Jan 31/GOLD RISES BY $9.80/SILVER UP 15 CENTS AND THIS IS THE FINAL OPTIONS EXPIRY DAY FOR LONDON/OTIC/CITGO MAKE FILE FOR BANKRUPTCY PROTECTION WHICH WILL NO DOUBT BRING IN THE RUSSIANS/FOXCONN MAY ABANDON MUCH OF ITS WISCONSIN PLANS FOR PRODUCTION IN THE USA/CHINA DUMPS A HUGE AMOUNT OF TREASURIES: 17.5 BILLION DOLLARS/ITALY FALLS INTO OFFICIAL RECESSION WITH ITS 2ND STRAIGHT QUARTER OF NEGATIVE GROWTH/EUROPE SET TO UNLEASH ITS OWN VERSION OF SWIFT WHICH WILL BE A HUGE DAGGER INTO THE HEART OF USA HEGEMONY/MORE SWAMP STORIES FOR YOU TONIGHT/

 

 

 

GOLD: $1320.60 UP $9.80 (COMEX TO COMEX CLOSING)

Silver:   $16.06 UP 15 CENTS (COMEX TO COMEX CLOSING)

Closing access prices:

Gold :  1322.00

 

silver: $16.06

 

 

 

 

 

 

 

 

For comex gold and silver:

FEBRUARY

 

 

 

NUMBER OF NOTICES FILED TODAY FOR  FEB CONTRACT: 939 NOTICE(S) FOR 93900 OZ (2.9206 tonnes)

TOTAL NUMBER OF NOTICES FILED SO FAR:  939 NOTICES FOR 93900 OZ  (2.9206 TONNES)

 

 

SILVER

 

FOR FEBRUARY

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

 

286 NOTICE(S) FILED TODAY FOR 1430,000  OZ/

 

total number of notices filed so far this month: 286 for 1,430,000

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Bitcoin: OPENING MORNING TRADE $3429: DOWN 23

 

Bitcoin: FINAL EVENING TRADE: $3440 DOWN   $16

 

end

 

XXXX

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

today 540/939

EXCHANGE: COMEX
CONTRACT: FEBRUARY 2019 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,309.900000000 USD
INTENT DATE: 01/30/2019 DELIVERY DATE: 02/01/2019
FIRM ORG FIRM NAME ISSUED STOPPED
____________________________________________________________________________________________
132 C SG AMERICAS 18
657 C MORGAN STANLEY 44
657 H MORGAN STANLEY 87
661 C JP MORGAN 828 286
661 H JP MORGAN 254
685 C RJ OBRIEN 3
686 C INTL FCSTONE 2
690 C ABN AMRO 23
737 C ADVANTAGE 5 18
800 C RCG 2 7
880 H CITIGROUP 240
905 C ADM 60 1
____________________________________________________________________________________________

TOTAL: 939 939
MONTH TO DATE: 939

 

This is the first time in quite a while that we have seen zero whacks on expiry week. The bankers are now in serious trouble as gold and silver quietly rise

 

 

 

 

 

Let us have a look at the data for today

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

In silver, the total OPEN INTEREST ROSE BY A HUGE SIZED 4419 CONTRACTS FROM 194,895 UP TO 199,314 ACCOMPANYING YESTERDAY’S 7 CENT GAIN  IN SILVER PRICING AT THE COMEX. TODAY WE ARRIVED CLOSER TO  AUGUST’S 2018  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 STRONG SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP:

803 EFP’S FOR MARCH,  0 FOR APRIL, 251 FOR MAY, 0 FOR DECEMBER AND ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE: OF 1054 CONTRACTS. WITH THE TRANSFER OF 1054 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 1054 EFP CONTRACTS TRANSLATES INTO 5.27 MILLION OZ  ACCOMPANYING:

1.THE 7 CENT GAIN IN SILVER PRICE AT THE COMEX AND

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

JUNE/2018. (5.420 MILLION OZ);

FOR JULY: 30.370 MILLION OZ

FOR AUG., 6.065 MILLION OZ

FOR SEPT. 39.505 MILLION  OZ S

FOR OCT.2.525 MILLION OZ.

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

21.925 MILLION OZ FINALLY STAND FOR DECEMBER.

5.845 MILLION OZ STAND IN JANUARY.

AND NOW 2.050 MILLION OZ STANDING FOR FEBRUARY.

 

 

ACCUMULATION FOR EFP’S/SILVER/J.P.MORGAN’S HOUSE OF BRIBES, / STARTING FROM FIRST DAY NOTICE/FOR MONTH OF JANUARY: 43,491 CONTRACTS (FOR 21 TRADING DAYS TOTAL 43,491 CONTRACTS) OR 217.455 MILLION OZ: (AVERAGE PER DAY: 2071 CONTRACTS OR 10.355 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH OF JAN:  217.455 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 31.055% 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:           217.455    MILLION OZ.

JANUARY 2019 EFP TOTALS:                                                      217.455. MILLION OZ.

 

 

RESULT: WE HAD A HUGE SIZED INCREASE IN COMEX OI SILVER COMEX CONTRACTS OF 4419 WITH THE 7 CENT GAIN IN SILVER PRICING AT THE COMEX //YESTERDAY..THE CME NOTIFIED US THAT WE HAD A GOOD SIZED EFP ISSUANCE OF 1054 CONTRACTS WHICH EXITED OUT OF THE SILVER COMEX AND TRANSFERRED THEIR OI TO LONDON AS FORWARDS. SPECULATORS CONTINUED THEIR INTEREST IN ATTACKING THE SILVER COMEX FOR PHYSICAL SILVER (SEE COMEX DATA) .

TODAY WE GAINED A HUGE SIZED: 5473 TOTAL OI CONTRACTS ON THE TWO EXCHANGES:

i.e 1054 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH INCREASE OF 4419 OI COMEX CONTRACTSAND ALL OF THIS  DEMAND HAPPENED WITH A 7 CENT GAIN IN PRICE OF SILVER  AND A CLOSING PRICE OF $15.91 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. .998 BILLION OZ TO BE EXACT or 142% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT FEBRUARY MONTH/ THEY FILED AT THE COMEX: 286 NOTICE(S) FOR 1430,000 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   JANUARY AT  5.825 MILLION OZ.AND NOW FEB 2019:  2.050 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 HUGE SIZED 11,929 CONTRACTS DOWN TO 471,461 DESPITE THE RISE IN THE COMEX GOLD PRICE/(A GAIN IN PRICE OF $0.65//YESTERDAY’S TRADING). 

THE LOSS IN OPEN INTEREST IS DUE TO SPREADERS WHO MUST LIQUIDATE THEIR POSITIONS AS THEY COME INTO AN ACTIVE DELIVERY MONTH. SINCE FEBRUARY IS AN ACTIVE MONTH FOR GOLD, THIS IS WHY WE ALWAYS SEE A CONTRACTION IN OPEN INTEREST ONCE WE APPROACH FIRST DAY NOTICE. SINCE THE SPREADERS HAVE AN IDENTICAL LONG AND SHORT POSITION, THE LIQUIDATION DOES NOT AFFECT PRICE.

 

 

THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A STRONG  SIZED 11,261 CONTRACTS:

 

FEBRUARY HAD AN ISSUANCE OF 1110 CONTACTS  APRIL 8884 CONTRACTS, DECEMBER: 1267 CONTRACTS AND ALL OTHER MONTHS ZERO.  The NEW COMEX OI for the gold complex rests at 471,461. 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 AN TINY SIZED LOSS IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 668 CONTRACTS: 11,929 OI CONTRACTS DECREASED AT THE COMEX AND 11,261 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI LOSS: 668 CONTRACTS OR 66,800 OZ = 2.077 TONNES. AND ALL OF THIS DEMAND OCCURRED WITH A RISE IN THE PRICE OF GOLD/ YESTERDAY TO THE TUNE OF $0.65.

 

 

 

 

 

YESTERDAY, WE HAD 10,460 EFP’S ISSUED.

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF JANUARY : 170,782 CONTRACTS OR 17,078,200 OZ  OR 531.20 TONNES (21 TRADING DAYS AND THUS AVERAGING: 8132 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 21 TRADING DAYS IN  TONNES: 531.20 TONNES

TOTAL ANNUAL GOLD PRODUCTION, 2018, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 2555 TONNES

THUS EFP TRANSFERS REPRESENTS 531.20/2550 x 100% TONNES = 20.83% OF GLOBAL ANNUAL PRODUCTION SO FAR IN DECEMBER ALONE.***

ACCUMULATION OF GOLD EFP’S YEAR 2019 TO DATE:     4,531.20  TONNES

JANUARY 2019 TOTAL EFP ISSUANCE;   531.20 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 HUGE SIZED DECREASE IN OI AT THE COMEX OF 11,929 (WITH THE MAJORITY OF THE LOSS COMING FROM THE LIQUIDATION OF THE SPREADERS) DESPITE THE GAIN IN PRICING ($0.65) THAT GOLD UNDERTOOK YESTERDAY) //.WE ALSO HAD A STRONG SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 11,261 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 11,261 EFP CONTRACTS ISSUED, WE HAD A SMALL LOSS OF 668 CONTRACTS IN TOTAL OPEN INTEREST  ON THE TWO EXCHANGES:

11,261 CONTRACTS MOVE TO LONDON AND 11,929 CONTRACTS DECREASED AT THE COMEX. (IN TONNES, THE GAIN IN TOTAL OI EQUATES TO 2.077 TONNES). ..AND ALL OF THIS  DEMAND OCCURRED WITH THE GAIN OF $0.65 IN YESTERDAY’S TRADING AT THE COMEX

 

 

we had:  939 notice(s) filed upon for 93,900 oz of gold at the comex.

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD...

 

WITH GOLD UP $9.80 TODAY 

 

NO CHANGES IN GOLD INVENTORY AT THE GLD

 

 

 

 

 

 

 

/GLD INVENTORY   823.87 TONNES

Inventory rests tonight: 823.87 tonnes.

 

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

 

SLV/

WITH SILVER UP 15 CENTS  IN PRICE  TODAY:

 

 

ANOTHER BIG CHANGE IN SILVER INVENTORY/

A “PAPER DEPOSIT” OF 1,126,000 OZ

 

 

 

 

 

 

 

/INVENTORY RESTS AT 310.723 MILLION OZ.

 

 

end

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

1. Today, we had the open interest in SILVER ROSE BY A HUMONGOUS SIZED 4419 CONTRACTS from 194,895 UP TO 199,314  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:

 

803 CONTRACTS FOR MARCH. 251 CONTRACTS FOR MAY., FOR DECEMBER AND  AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 1054 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON.  IF WE TAKE THE  OI GAIN AT THE COMEX OF 4419 CONTRACTS TO THE 1054 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN A STRONG GAIN  OF 5473  OPEN INTEREST CONTRACTS.  THUS IN OUNCES, THE GAIN ON THE TWO EXCHANGES: 27.36 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 , 5.845 MILLION OZ STANDING IN JANUARY..AND NOW 2.050 MILLION OZ STANDING IN FEBRUARY.

 

 

RESULT: A STRONG SIZED INCREASE IN SILVER OI AT THE COMEX WITH THE 7 CENT PRICING GAIN THAT SILVER UNDERTOOK IN PRICING// YESTERDAY.BUT WE ALSO HAD A GOOD SIZED 1054 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE STRONG  SIZED AMOUNT OF SILVER OUNCES STANDING FOR SEPTEMBER, DEMAND FOR PHYSICAL SILVER CONTINUES TO INTENSIFY AS WE WITNESS SEVERE BACKWARDATION IN SILVER IN LONDON.

 

 

(report Harvey)

.

2.a) The Shanghai and London gold fix report

(Harvey)

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY: Bloomberg

3. ASIAN AFFAIRS

i)THURSDAY MORNING/ WEDNESDAY NIGHT: 

SHANGHAI CLOSED UP 9.00 PTS OR 0.35% //Hang Sang CLOSED UP 299.62 POINTS OR 1.08% /The Nikkei closed UP 216.95  PTS OR 1.06%/ Australia’s all ordinaires CLOSED DOWN .23%

/Chinese yuan (ONSHORE) closed UP  at 6.7040 AS TRUCE DECLARED FOR 3 MONTHS /Oil DOWN to 52.48 dollars per barrel for WTI and 60.53 for Brent. Stocks in Europe OPENED GREEN

//ONSHORE YUAN CLOSED UP AT 6.7040AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED UP ON THE DOLLAR AT 6.7110: / TRADE TALKS NOW ON/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED   : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING STRONGER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING STRONGER AGAINST THE DOLLAR /CHINA RETALIATES WITH TARIFFS/ TRUMP RESPONDS TO NEW TARIFFS AND IT NOW A FULL TRADE WAR COMMENCED

 

 

 

 

 

3A/NORTH KOREA/SOUTH KOREA

 

 

i)North Korea//USA

 

 

b) REPORT ON JAPAN

 

 

3 C/  CHINA

 

 

i

 

i) CHINA/FOXCONN/USA

After much fanfare last year China’s Foxconn is now reconsidering his huge plan to hire 13,000 Wisconsin workers. Trump is not a happy camper on this news

( zerohedge)

ii)

This is big! China dumps 17 .5 billion dollars worth of treasuries.  This is the 6th straight month for liquidation and this must be very worrisome to Trump as they spare with China
(courtesy zerohedge)

4/EUROPEAN AFFAIRS

i)UK

Tom Luongo, our resident expert on European affairs discusses how the Davos crowd has failed with respect to their plans on thwarting a Brexit.

( TomLuongo)

ii)Do not expect a Brexit deal from the EU until the last minute.  Remember that the EU needs England far greater than England needs the EU

( zerohedge)

iii)ITALY

Not good!  Italy falls into recession as its 4th quarter GDP falls to negative .20%.  The previous quarter fell by .1% and we now have two quarters of negative growth and that fits the definition of a recession

(courtesy zerohedge)

iv)France:

France is preparing a new bill which will outlaw masks.  The problem will become interesting when the protesters don gas masks to prevent breathing in tear gas.

( zerohedge)

 

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

 

IRAN/EU

This is a huge blow to USA hegemony as Europe launches its alternative to SWIFT (INSTEX) to fund Iran. Trump will be furious and he may be so angry that he will pull out of NATO

(courtesy zerohedge)

 

 

 

6. GLOBAL ISSUES

 

7. OIL ISSUES

 

 

 

 

8 EMERGING MARKET ISSUES

 

 

VENEZUELA/USA/CITGO

Venezuela’s principal asset in the USA is Citgo which refines 5% of all USA gasoline.  It is now weighing its option for bankruptcy.  This is where the fun begins…Citgo is a wholly owned asset of PDVSA which is in default and sovereign Russia which lent 3 billion dollars to Venezuela has CITCO shares as collateral.  If CITGO goes bust, then Russia owns 49.9% of the stock.  The USA wants to transfer the assets to the Guaido

popcorn anyone?…

(courtesy zerohedge)

 

9. PHYSICAL MARKETS

i)For those of you who missed yesterday’s Fed announcement, here it is again.  The Fed caves in on rate increases and balance sheet tightening.
( zerohedge)

ii)A good interview of Chris Powell with Jay Taylor as the outline the rigging of gold/silver metal and shares of mining companies.

( Chris Powell./GATA/Jay Taylor)

iii)All 50 states should adopt this: West Virginia proposes eliminating all taxes on gold and silver

( Cortez/MoneyMetalsNews Service)

iv)We have been continually supplying to information that the White House and the Bank of England do not want anybody dealing with the Venezuelans in gold.

( Reuters/GATA)

v)I would bet that most of Venezuela’s gold has been disposed of by Maduro

( Bloomberg/GATA)

vi)Ronan Manly states correctly that the Bank of England tore up its gold custody contract with Venezuela.  No doubt that their plan to confiscate gold had the approval of the uSA.  I feel the real reason that the Bank of England did to return the gold to Venezuela was not for political reasons but for the fact that the goldis gone.

(Ronan Manly/Bullionstar)

vii)A good reason why you do not invest in Bitcoin or any cryptocurrency:l over 1 billion dollars were of cryptos were stolen last year.

( zerohedge)

 

viii)Venezuela cashes out of 18 tonnes of gold as this was sold to the United Arab Emirates.

( zerohedge)

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

 

 

MARKET TRADING

ii)Market data/

a)The Chicago national manufacturing PMI plummets to two year lows

( zerohedge)

b)Quite a surprise: after continual lousy housing reports, we get November new home sales rise 16.9% month/month.  This is the biggest rise since 1992.  Probably somebody goofed with the numbers

( zerohedge)

c)Pending home sales tumble to the lowest level in 5 years. This kind of affirms by belief that the new home sales above is fake

(courtesy zerohedge)

 

 

iii)USA ECONOMIC/GENERAL STORIES

a)The key Conference Board Future expectations signaled recession..a clear sign that the USA is heading lower.

Gundlach slams Powell for caving to the stock market.

(courtesy Gundlach/zerohedge)

c)Trump will not accept any trade deal unless China opens up its market to manufacturers, bankers and farmers.

I extremely doubt that China will comply with this especially the banker front.

( zerohedge)

d)No final deal with China will be announced until Trump meets Xi. No action on the wall discussions as of yet

( zerohedge)

d)Trump will not accept any trade deal unless China opens up its market to manufacturers, bankers and farmers.I extremely doubt that China will comply with this especially the banker front.

( zerohedge)

e)Amazon is a good Bellwether on the retail front: its shares drop after guidance in the next quarter to its worst revenue growth in 18 years.

( zerohedge)

iv)SWAMP STORIES

a)Lindsay Graham demands an FBI briefing as to why the FBI needed 29 agents to arrest Roger Stone knowing full well that he was not a flight risk

( zerohedge)

b)The Belarus prostitute that was named in the Steele dossier now admits that she fabricated the evidence claim on Trump.

( zerohedge)

 

 

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

 

end

 

 

 

Let us head over to the comex:

 

THE TOTAL COMEX GOLD OPEN FELL BY AN HUGE SIZED 11,261 CONTRACTS DOWN TO A LEVEL OF 471,461 DESPITE THE RISE IN THE PRICE OF GOLD ($0.65) IN YESTERDAY’S COMEX TRADING).FOR TWO YEARS STRAIGHT WE HAVE NOTICED THAT ONE WEEK PRIOR TO FIRST DAY NOTICE OF AN ACTIVE DELIVERY MONTH THE COMEX OPEN INTEREST CONTRACTS AND EFP’S NOTICES EXPONENTIALLY INCREASE AS WELL AS WE WITNESS THE COMEX OPEN INTEREST COLLAPSE. ONCE WE GET TO FIRST DAY NOTICE, THEN THE OPEN INTEREST RISES.THUS, THE REASON FOR THE COLLAPSE IN OPEN INTEREST IS THE FORCED LIQUIDATION OF THE SPREADERS.

 

 

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 11,261 EFP CONTRACTS WERE ISSUED:

FOR FEBRUARY:  1110. FOR APRIL 8884, FOR DECEMBER: 1267 AND  ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE:  11,261 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 LOST THE FOLLOWING TODAY ON OUR TWO EXCHANGES:  668 TOTAL CONTRACTS IN THAT 11,261 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST A HUGE SIZED 11,929 COMEX CONTRACTS.

NET LOSS ON THE TWO EXCHANGES:66contracts OR 66,800  OZ OR 2.077 TONNES.

 

We are now in the active contract month of FEBRUARY and here the open interest stands at A WHOPPING 10,648 contracts, a drop of 25,515 contracts and thus by definition, the initial amount of gold standing in this active month of February is 10,648 contracts x 100 oz per contract = 1,064,800 oz or 33.12 tonnes.

 

 

The next non active delivery month after February is  March and here we  GAINED 291 contracts to stand at 1936.  After March, the next big delivery month is April and here the OI rose by 13,393 contracts up to 331,699 contracts.

 

 

 

FOR COMPARISON FEBRUARY 2019 TO THE  FEBRUARY 2018 COMEX GOLD CONTRACT MONTH

 

 

 

ON FEB 1.2018: 20.07 TONNES OF GOLD STOOD FOR DELIVERY, BUT BY THE END OF MONTH ONLY 8.55 TONNES EVENTUALLY STOOD AS THE REST MORPHED INTO LONDON BASED FORWARDS.

TODAY’S NOTICES FILED:

WE HAD 939 NOTICES FILED TODAY AT THE COMEX FOR 93,900 OZ. (2.9206 tonnes)

 

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And now for the wild silver comex results.

Total COMEX silver OI ROSE BY A STRONG SIZED 4419  CONTRACTS FROM 194,895 UP TO 199,314(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 7 CENT GAIN IN PRICING.

 

WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF FEBRUARY AND THE  AMOUNT OF OPEN INTEREST READY TO STAND IS  410 CONTRACTS, HAVING GAINED 5 CONTRACTS FROM YESTERDAY.  Thus by definition the initial amount of silver standing in this non active month of February is as follows;

410 contracts x   5,000 oz per contract =   2,050,000 oz

.

 

 

 

THE NEXT NON ACTIVE DELIVERY MONTH AFTER FEBRUARY IS THE VERY BIG AND ACTIVE DELIVERY MONTH OF MARCH AND HERE THE OI ROSE BY 1861 CONTRACTS UP TO 140,207 CONTRACTS. AFTER MARCH, THE NEXT BIG ACTIVE DELIVERY MONTH IS MAY AND HERE THE OI ADVANCED BY 2161 CONTRACTS UP TO 27,954 CONTRACTS.

 

 

 

 

ON A NET BASIS WE GAINED 5473 SILVER OPEN INTEREST CONTRACTS AS WE OBTAINED A 4419 CONTRACT GAIN AT THE COMEX COMBINING WITH THE ADDITION OF 1054 OI CONTRACTS NAVIGATING OVER TO LONDON.

NET GAIN ON THE TWO EXCHANGES:  5473 CONTRACTS...AND ALL OF THIS OCCURRED WITH A 7 CENT GAIN IN PRICING// YESTERDAY

 

 

 

 

 

FOR COMPARISON SILVER COMEX CONTRACT MONTH  FEB 2018 VS FEB 2019

 

 

 

 

ON FIRST DAY NOTICE FEB 1/2018 CONTRACT MONTH WE HAD 670,000 OZ.  AT THE MONTH’S CONCLUSION WE HAD 2.035 MILLION OZ STAND AS WE WITNESSED QUEUE JUMPING ON A REGULAR BASIS AT THE SILVER COMEX.

TODAY THE INITIAL AMOUNT OF SILVER STANDING IS 2.050 MILLION OZ./

 

 

 

 

 

TODAY’S NUMBER OF NOTICES FILED:

 

We, today, had 286 notice(s) filed for 1,430,000 OZ for the FEB, 2019 COMEX contract for silver

 

 

Trading Volumes on the COMEX TODAY:  217,068 CONTRACTS

 

 

CONFIRMED COMEX VOL. FOR YESTERDAY:  343,841  contracts

 

 

 

 

 

 

 

 

 

 

 

INITIAL standings for  FEB/GOLD

JAN 31/2019.

Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
1698.190 oz
Delaware
HSBC
Deposits to the Dealer Inventory in oz 1794.65 oz

Brinks

 

 

 

 

 

Deposits to the Customer Inventory, in oz  

 

16,014.780

 

OZ

 

Scotia

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

No of oz served (contracts) today
939 notice(s)
 93,900 OZ
No of oz to be served (notices)
9709 contracts
(970,900 oz)
Total monthly oz gold served (contracts) so far this month
939 notices
93900 OZ
2,9206 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 1 dealer entries:

i) Into Brinks:  1794.65

 

total dealer deposits: 1794.65 oz

total dealer withdrawals: 0 oz

We had 0 kilobar entries

 

we had 0 deposit into the customer account

 

 

total gold customer deposits;  nil oz

 

we had 2 gold withdrawals from the customer account:

i) Out of Delaware:  801.057 iz

ii) Out of HSBC:  897.173 oz

 

 

 

total gold withdrawing from the customer;  1,698.190 oz

 

we had 0  adjustments….

FOR THE FEB 2019 CONTRACT MONTH)

Today, 0 notice(s) were issued from JPMorgan dealer account and 828 notices were issued from their client or customer account. The total of all issuance by all participants equates to 939 contract(s) of which 286 notices were stopped (received) by j.P. Morgan dealer and 286 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 FEBRUARY/2019. contract month, we take the total number of notices filed so far for the month (939) x 100 oz , to which we add the difference between the open interest for the front month of FEB. (10,648 contract) minus the number of notices served upon today (939 x 100 oz per contract) equals 1,064,800 OZ OR 33.11 TONNES) the number of ounces standing in this active month of FEBRUARY

 

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

No of notices served (939 x 100 oz)  + {10,648)OI for the front month minus the number of notices served upon today (939 x 100 oz )which equals 1,064,800 oz standing OR 33.11 TONNES in this active delivery month of FEBRUARY.

 

 

 

 

 

THERE ARE ONLY 23.17 TONNES OF REGISTERED COMEX GOLD AVAILABLE FOR DELIVERY AGAINST 33.11 TONNES STANDING FOR JANUARY

 

 

total registered or dealer gold:  745,010.257 oz or   23.17 tonnes
total registered and eligible (customer) gold;   8,439,056.807 oz 262.48 tonnes

IN THE LAST 27 MONTHS 92 NET TONNES HAS LEFT THE COMEX.

 

end

And now for silver

AND NOW THE NOV DELIVERY MONTH

FEB INITIAL standings/SILVER

JAN 31, 2019
Silver Ounces
Withdrawals from Dealers Inventory NIL oz
Withdrawals from Customer Inventory
1,049,892.741  oz
CNT
Scotia
Delaware
HSBC

 

 

Deposits to the Dealer Inventory
564,937.98 oz
Brinks
Deposits to the Customer Inventory
1,258,253.350 oz
Scotia
CNT
Delaware
HSBC
No of oz served today (contracts)
286
CONTRACT(S)
1430,000 OZ)
No of oz to be served (notices)
124 contracts
620,000 oz)
Total monthly oz silver served (contracts) 286 contracts

(1,430,000 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 dealer:  564.937.98 oz

 

total dealer deposits:  564,937.98  oz

total dealer withdrawals: 0 oz

we had  4 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 50.77% of all official comex silver. (149.787 million/295 million)

 

i) Into CNT:  588,836.000 oz

ii) Into Delaware: 3956.940 oz

iii) Into HSBC: 65,437.830 oz

iv) Into Scotia: 600,022.350 oz

 

 

 

 

 

 

 

 

 

 

 

 

 

 

total customer deposits today: 1,258,253.350   oz

we had 4 withdrawals out of the customer account:
i) Out of Scotia: 493,531.800 oz

ii) Out of CNT:  159,081.396 oz

iii) Out of Delaware: 20,899.215 oz

iv) Out of HSBC: 376,380.33 oz

 

 

 

 

 

 

total withdrawals: 1049,892.741    oz

 

we had 1 adjustment..

out of CNT..

220,886.598 oz was adjusted out of the dealer and this lands in the customer account of CNT

generally this signifies a settlement.

 

 

total dealer silver:  88.142 million

total dealer + customer silver:  298.004 million oz

 

 

 

 

The total number of notices filed today for the FEBRUARY 2019. contract month is represented by 286 contract(s) FOR 1,430,000  oz

To calculate the number of silver ounces that will stand for delivery in FEB., we take the total number of notices filed for the month so far at 286 x 5,000 oz = 1,430,000 oz to which we add the difference between the open interest for the front month of FEB. (410) and the number of notices served upon today (286x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the FEBRUARY/2019 contract month: 286(notices served so far)x 5000 oz + OI for front month of FEB( 410) -number of notices served upon today (286)x 5000 oz equals 2,050,000 oz of silver standing for the FEBRUARY contract month.  This is a strong number of oz standing for an off delivery month.

 

 

 

 

 

 

 

 

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

TODAY’S SILVER VOLUME:  81,398 CONTRACTS

 

 

CONFIRMED VOLUME FOR YESTERDAY: 89,562 CONTRACTS… 

 

 

 

 

YESTERDAY’S CONFIRMED VOLUME OF 89,562 CONTRACTS EQUATES to 447 million OZ  63.85% OF ANNUAL GLOBAL PRODUCTION OF SILVER

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

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

end

NPV for Sprott 

1. Sprott silver fund (PSLV): NAV RISES TO -3.43% (JAN 31/2019)
2. Sprott gold fund (PHYS): premium to NAV FALLS TO -1.08% to NAV (JAN 31 /2019 )
Note: Sprott silver trust back into NEGATIVE territory at -3.43%-/Sprott physical gold trust is back into NEGATIVE/

(courtesy Sprott/GATA)

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

NAV 13.46/TRADING 13.02/DISCOUNT 3.30

END

And now the Gold inventory at the GLD/

JAN 31/WITH GOLD UP $9.80 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 823.87 TONNES

JAN 30/WITH GOLD UP $.65: A HUGE HUGE MONSTROUS ADDITION OF 8.23 TONNES OF PAPER GOLD ENTERED THE GLD/INVENTORY RESTS AT 823.87..SO FAR IN JANUARY: 28.56 TONNES HAVE BEEN ADDED

JAN 29/WITH GOLD UP $6.15/A HUGE ADDITION OF 5.88 TONNES OF GOLD INTO THE GLD/INVENTORY RESTS AT 815.64 TONNES

JAN 28/WITH GOLD UP $5.30 TODAY:NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 809.76 TONNES

JAN 25/WITH GOLD UP $17.90: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 809.76 TONNES

jAN 24/WITH GOLD DOWN $3.70?: NO CHANGES AT THE GLD/INVENTORY RESTS AT 809.76 TONNES

JAN 23/WITH GOLD UP 50 CENTS: NO CHANGES AT THE GLD/INVENTORY RESTS AT 809.76 TONNES

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

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

JAN 31/2019/ Inventory rests tonight at 823.87 tonnes

*IN LAST 543 TRADING DAYS: 111.28 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 443 TRADING DAYS: A NET 48.75 TONNES HAVE NOW BEEN ADDED INTO THE GLD INVENTORY.

 

end

 

Now the SLV Inventory/

JAN 31/WITH SILVER UP 15 CENTS TODAY: ANOTHER BIG DEPOSIT OF 1.126 MILLION OZ/INVENTORY RESTS AT 310.723 MILLION OZ/

JAN 30/WITH SILVER UP 7 CENTS: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 938,000 INTO THE SLV INVENTORY./INVENTORY RESTS AT 309.597 MILLION OZ.

JAN 29/WITH SILVER UP 9 CENTS TODAY/A HUGE DEPOSIT OF 1.408 MILLION OZ  IN SILVER INVENTORY AT THE SLV.INVENTORY RESTS AT 308.659 MILLION OZ/

JAN 28/WITH SILVER UP 5 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 307.251 MILLION OZ/

JAN 25/WITH SILVER UP 40 CENTS: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 307.251 MILLION OZ/

JAN 24/WITH SILVER DOWN 7 CENTS TODAY: NO CHANGES IN SILVER INVENTORY

JAN 23/WITH SILVER UP 4 CENTS: A HUGE LOSS OF 938,000 FROM THE SLV/INVENTORY RESTS AT 307.251 MILLION OZ/

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/

 

 

JAN 31/2019:

 

Inventory 310.723 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 2.24/ and libor 6 month duration 2.81

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

G0LD LENDING RATE: + .57

 

 

XXXXXXXX

12 Month MM GOFO
+ 2.54%

LIBOR FOR 12 MONTH DURATION: 3.02

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.48

end

 

PHYSICAL GOLD/SILVER STORIES

end
i) GOLDCORE BLOG/Mark O’Byrne

U.S.-China War M

 

GATA STORIES AS IT RELATES TO PHYSICAL GOLD/SILVER
For those of you who missed yesterday’s Fed announcement, here it is again.  The Fed caves in on rate increases and balance sheet tightening.
(courtesy zerohedge)

Fed caves on rates and balance-sheet tightening

 Section: 

Chairman Powell’s grandfather Dick responds on behalf of monetary metals investors:

http://www.gata.org/files/DickPowellSings.wma

And:

https://www.youtube.com/watch?v=Gt6soO6O6Jg

* * *

Fed Adopts ‘Patient’ Rate Stance With Balance-Sheet Flexibility

By Craig Torres
Bloomberg News
Wednesday, January 30, 2019

The Federal Reserve said today it will be “patient” on any future interest-rate moves and signaled flexibility on the path for reducing its balance sheet, in a substantial pivot away from its bias just last month toward higher borrowing costs.

… The Federal Open Market Committee “will be patient as it determines what future adjustments to the target range for the federal funds rate may be appropriate to support” a strong labor market and inflation near 2 percent, the central bank said in a statement Wednesday following a two-day meeting in Washington.

In a separate special statement, the Fed said it’s “prepared to adjust any of the details for completing balance sheet normalization in light of economic and financial developments.” The central bank also said it would be ready to alter the balance sheet’s size and composition if the economy warrants a looser monetary policy than the federal funds could achieve on its own.

… For the remainder of the report:

https://www.bloomberg.com/news/articles/2019-01-30/fed-adopts-patient-ra…

.END

A good interview of Chris Powell with Jay Taylor as the outline the rigging of gold/silver metal and shares of mining companies.

(courtesy Chris Powell./GATA/Jay Taylor)

Financial letter writer Jay Taylor interviews GATA secretary on gold price rigging

 Section: 

2:50p ET Wednesday, January 30, 2019

Dear Friend of GATA and Gold:

Financial letter writer Jay Taylor (https://www.miningstocks.com/), long a friend of gold and GATA, interviewed your secretary/treasurer yesterday about the mechanics and objectives of gold price suppression by central banks. The interview is 21 minutes long and can be heard at YouTube here:

https://www.youtube.com/watch?v=xqH7Dv42VHU

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

END

All 50 states should adopt this: West Virginia proposes eliminating all taxes on gold and silver

(courtesy Cortez/MoneyMetalsNews Service)

West Virginia state legislator proposes eliminating all taxes on gold and silver

 Section: 

By JP Cortez
Money Metals News Service
Wednesday, January 30, 2019

CHARLESTON, West Virginia — West Virginia legislator Delegate Pat McGeehan, R-1st District has introduced the West Virginia Sound Money Act, House Bill 2684, to eliminate all tax liability on gold and silver in the state.

Following the Wyoming Legal Tender Act, which passed in Wyoming overwhelmingly last year, the West Virginia Sound Money Act is a similar measure that will remove all taxation on gold and silver, including sales and use tax, property tax, individual income tax, and corporate income tax.

…Under current law West Virginia citizens are discouraged from insulating their savings against the devaluation of the dollar because they are penalized with taxation for doing so. House Bill 2684 removes the disincentives to using gold and silver for this purpose. …

… For the remainder of the report:

https://www.moneymetals.com/news/2019/01/30/west-virginia-gold-silver-ta…

END 

We have been continually supplying to information that the White House and the Bank of England do not want anybody dealing with the Venezuelans in gold.

(courtesy Reuters/GATA)

Don’t deal in Venezuelan gold, White House says in anti-Maduro push

 Section: 

By Shaylim Castro and Jeff Mason
Reuters
Tuesday, January 29, 2019

CARACAS, Venezuela — The White House warned traders on Wednesday not to deal in Venezuelan gold or oil following its imposition of stiff sanctions aimed at forcing socialist President Nicolas Maduro from power.

National security adviser John Bolton tweeted that traders should not deal in gold, oil, or other commodities “being stolen” from the Venezuelan people, as opponents of Maduro’s government worried that a Russian-operated plane had shipped gold out of Caracas this afternoon. …

… For the remainder of the report:

https://www.reuters.com/article/us-venezuela-politics/dont-deal-in-venez…

END

I would bet that most of Venezuela’s gold has been disposed of by Maduro

(courtesy Bloomberg/GATA)

 

In Maduro’s Venezuela, even counting gold bars is a challenge

 Section: 

By Laura Millan Lombrana
Bloomberg News
Wednesday, January 30, 2019

Venezuela is home to rich gold deposits and holds billions of dollars of foreign reserves in gold bars in the central bank’s vaults. The question is: How much is there?

The answer has taken on added significance as beleaguered President Nicolas Maduro faces increasing pressure to resign. Last week countries including the U.S. and U.K. recognized the leader of the National Assembly, Juan Guaido, as the Venezuela’s legitimate leader, amid mass protests. On Monday, the Trump administration issued new sanctions that effectively block crude exports to the U.S., where Venezuela gets the bulk of its cash.

… 

 

While crude is by far Venezuela’s largest export, refined oil and then gold both make up significant sources of revenue, according to data compiled by the Observatory of Economic Complexity of the Massachusetts Institute of Technology. But both the nation’s gold reserves and mining production have dropped in recent years as Maduro’s regime used the yellow metal to generate hard currency in international transactions — and even to exchange it for food and medicine. …

… For the remainder of the report:

https://www.bloomberg.com/news/articles/2019-01-30/in-maduro-s-venezuela…

* * *

Help keep GATA going:

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

http://www.gata.org

To contribute to GATA, please visit:

http://www.gata.org/node/16

END

Ronan Manly states correctly that the Bank of England tore up its gold custody contract with Venezuela.  No doubt that their plan to confiscate gold had the approval of the uSA.  I feel the real reason that the Bank of England did to return the gold to Venezuela was not for political reasons but for the fact that the goldis gone.

(Ronan Manly/Bullionstar)

Ronan Manly: Bank of England tears up its gold custody contract with Venezuela

 Section: 

9:18p ET Wednesday, January 30, 2019

Dear Friend of GATA and Gold:

Confiscation of Venezuela’s gold by the Bank of England, Bullion Star gold researcher Ronan Manly writes today, seems to have been plotted by the United Kingdom and the United States last April when Venezuela’s central bank paid Citibank $172 million to recover gold bars kept at the Bank of England that had been given as collateral for a loan.

… 

 

In any case, Manly writes, the Bank of England’s reputation as a safe and impartial custodian of international gold reserves has been destroyed.

Of course Venezuela’s removal of so much gold from the Bank of England might have greatly endangered the gold price management operation of the major central banks, which is centered on the Bank of England.

Manly’s analysis is headlined “Bank of England Tears Up Its Gold Custody Contract with Venezuela’s Central Bank” and it’s posted at Bullion Star here:

https://www.bullionstar.com/blogs/ronan-manly/bank-of-england-tears-up-i…

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

END





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.

Venezuela cashes out of 18 tonnes of gold as this was sold to the United Arab Emirates.
(courtesy zerohedge)

Venezuela Central Bank Begins Shipping 18 Tons Of Gold To UAE

Venezuela has sold and shipped three tons of central bank gold to the United Arab Emirates (UAE) on January 26 and is preparing to ship 15 more tons, according to Reuters. At today’s spot price of $1,320 per ounce, the sale will total roughly $760 million USD.

Steve Kopack

@SteveKopack

Reuters reports, citing sources, that a three ton shipment of Venezuela’s central bank gold left for the UAE on January 26 and the country is preparing a 15 ton shipment in the coming days.

The shipment constitutes 11% of Venezuela’s current gold reserves, and follows the export last year of $900 million of unrefined gold to the UAE and Turkey.

end
I have highlighted to you over the year the various central bankers buying gold.  It amounted to  652 tonnes of gold.  The world produces around 2550 tonnes per year.
The countries that bought:
1. Russia (mostly from their production plus some imports)
2. Hungary (imports)
3. Turkey( imports)
4. Kazakhstan (production plus imports)
5  India (all imports)
6 Iraq  (a surprising purchase/imports)
7. Azerbaijan( imports)

Central Banks’ Gold-Buying Spree Reaches 50-Year High

Gold is poised to close out January with a fourth straight monthly gain after the Fed’s uber-dovish flip-flop seemed to signal that it’s done raising interest rates (reportedly for a while but that’s never happened before)…

Raoul Pal

@RaoulGMI

The Fed have never, ever “paused” a full hiking cycle. The always end up cutting. Each cutting cycle has led to a recession except mid 1990’s and 1987. Odds are in favour of the Fed having gone too far already and the stock market figuring it out in due course…

Which has hurt the dollar, helping gold to its sixth January gains in a row as investors sought a haven against slowing growth and U.S.-China trade disputes.

While short interest in GLD (Gold ETF) has soared along with price…

Bloomberg survey results show a decidedly positive bias on the precious metal (Bullish: 13 Bearish: 2 Neutral: 2)

If the Fed’s rate-hike cycle really has come to an end for now, the sooner-than-expected dollar weakness may help gold to “rise more quickly and more sharply,” Commerzbank said in a note.

“Both the tone and language of the Fed statement and presser appeared more accommodative versus consensus expectations,” Citigroup Inc. analysts including Aakash Doshi wrote in a note. “To take advantage of an ongoing gold market rally, investors might consider positioning for upside.”

“Gold is benefiting from a lower dollar in general, as well as safe-haven buyers hedging against the outcome of the U.S.-China trade talks,” Jeffrey Halley, senior market analyst at Oanda Corp. in Singapore, said in a note.

Still, there’s no guarantee gold will keep appreciating at the same pace.

Ole Hansen, head of commodity strategy at Saxo Bank, said by email. While the bank maintains a bullish view on gold, “some caution may now be warranted,” he said.

“With stocks rallying and emerging market assets receiving a boost, the buy-gold story has faded, at least for now,” Hansen said.

And as BCS Global Markets said in a note, the big range in analysts’ outlook for gold this year shows “that there is actually no consensus.”

However, there is one group of global ‘investors’ who are waving in those bullion trucks with both hands and feet – The world’s central banks…

Central banks bought last year the most gold in 47 years, with 651.5 tonnes (74% higher YoY). This is the highest level of annual net purchases since the suspension of dollar convertibility into gold in 1971…

Additionally, Bloomberg’s Javier Blas notes that the 2018 gold buying spree by central banks isn’t just the biggest in 47 years, but also the second highest annual total on record (only surpassed by 1967, when central bank gold reserves increased by 1,404 tonnes).

“Heightened geopolitical and economic uncertainty throughout the year increasingly drove central banks to diversify their reserves and re-focus their attention on the principal objective of investing in safe and liquid assets,” said the World Gold Council report released on Thursday.

Strong central bank and consumer demand offset ETF outflows…

More central banks look to gold.

Russia, Kazakhstan and Turkey again accounted for a large portion of demand in 2018. But their share fell to 58 % – from 94 % in 2017 – as other central banks chose to significantly increase their gold reserves, reinforcing the importance of gold as a reserve asset.

Notably, European central banks also bought gold last year. Hungary made one of the largest purchases, increasing its gold reserves ten-fold in October, to 31.5t. This is the highest level for nearly 30 years. The central bank cited gold’s role as a hedge against future structural changes in the international financial system, as well as its lack of counterparty or credit risk, as reasons for the purchase. Similarly, Poland was another European central bank which bought last year. Gold reserves rose by 25.7t during 2018, +25% y-o-y.

Indian net purchases were another notable component of central bank demand in 2018. Monthly purchases began in March and picked up in the second half of the year. In total, gold reserves rose by 40.5t, the highest annual growth since the purchase of 200t from the International Monetary Fund In 2009.5 In its Annual Report 2017-2018 the bank stated: “Diversification of India’s Foreign Currency Assets (FCA) continued during the year with attention being ascribed to risk management, including cyber security risk. The gold portfolio has also been activated.”

Mongolia announced that it had bought 22t of gold in 2018, in line with its stated target.  This represented a 10% increase on 2017 purchases. One of the drivers of this growth was a five-month “National Gold to the Fund of Treasures” campaign, which encouraged miners and individuals to sell their gold to the central bank.6

In September, the Central Bank of Iraq stated that it had taken advantage of lower gold prices to buy 6.5t. This was the first annual increase since 2014 and took total gold reserves to 96.3t, accounting for 6.7% of total reserves.

The State Oil Fund of Azerbaijan (SOFAZ) also re-entered the market last year. Gold reserves grew by 14.3t by the end Q3, an increase of nearly 50% from end-2017.7 Having been on the side-lines of the gold market since the end of 2013, this marked a change in policy for the fund. In December 2018, President Ilham Aliyev approved updated investment guidelines that would allow SOFAZ to invest up to 10% of its portfolio in gold. Currently, gold accounts for 4.3% of SOFAZ’s portfolio.

So, what do the central banks know that mom-and-pop FAANG-buyer don’t?

end

A good reason why you do not invest in Bitcoin or any cryptocurrency:l over 1 billion dollars were of cryptos were stolen last year.

(courtesy zerohedge)

Explosive Report Claims Two Hackers Stole $1 Billion In Crypto

Crypto related hacks have fallen in frequency since the great crypto bust of 2018 – or at the very least, they don’t grab headlines like they once did. They’ve also become an accepted risk of trading in crypto: Gone are the days when a devastating hack like the one that brought down Mt. Gox back in 2014 have had serious repercussions for the entire crypto market.

But that hasn’t deterred firms like Chainalysis, the respected crypto forensics firm that has reportedly helped the FBI and other US law enforcement agencies track illicit activity and bust money launderers using crypto, from exploring the methods used by hackers to conceal the provenance of stolen coins on a system that touts transparency as one of its biggest selling points.

BTC

During the course of its research, Chainalysis happened upon a surprising finding: Just as there are “whales” who hold concentrated portions of crypto wealth, so there are whale-like hackers who are responsible for much of the thievery that has plagued the eco-system. According to a Wall Street Journal summary of Chainalysis’ findings, two groups of highly sophisticated criminals appear to have stolen some $1 billion in cryptocurrencyan amount that accounts for the majority of the money lost to hackers. Some $1.7 billion in crypto has been reported stolen over the years, mainly from exchanges (Mt. Gox and Bitfinex being two of the most infamous hacks).

WSJ

Chainalysis spent about three months tracking the stolen funds in known hacks, and noted that there’s a slight chance that its analysis is incorrect.

The analysts at Chainalys christened the groups “Alpha” group and “Beta” group. The MOs of the two groups differ in one important way. While established government-linked groups like the Lazarus Group have been identified as the culprits behind certain hacks (like the hack of South Korea’s Bithumb), Chainalysis said these two groups appear to be independent – and possibly amateur – criminals.

Chainalysis’s digital investigators determined that likely wasn’t the case when they analyzed the transaction flows from known hacks. The firm believes it has connected most of the hacks to two groups, which it labeled alpha and beta.

Alpha is “a giant, tightly controlled organization at least partly driven by nonmonetary goals,” Chainalysis said in its report. Beta, the second group, is smaller and less organized, a “heavily sanctioned organization absolutely focused on the money,” according to the report.

Chainalysis said the two hacker groups employed an extensive network of digital wallets to hide their tracks and later converted the money to physical cash through online exchanges and individual transactions. The stolen funds were transferred an average of 5,000 times before they were converted into cash, Chainalysis found.

Alpha tends to immediately begin shuffling the funds around, according to the report. One hack involved 15,000 transfers. The entity converted about three-quarters of its stolen funds into cash within an average of 30 days.

Beta, on the other hand, may sit on the stolen funds for up to 18 months, waiting for any publicity surrounding the hack to fade. “When they feel ready to cash out, they quickly hit one exchange, cashing out over 50% of funds within days,” the report said.

Though thieves prefer unregulated exchanges (as the bust of shadowy exchange BTC-e showed), thieves will sometimes use regulated exchanges to launder the funds. Because by the time the funds have gone through so many transfers, even exchanges with stringent AML controls can’t trace them.

end

huge trading in the petroyuan scheme. Hopefully this will translate into massive imports of gold into China as owners and sellers of oil receive first yuan and then transfer those yuan into gold:

courtesy Nicholas B

PetroYuan and Other Topical Matters

Good Morning Bill/Harvey, (from Africa)

A few minutes ago (2.00 am ET) the Shanghai Energy Exchange closed its futures trading book for January 2019.The first full month of trading on the petroyuan futures contract was April 2018, when total turnover was just over half a trillion yuan. In November and December 2018, aggregate monthly turnover plateaued between 4.1 trillion and 4.2 trillion yuan and this has now increased to Yuan 4,642,063,051,800 in respect of January 2019.This turnover is achieved between the hours of 9-11.30 and 13.30-15.00 on weekdays –Shanghai is 13 hours ahead of ET so these rather restricted trading periods are basically in operation when the West sleeps. 24/7 trading is only an imperative for the obscene, corrupted COMEX/GLOBEX platforms so that peak illiquid periods can be identified in which to engineer the biggest possible impact from criminally manipulative paper trades.

Let us unpack this January 2019 data and see what it means on the ground. A barrel of oil is currently about Yuan 380 (three months out). The turnover data as reported on the Shanghai International Energy Exchange is ‘double sided’ and hence the number to dissect is only half the total as recorded above, which equates to Yuan2,321,031,525,900.

· Therefore about 6.1 billion barrels traded in January 2019 in lots of 1,000 barrels per trade.

· Open interest tends to evaporate (or rather be rolled forward) as the front month contract expiration approaches. The total open interest upon expiration of the SC1902 contract today was only 84 lots (84,000 barrels). Currently 42,048,000 million barrels are standing for 28th February 2018, but don’t hold your breath.

· There is, however, a genuine and detailed ‘’exchange for physical ‘(efp) mechanism” outlined in the rules of the Shanghai Energy Exchange .Such efp totals are excluded from the Exchange’s reported data, which is a pity, but perhaps is necessary to delay the onset of open warfare if the petrodollar hegemony was seen to be challenged in such an overt manner.

· China’s physical importation requirement for crude oil is reported to be about 7.6 million bpd to supplement domestic production of about 3.8 million bpd .About 203 million barrels trade daily (based on 30 days) on the Shanghai futures so would it be absurd to postulate that about 3.7% of this figure results in efp transactions. Perhaps most of China’s physical oil imports still occur on petrodollar denominated platforms, but is this probable?

Virtually no commentator mentions this inexorable crescendo in the emergence of the petroyaun, but it is clearly a principal component in the financial plumbing now being constructed on many fronts to enable USD trading platforms to be de emphasized as the East prepares to wean itself from the consequences of the abusive and delinquent mismanagement of the global reserve currency as exercised by the FED and USA politicians.

Tomorrow the BLS will release the Jan.2019 NFP report. (Zero Hedge reported that Larry Kudlow knew the no. two weeks ago.) I have a query. The BLS mendaciously fabricates its monthly survey data, but what is the sequence thereafter? Does the BLS apply the Birth/Death model inflator (which should be a deflator) and then only ‘’goal seeks’’ by applying quadruple or quintuple seasonal adjustment factors, or are the seasonal adjustment factors applied to the fabricated base data first, and then only is the Birth/Death model inflator (which should be a deflator) used as a final massaging tool? But then does the answer matter one little bit.

Also tomorrow the ‘transparent’’ LBMA will release 90 days in arrears, as at 31st October 2018, the (metronomically constant) loco London precious metal vault holdings. Don’t laugh because if you also collected data on horseback and then input this data into antiquated ledgers, you would also release your results in arrears, but maybe (say) only by 10 days or so. I am not a conspiracy theorist so I am inclined to accept this LBMA data as being (more or less) reasonably accurate .But just like the NFP data, it is pure propaganda, because the LBMA would never allow any visibility into the total claims on this physical gold. At last I have discovered why there are various estimates about the extent of fractional reserving in respect of total claims on this physical loco London gold. 140 times (as per Andrew Maguire last week) is the estimate of fractional reserving on the assumption that all gold bars comply with LBMA minimum .995 finesse requirements. But thanks, inter alia, to Robert Rubin, this fractional reserving estimate increases to 236 times when all identified tungsten contaminated bars are excluded. Then there is the immortal quotation of Don Rumsfeld about known knowns, known unknowns and unknown unknowns. The unknown unknown in this case relates to a contingency for tungsten contaminated bars that have hitherto escaped official detection, and when factored into the equation, this additional contamination moves the fractional reserving estimate up to 272 times (meaning that there are 272 legitimate claims on every ounce of non-tungsten contaminated physical vault gold). I recall once reading a claim that fractional reserving was as high as 500/1, but after yesterday’s Fed capitulation will fractional reserving of even 10/1 be manageable?

Regards
Nicholas

*J. Johnson’s Latest

GOLD TRADING/THIS MORNING

 

 

 

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

i) Chinese yuan vs USA dollar/CLOSED UP TO 6.7040/

 

//OFFSHORE YUAN:  6.7110   /shanghai bourse CLOSED UP 9.00 PTS OR 0.35%

 

HANG SANG CLOSED UP 299,62 POINTS OR 1.08%

 

 

2. Nikkei closed UP 216.95  POINTS OR 1.06%

 

 

 

 

 

3. Europe stocks OPENED ALL MIXED

 

 

 

 

 

 

 

/USA dollar index FALLS TO 95.29/Euro RISES TO 1.1494

3b Japan 10 year bond yield: RISES TO. +.01/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 108.58/ 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:: 54.22 and Brent: 61.84

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

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO +.18%/Italian 10 yr bond yield DOWN to 2.60% /SPAIN 10 YR BOND YIELD DOWN TO 1.22%…ITALIAN 10 YR BOND YIELD/GERMAN BUND: 2.42: DANGEROUS FOR THE ITALIAN BANKING SYSTEM

3j Greek 10 year bond yield FALLS TO : 3.88

3k Gold at $1323.10 silver at:16.10   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble UP 10/100 in roubles/dollar) 65.30

3m oil into the 53 dollar handle for WTI and 60 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 108.58 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 0.9931 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1415 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 +0.18%

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 2.69% early this morning. Thirty year rate at 3.02%

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

6.  TURKISH LIRA:  UP  TO 5.1942

 

Global Stock Rally Fades After Italy Slides Into Recession

The total capitulation by the Federal Reserve which confirmed all it cares about is the stock market, propelled world stocks to their best January on record on Thursday, although in a deja vu of last January, when stocks similarly soared only to flop spectacularly, traders were trying not to get too carried away.

An overnight rally in global markets, helped by a dovish capitulation by the Fed which sent the S&P 1.55% higher on Wednesday as well as strong results from Facebook that sent the stock 11% higher premarket, faded overnight following another contractionary print in China’s official manufacturing PMI (49.5, up from 49.4 in Dec and above the 49.3 estimate), and the latest GDP print out of Italy which confirmed that the country had entered a recession for the first time in 6 years.

Even with the modest fade in sentiment, the MSCI world stocks index rose 0.5% and for the 20th day out of the last 23.  For January it is up more than 7.2% which is its best January since the index began in 1988 and the best performance in any month since December 2015. “The rally really does lift all boats,” said Pictet emerging market portfolio manager Guido Chamorro.

S&P futures and European stocks traded mixed on Thursday following catch up gains in Asia as investors took a pause in the wake of mixed corporate earnings despite now open support from the Federal Reserve which signaled an extended rate hike pause and announced it will be flexible on the path for reducing its balance sheet, sending the S&P to an 8-week high even as Nasdaq contracts stayed in the green, helped by better-than-expected results at Facebook. Meanwhile, Treasury yields and the dollar extended Wednesday’s declines. As a result, S&P futs were unchanged before President Trump was set to meet top China trade negotiator Chinese Vice Premier Liu He in the second day of the US-China trade talks.

Europe’s Stoxx 600 Index trimmed early gains of as much as 0.6%, dragged lower by banks and telecos as energy companies rose following strong results from Shell. Italy’s FTSE MIB index dropped on data showing the country fell into recession at the end of 2018, its first in 6 years.

GDP

Germany’s DAX drifted 1% off session high, as Deutsche Bank weighs on the index following news the German lender could be forced to merge with Commerzbank by mid-year if its results dont improve. FTSE-100 up 0.6%

MSCI’s index of Asia-Pacific shares rose to its highest since October helped by a 1% jump on Japan’s Nikkei which shrugged off the normal headwind of a higher yen. The main emerging market index skipped to a more than 8 percent January gain while the Shanghai Composite Index climbed 0.3 percent despite data showing China’s factory activity contracted for a second straight month.

Emerging-market stocks were poised for their best monthly gain in almost three years and while Powell’s dovish turn boosted currencies for a seventh day as the dollar extended its decline. The MSCI emerging-market equity index added to yesterday’s advance to head for a four-month high. The currency gauge was set for its longest winning streak in more than a year, with South Africa’s rand, Turkey’s lira and Brazil’s real leading gains since the U.S. central bank’s statement on Wednesday.

In FX, the Bloomberg Dollar index slipped to the the lowest since Sept. 27 as focus turned to US payrolls data due Friday; the greenback fell versus all G-10 peers, while the yen and risk-sensitive currencies led gains following the dovish Fed remarks; Treasuries rallied, outperforming Bunds. The euro reversed gains to trade below the 1.15 handle; the common currency initially shrugged off weaker-than-forecast German retail sales (-4.3% m/m in Dec. vs est. -0.6%) before edging lower despite euro-area growth in the three months through December matching estimates at 1.2% y/y, pressured by Italian GDP data.

With Wednesday’s statement the Fed helped ease fears that it would continue with plans to tighten policy even in the face of cooling economic data. The Fed said it would be “patient” about any future rate hikes and signaled flexibility in reducing its bond holdings, adding fuel to the emerging-market rally that began as 2018 drew to a close.

Investors now have a wary eye on meetings between Chinese negotiators and their counterparts in Washington as talks to resolve the trade dispute continue.

“I suspect the Fed news will trump everything, and people will look at the news, whatever comes in these earnings, against the backdrop of what the Fed is doing,” Gavin Friend, senior market strategist at National Australia Bank in London, said in a podcast. “It could be the catalyst for a breakthrough in key levels in the dollar index against major currencies.”

Looking at today’s key event, President Trump will meet with Chinese Vice Premier Liu He at 15:30 EST today. Trump also said it is highly unlikely he would be willing to include ‘Dreamers’ in negotiations regarding border security and government funding, while there were separate reports that the White House is said to prepare an emergency wall plan. US Democrats reportedly suggested openness for a compromise with President Trump, despite unveiling initial proposal for border security which doesn’t include a physical barrier.

In the latest Brexit news, the EU stands ready to take Brexit to a last-minute summit rather than bend the knee to demands from UK PM May, according to diplomats citing the scheduled summit on March 21-22. UK PM May is also said to be putting together a series of measures in an attempt to woo Labour MPs to support her Brexit deal; measures include cash injections into leave-supporting deprived areas.

In the commodity markets, oil prices rose for a third day, pushed up by lower imports into the United States amid OPEC efforts to tighten the market, and as Venezuela struggles to keep up its crude exports after Washington imposed sanctions on the nation. U.S. West Texas Intermediate crude futures were at $54.47 per barrel, up 24 cents, or 0.4 percent, from their last settlement. Brent was up 36 cents, or 0.6 percent, at $62.01 per barrel.

Expected data include jobless claims and new home sales. Blackstone, Conoco, Ferrari, GE, Mastercard, UPS, and Amazon are among companies reporting earnings.

Market Snapshot

  • S&P 500 futures little changed at 2,684.25
  • STOXX Europe 600 up 0.1% to 358.96
  • MXAP up 1.2% to 156.58
  • MXAPJ up 0.8% to 510.49
  • Nikkei up 1.1% to 20,773.49
  • Topix up 1.1% to 1,567.49
  • Hang Seng Index up 1.1% to 27,942.47
  • Shanghai Composite up 0.4% to 2,584.57
  • Sensex up 1.8% to 36,246.18
  • Australia S&P/ASX 200 down 0.4% to 5,864.65
  • Kospi down 0.06% to 2,204.85
  • Brent futures up 0.4% to $61.90/bbl
  • Gold spot up 0.2% to $1,321.92
  • U.S. Dollar Index little changed at 95.31
  • German 10Y yield fell 2.3 bps to 0.165%
  • Euro up 0.06% to $1.1487
  • Italian 10Y yield fell 3.4 bps to 2.243%
  • Spanish 10Y yield fell 3.7 bps to 1.217%

Top Overnight News from Bloomberg

  • U.S. President Donald Trump will meet China’s top trade negotiator in the Oval Office on Thursday for high-level talks, with little indication that Beijing will bend to American demands to deepen economic reforms
  • Italy fell into recession at the end of 2018, capping a year of political turmoil, higher borrowing costs and fiscal tensions that took their toll on the economy. The contraction will put further pressure on the coalition government, which already appears to be fraying
  • The European Union is prepared to take Brexit down to a last-minute, high-stakes summit rather than cave into U.K. Prime Minister Theresa May’s demands over the next few weeks, diplomats said
  • The number of Chinese companies warning on earnings is turning into a flood as a deadline looms on Thursday, with no industry spared from worsening demand

Asian stocks were mostly higher across the board as they took impetus from their counterparts in US where sentiment was lifted on the back of earnings and a dovish Fed, while the region also digested better than expected Chinese PMI data. ASX 200 (-0.4%) and Nikkei 225 (+1.1%) both initially benefitted from the rising tide in the aftermath of the FOMC, although weakness in Australia’s largest weighted financial sector later dragged on the local bourse, while a slew of corporate updates shared the focus for Japan. Hang Seng (+1.1%) and Shanghai Comp. (+0.4%) conformed to the positive tone following better than expected Chinese Manufacturing PMI and Non-Manufacturing PMI data, while another PBoC liquidity injection ahead of next week’s Lunar New Year and ongoing US-China trade talks also contributed to the optimism. Finally, 10yr JGBs were initially higher as they tracked the upside in T-notes post-FOMC and as the BoJ Summary of Opinions unsurprisingly reiterated the need to persistently continue powerful monetary easing, although gains were later pared despite stronger 2yr auction results as upside was restricted by the firm risk sentiment.

Top Asian News

  • Ship Giants to Join Forces in Korea to Fend Off China Threat

All Major European indices initially opened higher [Euro Stoxx 50 -0.3%] continuing the overnight gains seen in Asia which benefited from a dovish Fed alongside strong earnings from Facebook, who were up 11.5% after-market; although European indices have since reverted much of this following an earnings dominated open. FTSE 100 (+0.5%) is benefitting from Shell (+4.1%) and Diageo (+4.0%) due to both companies’ earnings beating on expectations; Shell’s strong performance has subsequently led to outperformance in the energy sector (+2.3%). The SMI (U/C) is the underperforming sector, weighed on by Swatch (-5.4%) who are at the bottom of the Stoxx 600 after their FY group sales missed expectations; although losses are capped by strong performance in Roche (+2.2%) following their earnings. Other notable movers include, Unilever (-3.7%) who anticipate 2019 underlying sales growth at the bottom of their 3-5% range; and as such are down on the day. Elsewhere, Wirecard (+1.8%) have recouped some of the losses seen in the previous session due to an FT article reporting that an executive has been accused of using forged contracts. And BT (-2.6%) are down despite reiterating EBITDA guidance at the top end of expectations for FY18/19, as Philip Jansen is to take over as CEO from Gavin Patterson on Friday.

Top European News

  • Spain’s Economy Remains Bright Spot Amid Euro-Area Slowdown
  • Shell Pledges to ‘Do It All’ as Cash Surge Underpins Returns
  • As Wirecard Gets Bigger, So Does the Target on Its Back
  • Nestle Chairman Signals He’s Open to a Full Sale of Skin Health

In FX, odds looked stacked against the Greenback following an arguably even more dovish twist from the FOMC than many or most were looking for (effectively announced a pause in the tightening cycle, with patience going forward and not necessarily further hikes at this stage, or much more balance sheet reduction). This, coupled with some ‘strong’ sell signals for month end portfolio rebalancing saw the Buck slump to new recent lows vs G10 peers, while the DXY slipped under its 200 DMA (95.290) at one stage to 95.127 before stabilising and perhaps benefiting from early SOMA-related positioning (front-running ahead of the usual flow window).

  • JPY – The main beneficiary of post-Fed Dollar weakness and pronounced US Treasury curve bull-steepening, as Usd/Jpy reversed sharply from 109.50+ peaks into the FOMC to circa 108.50. Note, however, option expiries between 108.90-109.00 in 1 bn may limit further downside in the headline pair ahead of the NY cut.
  • AUD/NZD – Also revelling in the broadly bearish Usd hue, plus a revival in risk appetite, which partly Fed induced and underscored by improvements in China’s manufacturing and services PMIs overnight. Aud/Usd is consolidating off fresh multi-week highs circa 0.7275 having blasted through daily tech resistance around 0.7207 that had been containing advances ahead of the FOMC, while Nzd/Usd is pivoting 0.6900 with the Kiwi drawing additional momentum from S&P’s NZ rating outlook upgrade to positive from stable.
  • GBP/CHF/CAD – All firmer vs the US Dollar, albeit marginally, as Cable continues to trade heavily around 1.3150 amidst the ongoing Brexit hiatus, while the Franc remains in a 0.9900-50 range and Loonie meanders between 1.3120-55 awaiting some independent impetus from looming Canadian GDP and PPI data before a speech from BoC’s Wilkins.
  • EUR – The single currency finally breached its 100 DMA around 1.1443, and 1.1450 on its way to a 1.1515 peak vs the Usd, but has been undermined by more poor Eurozone data in the shape of German retail sales and Italian GDP (both negative and worse than forecast). Note, the aforementioned SOMA interests also have a tendency to weigh on Eur/Usd more than other Usd/major pairings.

In commodities, it was a mixed session in the commodities complex thus far, as the energy benchmarks pare back a bulk of yesterday’s Fed-induced gains with WTI (-0.2%) drifting into negative territory and Brent (+0.5%) off best levels. Oil prices have been on a downwards trajectory for most of the EU session with a brief Brent dip below USD 61.50/bbl, coinciding with the Iraqi oil ministry stating 40 oil wells are to be drilled in the Southern Manjoon oilfield. As reference the Manjoon oil field is estimated to have reserves of almost 12.6bln barrels. Otherwise, new-flow has been light in the complex with traders keeping a close eye on US-Sino trade developments with Vice Premier Liu He due to meet US President Trump at the Oval office around 20:30 GMT. On the Venezuelan front, Chinese energy giant PetroChina is reportedly planning to drop Venezuelan state-owned PDVSA amid the US oil sanctions on the company in the backdrop of Venezuela’s political turmoil. The sanctions seem to have a muted impact in the oil market thus far as US already stated that any shortfalls in output will be countered with the use of the US Strategic Petroleum Reserve. Meanwhile, prices are somewhat underpinned by the OPEC production cuts with figures stating output amongst the members fell 900k BPD, (vs. 800K planned at the latest meeting); as according to JBC.

Elsewhere, metal prices are supported by the still-subdued dollar with spot gold poised to end the month with a fourth consecutive monthly gain, prices reached levels last seen in May 2018 as the yellow metal advances above USD 1320/oz. Citigroup notes that the precious metal is benefitting from a weaker buck alongside safe-haven buyers hedging against the outcome of the US-China trade talks. Moving on, nickel and steel prices are expected to be weighed on by a soaring output of the raw material in China and Indonesia and as such, BMO analysts expect the nickel deficit to narrow to 96k tonnes in 2019 vs. current 129k tonnes.

Looking at the day ahead, we’re due to get Q4 ECI (+0.8% qoq expected), latest weekly initial jobless claims, November new home sales and the January Chicago PMI (2.3pt drop to 61.5 expected). Away from the data the ECB’s Coeure, Mersch and Weidmann are due to speak at separate events while earnings highlights include Amazon, Royal Dutch Shell, Unilever, DowDuPont, General Electrics, Diageo and ConocoPhillips.

US Event Calendar

  • 7:30am: Challenger Job Cuts YoY, prior 35.3%
  • 8:30am: Employment Cost Index, est. 0.8%, prior 0.8%
  • 8:30am: Initial Jobless Claims, est. 215,000, prior 199,000; Continuing Claims, est. 1.72m, prior 1.71m
  • 9:45am: Chicago Purchasing Manager, est. 61.5, prior 65.4
  • 10am: New Home Sales, est. 570,000, prior 544,000; MoM, est. 4.78%, prior -8.9%
  • 4pm: Total Net TIC Flows, prior $42.0b

DB’s Jim Reid concludes the overnight wrap

If you’re in the U.K. I hope you’ve met today’s tax return deadline. I still haven’t quite finished mine and I’m a little stressed as to when I’ll get the chance. This is the most complicated of my life as during the last tax year I sold all my worldly possessions (apart from my family and my golf clubs) to buy our new house. I’ve had to go through 24 years of files to work out what I’d originally paid for all the assets that I subsequently sold. Surprisingly some were actually sold higher than where I’d bought them. Others less so! At least next year’s will now be easy as pretty much all I own is tied up in a vastly overpriced U.K. house in a post Brexit era.

On the positive side this last day of January will be greeted with more enthusiasm than the last day of the previous two very poor months for performance. The Fed helped supercharge this last night with US markets advancing to their highest levels since early December after delivering a surprisingly dovish policy statement at yesterday’s meeting. It marked the first Fed meeting day in which the S&P 500 rallied since Chair Powell’s tenure began, snapping a streak of seven straight losses on Fed meeting days. Has Mr Powell now yielded to the desires and moods of financial markets? Indeed, yesterday was the best “Fed day” performance since December 2014, when then-Chair Yellen struck a similarly dovish tone and the committee inserted a reference to being “patient” into the statement.

The p-word was again a key factor at yesterday’s meeting, as its re-introduction marked one of several notably dovish changes that supported yesterday’s market reaction. As a reminder, yesterday was the first of the previous “off” meetings with a press conference. There was also the normal policy statement, but no update to FOMC participants’ macro and interest rate forecasts.

The new policy statement had four notable changes that all leaned in a dovish direction: theyi) removed the “further gradual increases” description of the policy path, ii) added “market-based measures of inflation compensation have moved lower,” iii) added a reference to “muted inflation pressures,” and iv) added a sentence saying “the Committee will be patient as it determines what future adjustments” to rates will be appropriate. Taking items i and iv together, the committee therefore removed its tightening bias, and looking at ii and iii this indicates that incoming hard data and market pricing on the inflation front are the key variables to watch before the fed returns to its tightening track. The policy statement was accompanied by a separate note which committed to using the fed funds rate as the main policy tool and to maintaining enough excess reserves moving forward to maintain the “floor” system. That was consistent with our economists’ expectations, but still represents an official confirmation.

Our economists now believe that the risk to their call for two more rate hikes later this year and another one next year has shifted a bit further to the downside, though the substantial further lift to financial conditions resulting from yesterday’s announcement somewhat limits this downside risk. See here for their full summary of the meeting.

Now to recap the strong day of market rallies. Yields on two-year Treasuries rallied -6.5bps while 10-year yields fell a more modest -3.2bps, leading the yield curve to bull steepen +3.2bps. The dollar dropped -0.50%, with the euro gaining +0.41% and emerging markets outperforming, up +0.65%. The NASDAQ advanced +2.20%, while the S&P 500 and DOW rallied +1.57% and +1.77% respectively, though to be fair the major indexes were already around 1 percent higher on the session before the Fed gave the rally an extra boost. The main factor during morning trading in New York was positive earnings reports (more details below).

After the close markets also had to contend with a couple of bellwether numbers in the tech space, with Facebook and Microsoft highlighting results. Thesocial media giant beat expectations on profits, revenue, and active users, and shares rallied over 11% overnight. Microsoft’s earnings and sales figures were slightly below analysts’ expectations, and shares slid -4%. Qualcomm’s revenues were a touch soft as well, but a healthy beat on profits helped shares rally over 2%. Net-net, NASDAQ futures are up +0.42% while the rest of Asia is taking the lead from Wall Street with healthy gains for the Nikkei (+1.16%), Hang Seng (+1.06%), Shanghai Comp (+0.69%) and Kospi (+0.36%).

We haven’t heard any sound bites to come from the US-China trade talks as of yet with talks continuing today however sentiment overnight has also partially been helped by the January PMIs in China where both the manufacturing (54.7 vs. 53.8 expected) and services (49.5 vs. 49.3 expected) prints came in higher than expected. The manufacturing reading also rose 0.9pts from December and it leaves the composite 0.6pts higher at 53.2, and therefore the highest since September last year.

Back to yesterday, where the earnings highlights included a +6.83% rally for Apple (post the numbers after the close on Tuesday), Boeing (+6.30%), AMD (+19.95%) and Anthem (+9.12%). The Boeing numbers were notable insofar as the company reported $100bn of annual sales for the first time in its 102-year history, while also forecasting further revenue growth for this year. Management also eased some of the recent concerns over China’s outlook, saying “we continue to see strong demand in China.”

Closer to home, Italy is starting to creep up on people’s radars again. Yesterday there was some focus on a Bloomberg story suggesting that Deputy PM Salvini is facing internal pressure to force early elections due to frustration over the League’s coalition partner 5SM. Cabinet Undersecretary Giorgetti is one who has publically voiced frustration. This story is also having legs given the rising support for the League based on a weekly average of opinion polls (Bloomberg) which puts their support at 32% (from 20% in April 2018) versus 25% for the 5SM (from 35%). The same article does however go on to say that Salvini is not looking at early elections and is supposedly talking down such expectations within the party. That said we’ve become more than accustomed to elections in Italy with 65 governments since 1946, equivalent to a new government every 1.1 years and 91 in the last 117 years.

Markets are also well versed on recessions in Italy with 5 since the adoption of the euro (equivalent to an average real GDP growth rate of +0.12% qoq). This morning we get a first look at Q4’18 GDP with the consensus expecting a -0.1% qoq reading. As a reminder this follows -0.1% qoq in Q3 and so assuming the consensus is correct, a negative reading will push Italy into another technical recession. For all the above BTPs outperformed yesterday with 10y yields -3.4bps lower compared to -1.1bps for Bunds and -1.5bps for OATs. At 2.596%, yields are now rivalling July levels from last year. It’s worth adding that the FTSE MIB (+0.36%) also outperformed the DAX (-0.33%) yesterday and performed in line with the STOXX 600 (+0.36%).

As for Brexit it was another day of swings and roundabouts for Sterling which traded as high as $1.315 and as low as $1.306. The newsflow mainly centered around the EU side yesterday with Juncker saying that a “disorderly Brexit is now more likely” and that the “withdrawal accord won’t be renegotiated”. That’s not a great surprise as it’s a reiteration of what Juncker has said previously. Ireland PM Varadkar also said that the “EU is not offering a renegotiation of a deal” and there are “no plans to organize an emergency summit”. Ireland’s Foreign Minister Coveney also said that he’s skeptical that there are workable alternatives to the backstop, a view reinforced by Angela Merkel’s spokesman who said “the opening of the exit deal is not on the table”. Comments then that hardly fuel much confidence that the stalemate will be broken. Over to Mrs May. My personal view is that there is scope for a deal but that the EU and Irish might conclude that Parliament is so anti no-deal and slowly gaining more control that if they hold off long enough the chamber will find a way of forcing the government to commit to this. This weakens the UK’s negotiating position in my opinion. As bad as no-deal might be, if you’re negotiating you need the genuine threat of it to strengthen your hand.

Back to the continent, where yesterday in Germany, the Economy Ministry officially slashed its forecast for 2019 growth to 1.0% compared to the 1.8% forecast made in October. That would be the weakest since 2013. It’s worth noting that Bunds are back to within just 3.5bps off the early January closing lows, which at the time were the lowest since 2016.

As far as yesterday’s data was concerned, in the US the ADP employment change report for January surprised to the upside at 213k (vs. 181k expected) ahead of payrolls tomorrow while pending home sales for December printed at -2.2% mom (vs. +0.5% expected). In Germany consumer confidence for Germany ticked up 0.3pts to 10.8 while for the Euro Area, economic, business and services confidence indicators all weakened marginally. Here in the UK net consumer credit was slightly weaker than consensus in December (0.7bn vs. 0.8bn expected) while mortgage approvals fell slightly to 63.8k (vs. 63.1k expected).

To the day ahead now, where the early data this morning comes from Germany with the December retail sales report. January house price data in the UK follows before we get the preliminary January CPI print in France (-0.6% mom expected) and a first look at Q4 GDP for the Euro Area. The consensus is for +0.2% qoq which would have the effect of lowering the annual rate to +1.2% yoy (from +1.6%). At the same time we’ll also get the aforementioned Q4 GDP for Italy which is expected to come in at -0.1% qoq and therefore confirm two consecutive negative quarters and a technical recession. Across the pond today we’re due to get Q4 ECI (+0.8% qoq expected), latest weekly initial jobless claims, November new home sales and the January Chicago PMI (2.3pt drop to 61.5 expected). Away from the data the ECB’s Coeure, Mersch and Weidmann are due to speak at separate events while earnings highlights include Amazon, Royal Dutch Shell, Unilever, DowDuPont, General Electrics, Diageo and ConocoPhillips.

 

 

3. ASIAN AFFAIRS

i)THURSDAY MORNING/ WEDNESDAY NIGHT: 

SHANGHAI CLOSED UP 9.00 PTS OR 0.35% //Hang Sang CLOSED UP 299.62 POINTS OR 1.08% /The Nikkei closed UP 216.95  PTS OR 1.06%/ Australia’s all ordinaires CLOSED DOWN .23%

/Chinese yuan (ONSHORE) closed UP  at 6.7040 AS TRUCE DECLARED FOR 3 MONTHS /Oil DOWN to 52.48 dollars per barrel for WTI and 60.53 for Brent. Stocks in Europe OPENED GREEN 

//ONSHORE YUAN CLOSED UP AT 6.7040AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED UP ON THE DOLLAR AT 6.7110: / TRADE TALKS NOW ON/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED   : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING STRONGER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING STRONGER AGAINST THE DOLLAR /CHINA RETALIATES WITH TARIFFS/ TRUMP RESPONDS TO NEW TARIFFS AND IT NOW A FULL TRADE WAR COMMENCED

 

3 a NORTH KOREA/USA

 

 

 

 

i)North Korea//USA/Sweden

 

end

3 b JAPAN AFFAIRS

 

3 C CHINA

i) CHINA/FOXCONN/USA

After much fanfare last year China’s Foxconn is now reconsidering his huge plan to hire 13,000 Wisconsin workers. Trump is not a happy camper on this news

(courtesy zerohedge)

China’s Foxconn Reconsidering Plan To Hire 13,000 Wisconsin Workers

One day after Apple reported a disappointing 15% drop in iPhone sales, and just hours before Chinese Vice Premier Liu He was set to kick off high level trade talks in Washington, Taiwan-based Foxconn, one of the consumer-tech giant’s largest suppliers, told Reuters that it is shelving plans to hire thousands of workers at its new plant in Wisconsin as it reconsiders plans to build LCD displays (Apple’s most recent crop of iPhones uses these displays).

Instead of the manufacturing workforce FoxConn promised when it received billions of dollars in tax breaks and state aide to build the $10 billion campus – the company, which has extensive operations in the PRC – said it instead plans to hire engineers and researchers. When Foxconn’s investment was announced in 2017, President Trump praised it as evidence that manufacturing jobs would return to the US under his administration. The investment marked the largest greenfield investment by a foreign company in US history, according to Reuters. The company had initially planned to build LCD screens for TVs and other larger gadgets, but had more recently pivoting to building screens for “smaller products” like smartphones. While it’s unclear whether these smartphone screens would have been used for Apple products, Foxconn is one of Apple’s largest suppliers, and has been cutting back iPhone-related production at facilities in China because sales of the latest batch of iPhones has been slower than Apple had initially anticipated.

Wis

A company spokesman blamed the change of plans on competition from Chinese and Japanese producers,

Now, those plans may be scaled back or even shelved, Louis Woo, special assistant to Foxconn Chief Executive Terry Gou, told Reuters. He said the company was still evaluating options for Wisconsin, but cited the steep cost of making advanced TV screens in the United States, where labor expenses are comparatively high.

“In terms of TV, we have no place in the U.S.,” he said in an interview. “We can’t compete.”

When it comes to manufacturing advanced screens for TVs, he added: “If a certain size of display has more supply, whether from China or Japan or Taiwan, we have to change, too.”

Instead of building a “factory”, Foxconn wants to instead focus on building a “technology hub”. But suddenly, plans to hire as many as 13,000 workers are now in jeopardy. The company told Reuters that rather than manufacturing the LCD panels in the US, it would make more sense to produce them in greater China or Japan, ship them to Mexico for the finishing touches, then bring them into the US for assembly of the final product.

Rather than a focus on LCD manufacturing, Foxconn wants to create a “technology hub” in Wisconsin that would largely consist of research facilities along with packaging and assembly operations, Woo said. It would also produce specialized tech products for industrial, healthcare, and professional applications, he added.

“In Wisconsin we’re not building a factory. You can’t use a factory to view our Wisconsin investment,” Woo said.

Earlier this month, Foxconn, a major supplier to Apple Inc., reiterated its intention to create 13,000 jobs in Wisconsin, but said it had slowed its pace of hiring.

The company initially said it expected to employ about 5,200 people by the end of 2020; a company source said that figure now looks likely to be closer to 1,000 workers.

It is unclear when the full 13,000 workers will be hired.

And in another blow to former Gov Scott Walker, who negotiated the $4 billion in incentives provided to Foxconn, Democrats who had decried the giveaways as a bad deal for the state of Wisconsin can now say “I told you so.”

Foxconn had reiterated its commitment to hiring the workers as recently as earlier this month. But according to Reuters, its scaled-back plans could involve hiring as few as 1,000 workers.

Earlier this month, Foxconn, a major supplier to Apple Inc., reiterated its intention to create 13,000 jobs in Wisconsin, but said it had slowed its pace of hiring. The company initially said it expected to employ about 5,200 people by the end of 2020; a company source said that figure now looks likely to be closer to 1,000 workers.

Foxconn Chief Executive Terry Gou plans to meet with Wisconsin’s new Democratic Gov. Tony Evers to discuss “modifications” to the original deal (to qualify for its tax credits, Foxconn must meet certain hiring and investment goals).

The timing of the reports certainly seems interesting, as Chinese companies pull money out of Silicon Valley and US real estate. And with trade talks with China entering there must critical stage, is this one more nudge to the Trump Administration that, if it doesn’t play ball, Beijing won’t hesitate to put the screws to companies that have a large presence in China?

Or is it simply another sign that Apple – which has blamed slowing sales in part on the trade war – needs to cut prices?

end
This is big! China dumps 17 .5 billion dollars worth of treasuries.  This is the 6th straight month for liquidation and this must be very worrisome to Trump as they spare with China.  France, which economically is a basket case and they are buying treasuries? Probably in trust for the USA
(courtesy zerohedge)

China Dumps Treasuries For 6th Straight Month, France Hits Record Exposure

As trade wars reached new levels of anger in November, China dumped $17.5 billion of US Treasuries (and was the biggest seller that month). This is the 6th monthly drop in China’s Treasury holdings and they are now at their lowest level since May 2017

Norway, Ireland, and Taiwan was also among the biggest dumpers of US Treasuries in November.

On the flip-side, France (+$22bn) and Japan (+18.1bn) added the most US Treasuries in November…

This is the biggest monthly addition by France ever to its highest exposure ever…

However, China remains the US largest debtholder and a little context to France is worth considering…

Still, it appears “great friend” Xi is not the same as “great friend” Macron…

end

4.EUROPEAN AFFAIRS

UK

Tom Luongo, our resident expert on European affairs discusses how the Davos crowd has failed with respect to their plans on thwarting a Brexit.

(courtesy TomLuongo)

Peak Davos & The Brexit Iceberg Dead Ahead

Authored by Tom Luongo,

This is the attitude of those opposed to it. Any real separation of the U.K. from the European Union would result in a catastrophe which knows no bounds.

They have ratcheted up Project Fear to the point now of saying there will be food shortages and permanent supply problems for fresh fruit if a hard Brexit occurs.

Things like this defy all reason. They are based on the stupidest interpretation of how humans react to changing situations. It is like saying the only potential suppliers for the U.K. of certain fruits and vegetables are those from the European Union.

Because people don’t respond to incentives and there aren’t other suppliers ready to take up the slack if the Eurocrats keep their panties in a twist over this.

Parliamentary Deck Chairs

And yet, after another major session of Parliament in which Remainers were supposed to scuttle the entire process we see Brexit moving steadily towards its obvious conclusion.

The six amendments which were on the table yesterday ranged from virtue signaling about not wanting a No-Deal Brexit to parliament wresting control of the law-making process from the Government, over-turning nearly 40 years of tradition.

Four of them, all of the terrible ones, failed.

Because what finally happened is that these corrupt and venal MP’s finally ran up against the reality that they hold what power they have at the pleasure of the people they represent.

Democracy may be a flawed and dangerous form of government, but every once in a while it has its uses.

And it is most useful when the crock of shit our representatives are selling us as a plate of foie gras is so horrible we can’t hold our nose and eat it anymore.

This explains Trump. It explains Italy and it explains succinctly, yesterday’s ride on the fail boat by the Remain camp. Why? Because so many of them went home over the past week and found out exactly what the polls have been telling us for months.

The British people value honoring the Brexit referendum and their voice more than Parliament’s perception of the consequences of that decision.

So, ‘Forget the Bollacks’ as it were and get on with it.

Because of that there was no clear majority to take over the government or even to extend Article 50 (two amendments on that failed). Moreover, these votes gave Theresa “The Calcite Lady” May some clearer direction with which to go back to Brussels with.

  1. The Irish Backstop is unacceptable. Here’s how it could be.
  2. No permanent customs union.

Jeremy Corbyn tried to get what he wanted, a permanent relationship in the EU customs union, and that failed as well. So, his main opposition within Labour, Yvette Cooper, and him were roundly rejected by the body. That doesn’t bode well for Labour’s future even if this Brexit process ends ultimately with a new General Election.

And that is exactly what was on the minds of Labour MP’s who couldn’t agree on anything of substance.

Peak Davos

It’s sad that it has come to this. The Davos Crowd’s dream of a United States of Europe not beholden to the democratic process (no matter how flawed) is failing. In the process they are willing to destroy anyone or any country saying no.

But, their power is ephemeral, if considerable in the moment. It evaporates when the people withdraw their consent far enough. Don’t believe me? Look across the channel at the Giles Jaunes in France.

I’ve seen reports that the convocation of oligarchs at Davos this year was like a morgue.They are worried about their projects failing and their nests de-feathered.

And that shows in how insane the anti-Brexit rhetoric is. And it speaks to their desperation. George Soros is now warning us about China, when just two years ago they were his best bet to assist him destroying the U.S. His MEP’s are trying to rewrite EU energy rules to wrest control of the Nordstream 2 pipeline from Europe.

These people are running out of answers. None of their usual tactics are working. I’ve been saying this for a long time, we can debunk their nonsense in real time anymore.

Even Trump’s Trio of Foreign Policy Retards — Bolton, Pompeo and Pence — had to openly admit that their little adventure in Venezuela wasn’t about humanitarianism but taking the oil.

But, again, don’t tell that to the MAGApedes, it might make them cry to realize the only thing Trump has a plan for at this point is what he’s having for lunch with his sixth Diet Coke.

And how he can MAGA by bankrupting the country with deficits he didn’t inherit, steal everyone’s oil, cave on immigration reform and shut the U.S. off from all foreign trade.

Good luck with that Orange Obama!

It is this ability to communicate in real time which has The Davos Crowd most scared. It’s why the EU will continue pushing for more control over criticism. And it’s why Project Fear over Brexit has failed.

Yesterday’s session of Parliament proved it and it’s now Theresa May’s job to turn up the heat on her opposition by pushing to March 29th without a deal in place.

  • The EU cannot back down here lest they invite a revolt from within that makes Brexit look like an outing to Chucky Cheese with the kids.
  • And the Remainers cannot accept a slightly better version of Mrs. May’s deal after giving it a sound thrashing by 230 votes.

At that point everyone who is anyone sees their dreams turn to nightmares. While the rest of the world just gets on with it.

*  *  *

end

Do not expect a Brexit deal from the EU until the last minute.  Remember that the EU needs England far greater than England needs the EU

(courtesy zerohedge)

Don’t Expect The EU To Cave On May’s Brexit Deal Until The Very Last Minute

After a series of embarrassing Parliamentary defeats (and still more embarrassing triumphs over a series of no-confidence votes), Theresa May is we imagine reveling in what was a rare win for on Tuesday: MPs backed an amendment that calls for removing the backstop from her Withdrawal agreement and replacing it with a commitment to find something better after the prime minister vowed to ask the EU to reopen negotiations (something she has reportedly been trying to persuade the block to do behind the scenes for weeks now with little apparent success).

Now that she’s won what her cabinet believes is enough support for a modified version of the deal, having finally corralled a majority for something resembling her current deal, the hard work truly begins: Convincing the EU to reopen negotiations on the withdrawal agreement, something officials have publicly insisted will not happen (though there have been whispers that they have been slowly coming around to the idea).

EU

In a speech on Wednesday, European Commission President Jean Claude Juncker blasted the vote as irresponsible and once again insisted that removing the backstop from the agreement is out of the question.

“This is not a game,” he said, according to Bloomberg.

If there’s anything new to take away from the developments of the past two days, it can be found in a Bloomberg report published Wednesday afternoon that effectively confirmed what many have long suspected: That there won’t be any movement on the deal – either from the EU or, likely, the UK, until the last possible minute. According to BBG, EU diplomats have pointed to a last-minute summit set for March 21 and March 22 – just a week before Brexit Day – as the likely time when a deal may finally be struck.

The European Union is prepared to take Brexit down to a last-minute, high-stakes summit rather than cave into U.K. Prime Minister Theresa May’s demands over the next few weeks, diplomats said.

Although May is getting ready to head back to Brussels to reopen the Brexit deal that she negotiated over the past 18 months, the EU isn’t planning to give her any concessions before she returns for a vote in the British Parliament on Feb. 14, according to the diplomats. Behind closed doors, European officials are sticking to their well-coordinated public line that they won’t rework the deal.

The EU is in no rush to convene an emergency meeting of EU leaders, which would be necessary for any changes to the deal or for a Brexit-day delay. Diplomats point to a scheduled summit on March 21-22 — just seven days before the U.K. is due to leave the bloc — as the moment when the two sides could be forced to act. Some senior figures in the EU believe the U.K. needs to be all but out of options before accepting the deal, diplomats said.

May met with Labour Leader Jeremy Corbyn on Wednesday and the two reportedly sparred over Labour’s demands that the UK commit to permanently remain a part of the EU customs union – an idea that’s anathema to Tory Brexiteers. She’s also due for a phone call with Donald Tusk Wednesday night (he has already publicly reiterated that he won’t budge on the backstop).

Ireland’s prime minister and his cabinet remain committed to the idea that Parliament must cave and accept May’s deal as-is, having warned that a return to a hard border in Ireland will not happen (a ‘no-deal’ Brexit would likely lead to a hard border returning), while simultaneously insisting that the backstop is an integral part of May’s deal.

In an interview with RTE Wednesday morning, Irish Foreign Minister Simon Coveney said the notion the UK could leave the bloc without a deal amounts to a threat to “jump out the window”, adding that Ireland wouldn’t cave to threats. He also offered a few unkind words for the Brady amendment, saying it was “wishful thinking:” to replace the backstop with a vague call for something better.

“We are being asked to replace the backstop with wishful thinking,” he said, adding there are no obvious ‘magic’ solutions out there to reopen the withdrawal agreement. Instead, he said that the focus might be on the non-binding political declaration, which would be tweaked in an effort to calm U.K. concerns.

Irish Prime Minister Leo Varadkar released a statement after speaking with May via phone on Wednesday where he “set out once again the unchanged Irish and EU position on the withdrawal agreement and the backstop.” It added that the latest developments “reinforced the need for a backstop which is legally robust and workable in practice” and said the two leaders “agreed to stay in touch over the coming period,” per the BBC.

If there’s any clarity to be found in the Brexit process, it’s in the markets: The pound has sunk since the Brady amendment was adopted on Tuesday (and two amendments calling for a delay of Brexit Day were rejected) based on the idea that the UK is inching closer to a ‘no deal’ Brexit scenario. Because of this, Goldman Sachs has upped its “no-deal” Brexit probability to 15% from 10%, and cut the chance of Brexit not happening at all to 35% from 40%.

But has anything really changed? A look past the headlines reveals that the basic facts on the ground haven’t. UBS perhaps put it best in a laconic recap of Tuesday’s vote, that still applies after Wednesday’s outraged squawking from EU officials in Brussels.

The interminably tedious EU-UK divorce continues. The UK government must renegotiate with the EU. The EU says it will not renegotiate. The UK parliament does not want a no-deal exit. There is no automatic delay mechanism, but there are votes in two weeks which might impose an automatic delay mechanism.

And it looks like that’s how things are going to stay for another month or so. But even as the reality that nothing will happen until the last possible minute dawns on markets, we doubt that will put a stop to the endless firehouse of Brexit-related headlines.

end

ITALY

Not good!  Italy falls into recession as its 4th quarter GDP falls to negative .20%.  The previous quarter fell by .1% and we now have two quarters of negative growth and that fits the definition of a recession

(courtesy zerohedge)

Italy Officially Slides Into Recession After Budget Battle With Brussels

The Italian government’s decision to cut its growth forecast for 2019 to just 1% during the most heated period of the populist government’s budget battle briefly rattled investors in the country’s bondholders. As it turns out, even that number may have been too optimistic.

In a report that could once again test the market’s confidence in Europe’s third-largest economy, official data from Italy’s Istat revealed that Italy’s economy fell into a technical recession during Q4, as economic output shrank 0.2% in the three months through December, following a 0.1% decline during the previous quarter.

GDP

News of the recession will further strain the relationship between M5S and the League, the two parties which make up the populist coalition that has been running the country since elections in March 2018. The populists had been riding high after striking a budget deal with the EU that allowed Italy to blow out its budget deficit far beyond the 0.8% of GDP that Brussels had initially demanded. Lately, Deputy Prime Minister Matteo Salvini, the leader of the League, has been facing internal pressure to call for early elections as the League’s poll numbers climb – largely thanks to the party’s anti-immigrant stance. The goal would be to push out the increasingly unruly M5S, allowing the League to take unilateral control, potentially in coalition with Silvio Berlusconi.

In a rapid response to the numbers, analysts at Goldman Sachs said they believe there’s room for even more pessimism than the official numbers would suggest:

  1. Italian GDP growth was -0.2% (non-annualised) in Q4, weaker than consensus expectations of -0.1% and the pace of growth seen in Q3 of -0.1%. The print confirms that the Italian economy is in a technical recession.
  2. The breakdown of the GDP components is not available and will be released on 5 March.
  3. With Q4 data in hand, calendar-year growth for 2018 was +0.9%, down from +1.6% in 2017. Today’s GDP print takes calendar-year growth for 2019 to 0.2%.
  4. The balance of risks to our GDP growth forecast for Italy is to the downside. Our 0.2% calendar-year growth forecast for 2019 is based on a sizeable acceleration in activity in 2019H2. But given falling business confidence, tightening bank credit standards and continued political uncertainty, this looks less likely than we thought a few months ago.
  5. The weak economic outlook poses a challenge for the government to meet its public finance targets. We remain more pessimistic than the official forecast on the outlook for the government deficit and public debt, and expect another volatile year for the Italian economy and Italian asset prices.

There are other signs that the government’s official forecast from its budget model might be unreasonably positive: both the Bank of Italy and the IMF project 0.6% growth in Italy this year, less than half the forecast pace of the 19-nation euro zone.

Unfortunately for Mario Draghi and his hopes for unwinding the European Central Bank’s massive stimulus program, Italy isn’t the only major European economy experiencing a marked slowdown. Fears of recession have also been dogging Germany following a plunge in industrial production last month.

end

France:

France is preparing a new bill which will outlaw masks.  The problem will become interesting when the protesters don gas masks to prevent breathing in tear gas.

(courtesy zerohedge)

 

Outrage As France Targets “Yellow Vest” Movement With “Anti-Hooligan” Bill Banning Masks

A free speech debate is brewing in France after lawmakers have backed a bill banning protesters from hiding their faces during demonstrations, according to Reuters. The legislation seeks to make it easier for facial recognition systems to identify rioters, and carries a penalty of up to a year in prison and a 15,000 euro fine.

The “anti-casseurs” (anti-hooligan) bill which is expected to secure approval next week also grants French police greater powers to identify and detain potential troublemakers from demonstrations.

Addressing the lower house National Assembly, Interior Minister Christophe Castaner urged members to “stop the brutes … (who listen) only to their hunger for chaos”.

Opponents of the “anti-casseurs” (anti-hooligan) bill accused the government of impinging on civil liberties, with the debate exposing divisions within Macron’s party, which has a comfortable majority in parliament.

The tactics used by police around the country have come under scrutiny, in particular the firing of “flash ball” riot guns, which have caused serious injuries, including at least one person blinded in one eye.

“We’re not restricting freedoms, we’re ensuring that freedoms can be guaranteed,” said a spokeswoman for French President Emmanuel Macron, Aurore Berger.

“We’re not talking about any French citizen chosen at random, we’re talking about those who have hurt others, those who want to kill and destroy property,” Berger told BFM TV on Thursday following the overnight vote.

The anti-mask bill has drawn criticism from the center-left of French politics, with some describing the measures as “authoritarian.”

Charles de Courson, from the centrist UDI party, told parliament the law was extremely dangerous. He said: “It’s as if we’re back under the Vichy regime [the Nazi-collaborationist regime of the 1940s]. You’re presumed to be a résistant so we throw you in prison. Wake up! Wake up, colleagues! … The day you have a different government in power – a far-right government – and you’re in opposition, you’ll see that it’s pure madness to vote for this text.” –The Guardian

The Yellow Vests began protesting in November against a climate change-linked fuel tax, and rapidly evolved into an general anti-Macron movement that has spilled over into several other countries. While the protests have been largely peaceful, there have been incidents of vandalism, looting and violent clashes with police nearly every weekend.

In response to the violence, four key measures contained within the “anti-hooligan” bill have been approved by French lawmakers ahead of Tuesday’s vote on the overall package.

In addition to the ban on wearing a mask or other face covering without justification, a specifically named person can now be prohibited from demonstrating.

Previously, judges could issue such an injunction as part of a case – but the power to ban a person from protesting will now also be granted to regional administrators.

Supporters of this ban say it will only target repeat violent offenders: they must represent a serious threat to public order and have carried out some violent act against people or property.

Another part of the law hopes to make troublemakers financially liable for any property damage they cause. –BBC

Of course, many of the protesters are donning gas masks to protect against tear gas fired by the police. We assume they’ll be prosecuted as well.

end

5.RUSSIAN AND MIDDLE EASTERN AFFAIRS

IRAN/EU

This is a huge blow to USA hegemony as Europe launches its alternative to SWIFT (INSTEX) to fund Iran. Trump will be furious and he may be so angry that he will pull out of NATO

(courtesy zerohedge)

Europe Launches SWIFT Alternative To Fund Iran In Collision Course With Trump

In a move sure to unleash fury from the Trump administration, the European Union has announced it has set up a transactions channel with Iran to bypass US sanctions. The launch of INSTEX — or “Instrument in Support of Trade Exchanges” — by France, Germany, and the UK will allow non-dollar trade with Iran and is being described as facilitating humanitarian goods-related transactions only, including food, medicine and medical equipment. 

Long anticipated, Thursday’s EU announcement marks the most concrete action Europe has taken to thwart Washington sanctions after the US pullout of the 2015 nuclear deal last May, and after SWIFT caved to US pressure. Europe is hoping the mechanism will act as a legal means to preventing Tehran from quitting the JCPOA, which promised sanctions relief should the country halt nuclear weapons research and development. INSTEX is expected to receive the formal endorsement of all 28 EU members, which aims to encourage skittish pharmaceutical and agricultural companies to the table with Tehran after many stopped doing business in Iran for fear of US economic retribution.

The Iranians welcomed the new mechanism: “It is a first step taken by the European side… We hope it will cover all goods and items,” Iranian Deputy FM Abbas Araqchi told state TV, referencing EU promises to stick to its end of the nuclear deal.

INSTEX will reportedly be based in Paris and run by a supervisory board chaired by the UK and managed by a German banking expert, and has further been described in European media as “expandable,” which is likely to provoke a reaction from the United States, especially after Washington was able to pressure the Belgium-based SWIFT financial messaging service to cut off the access of Iranian banks.

German Foreign Minister Heiko Maas cited EU strategic and “security interests” during a press briefing in Brussels: “We have been looking for ways to obtain this agreement because we are firmly convinced that it serves our strategic security interests in Europe.” He further bluntly described, “We do not want Iran to get out of this agreement and back into uranium enrichment. This has to do with our security interests in Europe.”

Technically US sanctions allow some limited humanitarian trade and limited goods; however the White House’s “maximum pressure” campaign on Iran has still scared away European giants like Seimens, Maersk, Total, Daimler, Peugeot, Renault, and others.

Secretary of State Mike Pompeo previously warned of “swift punishment” for countries doing business with Iran, thus INSTEX is seen as a first small step toward greater European economic independence, and toward calming Iranian criticisms centered on seeing “dollar domination” as fueling European weakness to follow through on JCPOA stipulations.

But is the new financial exchange mechanism too little too late? One prominent Iranian academic and political analyst, Mohammad Ali Shabani, told Al Jazeera: “If [the mechanism] will permanently be restricted to solely humanitarian trade, it will be apparent that Europe will have failed to live up to its end of the bargain for Iran,” told Al Jazeera. And another, Foad Izadi, professor at the University of Tehran, echoed what is a common sentiment among Iran’s leaders: “I don’t think the EU is either willing or able to stand up to Trump’s threat,” and continued, “The EU is not taking the nuclear deal seriously and it’s not taking any action to prove to Iran otherwise… People are running out of patience.”

 

6. GLOBAL ISSUES

 

7  OIL ISSUES

 

8. EMERGING MARKETS

VENEZUELA/USA/CITGO

Venezuela’s principal asset in the USA is Citgo which refines 5% of all USA gasoline.  It is now weighing its option for bankruptcy.  This is where the fun begins…Citgo is a wholly owned asset of PDVSA which is in default and sovereign Russia which lent 3 billion dollars to Venezuela has CITCO shares as collateral.  If CITGO goes bust, then Russia owns 49.9% of the stock.  The USA wants to transfer the assets to the Guaido

popcorn anyone?…

(courtesy zerohedge)

Venezuela’s Citgo, Which Refines 5% Of US Gasoline, Is Weighing Bankruptcy

In the latest salvo to emerge from the escalating fight between the Trump administration and Venezuela’s ruling Maduro regime over control of the South American country’s state-owned energy assets, the WSJ reports that in order to protect its operations, Venezuela’s Citgo Petroleum is considering various options, including filing for bankruptcy.

Citgo, which is among the largest refiners in the U.S., is weighing its options while the White House attempts to shift control of Venezuela’s assets from President Nicolás Maduro to opposition leader Juan Guaidó, whom the U.S. has recognized as the legitimate head of state prompting accusations by the Maduro regime that the US is fomenting a presidential coup.

In addition to control over the military, control of Venezuela’s state-owned assets is seen as key to the country’s political fate, and the tussle is forcing Citgo to consider U.S. bankruptcy proceedings as one of several plans drafted by some executives and advisers, the WSJ reports citing people familiar.

Reached for comment, a Citgo spokesman said Thursday the company is “profitable, solvent and has contingency plans to successfully manage the recent events.” Meanwhile, the US responded that the US goal is for Citgo to remain viable, but not under Maduro control.

While Citgo’s financial pressures aren’t pressing as of this moment, a bankruptcy filing could stabilize operations while providing an organized forum for restructuring its debt, dealing with a looming governance crisis and sorting out competing creditor claims on the company’s assets, with the WSJ reporting that Citgo, which is owned by defaulted state oil giant Petróleos de Venezuela SA, or PdVSA which was hit by US sanctions this week in an attempt to cripple the Maduro regime, has retained law firm Willkie Farr & Gallagher LLP for legal advice on several contingency plans.

And while a bankruptcy could provide a period of calm during the ongoing political duel, a potential problem emerges as the list of creditors circling Citgo as a source of repayment includes PdVSA bondholders, several North American companies that had their operations in Venezuela seized and nationalized, but most importantly Russian state oil company OAO Rosneft.

The issue is that should Citgo file for bankruptcy,Russia’s Rosneft could become an owner of 49.9% of the company’s equity, unleashing yet another diplomatic crisis as Moscow becomes the defacto minority owner of one of the largest refiners on US soil.

Speaking of which, Citgo runs three refineries along the U.S. Gulf Coast that support more than 3,000 U.S. jobs and supply thousands of Citgo-branded gasoline stations. Of these, the largest is the Lake Charles facility, which has a daily refining capacity of 425,000 bpd.

As such any prolonged impairment of operations would likely result in a drop in gasoline output and potentially a spike in US gasoline prices.

Which also explains why US officials said they are working to ensure Citgo, which represents around 5% of U.S. refining capacity, stays operational as they try to transfer control of the company and the country’s other assets to Mr. Guaidó. It was not immediately clear how the US can prevent Citgo from filing in the US if its Venezuela owners decide that is the only way to preserve ownership of the assets.

end

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

Euro/USA 1.1494 UP .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  MIXED 

 

 

 

 

 

USA/JAPAN YEN 108.58  DOWN 0.391 (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 1.3141     UP   0.0025  (Brexit March 29/ 2017/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED

USA/CAN 1.3136 DOWN .0007 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 WEDNESDAY morning in Europe, the Euro FELL by 1 basis points, trading now ABOVE the important 1.08 level FALLING to 1.1428/ Last night Shanghai composite closed UP 9.00 POINTS OR 0.35% 

 

 

//Hang Sang CLOSED UP 299.62 POINTS OR 1.08%

 

/AUSTRALIA CLOSED DOWN 0.23%  /EUROPEAN BOURSES MIXED

 

 

 

 

 

 

The NIKKEI: this WEDNESDAY morning CLOSED UP 216.95 POINTS OR 1.06%

 

 

 

 

 

 

 

Trading from Europe and Asia

1/EUROPE OPENED MIXED 

 

 

 

 

 

 

 

 

 

 

 

 

2/ CHINESE BOURSES / :Hang Sang CLOSED UP 299.62 POINTS OR 1.08% 

 

 

 

/SHANGHAI CLOSED UP 9.00 PTS OR 0.35%

 

 

 

 

Australia BOURSE CLOSED DOWN .23%

 

Nikkei (Japan) CLOSED UP 216.95 PTS OR 1.06%

 

 

 

 

 

 

 

INDIA’S SENSEX  IN THE GREEN

Gold very early morning trading: 1324.00

silver:$16.10

Early THURSDAY morning USA 10 year bond yield: 2.69% !!! DOWN 0 IN POINTS from TUESDAY’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 3.02 DOWN 3  IN BASIS POINTS from WEDNESDAY night. (POLICY FED ERROR)/

USA dollar index early THURSDAY morning: 95.29 DOWN 5 CENT(S) from  WEDNESDAY’s close.

This ends early morning numbers THURSDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

And now your closing THURSDAY NUMBERS \12: 00 PM

 

Portuguese 10 year bond yield: 1.62% DOWN 5     in basis point(s) yield from  WEDNESDAY/

JAPANESE BOND YIELD: +.01%  UP 0   BASIS POINTS from WEDNESDAY/JAPAN losing control of its yield curve/

 

 

SPANISH 10 YR BOND YIELD: 1.20% DOWN 5   IN basis point yield from WEDNESDAY

ITALIAN 10 YR BOND YIELD: 2.59 DOWN 1     POINTS in basis point yield from WEDNESDAY/

 

 

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

GERMAN 10 YR BOND YIELD: FALLS UP TO +.15%   IN BASIS POINTS ON THE DAY//

THE IMPORTANT SPREAD BETWEEN ITALIAN 10 YR BOND AND GERMAN 10 YEAR BOND IS 2.46% AND NOW ABOVE THE  THE 3.00% LEVEL WHICH WILL IMPLODE THE ENTIRE ITALIAN BANKING SYSTEM. AT 4% SPREAD THERE WILL BE A MASSIVE BANK RUN…

 

END

IMPORTANT CURRENCY CLOSES FOR THURSDAY

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

Euro/USA 1.1454 DOWN   .0032 or 32 basis points

 

 

USA/Japan: 108.83 UP  0.145 OR 15 basis points/

Great Britain/USA 1.3235 UP.0019( POUND UP 19  BASIS POINTS)

Canadian dollar up 2 basis points to 1.3141

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

The USA/Yuan,CNY closed UP AT 6.6961 0N SHORE  (YUAN UP)

THE USA/YUAN OFFSHORE:  6.7126(  YUAN UP)

TURKISH LIRA:  5.1869

the 10 yr Japanese bond yield closed at +.01%

 

 

 

Your closing 10 yr USA bond yield DOWN 10 IN basis points from WEDNESDAY at 2.63 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.99 DOWN 6  in basis points on the day /

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

Your closing USA dollar index, 95.52 UP  18 CENT(S) ON THE DAY/1.00 PM/

 

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

London: CLOSED UP 27.22 OR 0.39%

German Dax : DOWN 8.56 POINTS OR 0.08%

Paris Cac CLOSED UP 17.96 POINTS OR 0.36%

Spain IBEX CLOSED DOWN 14.80 POINTS OR  0.16%

Italian MIB: CLOSED DOWN 46.77 POINTS OR 0.21%

 

 

 

 

WTI Oil price; 55.18 12:00 pm;

Brent Oil: 62.05 12:00 EST

USA /RUSSIAN /   ROUBLE CROSS:    65.43  THE CROSS HIGHER BY 0.02 ROUBLES/DOLLAR (ROUBLE LOWER BY 2 BASIS PTS)

 

TODAY THE GERMAN YIELD FALLS +.15 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 :  54.01

 

 

BRENT :  61.08

USA 10 YR BOND YIELD: … 2.63..DEADLY/

 

 

USA 30 YR BOND YIELD: 3.00

 

 

 

EURO/USA DOLLAR CROSS:  1.1445 ( DOWN 40    BASIS POINTS)

USA/JAPANESE YEN:108.93 DOWN .050 (YEN UP 5   BASIS POINTS/..

 

.

 

USA DOLLAR INDEX: 95.57 UP 23 cent(s)/

The British pound at 4 pm: Great Britain Pound/USA:1.3109  DOWN 6 POINTS FROM YESTERDAY

the Turkish lira close: 5.1663

the Russian rouble 65.38:   UP .03 Roubles against the uSA dollar.( UP 3 BASIS POINTS)

 

Canadian dollar:  1.3130 UP 14 BASIS pts

USA/CHINESE YUAN (CNY) :  6.6961  (ONSHORE)

USA/CHINESE YUAN(CNH): 6.7087  (OFFSHORE)

German 10 yr bond yield at 5 pm: ,0.15%

 

The Dow closed DOWN 15.19 POINTS OR 0.06%

 

NASDAQ closed UP 98.68 POINTS OR 1.37%

 


VOLATILITY INDEX:  16.61 CLOSED DOWN 1.05 

 

LIBOR 3 MONTH DURATION: 2.736%  .LIBOR  RATES ARE FALLING/

 

FROM 2.744

 

 

 

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

 

After Worst December In A Century, Stocks Soar To Best January In 32 Years

The Fed capitulation appears to have been seen early by gold and the market is now implying a 13.5bps rate-cut in 2019… as stocks soar…

After the worst December in 100 years, the S&P just experienced its best January since 1987…

 

Is this really what you wanted Mr.Powell? This is how it ends…

 

Chinese stocks were very mixed in January with tech-heavy indices hit hardest (CHINEXT red) and the major industrials outperforming on stimulus, trade-talk optimism…

 

German retail sales collapse and Italy enters recession and Italian stocks soar to its best January since 2011!!

US markets and non-US markets are joined at the Central-bank-driven hip…

 

US equity markets were also exuberant in January (especially the last few days). Small Caps led the majors, soaring over 10% – the best month since Oct 2011 and the best January since 1987…

 

All on the heels of the biggest monthly short-squeeze since September 2010…

 

FANG Stocks soared over 31% off the lows…

 

A big January for banks also…

 

On the week, thanks to Powell’s fold and Lighthizer’s trade comments, we are back in the green…

 

GE was today’s big winner…

 

Credit spreads and VIX collapsed in January… (with credit dramatically outperforming in the last week or so…

 

The last few days have seen Treasury yields tumble – accelerating after Powell – leaving all yields lower in January…

 

30 TSY yields tumbled back below 3.00%…

Financials Conditions have eased dramatically – erasing the last hike’s tightening…

 

The Dollar dropped for the 3rd month in a row (biggest monthly drop in a year) slammed to 4-month lows after The Fed yesterday…

 

Yuan surged in January as the dollar slipped…

 

Despite dollar weakness, cryptos slipped again in January…

 

All major commodities made good gains in January, led by WTI…

 

WTI Crude soared over 18% in January (its best month since April 2016)…

This was WTI’s best January ever…

 

Gold had a great month too…

Ending the sixth straight January with gains…

While gold soared against the dollar, it barely broke-even in January against the Yuan…

Silver also had a solid January (the 7th year of the last 8 with a positive January)

In other commodity news, Nickel just posted its best January in more than two decades.

As Bloomberg notes, the metal, used in stainless steel and electric vehicles, surged 17 percent in the month amid bets that demand will rise as a production deficit deepens. Prices extended gains this week after Vale SA’s dam disaster fueled speculation that shutdowns at some of the company’s iron ore sites could extend to its nickel operations, tightening supplies further.

Finally, amid all the exuberance in January, the month saw the biggest drop in forward earnings expectation in three years…

 

But all stocks care about is how easy Powell can be…

 

“You Are Here”…

*  *  *

“You have meddled with the primary forces of nature, Mr Powell, and we won’t have it! Is that clear? … And you will atone.”

 

END

 

END

market trading/

Dow Dumps At Market Open – Erases Post-Powell Gains

We’re gonna need a dovish-er Fed…

 

Bonds and bullion remain bid as the dollar skids but stocks rolled over dramatically, not helped by Dow-Dupont and European banks.

end

MARKET DATA

The Chicago national manufacturing PMI plummets to two year lows

(courtesy zerohedge)

Chicago PMI Plunges To 2-Year Lows

Amidst all the hope – and promises from The Fed that everything will be awesome – Chicago Purchasing Managers strongly disagree as their latest business survey collapsed from a revised lower 63.8 to 56.7 in January…

That is below the lowest analyst estimate (range 58 – 63.8 from 24 economists surveyed) and the weakest print since Jan 2017…

Business barometer rose at a slower pace, signaling expansion

  • Prices paid unchanged, signaling expansion
  • New orders rose at a slower pace, signaling expansion
  • Employment rose at a faster pace, signaling expansion
  • Inventories rose at a slower pace, signaling expansion
  • Supplier deliveries rose at a slower pace, signaling expansion
  • Production rose at a slower pace, signaling expansion
  • Order backlogs rose at a slower pace, signaling expansion
  • Number of components rising vs last month: 1
end
Quite a surprise: after continual lousy housing reports, we get November new home sales rise 16.9% month/month.  This is the biggest rise since 1992.  Probably somebody goofed with the numbers
(courtesy zerohedge)

November New Home Sales Surge By The Most Since 1992

After calamitous declines in December’s Existing- and Pending-Home Sales, and Case-Shiller’s report that home price gains are the weakest in four years,  New-home sales were (like the others) expected to rebound in November (delayed due to the shutdown)… and they did, massively.

Against expectations of a 4.8% rebound from October’s 8.9% plunge, November printed a surprising 16.9% MoM surge in new home sales...the biggest MoM rise since Jan 1992

But Year-over-year new home sales are still down…

New Home Sales SAAR rose to 657k (massively above the 570k expected)…

as the median price plunged to $302,400 – the lowest since Feb 2017…

So what happens next? Does November’s surge collapse like December’s did for pending and existing sales?

end
Pending home sales tumble to the lowest level in 5 years. This kind of affirms by belief that the new home sales above is fake
(courtesy zerohedge)

Pending home sales tumble to lowest in nearly five years in December

Published: Jan 31, 2019 8:24 a.m. ET

The Realtors are ‘confident that the housing market will see improvement in 2019’

The numbers: Pending-home sales slid 2.2% in December to a reading of 99, and were 9.8% lower compared to a year ago, marking the 12th straight month of annual declines, the National Association of Realtors said Wednesday.

That’s the lowest reading since April 2014.

What happened: NAR’s index, which tracks home contract signings, missed the Econoday consensus for a 0.3% monthly increase. Given all the headwinds facing the housing market at the end of last year, that forecast may have been too rosy.

In December, the pending home sales index for the Northeast was up 2%. The index for the West were also up moderately, by 1.7%. But pending sales plummeted in the South by 5%, and in the Midwest by 0.6%.

See also: Outside-the-box alternatives for home buyers in a tough housing market

Big picture: The Realtor group named a litany of culprits for the steep decline in December: the stock market SPX, +1.55% correction, high home prices and mortgage rates, lean inventory, and even the government shutdown.

Contract signing usually precede closing by about 45 days, so the pending home sales index is a leading indicator for upcoming existing-home sales reports.

-END-

USA ECONOMIC STORIES OF INTEREST

The key Conference Board Future expectations signaled recession..a clear sign that the USA is heading lower.

Gundlach slams Powell for caving to the stock market.

(courtesy Gundlach/zerohedge)

Jeff Gundlach Slams “Embarrassed” Fed’s Powell For “Caving To The Stock Market”

Having earlier in the week indicated his grave  concern that a recession looms, signaled by Conference Board sentiment extremes…noting the spread between the Conference Board’s current sentiment and expectations is the widest since March 2001, the first month of the U.S. recession that year.

Which DoubleLine’s CEO Jeff Gundlach warned…

Jeffrey Gundlach

@TruthGundlach

The most recessionary signal at present is consumer future expectations relative to current conditions. It’s one of the worst readings ever.

The bond guru told Reuters in an interview tonight that fragile equity markets forced Fed Chair Jerome Powell to pledge on Wednesday that the U.S. central bank will be patient with future interest rate hikes

He’s caving to the stock market. The stock market scared him, in late 2018.

And while Powell umm’d and agh’d through his press conference, truly unable to draw the line between optimistic economic outlooks and his unprecedented reversal of policy (which plunged market expectations from a 50bps hike in 2019 to a 25bps cut in a few weeks)…

Gundlach explained that this is laying the ground work for QE4…

“Even though they won’t say so, this shows that Quantitative Tightening will be slowed down,” Gundlach said.

And if need be, the Fed will expand the balance sheet. QE (Quantitative Easing) is the ‘unnamed’ other policy tool he referenced in case lowering the Fed funds rate proves not to be enough to strengthen the economy/markets.”

Which explains the plunge in the dollar and surge in stocks, bonds, and gold…

The DoubleLine boss went on to warn,the consumer future expectations data is “flat-out bright red bells ringing.”

 

One of the “morning binge-party after effects” from Wednesday’s strong stock-market rally is “not knowing what the plan really is,” Gundlach said.

“Powell is basically saying, I am going back into a foxhole and then decide what the next move is. Powell said ‘I don’t want to say anything and I don’t want to get pinned down as I did before.’ Because it got embarrassing.”

And in the meantime, macro data and earning expectations continue to tumble against a Powell-Put levitated stock market…

end
No final deal with China will be announced until Trump meets Xi. No action on the wall discussions as of yet
(courtesy zerohedge)

Trump Says “No Final Deal” On Trade Until He Meets Xi

Update: In another of what we imagine could be daily updates on the negotiations over the border wall funding that Trump is demanding, the president warned that Republican negotiators on the 17-lawmaker committee are “wasting their time”because the Democrats “are not going to give money to build the…wall.”

Donald J. Trump

@realDonaldTrump

Republicans on the Homeland Security Committee are wasting their time. Democrats, despite all of the evidence, proof and Caravans coming, are not going to give money to build the DESPERATELY needed WALL. I’ve got you covered. Wall is already being built, I don’t expect much help!

Fortunately, Trump has a ‘Plan B’…

* * *

As talks in Washington between a delegation of senior US officials led by Trade Representative Robert Lighthizer and a delegation from Beijing led by Vice Premier Liu He enter their second day, President Trump conclusively ruled out the possibility that a deal could be announced by the end of the week in a series of early morning tweets.

The president said that while the negotiations are going “very well,” he said that “no final deal will be made until my friend President Xi, and I, meet in the near future to discuss and agree on some of the long standing and more difficult points.”

Donald J. Trump

@realDonaldTrump

China’s top trade negotiators are in the U.S. meeting with our representatives. Meetings are going well with good intent and spirit on both sides. China does not want an increase in Tariffs and feels they will do much better if they make a deal. They are correct. I will be……

Donald J. Trump

@realDonaldTrump

….meeting with their top leaders and representatives today in the Oval Office. No final deal will be made until my friend President Xi, and I, meet in the near future to discuss and agree on some of the long standing and more difficult points. Very comprehensive transaction….

According to the president, the two sides are seeking a “comprehensive deal” that will leave “NOTHING unresolved”…suggesting that even the more controversial issues like US demands that China end its policy of institutionalized IP theft and cyber espionage activities will be addressed in any final deal.

Donald J. Trump

@realDonaldTrump

….China’s representatives and I are trying to do a complete deal, leaving NOTHING unresolved on the table. All of the many problems are being discussed and will be hopefully resolved. Tariffs on China increase to 25% on March 1st, so all working hard to complete by that date!

He ended the stream of tweets by insisting that the US will move ahead with plans to hike some of its tariffs if a deal isn’t reached by March 1. Though Lighthizer and other senior officials are leading talks this week, the president is expected to meet with Liu and his delegation at the White House on Thursday afternoon.

This means a final agreement likely won’t happen until next month. The Wall Street Journal reported Thursday morning that China has proposed a meeting in China between Trump and Xi next month.

Given that Mike Pompeo last night reaffirmed that Trump had committed to meeting with Kim Jong Un next month for their second summit, some are concerned that Trump is planning to spend most of February jetsetting around Asia meeting with authoritarian leaders. Because of this, some US allies are demanding that Trump brief them after the meetings…which would make the trip a “very long one” for Trump.

Kayla Tausche

@kaylatausche

Another consideration to a Trump/Xi meeting that follows a Trump/Kim summit, per sources:

– Allies (Japan, SK) worried about two back-to-back meetings w nondemocratic leaders
– Would want to be briefed afterward, which would make the trip a very long one for POTUS

If Trump agrees, that could leave Vice President Mike Pence steering the ship during a second government shutdown next month.

end

 

Trump will not accept any trade deal unless China opens up its market to manufacturers, bankers and farmers.

I extremely doubt that China will comply with this especially the banker front.

(courtesy zerohedge)

Trump Won’t Accept Trade Deal Unless China Opens Market To Manufacturers, Bankers And Farmers

President Trump is on another tweeting tear Thursday morning, alternating between comments about the ongoing US-China trade talks and his push to convince a bipartisan group of lawmakers to strike a border security deal that includes funding for his promised border wall.

After affirming earlier that a trade deal won’t be struck this week because there won’t be a “final deal” until Trump and President Xi can meet face to face (the WSJ reported that Trump will travel to China next month for the meeting), Trump followed up by insisting that a final deal will require China to open up its markets not only to US financial services firms, but to US “manufacturing, farmers and other US businesses and industries.”

Donald J. Trump

@realDonaldTrump

Looking for China to open their Markets not only to Financial Services, which they are now doing, but also to our Manufacturing, Farmers and other U.S. businesses and industries. Without this a deal would be unacceptable!

He followed that up with a tweet affirming that the Pentagon will be sending more troops to the US border (something the Pentagon announced earlier this week).

Donald J. Trump

@realDonaldTrump

More troops being sent to the Southern Border to stop the attempted Invasion of Illegals, through large Caravans, into our Country. We have stopped the previous Caravans, and we will stop these also. With a Wall it would be soooo much easier and less expensive. Being Built!

On Wednesday, Trump shared a quote from a Fox & Friends story about the three migrant caravans that are currently headed for the US border, an angle that Trump is seeking to play up as Democrats dig in their heels and Trump threatens to finally call the national emergency that would (in theory, at least) allow him to circumvent Congress and order the military to build the wall (which, as Trump has repeatedly claimed, has already been started). The tweets on trade come ahead of a reported meeting between Trump and Chinese Vice Premier Liu He at the White House on Thursday.

However, despite Trump’s emphasis on farming and manufacturing, the president’s tweet notably follows a story published Thursday in the Wall Street Journal which explained why the US is in a better position to expand services like banking, consulting, engineering and insurance in China than agriculture – the US already ships tons of agricultural products to China – and manufacturing – China’s lower costs and established supply chains will make it impossible for US firms to compete.

An emphasis on services would be a natural fit: US companies are already internationally competitive in the financial services, insurance, engineering, consulting, software development and many other high-skilled service industries. But the US provides far fewer of these services to China than to the rest of the world, according to Adam Slater, the lead economist of Oxford Economics.

“These might be the sectors you would hope would grow in the future, but currently face barriers,” Mr. Slater said.

To be sure, expanding these sectors would benefit an entirely different group of companies – and people – than Trump would have us believe. And that might be an issue for Trump as 2020 approaches.

end
Amazon is a good Bellwether on the retail front: its shares drop after guidance in the next quarter to its worst revenue growth in 18 years.
(courtesy zerohedge)

Amazon Drops After Guiding To Worst Revenue Growth Since 2001, Slowing Prime Subscriptions

After two months of dramatic volatility in its stock, which saw the share price of Amazon first tumble to close 2018 then soar by in the past month, Jeff Bezos’ online retailing titan was expected to report blow out earnings after what the company said was a record holiday period (while news of Bezos’ divorce from his wife came and went without affecting the stock), and moments ago Amazon did not disappoint, when it reported both EPS and revenues which handily beat expectations, even as it reported guidance guidance for the current quarter that came in well below Wall Street estimates.

In kneejerk response, the stock rose over 2% but has since trimmed its gains and was down slightly which perhaps is to be expected after the torrid gains the company enjoyed in the past month.

Here are the details from Amazon’s just concluded Q4:

  • EPS of $6.04, beating estimates of $5.56
  • Revenue of $72.4BN, beating estimates of $71.92BN
  • Operating income of $3.79 billion, also beating consensus estimates of  $3.65 billion

A somewhat troubling trend to some, Amazon’s revenue growth has been slowing in recent quarters, and in Q4 came in at 19.7%, the slowest since Q1 2015. And while Q4 revenue growth was nearly 20% year over year, a strong if slowing number, it came amid a friendly backdrop of high consumer confidence, which was mirrored by robust chain-store sales. Moreover, it was the lowest year-over-year revenue growth for the company since mid-2015 as Bloomberg notes.

Outlook

Offsetting the strong, if slowing, historical numbers, however, Amazon guided Q1 net sales to be between $56 billion and $60 billionwhich however was below the consensus est. of $60.99B. Meanwhile, operating income is expected to come in between $2.3 and $3.3 billion, compared with $1.9 billion in Q4 2017, and also roughly in line with consensus estimate of $2.99 billion. Also it is worth noting that the midpoint of the first-quarter revenue guidance – $58 billion – would represent year-over-year growth of just 13.6%. That would be the lowest for Amazon since the recession of 2001.

Commenting on the revenue slowdown, during the conference call, AMZN’s CFO Olsavsky highlighted headwinds from foreign exchange rates. Excluding those, the company sees its revenue growth as between 12% and 20%. He also highlighted the uncertainty around sales in India amid the implementation of new e-commerce rules on foreign online marketplace operators like Amazon and Walmart’s Flipkart.

In any case, slowing revenue was offset by stable and growing profit margins (if not sequentially in Q4, when operating margin declined from 6.6% to 5.2%), and it will be up to the market to determine whether profits are increasing enough to offset the slowdown in overall growth. As RJ Hottovy, analyst at Morningstar, notes, “The story is transitioning from pure growth to growth and profitability. AWS is generating profits and advertising is becoming a bigger contributor. Some investors have been worried about Amazon fatigue, but this shows it’s a pretty indispensable part of consumers’ lives.”

Going back to the historical data, the all-important Amazon Web Services unit, or AWS, posted sales of $7.4 billion, versus the $7.3 billion analyst outlook.

Amid worries about whether business technology spending might be wavering, AWS’s sales growth rate dipped fractionally to 45% from 46%.

Despite the modest decline in annual revenue growth, a year ago consensus seemed to be that competition from Microsoft and Google would cut into AWS’s growth, but that has yet to happen. The division remains the leader in the rapidly growing cloud computing space, and a perhaps a leading candidate to secure the Department of Defense’s lucrative $10 billion Jedi contract.

On the bottom line, AWS was responsible for operating income of $2.2 billion, a 29.3%profit margin, down from 31.1% last quarter but up from the 26.4% a year ago. In other words, for yet another quarter, AWS was responsible for more than half, or 62% of Amazon’s total operating income.

In addition to AWS, another bright star was Amazon’s advertising business, which as Bloomberg notes, “continued to be a star” with sales in the company’s “other” category, which is mostly advertising, nearly doubled from a year ago, to $3.38 billion. Like cloud computing sales, advertising is more profitable for Amazon than its core retail unit.

Now the not so good news: perhaps as a result of the recent price cut at Amazon’s Whole Foods chain, revenue declined 3% year-over-year in its “physical stores” – a category that mostly includes Whole Foods and also Amazon’s chain of bookstores. The revenue figure was worse than analysts had expected.

Another potential red mark this quarter: Amazon’s subscription services, mostly Amazon Prime, saw a sharp slowdown, growing by 26% from a year ago, down from 50%+ growth rates in recent quarters. This may be the result of Amazon raising the price of Prime and its quick-delivery perks in the U.S. to $119 annually last year. Expect analysts to ask management on the conference call later how the price hike is impacting retention and new memberships.

And then note the surge in Amazon’s selling and marketing expenses, which just surged higher.

As Bloomberg’s Shira Ovide notes, one other spot of growth worry: paid unit sales, which counts individual items sold on Amazon websites, saw year-over-year growth figure slow again to 14%.

That could be a sign that total revenue growth is slowing not only because of a shift by Amazon from selling its own merchandise to being a conduit for merchandise sold by outside companies.

In his remarks in the press release, CEO Jeff Bezos pivoted from focusing on Amazon Business last quarter, and this time it was all about Alexa:

“Alexa was very busy during her holiday season. Echo Dot was the best-selling item across all products on Amazon globally, and customers purchased millions more devices from the Echo family compared to last year.

“The number of research scientists working on Alexa has more than doubled in the past year, and the results of the team’s hard work are clear. In 2018, we improved Alexa’s ability to understand requests and answer questions by more than 20% through advances in machine learning, we added billions of facts making Alexa more knowledgeable than ever, developers doubled the number of Alexa skills to over 80,000, and customers spoke to Alexa tens of billions more times in 2018 compared to 2017.

“We’re energized by and grateful for the response, and you can count on us to keep working hard to bring even more invention to customers.”

Meanwhile, in the broader quarterly comments, the company announced the following chilling update on the current state of SkyNet:

Amazon made new scientific advancements with Alexa, including a new unsupervised self-learning system that detects the defects in Alexa’s understanding and automatically recovers from these errors, helping Alexa learn at a faster pace. Amazon also introduced a new text-to-speech system, which uses a generative neural network and produces more natural speech, paving the way for Alexa and other services to adopt different speaking styles based on different contexts.

So before Alexa murders everyone in their sleep, for those still concerned about AMZN’s cash burn, here is an update on the company’s reported LTM Free Cash Flow in Q4 of $19.4 billion, a new all time high.

Perhaps just as notable is that after sliding in early 2017, Amazon’s operating margin has soared in the past three quarters, largely as a result of AWS, however after hitting a record last quarter, it dipped modestly to 5.2%

Clearly, this means that the company’s LTM operating margin is soaring, after dropping modestly in early/mid 2017:

Meanwhile, as noted above, after the company consistently grew its global net sales in past years, in Q4 this number dipped further, from 35% in Q3 to 30% in Q4 even as total headcount increased from 613K to 648K. As a reference, at the beginning of 2017, Amazon employed around 350,000 full- and part-time workers. It is nearly double this number less than two years later.

As noted above, the kneejerk reaction was initially positive, but investors may have been spooked by the company’s poor Q1 guidance, and as a result the stock has slipped modestly after hours.

Developing

SWAMP STORIES

Lindsay Graham demands an FBI briefing as to why the FBI needed 29 agents to arrest Roger Stone knowing full well that he was not a flight risk

(courtesy zerohedge)

Lindsey Graham Demands FBI Briefing After Dramatic Roger Stone Arrest; Trump May Launch Inquiry

Senate Judiciary Committee Chairman Lindsey Graham (R-SC) demanded an explanation over last week’s arrest of longtime Trump adviser Roger Stone, according to the Washington Post.

Stone was arrested on Friday in an early morning raid by heavily armed federal agents as part of special counsel Robert Mueller’s Russia probe. Hours later, Stone was out on $250,000 signature bond – leaving many to note that the whole thing appears to have been a dramatic waste of taxpayer money that could have been handled by simply notifying Stone’s attorney of the indictment.

Graham – who was pictured having dinner with Trump, VP Mike Pence, Treasury Secretary Steve Mnuchin and Mnuchin’s Chief of Staff – said in his letter to FBI Director Christopher Wray that he was concerned over “the number of agents involved, the tactics employed, the timing of the arrest” and whether the media was tipped off.

“The American public has had enough of the media circus that surrounds the Special Counsel’s investigation,” reads Graham’s letter, referring to Mueller’s probe. “Yet, the manner of this arrest appears to have only added to the spectacle.”

In Wednesday comments to the Daily Caller, President Trump said that he was “speaking for a lot of people that were very disappointed to see that go down that way. To see it happen where it was on camera, on top of it. That was a very, very disappointing scene,” and that he would “think about” asking the FBI to review its use of force.

Stone was charged with obstruction, witness tampering and lying to Congress in connection to the Mueller investigation. He pleaded not guilty on Tuesday.

According to Stone, the FBI agents “terrorized my wife and my dogs,” adding that the agency used “greater force than was used to take down bin Laden or El Chapo or Pablo Escobar.”

end

The Belarus prostitute that was named in the Steele dossier now admits that she fabricated the evidence claim on Trump.

(courtesy zerohedge)

Belarus Prostitute Admits She Fabricated Trump-Russia Evidence Claim

A prostitute from Belarus who claimed to be the “missing link” that can provide secret evidence of a Trump-Russia connection now says that she fabricated her story in order to attract media attention, in an attempt to save her life while she was detained in Thailand.

27-year-old Anastasia Vashukevich, best known by the self-described “seductress” and “sex coach” Nasta Rybka, claimed to have recordings of Russian billionaire (and former FBI asset) Oleg Deripaska that would reveal a connection between Trump and Russia.

I am the only witness and the missing link in the connection between Russia and the U.S. elections – the long chain of Oleg Deripaska, Prikhodko, Manafort, and Trump,” said Vashukevich in an Instagram broadcastlast February while riding in the back of a thai police vehicle after her $600/head five-day sex training seminar was raided by authorities.

After spending nearly a year in Thai prison freezing her kidneys off, Vashukevich was arrested by Russian police in mid-January after arriving in Moscow for a connecting flight to Minsk, Belarus. The Kremlin let her go her last week after she promised not to release further audio or video recordings of Deripaska.

In an exclusive interview with CNN on Tuesday, Vashukevich said she was instructed by Russian security services not to talk about Deripaska, an ex-business associate of former Trump campaign chairman Paul Manafort.

“I had some talk when I was in Russian jail,” she said. “And they explained to me very clear(ly) what should I do, what should I say and what I shouldn’t say.”

Asked who explained that to her, Vashukevich said “Russian agents,” adding, “They said to me, ‘Don’t touch Oleg Deripaska anymore.'” –CNN

Now that she’s free, perhaps in an effort to remain breathing, Vashukevih now says she fabricated the story about a Trump-Russia connection.

She told CNN from a Thai detention center last year that she witnessed meetings between Deripaska and at least three unnamed Americans. Now back in Moscow, she says the claims she made to the media were an attempt to get media attention to save her life. –CNN

“I think it saved my life, how can I regret it? If journalists had not come at that time and that story had not come to the newspapers, maybe I would die [be dead by] now,” she told CNN. Russian authorities have suggested that Vashukevich has forced women into prostitution, which could land her in jail for up to three years.

https://www.instagram.com/p/BNCK1_jj0SZ/embed/?cr=1&v=12&wp=540&rd=https%3A%2F%2Fwww.zerohedge.com&rp=%2Fnews%2F2019-01-30%2Fbelarus-prostitute-admits-she-fabricated-trump-russia-evidence-claim#%7B%22ci%22%3A0%2C%22os%22%3A3441.6000000019267%7DVashukevich made headlines in January 2018 after Russian opposition leader Alexi Navalny broadcast footage from her Instagram account from an August 2016 yacht trip with Russian deputy Prime Minister Sergei Prikhodko and Deripaska. Navalny alleged that Deripaska had bribed Prikhodko, who is one of Russia’s most influential senior officials.

In a 25-minute Youtube video (Russian with subtitles), Navalny shows footage of Deripaska with Russian deputy prime minister Sergei Prikhodko on his yacht in Norway in August 2016. Based on that footage, he alleges that information about the Trump campaign must have passed between the two. Quartz

Navalny also asserted – with no proof – that Prikhodko and Deripaska may have been conduits between the Kremlin and the Trump campaign in 2016; a link which has proven elusive despite more than 18 months of counterintelligence operations, including surveillance of members of the Trump team.

It is suspected that Deripaska, thought to be a “backchannel” top Putin, brought Manafort’s briefings with him. After a report by the Washington Post asserted Manafort’s offer to provide the documents, Deripaska told CNN it was “fake news,” while his spokesman told AP in an email “These scandalous and mendacious assumptions are driven by sensationalism and we totally refute these outrageous false allegations in the strongest possible way.”

Manafort allegedly offered Deripaska the private briefings on Jul. 7, 2016. The yacht trip allegedly took place over three days from Aug. 6. Less than two weeks later, Manafort resigned from the campaign under heavy scrutiny of his ties to pro-Russian Ukrainian oligarchs. Manafort has since been charged by special counsel Robert Mueller with twelve crimes, including a conspiracy against the United States. –Quartz

Of note, after slapping Deripaska and three of his companies with harsh sanctions over 2016 Russian election meddling, the Trump administration said on Sunday lifted sanctions on two of the companies after Deripaska agreed to partially divest from them.

Under the agreement to lift sanctions, Deripaska has agreed to cut his direct and indirect share ownership below 50% in each company in a move designed to sever his control over the companies,  overhauling the boards of En+ and Rusal, and “committing to full transparency with Treasury by undertaking extensive, ongoing auditing, certification, and reporting requirements,” the department said in December when announcing its plans to remove the sanction. He will hold voting rights over just 35% of the company’s shares.

“This action ensures that the majority of directors on the En+ and Rusal boards will be independent directors, including US and European persons, who have no business, professional, or family ties to Deripaska or any other specially designated individuals, and that independent US persons vote a significant bloc of the shares of En+,” the Treasury’s Office of Foreign Assets Control (OFAC) said in a statement.

END
SWAMP STORIES/MAJOR STORIES//THE KING REPORT
and special thanks to Chris Powell of GATA for sending this down for us:

Fed Balance Sheet Normalization Might End Earlier than Expected’ Is Not New News [4 days ago]

On Friday, WSJ’s article about the Fed might end balance sheet reduction soon is the market mover.

However, the article is merely restatements of what the Fed has published publicly in the last couple of weeks…  https://seekingalpha.com/article/4235870-fed-balance-sheet-normalization-might-end-earlier-expected-new-news

From Wednesday’s King Report: The upward manipulation might be delayed until after the FOMC Communique, which is expected to be mildly dovish.  The unknown is Powell’s ensuing press conference.  Barring unexpected hawkish comments from Powell or in the FOMC Communique, the usual suspects want to push stocks higher to game January performance.

Professor @mtmalinen on FOMC Communique: … Short-term bullish, and long-term ultra-bearish.

Better start to look a place for the ‘bunker’.

Fed Chair Jerome Powell’s presser highlights

Economy is in a ‘good place’ [Then why the U-turn to dovishness?]

Economy growing at a ‘solid pace’ for 2019

Cross currents suggest risk of less favorable outlook

The case for raising interest rates ‘has weakened somewhat’

Fed policies are data based [S&P 500 Index?]

Fed has made important progress on clarifying balance sheet path

Doesn’t plan to use the Fed’s balance sheet as an active tool  [Huh?!?!]

Doesn’t want the balance sheet plan to cause market turbulence [The punch line – it was the stock market that forced Powell and the Fed to make at least two U-turns.

Market Watch’s @StevenGoldstein274: Powell gulps when MarketWatch’s Greg Robb points out the Dow is up more than 500 points.  “The situation calls for patience” he says when asked if there’s a Powell put.  “Uncertainty is not the friend of business,” Powell declares.  It looks like Powell’s comment that of course the Fed looks at financial markets — that’s the Fed’s transmission vehicle — is what is driving further gains. Put another way, Powell seems to be endorsing a Fed put

https://www.marketwatch.com/story/fed-interest-rate-decision-and-powell-press-conference-live-blog-and-video-2019-01-30?mod=newsviewer_cl

Nellie Ohr, the wife of Justice Department official Bruce Ohr, told Congress in October that she investigated President Donald Trump’s children on behalf of Fusion GPS, the opposition research firm behind the Steele dossier…   https://dailycaller.com/2019/01/30/nellie-ohr-ivanka-trump-fusion-gps/

[Senate Judiciary Com Chair] Lindsey Graham Sends Letter to FBI Director Wray Demanding Justification for Pre-Dawn Raid on Roger Stone         https://www.thegatewaypundit.com/2019/01/lindsey-graham-sends-letter-to-fbi-director-wray-demanding-justification-for-pre-dawn-raid-on-roger-stone/

 

Inside Kushner’s immigration plans

Kushner relayed to White House officials an idea from Republican Sen. James Lankford: Give a path to green cards for illegal immigrants who came to the U.S. as children and who are currently protected under the Deferred Action for Childhood Arrivals (DACA) program… [DJT campaigned against this.]

https://www.axios.com/jared-kushner-immigration-plans-government-shutdown-f5e144d4-5342-4509-a56e-627eb1a8a9c1.html

@kausmickey: By playing hard to get, Dems have Kushner, Trump, biz-oriented GOPs falling over themselves to offer bigger/better amnesties for a few $B of wall. Seems a terrible dynamic for border controllers. PULL THE PLUG NOW

Sen. Kamala Harris is the MSM’s favorite Democratic 2020 presidential candidate – despite a very checkered and racy past.  On Tuesday, she stepped in it, big time.  Harris called for “Medicare for all” and the abolition of the US’s private health insurance system.  Even leftists slammed her.  By Tuesday night, her aides were trying to walk back her comments.

‘You’ll bankrupt the country!’ Michael Bloomberg savages 2020 presidential rival Kamala Harris’ ‘Medicare for all’ plan

https://www.dailymail.co.uk/news/article-6648373/Michael-Bloomberg-says-2020-presidential-rival-Kamala-Harris-Medicare-bankrupt-US.html

 

Democrats distance themselves from Harris’ call to eliminate private health plans

https://www.cnn.com/2019/01/29/politics/kamala-harris-medicare-for-all-divides-democrats/index.html

 

Ex-DoD intel analyst @JasonButtrill: I would add that the GOP’s problem is that they have ceased to be the “party of ideas.” Sure Dems are going more radical, but at least they’re sharing ideas. And in the absence of a counter argument people will get so thirsty, they’ll drink the sand, Even if it’s Socialism.

 

Kamala Harris is open to multiple paths to ‘Medicare-for-all’

By stating she would eliminate private insurers as a necessary part of implementing “Medicare-for-all,” California Sen. Kamala Harris during a CNN town hall Monday night sent a shockwave through the national health care debate….

       As the furor grew, a Harris adviser on Tuesday signaled that the candidate would also be open to the more moderate health reform planswhich would preserve the industry

https://www.cnn.com/2019/01/29/politics/kamala-harris-medicare-for-all-eliminate-private-insurers-backlash/index.html

end

I WILL SEE YOU FRIDAY NIGHT
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