenue data.

The net result: Property tax bills per household have grown three times faster than household incomes since 2000.

That means more of Illinoisans’ hard-earned incomes are going toward property taxes and less towards groceries, college tuition, and retirement savings. In 2017, 6.73 percent of household incomes went toward property taxes, up from 4.3 percent in 2000.

That’s a 55 percent increase in the effective tax rate.

The detailed data is below:

Property taxes, county by county

Residents of Lake County pay the highest property taxes in Illinois when measured as a percentage of household incomes. In 2000, Lake County residents paid 6.5 percent of their household incomes toward property taxes. Today, residents pay 9.1 percent. That’s a 40 percent increase. The average Lake County property tax bill is now over $7,500 per household.

Meanwhile the residents of the other collar counties and Cook pay more than 7 percent of their incomes to property taxes, with average bills ranging from $4,500 to $6,200 a year.

Overall, the collar counties pay the highest taxes as a percent of income in the state. But it’s not just the Chicago suburbs that are taking a hit. Taxpayers statewide have seen their taxes rise.

In fact, most of the counties that have had the biggest tax growth, in percentage terms, are found downstate. Hardin County residents, though they pay low rates, have seen them jump 97 percent since 2000. Residents in Pulaski County, have seen their rates go up by 78 percent.

Cook County comes next at 75 percent, but after that it’s all deep downstate again: Calhoun (70 percent), Greene (66 percent), Jersey (65 percent), and Pope County (62 percent).

Taxes too high

Any way you cut it, Illinoisans are being punished by property taxes.

That’s prompted some, including new Gov. J.B. Pritzker, to propose a reduction in property taxes by increasing income taxes.

But that would do Illinoisans no good. Illinoisans already pay the nation’s 6th-highest rates when you lump all state and local taxes together.

Shifting them around won’t help when the total tax bill is too high to begin with. What Illinoisans need is tax cut, not a tax shift.

END

The following is what we must watch for:  when the Fed stops hiking, no doubt we will see another round of QE.  That is when the yield curve steepens and that is when the economy will be in recession.

(courtesy zerohedge)

What Happens When The Fed Stops Hiking

As we explained last weekend, it’s not the Fed tightening – and curve flattening – that is the recession catalyst: it is when the Fed begins cutting rates, sending the yield curve sharply higher, that one should be worried as all three prior recessions followed within 3 months of the first rate cut after a hiking cycle:

This is a critical distinction at a time when the Fed is contemplating not only ending its rate hike cycle – and thus curve flattening impulse – but potentially cutting rates, at least if it agrees with the market, so soon as late 2019, which in turn would prompt a sharp spike in the yield curve and, as we argued in our post explaining why the Fed is trapped, catalyze the next recession.

To be sure, nothing is set in stone, and as Goldman strategist Ian Wright writes, much focus remains on the state of US growth, the ongoing US-China trader war, the US government shutdown, and Brexit, each of which could tip the Fed’s hand. And yet, amid this uncertain backdrop, recent weeks have been good for risky assets. Oil has risen sharply, with GSCI Energy now up 16% on the year. Credit has also rallied – especially on a risk-adjusted basis – and undone almost all of its December spread widening, in both IG and HY, and USD and EUR markets. Last but not least, the S&P 500 is up 14% since the Steve Mnuchin called the Plunge Protection team on December 24 (and since the government shutdown).

Sarcasm aside, the recent risk was largely the result of Powell’s abrupt dovish reversal and has been supported by the abatement  of concerns about central banks hiking rates. In the past month, markets have priced both the Fed and ECB more dovishly in the coming year, with no hikes priced for the Fed in 2019 and a first ECB hike priced only in 2020 (notably, 10-year yields have risen amid the recent risk-on, as the correlation between stocks and bonds which recently shocked market watchers when it inverted, appears to be normalizing somewhat).

Meanwhile, as the Goldman strategist writes, even as the bank’s economists’ view remains that the Fed will hike again in June, followed by December, the bank’s clients have asked “if the Fed is done with its hiking cycle”… and, if so, what the implications for asset prices would be.

And while we know that the first rate cut following a hiking cycle has been a clear signal for an imminent recession in the last three contractions, the question is what happens to risk assets once the Fed stops hiking. Here the answer is a little more nebulous.

Looking at the end of the past four Fed hiking cycles (1989, 1995, 2000 and 2006), Goldman finds US equities have tended to do relatively well in the year following the Fed’s last hike (Exhibit 1).

The exception to this was in 2000, when the tech bubble burst, while equities did exceptionally well in 1995, which however was the only time the last hike was not followed by a recession in the coming years. It is also worth noting that while there was no immediate bear market in the year following the last rate hike in June 2006, everyone knows what happened shortly thereafter.

The average result, Goldman notes, may be surprising because growth expectations (measured by the ISM manufacturing) also tend to fall into and after the Fed’s last hike in a cycle (Exhibit 2).

What about rates? Here Goldman finds that 10-year Treasuries tend to rally strongly following the last Fed hike (Exhibit 3) hence the sharp steepening in the yield curve noted above just before a recession.

The fact that the Fed has not cut rates soon after ending hikes, but rather held rates high, could explain these findings.

In other words, equities may benefit from the reprieve in rates rising further, without recession concerns rising immediately (which would drive cuts). However, the bond market prices the end of hikes and future rate cuts over a long window, creating an interplay whereby the Fed’s actions force a sharp curve steepening, which in turn is interpreted by the market as a recession onset and in turn results in a bear market for equities.

Finally, Goldman notes that these results could be different from what happens should the Fed pause in its hiking cycle, something Powell may be actively considering as he decides whether to keep hiking or capitulate, and cut rates, catalyzing the next recession.

SWAMP STORIES

Kim Strassel outlines beautifully how everyone at the FBI know unequivocally that the Steele dossier was biased and paid for by the Clinton campaign.  She also debunks the Democratic time line of when the FBI received the dossier

Thus 3 things are apparent:

“First, it further demonstrates the accuracy of the House Intelligence Committee Republicans’ memo of 2018 – which noted Mr. Ohr’s role and pointed out that the FBI had not been honest about its knowledge of the dossier and failed to inform the court of Mrs. Ohr’s employment at Fusion GPS.

Second, the testimony also destroys any remaining credibility of the Democratic response,in which Mr. Schiff and his colleagues claimed Mr. Ohr hadn’t met with the FBI or told them anything about his wife or about Mr. Steele’s bias until after the election.

And third, the testimonyraises new concerns about Mr. Mueller’s team. Critics have noted Mr. Weissman’s donations to Mrs. Clinton and his unseemly support of former acting Attorney General Sally Yates’s obstruction of Trump orders. It now turns out that senior Mueller players were central to the dossier scandal. The conflicts of interest boggle the mind.

And Strassel concludes unequivocally, the Ohr testimony is evidence the FBI itself knows how seriously it erred. The FBI has been hiding and twisting facts from the start.”

 

(courtesy zerohedge)

“Everybody Knew” WSJ Exposes Bruce Ohr’s Shocking Admission To The FBI

The Wall Street Journal continues to counter  the  liberal mainstream media’s Trump Derangement Syndrome, dropping uncomfortable truth-bombs and refusing to back off its intense pressure to get to the truth and hold those responsible, accountable (in a forum that is hard for the establishment to shrug off as ‘Alt-Right’ or ‘Nazi’ or be ‘punished’ by search- and social-media-giants).

And once again Kimberley Strassel  – who by now has become the focus of social media attacks for her truth-seeking reporting – does it again. Confirming what we detailed yesterday – that The Justice Department was fully aware that the notorious Steele Dossier was connected to Hillary Clinton and might be biased, a crucial detail which was omitted just weeks later from the Foreign Intelligence Surveillance Act (FISA) warrant used to spy on the Trump campaign – Strassel makes the aggressive and correct statement that the Justice Department official’s testimony raises new doubts about the bureau’s honesty.

Via The Wall Street Journal,

Everybody knew.

Everybody of consequence at the Federal Bureau of Investigation and Justice Department understood fully in the middle of 2016 – as the FBI embarked on its counterintelligence probe of Donald Trump – that it was doing so based on disinformation provided by Hillary Clinton’s campaign.

That’s the big revelation from the transcript of the testimony Justice Department official Bruce Ohr gave Congress in August. The transcripts haven’t been released, but parts were confirmed for me by congressional sources.

Mr. Ohr testified that he sat down with dossier author Christopher Steele on July 30, 2016, and received salacious information the opposition researcher had compiled on Mr. TrumpMr. Ohr immediately took that to the FBI’s then-Deputy Director Andy McCabe and lawyer Lisa Page. In August he took it to Peter Strzok, the bureau’s lead investigator. In the same month, Mr. Ohr believes, he briefed senior personnel in the Justice Department’s criminal division: Deputy Assistant Attorney General Bruce Swartz, lawyer Zainab Ahmad and fraud unit head Andrew Weissman.The last two now work for special counsel Robert Mueller.

More important, Mr. Ohr told this team the information came from the Clinton camp and warned that it was likely biased, certainly unproven.

“When I provided [the Steele information] to the FBI, I tried to be clear that this is source information,” he testified.

“I don’t know how reliable it is. You’re going to have to check it out and be aware. These guys were hired by somebody relating to—who’s related to the Clinton campaign, and be aware.”

He said he told them that Mr. Steele was “desperate that Donald Trump not get elected,”and that his own wife, Nellie Ohr, worked for Fusion GPS, which compiled the dossier. He confirmed sounding all these warnings before the FBI filed its October application for a surveillance warrant against Carter Page. We broke some of this in August, though the transcript provides new detail.

The FBI and Justice Department have gone to extraordinary lengths to muddy these details, with cover from Democrats and friendly journalists.

A January 2017 memo from Adam Schiff,the House Intelligence Committee’s top Democrat, flatly (and incorrectly) insisted “the FBI’s closely-held investigative team only received Steele’s reporting in mid-September.”

A May 2018 New York Times report repeated that claim, saying Mr. Steele’s reports didn’t reach the “Crossfire Hurricane team,” which ran the counterintelligence investigation, until “mid-September.”

This line was essential for upholding the claim that the dossier played no role in the unprecedented July 31, 2016, decision to investigate a presidential campaign. Former officials have insisted they rushed to take this dramatic step on the basis of a conversation involving a low-level campaign aide, George Papadopoulos, which took place in May, before the dossier officially came into the picture. And maybe that is the case. Yet now Mr. Ohr has testified that top personnel had dossier details around the time they opened the probe.

The Ohr testimony is also further evidence that the FBI misled the Foreign Intelligence Surveillance Court in its Page warrant application. We already knew the bureau failed to inform the court it knew the dossier had come from a rival campaign.But the FISA application additionally claimed the FBI was “unaware of any derogatory information pertaining” to Mr. Steele, that he was “reliable,” that his “reporting” in this case was “credible,” and that the FBI only “speculates” that Mr. Steele’s bosses “likely” wanted to “discredit” Mr. Trump.

Speculates? Likely? Mr. Ohr makes clear FBI and Justice officials knew from the earliest days that Mr. Steele was working for the Clinton campaign, which had an obvious desire to discredit Mr. Trump. And Mr. Ohr specifically told investigators that they had every reason to worry Mr. Steele’s work product was tainted.

Strassel concludes succinctly – and ominously for anyone who still believes that ‘we, the people’ have any freedom left, that the testimony has three other implications.

First, it further demonstrates the accuracy of the House Intelligence Committee Republicans’ memo of 2018 – which noted Mr. Ohr’s role and pointed out that the FBI had not been honest about its knowledge of the dossier and failed to inform the court of Mrs. Ohr’s employment at Fusion GPS.

Second, the testimony also destroys any remaining credibility of the Democratic response,in which Mr. Schiff and his colleagues claimed Mr. Ohr hadn’t met with the FBI or told them anything about his wife or about Mr. Steele’s bias until after the election.

And third, the testimonyraises new concerns about Mr. Mueller’s team. Critics have noted Mr. Weissman’s donations to Mrs. Clinton and his unseemly support of former acting Attorney General Sally Yates’s obstruction of Trump orders. It now turns out that senior Mueller players were central to the dossier scandal. The conflicts of interest boggle the mind.

And Strassel concludes unequivocally, the Ohr testimony is evidence the FBI itself knows how seriously it erred. The FBI has been hiding and twisting facts from the start.

 

END

We reported to you on Friday night that the Cohen affair with respect to he being told to lie to Congress about the Moscow project was false.  Late Friday night, the Special Counsel provided a rare statement denying the report’s validity.  Guiliani goes on a rant. He demands the Dept of Justice to reveal the false leakers…

(courtesy zerohedge)

Trump Attorney Goes Ballistic After BuzzFeed Blunder; Demands DOJ Reveal Leakers

Rudy Giuliani has gone ballistic over Twitter following a BuzzFeed News report alleging that President Trump told former attorney Michael Cohen to lie about a plan to build a Trump Tower in Moscow – only to have special counsel Robert Mueller’s office issue a rare statement denying the report’s validity.

“BuzzFeed’s description of specific statements to the Special Counsel’s Office, and characterization of documents and testimony obtained by this office, regarding Michael Cohen’s Congressional testimony are not accurate,” said the statement by the Special Counsel, which was clarified by the Washington Post to mean the entire report. 

Robby Starbuck

@robbystarbuck

WASHINGTON POST: “Mueller’s denial, according to people familiar with the matter, aims to make clear that NONE of the statements in the Buzzfeed story are accurate.” https://www.washingtonpost.com/world/national-security/2019/01/18/b9c40d34-1b85-11e9-8813-cb9dec761e73_story.html 

In a rare move, Mueller’s office denies BuzzFeed report that Trump told Cohen to lie about Moscow…

The special counsel, which seldom speaks about its investigation, says explosive assertions are ‘not accurate.’

washingtonpost.com

50 people are talking about this

On Friday night, Giuliani praised Mueller’s office for “correcting the BuzzFeed false story that Pres. Trump encouraged cohen to lie.” He then called for the DOJ to “reveal the leakers of this false BuzzFeed story which the press and Democrats gleefully embraced.”

Rudy Giuliani

@RudyGiuliani

I commend Bob Mueller’s office for correcting the BuzzFeed false story that Pres. Trump encouraged Cohen to lie. I ask the press to take heed that their hysterical desire to destroy this President has gone too far. They pursued this without critical analysis all day.

Rudy Giuliani

@RudyGiuliani

Now the DOJ must reveal the leakers of this false BuzzFeed story which the press and Democrats gleefully embraced. And maybe House Dems should wait to investigate until the Mueller report is filed. 4 have started already.There may be nothing to legitimately investigate.

President Trump also slammed BuzzFeed Friday night, telling his 57.5 million Twitter followers: “Remember it was Buzzfeed that released the totally discredited “Dossier,” paid for by Crooked Hillary Clinton and the Democrats (as opposition research), on which the entire Russian probe is based!

Donald J. Trump

@realDonaldTrump

Remember it was Buzzfeed that released the totally discredited “Dossier,” paid for by Crooked Hillary Clinton and the Democrats (as opposition research), on which the entire Russian probe is based! A very sad day for journalism, but a great day for our Country!

BuzzFeed editor-in-chief, Ben Smith, said in a statement that the outlet stands “by our reporting and the sources who informed it,” and called on Mueller “to make clear what he’s disputing.”

To which Mueller’s team told WaPo: all of it.

SWAMP STORIES/MAJOR STORIES//THE KING REPORT
and special thanks to Chris Powell of GATA for sending this down for us:

U.S. Preparing Trump Order to Restrict Chinese Telecoms, Sources Say

The Trump administration is preparing an executive order that could significantly restrict Chinese state-owned telecom companies from operating in the U.S. over national security concerns, according to people familiar with the matter…

https://www.bloomberg.com/news/articles/2019-01-18/u-s-said-to-prepare-trump-order-to-restrict-chinese-telecoms

After the close on Friday, Kudlow refuted reports that a US-China trade deal was imminent.

Fox Business: “We’ve made some progress with China in the deputy’s meeting in Beijing,” Kudlow said during an interview on “Bulls & Bears Opens a New Window” Friday. “Nothing has been resolved, nothing on paper, no contracts” he said, noting that recent news reports of a deal being imminent are not accurate at this time…

https://www.foxbusiness.com/politics/us-china-see-trade-progress-but-trump-still-shrewdly-negotiating-larry-kudlow

U.S.-China Trade Talks Falling Short on Make-Or-Break IP Issues

https://www.bloomberg.com/news/articles/2019-01-21/u-s-china-trade-talks-falling-short-on-make-or-break-ip-issues

@ChuckRossDC: What I hate most about Twitter and “the Internet” is that I know it is rotting my soul and everyone else’s, while also destroying our society and driving us to self-destruction…but I need it for my job. [Own some gold]

Rudy G’s mouth ran amok, again, on Sunday and Monday.  Is his inanity a tactic or a malady?

 

Rudy Giuliani — stop talking!    https://www.washingtontimes.com/news/2019/jan/21/rudy-giuliani-stop-talking/

Closed-door testimony by former top FBI lawyer James Baker revealed that Michael Sussmann, a lawyer and partner at Perkins Coie, gave Baker information alleging a Russian bank was communicating with a server in Trump Tower—an allegation later proven false… Perkins Coie was also the law firm who had hired Fusion GPS—on behalf of the Clinton campaign and the DNC…

https://www.theepochtimes.com/baker-testimony-reveals-perkins-coie-lawyer-provided-fbi-with-information-on-alfa-bank-allegations_2773855.html

Judiciary Committee Democrat Floats Perjury Probe of Justice Brett Kavanaugh [buy some gold]

https://amp.dailycaller.com/2019/01/20/kavanaugh-perjury-impeachment

Over the weekend, the MSM and many reporters provided a cautionary tale about confirmation bias that Street professionals should heed.  Everyone has biases; you can’t allow them to subvert your judgment.

The disturbing action of the MSM, reporters, pundits and celebrities over the weekend reinforces the notion that the US political environment is pernicious and self-destructive – own some gold!

Media was Already Calling for Trump Impeachment following Disputed Buzzfeed Report

https://news.grabien.com/story-montage-media-was-already-calling-trump-impeachment-followin

Mueller team disputes BuzzFeed report claiming Trump told Cohen to lie

“BuzzFeed’s description of specific statements to the Special Counsel’s Office, and characterization of documents and testimony obtained by this office, regarding Michael Cohen’s Congressional testimony are not accurate,” Peter Carr, a spokesman for Mueller’s office, said Friday…

https://www.foxnews.com/politics/mueller-team-disputes-buzzfeed-report-claiming-trump-told-cohen-to-lie

Buzzfeed defiantly challenged Mueller’s retort, so Bob, via the WaPo, gave Buzzfeed a second slap.

@BuzzFeedBen: In response to the statement tonight from the Special Counsel’s spokesman: We stand by our reporting and the sources who informed it, and we urge the Special Counsel to make clear what he’s disputing.

WaPo: The potential consequences of the report were so severe — immediate congressional investigations and a possible legal showdown with the White House — that Mueller decided to take the surprising step of publicly denying his investigation had gathered any such evidence… Mueller’s denial… aims to make clear that none of those statements in the story are accurate

https://www.washingtonpost.com/world/national-security/2019/01/18/b9c40d34-1b85-11e9-8813-cb9dec761e73_story.html?utm_term=.cee42e070fbd

Inside the Mueller team’s decision to dispute BuzzFeed’s explosive story on Trump and Cohen

After Carr [Mueller spokesman] declined to comment to BuzzFeed, but before the story was publishedhe sent reporter Jason Leopold a partial transcript of Cohen’s plea hearing, in which Cohen admitted lying to Congress about the timing of discussions related to a possible Trump Tower project in Moscow, according to the emails BuzzFeed’s spokesman provided… https://www.washingtonpost.com/world/national-security/inside-the-mueller-teams-decision-to-dispute-buzzfeeds-explosive-story-on-trump-and-cohen/2019/01/19/d89dba5b-fa0f-445b-9fd3-72f0e911e28d_story.html

Soon, Mueller will have a new boss, AG-Nominee William Barr.  The ex-Bush I AG, a long-time Mueller buddy, is on record as being concerned about aspects of Mueller’s investigation.  Team Bob will lose Rosenstein’s protection when the Senate confirms Barr.  Some ex-federal prosecutors opined that Mueller is concerned that Barr could investigate or appoint a 2nd Special Counsel to investigate his team, which is what Senate Judiciary Committee Chair Lindsey Graham is advocating.

@RealSaavedra: CNN’s Jeffrey Toobin on BuzzFeed: “People are going to take from this story is that the news media are a bunch of leftist liars who are dying to get the president, and they’re willing to lie to do it… I just think this is a bad day for us

 

Just one day later, the MSM and the usual suspects smeared teenagers to advance their agendas.

Covington Catholic High School students smeared by mainstream media lies – Even conservative outlets like the National Review turned on the Catholic boys – without bothering to check their facts…

https://www.foxnews.com/opinion/covington-catholic-high-school-students-smeared-by-mainstream-media-lies-dont-expect-an-apology

The Media Wildly Mischaracterized That Video of Covington Catholic Students Confronting a Native American Veteran – Journalists who uncritically accepted Nathan Phillips’ story got this completely wrong…    https://reason.com/blog/2019/01/20/covington-catholic-nathan-phillips-video

@BreakingNLive: Covington Catholic High School says they’ve been forced to work closely with local police and authorities to make sure that the staff and students are safe followingserious death threats made against several students, their families and the school’s principal.

Kentucky Prosecutor Fires Warning Shot to People Threatening Acts of Violence against Covington Catholic High School   https://www.thegatewaypundit.com/2019/01/kentucky-prosecutor-fires-warning-shot-to-people-threatening-acts-of-violence-against-covington-catholic-high-school/

Twitter Allows ‘Verified’ Calls for Violence against Conservative High School Kids

https://www.breitbart.com/tech/2019/01/21/twitter-allows-verified-calls-for-violence-against-conservative-high-school-kids/

 

Last night: @OfficeOfMike: Twitter suspends account that spread the false narrative about Covington School students.

 

Reports last night indicate that some writers and reporters have been fired for their advocacy of violence against the Covington Catholic teenagers.

Parents and Students from Covington Catholic Demand Apology from Diocese

The families have reached out to lawyer Robert Barnes, who has offered to help the families sue the media outlets and reporters who attacked their children.

https://www.thegatewaypundit.com/2019/01/interview-parents-and-students-from-covington-catholic-demand-apology-from-diocese/

Apologies to Covington Catholic Students Flood Twitter after Video Shows Teens Were Framed: ‘I Got Duped by Fake News’    https://www.thegatewaypundit.com/2019/01/apologies-to-covington-catholic-students-flood-twitter-after-video-shows-teens-were-framed-i-got-duped-by-fake-news/

Native Activist Who Harassed Catholic Teens Identified as Actor from 2012 Skrillex Video about Attacking Police – Nathan Phillips… is raising money with the help of a major big-money left-wing operation, and has a history of appearing in the press claiming to be a victim of anti-Native racism…

https://bigleaguepolitics.com/native-activist-who-harassed-catholic-teens-identified-as-actor-from-2012-skrillex-video-about-attacking-police/

@RepJohnYarmuth [D-KY]: I am calling for a total and complete shutdown of teenagers wearing MAGA hats until we can figure out what is going on. They seem to be poisoning young minds.  The conduct we saw in this video is beyond appalling, but it didn’t happen in a vacuum.This is a direct result of the racist hatred displayed daily by the President of the United States who, sadly, some mistake for a role model. [The Chairman of the House Budget Committee is advocating the suspension of teenagers’ 1st Amendment rights due to fake news!  Yarmuth backtracked on Monday; said he was ‘joking’.]

Trump has remained mum on L’affaire Covington Catholic.  We think we know why.  Hint: SCOTUS

If you cannot do great things, do small things in a great way.” – Napoleon Hill

If I cannot do great things, I can go small things in a great way.” – Martin Luther King, Jr.

end

I WILL SEE YOU ON WEDNESDAY
AS AN ADVANCE WARNING, i WILL NOT BE WRITING A COMMENTARY ON THURSDAY
HOWEVER I WILL PROVIDE THE COMEX DATA LATE THURSDAY NIGHT.
H

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