MAY 31/GOLD UP A HUGE $17.10//SILVER UP ONLY 6 CENTS/SMALL DEPOSIT OF SILVER INTO THE SLV//TRUMP TO TARIFF ALL MEXICAN GOODS EQUAL TO 5% AND THEN RAISE SLOWLY IF ILLEGAL IMMIGRATION DOES NOT STOP//DOW DOWN 353 POINTS ON THAT NEWS //USA 10 YR RATE DOWN TO 2.13 PERCENT//SWAMP STORIES FOR YOU TONIGHT//

 

 

GOLD: $1305.80  UP $17.10 (COMEX TO COMEX CLOSING)

Silver:  $14.59 UP 6 CENTS  (COMEX TO COMEX CLOSING)

Closing access prices:

Gold : 1305.25

 

silver:  $14.59

 

 

QUITE A WEEK!!

 

 

 

COMEX DATA

 

JPMorgan has been receiving gold with reckless abandon and sometimes supplying (stopping)

today RECEIVING  16/58

EXCHANGE: COMEX
CONTRACT: JUNE 2019 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,287.100000000 USD
INTENT DATE: 05/30/2019 DELIVERY DATE: 06/03/2019
FIRM ORG FIRM NAME ISSUED STOPPED
____________________________________________________________________________________________
323 H HSBC 26
363 C WELLS FARGO SEC 6
657 C MORGAN STANLEY 8
661 C JP MORGAN 13
661 H JP MORGAN 3
686 C INTL FCSTONE 4 1
690 C ABN AMRO 4
709 C BARCLAYS 2
737 C ADVANTAGE 32 1
800 C MAREX SPEC 2
905 C ADM 14
____________________________________________________________________________________________

TOTAL: 58 58
MONTH TO DATE: 58

 

 

 

 

NUMBER OF NOTICES FILED TODAY FOR  MAY CONTRACT: 58 NOTICE(S) FOR 5800 OZ (0.1804 tonnes)

TOTAL NUMBER OF NOTICES FILED SO FAR:  58 NOTICES FOR 5800 OZ  (.1804 TONNES)

 

 

 

SILVER

 

FOR MAY

 

 

216 NOTICE(S) FILED TODAY FOR 1,080,000  OZ/

 

total number of notices filed so far this month: 216 for 1080,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Bitcoin: OPENING MORNING TRADE :  $ N/A

 

 

 

Bitcoin: FINAL EVENING TRADE: $ N/A

 

 

 

 

end

 

XXXX

 

 

Let us have a look at the data for today

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

IN SILVER THE COMEX OI FELL BY A SMALL SIZED 961 CONTRACTS FROM 213,540 DOWN TO 212,579  DESPITE THE 19 CENT GAIN IN SILVER PRICING AT THE COMEX. LIQUIDATION OF THE SPREADERS HAVE STOPPED FOR SILVER BUT IT NOW IN FULL FORCE FOR GOLD. TODAY WE ARRIVED FURTHER FROM 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 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 FAIR SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP:

 0 FOR MAY, 0 FOR JUNE, 595 FOR JULY AND ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE  595 CONTRACTS. WITH THE TRANSFER OF 595 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 595 EFP CONTRACTS TRANSLATES INTO 2.95 MILLION OZ  ACCOMPANYING:

1.THE 19 CENT GAIN IN SILVER PRICE AT THE COMEX AND

2. THE STRONG AMOUNT OF SILVER OUNCES WHICH STOOD FOR DELIVERY IN THE LAST NINE 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  AND

21.925 MILLION OZ FINALLY STAND FOR DECEMBER.

5.845 MILLION OZ STAND IN JANUARY.

2.955 MILLION OZ STANDING FOR FEBRUARY.:

27.120 MILLION OZ STANDING IN MARCH.

3.875 MILLION OZ STANDING FOR SILVER IN APRIL.

18.845 MILLION OZ STANDING FOR SILVER IN MAY.

1.260 MILLION OZ STANDING FOR SILVER IN JUNE//

 

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

27,309 CONTRACTS (FOR 22 TRADING DAYS TOTAL 27,309 CONTRACTS) OR 136.55 MILLION OZ: (AVERAGE PER DAY: 1241 CONTRACTS OR 6.207 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH OF MAY:  136.55 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 19.50% 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:          892.11    MILLION OZ.

JANUARY 2019 EFP TOTALS:                                                      217.455. MILLION OZ

FEB 2019 TOTALS:                                                                       147.4     MILLION OZ/

MARCH 2019 TOTAL EFP ISSUANCE:                                          207.835 MILLION OZ

APRIL 2019 TOTAL EFP ISSUANCE:                                              182.87  MILLION OZ.

MAY 2019: TOTAL EFP ISSUANCE:                                                136.55 MILLION OZ

RESULT: WE HAD A SMALL SIZED DECREASE IN COMEX OI SILVER COMEX CONTRACTS OF 961 DESPITE THE 19 CENT GAIN IN SILVER PRICING AT THE COMEX /YESTERDAY... THE CME NOTIFIED US THAT WE HAD A VERY SMALL SIZED EFP ISSUANCE OF 595 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) . OUR BANKERS RESUMED THEIR LIQUIDATION OF THE SPREAD TRADES TODAY.

TODAY WE LOST A SMALL SIZED: 366 TOTAL OI CONTRACTS ON THE TWO EXCHANGES: 

i.e 595 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH DECREASE OF 961  OI COMEX CONTRACTS. AND ALL OF THIS DEMAND HAPPENED WITH A 19 CENT GAIN IN PRICE OF SILVER AND A CLOSING PRICE OF $14.64 WITH RESPECT TO YESTERDAY’S TRADING. YET WE STILL HAVE A STRONG AMOUNT OF SILVER STANDING AT THE COMEX FOR DELIVERY!! 

 

 

In ounces AT THE COMEX, the OI is still represented by JUST OVER 1 BILLION oz i.e. 1.064 BILLION OZ TO BE EXACT or 152% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT MARCH MONTH/ THEY FILED AT THE COMEX: 216 NOTICE(S) FOR  1,080,000, 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 FEB 2019:  2.955 MILLION OZ/ MARCH: 27.120 MILLION OZ/  APRIL AT 3.875 MILLION OZ/ A MAY:  18.845 MILLION OZ ..JUNE 1.260 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 ANOTHER UNBELIEVABLE SIZED 10,944 CONTRACTS, TO 443,231 DESPITE THE  $6.40 PRICE GAIN WITH RESPECT TO COMEX GOLD PRICING YESTERDAY/THE SPREADING LIQUIDATION STILL CONTINUED TODAY.   

 

THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A STRONG SIZED 8499 CONTRACTS:

APRIL 0 CONTRACTS,JUNE: 0 CONTRACTS, AUGUST 2019: 8499 CONTRACTS, JUNE 2020  0 CONTRACTS AND ALL OTHER MONTHS ZERO.  The NEW COMEX OI for the gold complex rests at 443,231.  ALSO REMEMBER THAT THERE WILL BE A DELAY IN THE ISSUANCE OF EFP’S.  THE BANKERS REMOVE LONG POSITIONS OF COMEX GOLD IMMEDIATELY.  THEN THEY ORCHESTRATE THEIR PRIVATE EFP DEAL WITH THE LONGS AND THAT COULD TAKE AN ADDITIONAL, 48 HRS SO WE GENERALLY DO NOT GET A MATCH WITH RESPECT TO DEPARTING COMEX LONGS AND NEW EFP LONG TRANSFERS. . EVEN THOUGH THE BANKERS ISSUED THESE MONSTROUS EFPS, THE OBLIGATION STILL RESTS WITH THE BANKERS TO SUPPLY METAL BUT IT TRANSFERS THE RISK TO A LONDON BANKER OBLIGATION AND NOT A NEW YORK COMEX OBLIGATION. LONGS RECEIVE A FIAT BONUS TOGETHER WITH A LONG LONDON FORWARD. THUS, BY THESE ACTIONS, THE BANKERS AT THE COMEX HAVE JUST STATED THAT THEY HAVE NO APPRECIABLE METAL!! THIS IS A MASSIVE FRAUD: THEY CANNOT SUPPLY ANY METAL TO OUR COMEX LONGS BUT THEY ARE QUITE WILLING TO SUPPLY MASSIVE NON BACKED GOLD (AND SILVER) PAPER KNOWING THAT THEY HAVE NO METAL TO SATISFY OUR LONGS. LONDON IS NOW SEVERELY BACKWARD IN BOTH GOLD AND SILVER  AND WE ARE WITNESSING DELAYS IN ACTUAL DELIVERIES.

IN ESSENCE WE HAVE A CONSIDERABLE SIZED LOSS IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 2445 CONTRACTS: 10,944 OI CONTRACTS DECREASED AT THE COMEX  AND 8499 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI LOSS OF 2445 CONTRACTS OR 244,500 OZ OR 7.6 TONNES.  YESTERDAY WE HAD A GOOD GAIN OF $6.40 IN GOLD TRADING….AND WITH THAT GAIN IN  PRICE, WE  HAD A CONSIDERABLE LOSS OF GOLD TONNAGE OF 7.6  TONNES!!!!!!

 

WITH RESPECT TO SPREADING:  WE  HAD STILL CONSIDERABLE LIQUIDATION OF THE SPREADERS TODAY 

 

 

FOR NEWCOMERS, HERE IS THE MODUS OPERANDI OF THE CORRUPT BANKERS WITH RESPECT TO THEIR SPREAD/TRADING.

 

 

AS I HAVE MENTIONED IN PREVIOUS COMMENTARIES:

 

 

“AS YOU WILL SEE, THE CROOKS HAVE NOW SWITCHED TO GOLD AS THEY INCREASE THE OPEN INTEREST FOR THE SPREADERS. THE TOTAL COMEX GOLD OPEN INTEREST WILL RISE FROM NOW ON UNTIL ONE WEEK PRIOR TO FIRST DAY NOTICE AND THAT IS WHEN THEY START THEIR CRIMINAL LIQUIDATION.

HERE IS HOW THE CROOKS USED SPREADING AS WE ARE NO INTO THE NON ACTIVE DELIVERY MONTH OF MAY HEADING TOWARDS THE VERY ACTIVE DELIVERY MONTH OF JUNE.

AS I HAVE MENTIONED IN PREVIOUS COMMENTARIES, HERE IS THE BANKERS MODUS OPERANDI:

YOU WILL ALSO NOTICE THAT THE COMEX OPEN INTEREST IS STARTING TO RISE IN THIS NON ACTIVE MONTH OF MAY BUT SO IS THE OPEN INTEREST OF  SPREADERS. THE OPEN INTEREST IN GOLD WILL CONTINUE TO RISE UNTIL ONE WEEK BEFORE FIRST DAY NOTICE OF AN UPCOMING ACTIVE DELIVERY MONTH (JUNE), AND THAT IS WHEN THE CROOKS SELL THEIR SPREAD POSITIONS BUT NOT AT THE SAME TIME OF THE DAY.  THEY WILL USE THE SELL SIDE OF THE EQUATION TO CREATE THE CASCADE (ALONG WITH THEIR COLLUSIVE FRIENDS) AND THEN COVER ON THE BUY SIDE OF THE SPREAD SITUATION AT THE END  OF THE DAY. THEY DO THIS TO AVOID POSITION LIMIT DETECTION. THE LIQUIDATION OF THE SPREADING FORMATION CONTINUES FOR EXACTLY ONE WEEK AND ENDS ON FIRST DAY NOTICE.” 

 

 

 

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF MAY : 144,386 CONTRACTS OR 14,438,600 OR 449.10 TONNES (22 TRADING DAYS AND THUS AVERAGING: 6563 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE STRONG SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 22 TRADING DAYS IN  TONNES: 449.10 TONNES

TOTAL ANNUAL GOLD PRODUCTION, 2018, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 3555 TONNES

THUS EFP TRANSFERS REPRESENTS 449.10/3550 x 100% TONNES =11.89% OF GLOBAL ANNUAL PRODUCTION SO FAR IN DECEMBER ALONE.***

ACCUMULATION OF GOLD EFP’S YEAR 2019 TO DATE:     2277,92 TONNES

JANUARY 2019 TOTAL EFP ISSUANCE;   531.20 TONNES

FEB 2019 TOTAL EFP ISSUANCE:             344.36 TONNES

MARCH 2019 TOTAL EFP ISSUANCE:       497.16 TONNES

APRIL 2019 TOTAL ISSUANCE:                 456.10 TONNES

MAY 2019 TOTAL ISSUANCE:                    449.10 TONNES

 

 

WHAT IS ALARMING TO ME, ACCORDING TO OUR LONDON EXPERT ANDREW MAGUIRE IS THAT THESE EFP’S ARE BEING TRANSFERRED TO WHAT ARE CALLEDRIAL 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: ANOTHER UNBELIEVABLE  SIZED DECREASE IN OI AT THE COMEX OF 10,944 DESPITE THE   PRICING GAIN  THAT GOLD UNDERTOOK YESTERDAY(6.40)) //.WE ALSO HAD A STRONG SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 8499 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 8499 EFP CONTRACTS ISSUED, WE  HAD A GOOD SIZED LOSS OF 2455 CONTRACTS IN TOTAL OPEN INTEREST  ON THE TWO EXCHANGES:

8499 CONTRACTS MOVE TO LONDON AND 10,944 CONTRACTS DECREASED AT THE COMEX. (IN TONNES, THE LOSS IN TOTAL OI EQUATES TO 7.6 TONNES). ..AND THIS LOSS OF  DEMAND OCCURRED WITH THE RISE IN PRICE OF $6.40 WITH RESPECT TO YESTERDAY’S TRADING AT THE COMEX. WE  HAD A STRONG PRESENCE OF SPREADING LIQUIDATION TODAY/

 

 

 

we had:  58 notice(s) filed upon for 5800 oz of gold at the comex.

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD...

 

WITH GOLD UP $17.10 TODAY//SEEMS THE BOYS FOUND RELIGION

A BIG CHANGE IN GOLD INVENTORY AT THE GLD: A HUGE “PAPER” GOLD DEPOSIT OF 3.52 TONNES

 

 

 

INVENTORY RESTS AT 740.86 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 6 CENTS TODAY:

A BIG CHANGE  IN SILVER INVENTORY AT THE SLV:

A DEPOSIT OF 422,000 OZ INTO THE SLV

 

 

 

 

 

 

 

/INVENTORY RESTS AT 312.038 MILLION OZ.

 

 

end

 

OUTLINE OF TOPICS TONIGHT

 

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

1. Today, we had the open interest in SILVER FELL BY AN SMALL SIZED 961 CONTRACTS from 213,540 DOWN TO 212,579 AND FURTHER FROM THE NEW COMEX RECORD SET LAST IN AUG.2018 AT 244,196 WITH A SILVER PRICE OF $14.78/(AUGUST 22/2018)..THE PREVIOUS RECORD WAS SET ON APRIL 9/2018 AT 243,411 OPEN INTEREST CONTRACTS WITH THE SILVER PRICE AT THAT DAY: $16.53). AND PREVIOUS TO THAT, THE RECORD  WAS ESTABLISHED AT: 234,787 CONTRACTS, SET ON APRIL 21.2017 OVER  1 1/3 YEARS AGO.  THE PRICE OF SILVER ON THAT DAY: $17.89.  AS YOU CAN SEE, WE HAVE RECORD HIGH OPEN INTERESTS IN SILVER  ACCOMPANIED BY A CONTINUAL LOWER PRICE WHEN THAT RECORD WAS SET…..THE SPREADERS HAVE STOPPED THEIR LIQUIDATION IN SILVER BUT HAVE NOW MORPHED INTO GOLD..

 

 

 

 

EFP ISSUANCE:

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

 

0 CONTRACTS FOR APRIL., 0 FOR MAY, FOR JUNE 0 CONTRACTS AND JULY: 595 CONTRACTS  AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 595 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON.  IF WE TAKE THE  OI LOSS AT THE COMEX OF 961 CONTRACTS TO THE 595 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN A SMALL LOSS OF 366 OPEN INTEREST CONTRACTS. THUS IN OUNCES, THE LOSS ON THE TWO EXCHANGES: 1.83MILLION 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 7.475 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. 2.955 MILLION OZ STANDING IN FEBRUARY,  27.120 MILLION OZ FOR MARCH., 3.875 MILLION OZ FOR APRIL  18.765 MILLION OZ FOR MAY AND NOW 1.260 MILLION OZ FOR JUNE.

 

 

RESULT: A SMALL SIZED DECREASE IN SILVER OI AT THE COMEX DESPITE THE 19 CENT GAIN IN PRICING THAT SILVER UNDERTOOK IN PRICING// YESTERDAY. WE ALSO HAD A STRONG SIZED 595 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE STRONG  SIZED AMOUNT OF SILVER OUNCES STANDING FOR THIS MONTH, DEMAND FOR PHYSICAL SILVER CONTINUES TO INTENSIFY AS WE WITNESS SEVERE BACKWARDATION IN SILVER IN LONDON.

BOTH THE SILVER COMEX AND THE GOLD COMEX ARE IN STRESS AS THE BANKERS SCOUR THE BOWELS OF THE EXCHANGE FOR METAL

 

 

(report Harvey)

.

 

2 ) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY: Bloomberg

3. ASIAN AFFAIRS

I)FRIDAY MORNING/ THURSDAY NIGHT: 

SHANGHAI CLOSED DOWN 7.11 POINTS OR 0.24%  //Hang Sang CLOSED DOWN 213.79 POINTS OR 0.79%   /The Nikkei closed DOWN 341.34 POINTS OR 1.63%//Australia’s all ordinaires CLOSED UP 0.04%

/Chinese yuan (ONSHORE) closed DOWN  at 6.9097 /Oil DOWN TO 57,28 dollars per barrel for WTI and 68.41 for Brent. Stocks in Europe OPENED RED//  ONSHORE YUAN CLOSED DOWN // LAST AT 6.9097 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.9437 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY CLOSE TO 7:1//TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED  : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /TRADE DEAL NOW DEAD..TRUMP  RAISED RATES TO 25%

 

 

 

 

 

 

 

 

3A//NORTH KOREA/ SOUTH KOREA

 

 

 

 

 

 

b) REPORT ON JAPAN

3 China/Chinese affairs

i)The bond markets are correct:  the trade war is taking a huge bit out of China manufacturing as its PMI tumbles back into

contraction mode

( zerohedge)

ii)Beijing has reportedly developed its plan for rare earth export ban
(courtesy zerohedge)

 

4/EUROPEAN AFFAIRS

i)EUROPE/

 

Countries are continuing to shun the USA , which is not good for USA hegemony

a very important commentary from Tom Luongo
( Tom Luongo)

ii)FRANCE

Journalist Ariane Chemin has been questioned by French police after she refused to reveal her sources for a report exposing alleged corruption in Macron’s inner circle.
( zerohedge)
III)ITALY
Interesting developments this morning from Italy:
1. The 5 star party will now back Salvini’s plan for a flat tax which will save his citizens huge amounts of money
2.  They deny that they wish a “parallel currency”
3.  The Bank of Italy warned this morning that Italy’s public debt is very high at 2.3 trillion euros and they must pare it to stay solvent.
(zerohedge)

iv)Late this morning:  right on cue..Italy says what the EU wants to hear..but do they mean it?

It worked temporarily as it knocked the yield on the 10 yr Italian bond down
( zero hedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

i)Iraq

An explosion rips through the oil city of Kirkuk in the Kurdistan region of Iraq

( zerohedge)

ii)IRAN/USA

Bolton backs off the Iran escalation.

( zerohedge)

iii)RUSSIA/TURKEY

Russia has figured out Turkey.  Turkey wanted a ceasefire in Idlib province because iSIS folks over there are Turkey’s friends. Now Russia has rejected Turkey;s overturesdue to the many failed promises in the past.  Turkey only wants to annihilate the Kurds in the Northern part of Syria.

( AlmasdairNews)

iv)SYRIA/SYRIAN DEMOCRATIC FORCES/USA
You need to keep a score card to see who are the players and on which side they are on.
Today a USA coalition of USA and SDF raided transport boats on the Euphrates River starving Assad of badly needed oil
( zero hedge)

6. GLOBAL ISSUES

i)This is the reason for stock markets around the world collapsing:  Trump unleashes tariffs on Mexico for allowing illegal immigration through its borders.  He has initiated firstly a 5% rate and that will increase until they get their act together.

( zerohedge)

ii)seems Mnuchin and Lighthizer reportedly opposed trump’s Mexico tariffs because they felt it would hinder their New NAFTA no2 dea

(courtesy zerohedge)

7. OIL ISSUES

 

 

 

8 EMERGING MARKET ISSUES

 

VENEZUELA/

Another good look at Venezuela where the cost of bullets are too expensive even for the criminals.  Nothing pays in Venezuela, even crime

( Mac Slavo)

 

 

 

 

9. PHYSICAL MARKETS

i)Malaysia’s Prime Minister raps currency rigging and proposes currency pegged to gold to settle East Asian trade

Two commentaries

(Reuters/GATA)

ii)Judy Shelton is without a doubt the right pick for Trump. Let us hope that she gets the job of Fed governor.  She is a strong advocate for gold backed currency and less dependency on the Fed.

( London’s Financial Times/Judy Shelton/GATA)

 

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

 

 

MARKET TRADING//

a)Last night, after the bell:

Pence warns that the uSA can double tariffs..bond yields tumble.

b)10 yr yield at 1 am est:

USGG10YR:IND
c)Early morning, Wall Street reaction and response to Trump’s shock tariff announcement:

(zerohedge)

 

ii)Market data

a)As we pointed out to you yesterday, Trump is not winning in the trade battle. Last night imports fell by 2.7% and imports a drop of 4.0%

This caused the trade deficit to rise despite the tariffs.  Remember the words of Alasdair Macleod..unless the USA saves, the trade deficit will continue to rise

He is right…

( Mish Shedlock/Mishtalk)

 

b)As we pointed out to you yesterday, Trump is not winning in the trade battle. Last night imports fell by 2.7% and imports a drop of 4.0%

This caused the trade deficit to rise despite the tariffs.  Remember the words of Alasdair Macleod..unless the USA saves, the trade deficit will continue to rise

He is right…

( Mish Shedlock/Mishtalk)

iii)USA ECONOMIC/GENERAL STORIES

Trump approval rating hits a two year high:

( zerohedge)

SWAMP STORIES

Barr strikes back on Mueller and stated that he should have reached a decision on obstruction if he wanted to.  He also stated that 3 times Mueller told Barr that his decision is not based on the

Office of Council’s opinion that you cannot indict a sitting president.

( zerohedge)

 

E)SWAMP STORIES/MAJOR STORIES//THE KING REPORT
end
LET US BEGIN:

 

Let us head over to the comex:

 

THE TOTAL COMEX GOLD OPEN INTEREST FELL BY ANOTHER UNBELIEVABLE  SIZED 10,944 CONTRACTS TO A LEVEL OF 443,231 DESPITE THE RISE OF $6.40 IN GOLD PRICING WITH RESPECT TO YESTERDAY’S // COMEX TRADING)

WE ARE NOW IN THE NON ACTIVE DELIVERY MONTH OF MAY..  THE CME REPORTS THAT THE BANKERS ISSUED A STRONG SIZED  TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS., THAT IS 8499 EFP CONTRACTS WERE ISSUED:

0 FOR JUNE ’19: 0 CONTRACTS , AUG; 8499 CONTRACTS: 0 AND  ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE:  8499 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 OUR 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: 2445 TOTAL CONTRACTS IN THAT 8499 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST A LARGE  SIZED 10,944 COMEX CONTRACTS.ALMOST ALL OF THE LOSS IN OI WAS DUE TO THE LIQUIDATION OF THE SPREADERS.

 

NET LOSS ON THE TWO EXCHANGES ::  2445 CONTRACTS OR 244,500 OZ OR 7.6 TONNES.

 

We are now in the  active contract month of JUNE and here the open interest stands at 3382 CONTRACTS.  Thus by definition, the initial amount of gold ounces standing for June is as follows;

3382 contracts x 100 oz per contract  =  339600 oz or 10.519 tonnes.  This is extremely small amount of gold standing and the reason is very simple..there is no gold at the comex. The next month after June is July and here the OI rose by 91 contracts up to 1495 contracts.  Finally the next big delivery month after June is August and here the OI rose by 14,924 contracts up to 327,393 contracts.We no doubt witnessed CONSIDERABLE spreading liquidation yesterday/today

 

 

 

TODAY’S NOTICES FILED:

WE HAD 58 NOTICES FILED TODAY AT THE COMEX FOR  5800 OZ. (0.1804 TONNES)

 

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And now for the wild silver comex results.

Total COMEX silver OI FELL BY A SMALL SIZED 961CONTRACTS FROM 213,540 DOWN TO 212,579 (AND FURTHER FROM 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 HUGE  OI COMEX GAIN OCCURRED DESPITE THE 19 CENT RISE IN PRICING.//YESTERDAY.

 

 

WE ARE NOW INTO THE NON  ACTIVE DELIVERY MONTH OF JUNE.  HERE WE HAVE 252 OPEN INTEREST STAND FOR DELIVERY.  THUS BY DEFINITION, THE INITIAL AMOUNT OF SILVER STANDING IN THIS NON ACTIVE MONTH OF JUNE IS AS FOLLOWS:

252 X 5000 OZ PER CONTRACT  =  1,,260,000 OZ

 

 

 

 

THE NEXT MONTH AFTER JUNE IS THE ACTIVE MONTH OF JULY.  HERE THE OI FELL BY 1629 CONTRACTS DOWN TO 153,595.  THE NEXT BIG DELIVERY MONTH AFTER JULY IS SEPT AND HERE THE OI ROSE BY 635 CONTRACTS UP TO 25,163 CONTRACTS.

 

 

 

 

TODAY’S NUMBER OF NOTICES FILED:

 

We, today, had 216 notice(s) filed for 1,080,000 OZ for the JUNE, 2019 COMEX contract for silver

 

 

Trading Volumes on the COMEX TODAY: 319,845  CONTRACTS 

 

 

 

CONFIRMED COMEX VOL. FOR YESTERDAY:  445,482  contracts (considerable spreading liquidation)

 

 

 

 

 

INITIAL standings for  JUNE/GOLD

MAY 31/2019

Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
200.193
oz
HSBC
Deposits to the Dealer Inventory in oz 1200.183

oz

Brinks

 

 

 

 

 

 

 

 

Deposits to the Customer Inventory, in oz  

 

 

 

nil oz

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

No of oz served (contracts) today
58 notice(s)
 5800 OZ
(0.1804 TONNES)
No of oz to be served (notices)
3324 contracts
(332,400 oz)
10.339 TONNES
Total monthly oz gold served (contracts) so far this month
58 notices
5800 OZ
0.1804 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

STRANGE:!! TODAY IS FIRST DAY NOTICE FOR THE SECOND LARGEST DELIVERY MONTH OF THE YEAR FOR GOLD AND HARDLY ANYTHING COMES IN?

we had 1 dealer entry:

i) Into Brinks: 1200.183 oz

 

 

total dealer deposits: 1200.183 oz

total dealer withdrawals: nil oz

We had 0 kilobar entries

 

we had 1 deposit into the customer account

i) Into JPMorgan:  nil oz

 

ii) Into hsbc: 200.193  OZ

 

 

total gold deposits: 200.193  oz

 

 very little gold arrives from outside/ piddly stuff arrived   today

we had 0 gold withdrawals from the customer account:

 

 

Gold withdrawals;

i)  We had 0 withdrawals:

 

 

 

.

total gold withdrawals;   nil oz

 

 

i) we had 0 adjustments today

FOR THE JUNE 2019 CONTRACT MONTH)

Today, 0 notice(s) were issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 58 contract(s) of which 3 notices were stopped (received) by j.P. Morgan dealer and 13 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 JUNE /2019. contract month, we take the total number of notices filed so far for the month (58) x 100 oz , to which we add the difference between the open interest for the front month of  JUNE. (3382 contract) minus the number of notices served upon today (58 x 100 oz per contract) equals 338,200 OZ OR 10. 519 TONNES) the number of ounces standing in this NON active month of MAY

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

No of notices served (58 x 100 oz)  + (3382)OI for the front month minus the number of notices served upon today (58 x 100 oz )which equals 338,200 oz standing OR 10.519 TONNES in this  active delivery month of JUNE.

 

 

 

 

SURPRISINGLY LITTLE TO NO  GOLD HAS BEEN ENTERING THE COMEX VAULTS AND WE HAVE WITNESSED THIS FOR THE PAST YEAR!!  WE HAVE ONLY 6.233 TONNES OF REGISTERED (  GOLD OFFERED FOR SALE) VS 10.519 TONNES OF GOLD STANDING// THEY SEEM TO BE USING CONSIDERABLE GOLD VAPOUR TO SETTLE UPON UNSUSPECTING LONGS.

 

 

 

 

total registered or dealer gold:  200,412.535 oz or  6.233 tonnes
total registered and eligible (customer) gold;   7,678,316.815 oz 238.82 tonnes

 

 

 

OF OPEN INTERESTS FOR THE UPCOMING JUNE 2019 CONTRACT VS JUNE 2018

 

 

 

 

 

FOR THE INITIAL JUNE 2018 CONTRACT WE HAD A HUGE 32.152 TONNES STAND. (VS 10.56 TONNES TODAY)

HOWEVER BY MONTH’S END ONLY 21.56 TONNES EVENTUALLY STOOD AS THE REST MORPHED INTO LONDON BASED FORWARDS.

IN THE LAST 32 MONTHS 117 NET TONNES HAS LEFT THE COMEX.

 

THE GOLD COMEX IS NOW IN STRESS AS
1. GOLD IS LEAVING THE COMEX 
2. GOLD IS LEAVING THE REGISTERED CATEGORY OF THE COMEX.

end

And now for silver

AND NOW THE  DELIVERY MONTH OF APRIL

INITIAL  standings/SILVER

IN TOTAL CONTRAST TO GOLD, HUGE ACTIVITY IN SILVER TODAY.
MAY 31 2019
Silver Ounces
Withdrawals from Dealers Inventory NIL oz
Withdrawals from Customer Inventory
 601,118.969 oz
CNT

 

 

 

 

 

 

 

Deposits to the Dealer Inventory
NIL oz
Deposits to the Customer Inventory
659,688.946 oz
Delaware
Brinks
CNT
Scotia
No of oz served today (contracts)
216
CONTRACT(S)
(1,080,000 OZ)
No of oz to be served (notices)
36 contracts
180,000 oz)
Total monthly oz silver served (contracts) 216 contracts

1,080,000 oz)

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

**

 

we had 0 inventory movement at the dealer side of things

 

total dealer deposits: NIL  oz

total dealer withdrawals: nil oz

we had  1 deposits into the customer account

into JPMorgan:  nil

 

 

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

JPMorgan now has 149.469 million oz of  total silver inventory or 48.80% of all official comex silver. (149 million/307 milli

into CNT:   601,118,969 oz

 

 

 

 

 

 

 

 

 

 

 

 

total customer deposits today:  601,118.969  oz

 

we had 4 withdrawals out of the customer account:

 

i) out of Scotia  600,698.010 oz

ii) Out of Brinks; 18,135.560 oz

iii) Out of Delaware:  1002.15 oz

iv)  out of CNT 39,853.226 oz

 

 

 

 

 

 

total withdrawals:  659,688.946 oz

 

we had 2 adjustment : and they are all amounts adjusted out of the dealer account and this lands into the customer account

these are deemed to be settlements ahead of first day notice.  Strange that we have not witnessed this in gold

 

i)Out of CNT:  2,465,987.552 oz was adjusted out of the dealer account and this landed into the customer account of CNT

ii) Out of Brinks:  533,517,991 oz was adjusted out of the dealer account and this landed into the customer account of Brinks

 

 

 

total dealer silver:  87.865 million

total dealer + customer silver:  305.853 million oz

 

 

The total number of notices filed today for the JUNE 2019. contract month is represented by 216 contract(s) FOR  1,080,000  oz

To calculate the number of silver ounces that will stand for delivery in JUNE, we take the total number of notices filed for the month so far at 216 x 5,000 oz = 1,080,000 oz to which we add the difference between the open interest for the front month of JUNE. (252) and the number of notices served upon today (216 x 5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the JUNE/2019 contract month: 216(notices served so far)x 5000 oz + OI for front month of MAY( 252) -number of notices served upon today (216)x 5000 oz equals 1,260,000 oz of silver standing for the JN contract month.

 

 

 

 

 

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

 

TODAY’S ESTIMATED SILVER VOLUME:  90,580 CONTRACTS

 

 

 

 

 

 

CONFIRMED VOLUME FOR YESTERDAY: 64,144 CONTRACTS..

 

 

 

 

YESTERDAY’S CONFIRMED VOLUME OF 64,144 CONTRACTS EQUATES to 320 million  OZ 45.9% 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

 

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

 

 

NPV for Sprott 

1. Sprott silver fund (PSLV): NAV FALLS TO -3.94% (MAY 30/2019)
2. Sprott gold fund (PHYS): premium to NAV FALLS TO -2.09% to NAV (MAY 30/2019 )
Note: Sprott silver trust back into NEGATIVE territory at -3.94%-/Sprott physical gold trust is back into NEGATIVE/

(courtesy Sprott/GATA)

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

NAV 12.90 TRADING 12.38/DISCOUNT 4.02

END

And now the Gold inventory at the GLD/

MAY 31/WITH GOLD UP $17.10 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/GLD INVENTORY RESTS AT 740.86 TONNES

MAY 30: WITH GOLD UP $6.40 TODAY: A BIG CHANGE IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 3.52 TONNES/INVENTORY RESTS AT 740.86 TONNES

MAY 29/WITH GOLD UP $3.90 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 737.34 TONNES

MAY 28/WITH GOLD DOWN $6.50 TODAY: A BIG  CHANGE IN GOLD INVENTORY AT THE GLD> A WITHDRAWAL OF 1.47 TONNES/INVENTORY RESTS AT 737.34 TONNES

MAY 24/WITH GOLD DOWN $1.60 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 738.81 TONNES

MAY 23/WITH GOLD UP $11.10 TODAY: A STRANGE WITHDRAWAL OF .88 TONNES FORM THE GLD/INVENTORY RESTS AT 738,81 TONNES

MAY 22//WITH GOLD FLAT TODAY: WE HAD A GOOD 1.52 TONNES OF GOLD DEPOSIT INTO THE GLD/INVENTORY RESTS TONIGHT AT 739.69 TONNES

 

MAY 21/WITH GOLD DOWN $3.65 TODAY: A SURPRISE 2.00 TONNES WERE ADDED  TO THE GLD GOLD INVENTORY//INVENTORY RESTS AT 738.17 TONNES

MAY 20/WITH GOLD UP $1.00 A HUGE 2.96 TONNE DEPOSIT INTO THE GLD//INVENTORY RESTS AT 736.17 TONNES

MAY 17/WITH GOLD DOWN $9.70 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 733.23 TONNES

MAY 16/WITH GOLD DOWN $11.50: A WITHDRAWAL OF 3.23 TONNES FROM THE GLD//INVENTORY RESTS AT 733.23 TONNES

MAY 15/WITH GOLD UP $1.50 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 736.46 TONNES

MAY 14//WITH GOLD DOWN $5.45 TODAY: STRANGE!! THE CROOKS DECIDED TO DEPOSIT A HUGE 3.23 TONNES INTO THE GLD INVENTORY//INVENTORY RESTS AT 736.46 TONNES

MAY 13/ WITH GOLD UP ANOTHER $15.40 TODAY: STRANGE! A MASSIVE WITHDRAWAL OF 6.41 TONNES OF GOLD (TO TAME GOLD’S RISE TODAY)/INVENTORY RESTS AT 733.23 TONNES

MAY 10 WITH GOLD UP $2.15 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 739.64 TONNES

MAY 9//WITH GOLD UP $4.00 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 739.64 TONNES

MAY 8/WITH GOLD DOWN $3.70 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 739.64 TONNES

MAY 7/ WITH GOLD UP $1.80: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 739.64 TONNES

MAY 6/WITH GOLD UP $2.35: ANOTHER WITHDRAWAL OF 5.88 TONNES OF GOLD FROM THE GLD/INVENTORY RESTS AT 739.64 TONNES

MAY 3/WITH GOLD UP $9.35 TODAY: A WITHDRAWAL  OF 1.17 TONNES OF GOLD FROM THE GLD INVENTORY/INVENTORY RESTS AT 745.52

MAY 2/WITH GOLD DOWN $12.30 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 746.69 TONNES

MAY 1/WITH GOLD DOWN $1.20 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 746.69 TONNES

APRIL 30/WITH GOLD UP $4.30 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 746.69 TONNES//

APRIL 29/WITH GOLD DOWN $7.00: NO CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 746.69 TONNES

APRIL 26/WITH GOLD UP $9.2//ANOTHER BIG CHANGE IN GOLD INVENTORY AT THE GLD; A WITHDRAWAL OF 1.18 TONNES OF GOLD FROM THE GLD.//INVENTORY LOWERS TO 746.69 TONNES TONNES

APRIL 25//WITH GOLD UP $.05 TODAY  (BASICALLY FLAT) NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 747.87 TONNES

 

APRIL 24 WITH GOLD UP  $6.00 TODAY// TWO TRANSACTIONS: 1)A HUGE WITHDRAWAL OF 2.05 TONNES FROM THE GLD AND THEN II) ANOTHER WITHDRAWAL OF 1.76 TONNES//INVENTORY RESTS AT 747.87 TONNES

APRIL 23./WITH GOLD DOWN $4.45 TODAY: NO CHANGES AT THE GLD/INVENTORY RESTS AT 751.68 TONNES//

APRIL 22/WITH GOLD UP $1.75//A SMALL WITHDRAWAL OF .59 TONNES OF GOLD FROM THE GLD INVENTORY//INVENTORY RESTS AT 751.68 TONNES

APRIL 18/WITH GOLD DOWN $.45 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT752.27 TONNES

APRIL 17/WITH GOLD DOWN $0.10 TODAY: ANOTHER HUGE WITHDRAWAL OF 1.76 TONNES AT THE GLD WHICH WAS USED IN YESTERDAY’S RAID/INVENTORY RESTS AT 752.27 TONNES

APRIL 16/WITH GOLD DOWN $13.60 TODAY: A HUGE WITHDRAWAL OF 3.82 TONNES AT THE GLD/INVENTORY RESTS AT 754.03

 

 

 

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MAY 31/2019/ Inventory rests tonight at 737.34 tonnes

*IN LAST 602 TRADING DAYS: 193.11 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 502 TRADING DAYS: A NET 27.27 TONNES HAVE NOW BEEN LOST INTO THE GLD INVENTORY.

 

end

 

Now the SLV Inventory/

MAY 31/WITH SILVER UP 6 CENTS TODAY: A DEPOSIT OF 422,000 OZ INTO THE SLV INVENTORY//INVENTORY RESTS AT 312.038 MILLION OZ/

May 30/WITH SILVER UP 19 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.616 MILLION OZ///

MAY 29/WITH SILVER UP 11 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.616 MILLION OZ//

MAY 28/WITH SILVER DOWN 23 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.616 MILLION OZ//

MAY 24/WITH SILVER DOWN 6 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.616 MILLION OZ/

MAY 23/WITH SILVER UP 16 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.616 MILLION OZ//

MAY 22/WITH SILVER UP 3 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS TONIGHT AT 311.616 MILLION OZ

MAY 21: WITH SILVER DOWN 3 CENTS TODAY: A SMALL CHANGE IN SILVER INVENTORY AT THE SLV; A WITHDRAWAL OF 750,000 OZ///INVENTORY RESTS AT 311.616 MILLION OZ//

MAY 20/WITH SILVER UP 6 CENTS:NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 312.366 MILLION OZ

MAY 17/WITH SILVER DOWN 13 CENTS TODAY: A BIG CHANGES IN SLV: A WITHDRAWAL OF 3.185 MILLION OZ FROM THE SLV INVENTORY VAULTS:/INVENTORY RESTS AT 312.366 MILLION OZ//

MAY 16/WITH SILVER DOWN 26 CENTS: NO CHANGES IN THE SLV INVENTORY//INVENTORY RESTS AT 315.551 MILLION OZ//

MAY 15/WITH SILVER UP 2 CENTS TODAY: A BIG CHANGE IN SLV  INVENTORY: A WITHDRAWAL OF 1.031 MILLION OZ//  THE SLV/INVENTORY RESTS AT 315.551 MILLION OZ.

MAY 14/WITH SILVER UP 2 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV. INVENTORY RESTS AT 316.582 MILLION OZ/

MAY 13//WITH SILVE5 DOWN 2 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 316.582 MILLION OZ…

MAY 10/WITH SILVER UP 2 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 316.582 MILLION OZ///

MAY 9/WITH SILVER DOWN 9 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 316.582 MILLION OZ//

MAY 8/WITH SILVER DOWN 3 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 316.582 MILLION OZ///

MAY 7/WITH SILVER DOWN 3 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 316.582 MILLION OZ//

MAY 6/WITH SILVER DOWN 3 CENTS WE HAD ANOTHER DEPOSIT OF 891,000 OZ OF SILVER INTO THE SLV/INVENTORY RESTS AT 316.582 MILLION OZ/

MAY 3//WITH SILVER UP 34 CENTS TODAY: A DEPOSIT OF 843,000 OZ INTO THE SLV/TOTAL INVENTORY RESTS AT 315.691 MILLION OZ//

MAY 2/WITH SILVER DOWN ANOTHER 13 CENTS, MIRACUOUSLY THE AUTHORITIES ADD 2.869 MILLION OZ OF SILVER BACK INTO THE SLV/INVENTORY RESTS AT 314.848 MILLION OZ//

MAY 1/WITH SILVER DOWN 23 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.979 MILLION OZ////

APRIL 30/WITH SILVER UP 5 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.979 MILLION OZ/

APRIL 29/ WITH SILVER DOWN 13 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.979 MILLION OZ.

APRIL 26//WITH SILVER UP 12 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.979 MILLION OZ//

APRIL 25/WITH SILVER DOWN 4 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.979 MILLION OZ///

APRIL 24/WITH SILVER UP 15 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.979 MILLION OZ//

APRIL 23./WITH SILVER DOWN 21 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.979 MILLION OZ///

APRIL 22/WITH SILVER UP 4 CENTS TODAY; NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 311.979 MILLION OZ///

APRIL 18/WITH SILVER FLAT TODAY: A SHOCKING 2.8122 MILLION PAPER OZ WERE ADDED INTO SLV INVENTORY: INVENTORY RESTS AT 311.979 MILLION OZ/

APRIL 17/WITH SILVER UP ONE CENT TODAY; NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 309.167 MILLION OZ///

APRIL 16/WITH SILVER DOWN 3 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 309.167 MILLION OZ/

 

MAY 30/2019:

 

Inventory 312.038 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 2.06/ and libor 6 month duration 2.54

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

G0LD LENDING RATE: + .48

 

XXXXXXXX

12 Month MM GOFO
+ 2.30%

LIBOR FOR 12 MONTH DURATION: 2.58

 

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.28

end

 

PHYSICAL GOLD/SILVER STORIES

 

end
i) GOLDCORE BLOG/Mark O’Byrne

Gold Sees Safe Haven Gains As Stocks Fall Sharply and Deutsche Plummets

Gold rose to a two week high and was higher in most currencies today after Washington’s threat of tariffs on Mexico exacerbated fears of a global trade war and recession, which saw a ‘flight to quality’ and gains for safe haven gold.

Spot gold jumped 0.9% to $1,298.80 an ounce this morning, its highest since May 15. Gold bullion has risen over 1.2% this month and appears headed for its first monthly gain in four months. This is important from a technical perspective and the fundamentals of growing risk aversion and robust demand should lead to further gains in June.

European trading has seen a clear flight to quality after President Trump unexpectedly politicised tariffs by slapping 5% on all goods coming from Mexico.

The increasingly hopeless case of a U.S. and China trade deal looked even further away after China drew up an “Unreliable entities” list of foreign parties (presumably mostly U.S.) that harm Chinese firms.

Stocks are red across the board globally with the S&P 500 breaking down sharply below its 200 day moving average (DMA). 2776 is a key level and Wall Street and Wasshington will not want a close below this level. Market intervention is quite possible, if not likely.

A weekly close below the 200 day moving average (DMA) could lead to follow through selling on Monday which could get ugly given the economic backdrop.

Financial stocks are particularly under pressure including UBS and embattled Deutsche Bank with the latter posting new “all time” lows of around €6. A whiff of contagion is in the air.

US and German bond yields hitting recent lows indicate the Fed might be backed into a rate cut sooner than they have been guiding with an inverting yield curve being a good barometer of trouble ahead

The greenback has also benefited somewhat from the risk off trade, in the face of this, silver and particularly gold are holding up well despite the recent sell off.

$1,300/oz and $14.60/oz are the respective hurdles approaching for both. Weekly closes over these levels should see follow though buying and further gains.

How far down we go, nobody knows, but it makes sense to stay cautious and prepared.

Fasten your seat belts it could be a lively Friday afternoon and weekend…

Global Risks Increasing – Underlining The Case For Gold – Watch Video Here

LBMA Gold Prices (USD, GBP & EUR – AM/ PM Fix)
30-May-19 1276.45 1280.95, 1010.44 1015.92 & 1146.25 1151.70
29-May-19 1283.50 1281.65, 1016.02 1013.27 & 1151.04 1150.67
28-May-19 1283.90 1278.30, 1012.87 1008.20 & 1146.91 1142.29
27-May-19  UK Bank Holiday
24-May-19 1281.50 1282.50, 1011.36 1011.89 & 1145.92 1145.40
23-May-19 1275.95 1283.65, 1009.79 1015.37 & 1146.19 1152.46
22-May-19 1274.00 1273.80, 1005.44 1008.09 & 1141.12 1141.20
21-May-19 1276.00 1271.15, 1004.85   998.62 & 1144.19 1139.84
20-May-19 1275.25 1276.85, 1000.05 1003.22 & 1142.63 1143.42

Swiss Gold Investment – Own Gold Coins (CGT Free in UK) Stored In Zurich With Six Months Free Storage

Mark O’Byrne
Executive Director

 

GATA STORIES WITH RESPECT TO GOLD/PRECIOUS METALS.

Malaysia’s Prime Minister raps currency rigging and proposes currency pegged to gold to settle East Asian trade

Two commentaries

(Reuters/GATA)

Malaysia’s prime minister raps currency rigging, urges using gold to settle East Asian trade

 Section: 

Malaysia’s Mahathir Proposes Common East Asia Currency Pegged to Gold

By Rozanna Latiff and A. Ananthalakshmi
Reuters
Thursday, May 30, 2019

KUALA LUMPUR, Malaysia — Malaysian Prime Minister Mahathir Mohamad today mooted the idea of a common trading currency for East Asia that would be pegged to gold, describing the existing currency trading in the region as manipulative.

Mahathir said the proposed common currency could be used to settle imports and exports, but would not be used for domestic transactions.

… 

In the Far East, if you want to come together, we should start with a common trading currency, not to be used locally but for the purpose of settling of trade,” he said at the Nikkei Future of Asia conference in Tokyo.

“The currency that we propose should be based on gold because gold is much more stable.”

He said under the current foreign-exchange system, local currencies were affected by external factors and were manipulated. He did not elaborate on how they were manipulated. …

… For the remainder of the report:

https://www.reuters.com/article/us-malaysia-currency/malaysias-mahathir-…

* * *

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:

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END

Malaysian PM elaborates on currency market rigging, resents dictation by U.S.

 Section: 

Dr. M. Moots Currency Backed by Gold

From the Malaysian National News Agency
via Free Malaysia Today, Petaling Jaya, Malaysia
Thursday, May 30, 2019

https://www.freemalaysiatoday.com/category/nation/2019/05/30/dr-m-moots-…

TOKYO — Prime Minister Dr. Mahathir Mohamad says Malaysia is proposing a new currency based on gold, as this would be more stable than the current currency trading, which is manipulative.

He said the precious metal could be used to evaluate import and export activities among the East Asian countries.

We can make settlements” using the new currency using gold, the prime minister said. “That currency must relate to the local currency as to the exchange rate, and that is something that can be related to the performance of that country.

“That way we know how much we owe and how much we have to pay in the special currency of East Asia,” he said during a dialogue session at the 25th International Conference on The Future of Asia (Nikkei Conference) here today.

Mahathir arrived in Tokyo last night for a three-day working visit.

He said the new currency could also be extended to countries outside the East Asian region.

Currently, he said, the global market is tied to the U.S. dollar, which gives room for the currency to be manipulated.

“Just because that one country is affected, there is infection to the other countries. Malaysia was very stable way back in 1997 … but because of the problems that occurred in Thailand” during the Asian financial crisis, “they said we must peg the Malaysian currency also.

“What happened? The currency traders sold the Malaysian currency down and the value of Malaysian currency depreciated.

“It is not even the money that they have. They never had any Malaysian currency but nevertheless they were able to sell huge quantities of Malaysian currency, and when it is depressed, of course they can buy and sell it at a higher price when it comes up,” he added.

“Currency trading is not something that is healthy because it is not about the (economic) performance of countries but about manipulation.

“Anything that you have in oversupply, we will lose value. Anything that is short of supply will increase in value, so they sell huge quantities of money they don’t have, and because the amount is so big, there is depression of the value.”

Mahathir said that if countries are downgraded or upgraded, it should be done by an uncommitted international forum, not a country.

Here, he hit out at the United States for “labeling” other countries.

“The United States is fond of labeling that country as no good, this country as no good, and telling countries about ways to conduct their business.

“You are not democratic. That is not for any single power to decide. If you want to live in a united world, a stable world, we must resort to sustainability through agreement between all nations that have a stake in that problem.”

Asked if the Japanese yen or Chinese yuan could be used as the common currency in Asia, Mahathir replied: “If we try to promote our own currency, there will be conflict. But if we have a common currency for East Asia, a common trading currency that is not used in each country but for the purpose of settlement trade only, then there will be stability.

“But trying to promote the yen or the yuan, that is not the way to go.”

END

Judy Shelton is without a doubt the right pick for Trump. Let us hope that she gets the job of Fed governor.  She is a strong advocate for gold backed currency and less dependency on the Fed.

(courtesy London’s Financial Times/Judy Shelton/GATA)

Fed candidate Shelton slams central bank’s ‘Soviet’ power over markets

 Section: 

By James Politi
Financial Times, London
Friday, May 31, 2019

https://www.ft.com/content/46c4b186-8308-11e9-b592-5fe435b57a3b

Judy Shelton, a senior US official who is being vetted for a job on the board of the Federal Reserve, has attacked the central bank for wielding undemocratic, Soviet-style powers over markets and suggested it should not even be in the business of setting interest rates.

In an interview with the Financial Times at the Trump International Hotel in Washington this week, Ms. Shelton called on the Fed to “think about whether they are doing more harm than good.” If appointed to the board, she would be “asking tough questions” about its most basic mission, she said.

… 

In an interview with the Financial Times at the Trump International Hotel in Washington this week, Ms. Shelton called on the Fed to “think about whether they are doing more harm than good.” If appointed to the board, she would be “asking tough questions” about its most basic mission, she said.

“How can a dozen, slightly less than a dozen, people meeting eight times a year, decide what the cost of capital should be versus some kind of organically, market-supply-determined rate? The Fed is not omniscient. They don’t know what the right rate should be. How could anyone?” Ms. Shelton said.

“If the success of capitalism depends on someone being smart enough to know what the rate should be on everything … we’re doomed. We might as well resurrect Gosplan,” she said, referring to the state committee that ran the Soviet Union’s planned economy. Ms. Shelton did post-doctoral research on the Soviet economy at Stanford University’s Hoover Institution and was designated to be the Russia expert on the board of the National Endowment for Democracy.

The U.S. representative on the board of the European Bank for Reconstruction and Development, Ms. Shelton is being considered by Donald Trump to be a Fed governor after his previous proposed candidates — Stephen Moore and Herman Cain — were dropped from contention. Both Mr. Moore and Mr. Cain withdrew this year after Republicans in the upper chamber balked at their limited qualifications for the job, personal factors that emerged during their vetting, and fears that they would not be independent enough from Mr. Trump.

Ms. Shelton, who obtained an MBA in business administration from the University of Utah, has already passed muster with Congress for the EBRD job, which could make it harder for the Senate to turn her down. But her possible nomination suggests that Mr. Trump is in no mood for a less controversial pick for the US central bank, and wants a disruptive candidate to argue for unorthodox policies within the Fed.

As well as questioning whether the Fed should even be steering monetary policy, Ms. Shelton has called for the central bank to stop paying banks interest on excess reserves, a policy introduced during the financial crisis, saying it was turning financial institutions into “utilities,” rewarding them for allowing money to “sit doing zilch” rather than being loaned out.

She also said that the Fed should continue to reduce its balance sheet below the $3.5 trillion target set by Jay Powell, the chairman. “I would rather the Fed be less of an entity. When a central bank buys up government debt, that’s the beginning of compromised finances.”

She also said the Fed had become so influential that it unnaturally drove investment decisions and affected financial markets. “It’s the distorting aspect of the Fed that is the worst aspect — it’s a wag-the-dog situation. People are fixated on the Fed and are making money by arbitraging, trillions of a second after the latest FOMC announcement,” she added.

Ms. Shelton has long been sympathetic to the gold standard, which the U.S. fully abandoned in the early 1970s in favour of a flexible exchange rate for the dollar. “People call me a goldbug, and I think, well, what does that make them? A Fed bug,” she says.

Her big dream is a new Bretton Woods-style conference — “if it takes place at Mar-a-Lago, that would be great” — to reset the international monetary system, replacing the current regime, mostly based on floating currencies. Ms. Shelton said countries should agree to tie their currencies to a “neutral reference point, a benchmark” — which she envisages to be a “convertible gold-backed bond.”

“Now is the pivotal moment to question whether central banking is really delivering what the central bankers themselves aspire to. They are going through self-examination so I think it’s reasonable to say there are alternatives,” she said.

Ms. Shelton, who has close ties to Larry Kudlow, the director of the National Economic Council, as well as David Malpass, the president of the World Bank, worked for Mr. Trump as an economic adviser during the 2016 presidential campaign. She endorsed his “pro-growth economic agenda,” from tax cuts to deregulation.

She also supports the U.S. president’s trade war with China, including the decision to ratchet up tariffs after turning away from a deal at the eleventh hour. “I think it took a lot of guts to say that [the deal offered by China in early May] will mean everything we were fighting for was just a joke,” Ms. Shelton said.

“Thank goodness he is sticking it out. I’ve always thought we had to fight fire with fire with China, Europe’s talked about it for ages and never really did anything with teeth in it, and neither did the U.S. until now.”

* * *

end



iii) Other Physical stories

-END-

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

A federal judge tells traders that they can combine cases (with the other 6 banks) as they accused JPMorgan of rigging the precious metals market
(courtesy CNBC)

Federal judge tells traders they can combine cases accusing JP Morgan of rigging metals market

  • Litigation in a separate civil case has been put on hold until at least May at the behest of the Justice Department, which is investigating a “related criminal case” that involves alleged market manipulation by precious metals traders at J. P. Morgan.
  • Judge John Koeltl of the Southern District of New York appointed the White Plains, N.Y., law firm Lowey Dannenberg as interim lead counsel for the proposed class action.

71671201

Spencer Platt | Getty Images

A group of traders from across the U.S. who allege that J. P. Morgan Chase manipulated precious metals markets for years are one step closer to bringing a class action suit against the nation’s largest bank.

Earlier this month, a federal judge said five separate lawsuits making similar allegations against the bank could be combined, potentially including thousands of people who traded in the precious metals market from Jan. 2009 through Dec. 2015.

Litigation in a separate civil case has been put on hold until at least May at the behest of the Justice Department, which is investigating a “related criminal case” that involves alleged market manipulation by precious metals traders at J. P. Morgan.

J. P. Morgan declined to comment on this story.

Judge John Koeltl of the Southern District of New York appointed the White Plains, N.Y., law firm Lowey Dannenberg as interim lead counsel for the proposed class action.

Vincent Briganti, a partner at the firm, filed the first suit seeking class action status in November on behalf of Dominick Cognata, a trader who alleges he suffered losses due to J.P. Morgan’s illegal trading conduct in the silver and gold futures and options markets.

That was after the federal court in Connecticut unsealed a criminal plea agreement by John Edmonds, a former J.P. Morgan metals trader. In his guilty plea, Edmonds, who is 36-years old, admitted that he and other “unnamed co-conspirators” fraudulently manipulated the precious metals markets while they were employed at J. P. Morgan from 2009 to 2015.

Edmonds said he had learned the illegal trading tactics from senior traders, and then used them hundreds of times with the knowledge of and consent of his immediate supervisors.

Briganti’s lawsuit also names John Edmonds and a group of yet-to-be-identified precious metals traders and the bank as defendants.

On Wednesday, the lawyers sent a letter to Judge Koeltl saying they were having difficulty locating Edmonds to serve him legal papers and requested a 30-day extension to do so, which the judge granted on Thursday. Briganti noted that they have been in contact with Edmonds’ attorney in the criminal case. Edmonds’ attorney and Briganti could not be reached for comment.

“We are hopeful that this extension will result in completing service on Mr. Edmonds without formal motion practice and a request for alternative means of service,” Briganti said in the letter.

The next step in the civil case is for the plaintiffs to file an amended class action complaint and set a schedule for defendants to respond.

In addition to the proposed class action, J. P. Morgan also faces a separate civil suit which also accuses the bank of rigging precious metals markets.

end

March 4.2019

Parker City News

JP Morgan faces potential class action lawsuit after guilty pleas by a former metals trader

Traders from across the U.S. are banding together to accuse J. P. Morgan Chase of manipulating precious metals markets for years.

At least six lawsuits, all making similar allegations against the nation‘s largest bank, have been filed in New York federal court in the past month, since federal prosecutors in Connecticut with a former J. P. Morgan Chase metals trader.

The cases could potentially include thousands of people who traded in the precious metals market. The White Plains, N.Y., law firm Lowey Dannenberg is asking the court to combine the cases and name it as the lead.

The law firm‘s commodities group is led by Vincent Briganti, the attorney who filed the first lawsuit on behalf of Dominick Cognata, a New York resident who alleges he suffered losses due to J. P. Morgan‘s trading conduct in the silver and gold futures and options markets.

A combined case, seeking class action status, would include anyone who purchased or sold futures contracts or an option on NYMEX platinum or palladium or COMEX silver or gold between at least Jan. 1, 2009, and Dec. 31, 2015. The lawyers believe that “at least hundreds, if not thousands” of traders would be eligible to join the case.

Named as defendants in all of the lawsuits are John Edmonds, a 36-year old former metals trader at J. P. Morgan, a group of yet-to-be-identified precious metals traders and the bank.

Edmonds, a New York resident, pleaded guilty in October to one count of conspiracy to defraud the market and manipulate prices of precious metals futures contracts and one count of commodities fraud. In the criminal plea, Edmonds admitted that he and other “unnamed co- conspirators” at J. P. Morgan, fraudulently manipulated precious metals markets from 2009 to 2015, the same time frame covered in the class action suits.

Briganti filed the initial class action on Nov. 7, just one day after the Justice Department unsealed Edmonds‘ plea in the U.S. District Court of Connecticut.

Edmonds admitted in his guilty plea that he deployed the illegal trading scheme hundreds of times with the direct knowledge and consent of his immediate supervisors. Plaintiffs say they have suffered economic injury, including monetary losses, as a direct result of actions by Edmonds and the other unnamed J. P. Morgan metals traders in the futures and options contracts.

One of the suits alleges that “the number of unlawful trades that JP Morgan traders executed in precious metals futures markets is at least in the thousands.”

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

The Justice Department‘s criminal investigation is still ongoing and recently caused a separate related civil case to be put on hold for at least six months while the government continues its investigation. That civil lawsuit, which also accuses J. P. Morgan of rigging the precious metals market, was filed in 2015 by hedge fund manager Daniel Shak and two commodity traders.

After reviewing the details of the plea agreement, David Kovel, the attorney for Shak‘s suit, sought to re- interview Edmonds, along with two other current and former senior traders at the bank. However, the government argued that reopening questioning would be detrimental to the ongoing criminal investigation. The federal judge overseeing the proceedings ordered a six-month stay in the civil case.

Kovel declined to comment.

Edmonds was originally scheduled to be sentenced in Hartford, Conn., on Wednesday, Dec. 19, but a court filing on Nov. 27 shows the sentencing has been postponed until June. A spokesman for the U.S. Attorney for Connecticut could not elaborate on why the sentencing was postponed since the court filing is under seal.

-END-

Justice Department stalls another class action in gold market rigging, this one against JPM

 Section: 

9:47a ET Tuesday, March 5, 2019

Dear Friend of GATA and Gold:

Proceedings in the federal class-action anti-trust lawsuit against JPMorganChase charging the investment bank with manipulating the gold and silver futures markets —

http://www.gata.org/node/18844

— have been suspended for three months at the request of the U.S. Justice Department, just as the department has arranged suspension of proceedings in the class-action anti-trust lawsuit against Deutsche Bank charging similar market manipulation.

… 

In both cases the Justice Department has told U.S. District Court for the Southern District of New York that proceedings would jeopardize its criminal investigation into market rigging, which has been admitted by a former JPMorganChase trader, John Edmonds, who awaits sentencing.

According to court filings, the White Plains, New York, law firm representing the plaintiffs against JPMorganChase, Lowey Dannenberg, concurred in the government’s request to suspend proceedings. The stay is to continue for three months and may be extended.

The Justice Department’s motion, granted by the court on February 26 —

http://www.gata.org/files/JPMorganChaseClassActionStay.pdf

— said “the government is not seeking an open-ended stay that could indefinitely postpone this matter and thus jeopardize the parties’ interests in a timely resolution.” The motion added, “Any developments in the criminal case during the period the consolidated action is stayed may reduce or completely resolve the need to litigate certain issues in the consolidated action.”

Much of the Justice Department’s motion is redacted to conceal from the public evidence still under investigation. Edmonds has said he and other traders manipulated the gold and silver markets for years with the knowledge of their supervisors at JPMorganChase. In its motion to conceal that evidence, also granted by the court on February 26, the Justice Department said disclosure “could lead to destruction of evidence, flight from prosecution, and otherwise interfere with the government’s ability to conduct its investigation”:

http://www.gata.org/files/JPMorganChaseClassActionStaySeal.pdf

Monetary metals investors may be skeptical of the Justice Department’s stalling the Deutsche Bank and JPMorganChase cases, since the department and the U.S. Commodity Futures Trading Commission do not seem ever to have responded conscientiously to complaints of gold and silver market rigging until the class actions commenced.

How much time will the court give the Justice Department to delay getting to the bottom of the issue? The court might hasten matters if enough monetary metals mining companies protested the harm done to them and their shareholders by market rigging, but of course most monetary metals mining companies don’t mind at all.

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

* * *

 

end

* * *

Your early FRIDAY morning currency, Asian stock market results,  important USA/Asian currency crosses, gold/silver pricing overnight along with the price of oil Major stories overnight/7 AM EST

i) Chinese yuan vs USA dollar/CLOSED / LAST AT: 6.9097/ GETTING VERY DANGEROUSLY CLOSE TO 7:1

//OFFSHORE YUAN:  6.9437   /shanghai bourse CLOSED DOWN 7.11 POINTS OR 0.24%

HANG SANG CLOSED DOWN 213.79 POINTS OR 0.79%

 

2. Nikkei closed DOWN 341.34 POINTS OR 1.63%

 

 

 

 

3. Europe stocks OPENED RED /

 

 

 

USA dollar index RISES TO 98.00/Euro RISES TO 1.1149

3b Japan 10 year bond yield: FALLS TO. –.09/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 108.72/ 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//CARRY TRADERS GETTING KILLED

 

3c Nikkei now JUST BELOW 17,000

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

3e WTI:: 55.45 and Brent: 63.73

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

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO -.21%/Italian 10 yr bond yield UP to 2.71% /SPAIN 10 YR BOND YIELD DOWN TO 0.73%…ITALIAN 10 YR BOND YIELD/GERMAN BUND: 2.92: DANGEROUS FOR THE ITALIAN BANKING SYSTEM

3j Greek 10 year bond yield FALLS TO : 2.99

3k Gold at $1297.20 silver at: 14.51   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 42/100 in roubles/dollar) 65.55

3m oil into the 55 dollar handle for WTI and 65 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 108.72 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 1.0058 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1201 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 NEGATIVE territory with the 10 year FALLING to 0.21%

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 2.15% early this morning. Thirty year rate at 2.60%

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

6.  TURKISH LIRA:  UP  TO 5.8641..they are toast

Global Markets Routed After Trump Tariff Bombshell, Bund Yields Crater To Record Low

To those who sold in May, congratulations. To everyone else, we hope you are enjoying the bloodbath.

US stock futures, global markets and sovereign bond yields tumbled on Friday as investors feared President Donald Trump’s shock threat of tariffs on Mexico – a 5% tariff from June 10, which would then rise steadily to 25% until illegal immigration across the southern border was stopped – risked tipping the United States, and maybe the whole world, into recession.

The rout, which sent the Dow below 25,000 and the S&P below its 200 DMA, will break the S&P’s unbroken monthly streak in 2019, with May set for the first monthly loss since the December rout. In fact, May will be the third worst month since the US downgrade in August 2011.

Trump announced the decision on Twitter late Thursday, catching markets completely by surprise.

“The mercurial President Trump has signalled via Twitter this morning that his mindset is shifting ever farther from reaching trade deals,” warned Saxo’s Eleanor Creagh. “It seems now that market participants are finally realising that the narrative of an H2/19 recovery is fast dissipating,” she added. “As escalating trade tensions across the globe cause growth expectations to be recalibrated, risk off sentiment will remain and volatility will increase.”

“We are seeing a Trump who is going all-out,” said Kay Van-Petersen, global macro strategist at Saxo Capital Markets Pte. “This raises the bar not just for Mexico and Canada, but also for China.”

After Trump’s announcement, investor mood hit pitch black when China’s May manufacturing PMI printed not only below expectations, but below the lowest expectation, raising questions about the effectiveness of Beijing’s stimulus steps. The official NBS manufacturing PMI fell to 49.4 in May, from 50.1 in April. Sub-indexes suggested lower price inflation and weaker trade growth in May. Trade indicators worsened further – the imports sub-index declined to 47.1, from 49.7, and the new export order index went down to 46.5, vs. 49.2 in April. Inventory indicators rose – the raw material inventories index was 0.2pp higher at 47.4, and the finished goods inventory index rose to 48.1 in May.

With traders throwing in the towel, global markets moved aggressively to price in deeper rate cuts by the Federal Reserve this year, while bond yields touched fresh lows and curves inverted further in a warning of recession.

With markets tumbling, traders flooded into the safety of bond market and the dollar, with yields on the 10-year Treasury note quickly fell to a fresh 20-month low of 2.17%, while the dollar jumped 1.7% on the Mexican peso. In the US, all Treasury tenors from 2Y to 5Y were now trading below 2.0%, while the 3M-10Y was inverted as much as 21bps. Bonds extended their bull run with 10-year Treasury yields now down a steep 33 basis points for the month and decisively below the overnight funds rate. Such an inversion of the yield curve has presaged enough recessions in the past that investors are wagering the Fed will be forced to ease policy just as “insurance”.

Yet Treasuries were hardly alone in rallying, with bond yields across Europe either at or near record lows. Yields in Australia and New Zealand have also hit an all-time trough on expectations of rate cuts there. Bund yield falls 4bps to -0.213%, below the previous all-time low touched in July 2016, as core bonds outperformed semi-core, and German provincial CPI numbers are weaker than economists estimated.

As if that wasn’t enough, stocks extended declines on reports that China will establish a list of “unreliable” entities to target firms it says damage the interests of domestic companies.

The Stoxx Europe 600 Index fell, with all industry sub indexes down, led by autos and basic resources.European shares extend losses, alongside U.S. futures, as China announces it is preparing for retaliation by implementing a list of “unreliable” entities in order to target firms it says damage the interests of domestic companies. Stoxx 600 Index falls 1.4%. European shares set for largest monthly drop since January 2016; Stoxx Europe 600 Index down 6.2% in May, with the biggest pain felt again by Deutsche Bank shareholders, as DBK tumbled to new all time lows.

Asian shares fell at first, only to draw month-end bargain hunting having endured a torrid few weeks. MSCI’s broadest index of Asia-Pacific shares outside Japan edged up 0.3%, though it was still down a whopping 7.3% for the month.

China’s blue chip index held steady, partly on talk Beijing would now have to ramp up its stimulus, but again was nursing loses of 6.8% for May. Japan’s Nikkei fell 1.3%, dragged down by big falls in car makers, which left it off 7.1% for the month.

There was one silver lining: Apple suppliers rose in Taipei Friday, boosting the Taiex index, after China said it would protect foreign businesses’ legitimate rights. The comments from China’s commerce ministry official Thursday was interpreted as an indication that Beijing doesn’t intend to retaliate against Apple and other American firms doing business on the mainland, according to Concord Securities assistant vice president Allan Lin, although that may be over as soon as today.

Another silver lining: investors clearly felt encouraged that opening a new front in the trade wars would pressure central banks everywhere to consider new stimulus. On Thursday, Fed Vice Chair Richard Clarida said the central bank would act if inflation stays too low or global and financial risks endanger the economic outlook.

“What the Clarida’s comments have done is clarify in many people’s minds the answer to the questions of whether low inflation proving more than transitory would itself be enough to get the Fed to ease – the answer appears to be ‘yes’,” said Ray Attrill, head of FX strategy at National Australia Bank. “That served to reinforce prevailing market expectations that the Fed will be easing in the second half of this year.”

Not surprisingly, in FX the DXY dollar index ramped to new two-year highs against a basket of currencies at 98.115. The euro was huddled at $1.1129, having shed 0.7% for the month. The safe-haven yen fared better as the dollar lost 0.6% on the day to a three-month low of 108.94. Sterling was poised for the biggest monthly drop in a year as the imminent departure of Theresa May as prime minister deepened fears about a chaotic divorce from the European Union. The pound was last at $1.2611 and nursing a 3.2% loss for the month so far.

In commodity markets, spot gold firmed 0.4% to $1,293.33 per ounce. Oil prices fell to their lowest in almost three months on fears a global economic slowdown would crimp demand. U.S. crude was last down 55 cents at $56.04 a barrel, while Brent crude futures lost 91 cents to $65.96.

Expected data include personal income and University of Michigan Sentiment Index. Big Lots is reporting earnings.

Market Snapshot

  • S&P 500 futures down 1.1% to 2,759.25
  • STOXX Europe 600 down 1% to 368.54
  • MXAP down 0.04% to 152.22
  • MXAPJ up 0.2% to 498.43
  • Nikkei down 1.6% to 20,601.19
  • Topix down 1.3% to 1,512.28
  • Hang Seng Index down 0.8% to 26,901.09
  • Shanghai Composite down 0.2% to 2,898.70
  • Sensex down 0.3% to 39,707.10
  • Australia S&P/ASX 200 up 0.07% to 6,396.85
  • Kospi up 0.1% to 2,041.74
  • German 10Y yield fell 2.7 bps to -0.202%
  • Euro up 0.2% to $1.1148
  • Italian 10Y yield rose 1.4 bps to 2.283%
  • Spanish 10Y yield fell 1.8 bps to 0.746%
  • Brent futures down 3.3% to $64.70/bbl
  • Gold spot up 0.7% to $1,297.30
  • U.S. Dollar Index down 0.1% to 98.00

Top Overnight News from Bloomberg

  • Trump vowed to impose tariffs on Mexican goods until that country stops immigrants from entering the U.S. illegally, jeopardizing a new North American trade agreement. The tariff would take effect on June 10 and has major implications for American automakers and other companies with production south of the border
  • U.S. Senate Finance Committee Chairman Chuck Grassley (R-Iowa) calls President Trump’s Mexico tariff Plan a “misuse” of authority. “Following through on this threat would seriously jeopardize passage of USMCA.” Mexican President Andres Manuel Lopez Obrador says in letter to Trump posted to Twitter “from start, I express that I don’t want confrontation.”
  • China has prepared the steps it will take to use its stranglehold on the critical minerals in a targeted way to hurt the U.S. economy, people familiar said. The measures would likely focus on heavy rare earths, a sub-group of the materials where the U.S. is particularly reliant on China
  • China will establish a list of so-called “unreliable” entities in order to target firms it says damage the interests of domestic companies, according to an announcement carried by state media on Friday
  • Mitsubishi UFJ Financial Group Inc., Japan’s largest bank, is preparing major job cuts in London, offering voluntary redundancy packages to about 500 directors and managing directors in London, according to an emailed statement. That’s roughly a quarter of its workforce in the city
  • India’s Prime Minister Narendra Modi picked leaders with experience for key portfolios as he began a second five-year term facing an economic slowdown and global headwinds
  • The outlook for China’s manufacturing sector deteriorated more than expected in May, as weakness in the domestic economy combined with escalation in the trade standoff with the U.S.
  • Federal Reserve Vice Chair Richard Clarida says “if the incoming data were to show a persistent shortfall in inflation below our 2% objective or were it to indicate that global economic and financial developments present a material downside risk to our baseline outlook, then these are developments that the committee would take into account in assessing the appropriate stance for monetary policy
  • Mitsubishi UFJ Financial Group Inc., Japan’s largest bank, is preparing major job cuts in London, offering voluntary redundancy packages to about 500 directors and managing directors in London, according to an emailed statement. That’s roughly a quarter of its workforce in the city
  • India’s Prime Minister Narendra Modi picked leaders with experience for key portfolios as he began a second five-year term facing an economic slowdown and global headwinds

Asian equity markets traded mixed heading into month-end with early pressure seen after US President Trump announced to place 5% tariffs on all goods from Mexico from June 10th, which will increase to as much as 25% by October 1st and remain there until Mexico addresses the illegal immigration inflows to the US through its territory. The announcement pressured US equity futures to give back the prior session’s gains in which the Emini S&P breached its 200DMA to the downside and the DJIA briefly slipped below the 25K level, with Wall St on track for its worst monthly performance YTD. ASX 200 (Unch.) was lower for most the session with tech and energy the underperformers although strength in gold and other mining names stemmed the downside in the index, while Nikkei 225 (-1.6%) suffered from currency flows and with automakers spooked by fears of a trigger-happy ‘Tariff Man’. Hang Seng (-0.8%) and Shanghai Comp. (-0.2%) were mixed as participants digested varied Chinese PMI data in which Manufacturing PMI fell short of estimates and slipped into contractionary territory but Non-Manufacturing PMI printed inline, and although the PBoC refrained from open market operations, its efforts this week resulted to a total net injection of CNY 430bln. Finally, 10yr JGBs followed suit to the upside in T-notes as Trump’s announcement spurred safe-haven demand, while the BoJ were also present in the market for JPY 680bln of JGBs in the belly to super long-end.

Top Asian News

  • Anta Jumps After Fighting Back on ‘Misleading’ Short Sell Attack
  • BOJ Paves Way to Buy Fewer Bonds as Growth Worries Sink Yields
  • Apple Suppliers Rise as China Shows No Intention to Retaliate
  • Philippine Central Bank Governor ‘Promises’ More Rate Cuts

European Indices trade firmly in negative territory this morning [Euro Stoxx 50 -1.7%] as sentiment took a hit as US President Trump revisited his ‘Tariff Man’ persona by announcing the placement of 5% tariffs on all goods stemming from Mexico as of June 10th; which may increase by up to an additional 20% by October 1st. Currently eight automakers including Volkswagen (-3.6%) and Fiat Chrysler (-4.6%) operate plants in Mexico, as such the Stoxx 600 Auto Sector (-2.8%) is significantly lagging its peers with the Dax (-1.6%) the underperforming bourse due to automakers/parts having around a 14% weighting in the Dax. Auto names aside, other companies with exposure to Mexico have been significantly affected by President Trump’s announcement with the likes of Tenaris (-4.7%) afflicted due to the Co. operating one of the world’s largest manufacturing centres for steel tubes in Mexico. Elsewhere, Italian banks are at their lowest level since November 2016 due to the ongoing internal political tensions as well as the potential for Italy to face EU disciplinary procedures in the form of a EUR 3.5bln fine. Other notable movers this morning include Wirecard (-11.3%) who are lagging the Stoxx 600 after reports that several public prosecutors are said to see the Co. as the central payment processor for the fraudulent trading site Option888. Bucking the risk-off sentiment and at the other end of the Stoxx 600 are Whitbread (+1.9%) after the Co’s board decided that the second phase in their three phase capital programme is a GBP 2bln tender offer.

Top European News

  • Brexit Delay Boosts U.K. Mortgage Lending, Consumer Borrowing
  • German Yields Set New Sub-Zero Record as Haven Seekers Rush In
  • Visco Says Italy’s Debt Load Is ‘Severe Constraint’ on Economy
  • Europe Car Stocks Sink to Five-Month Low on Trump’s Mexico Plan

In FX, the broad Dollar and Index are on the backfoot this morning with DXY now back below 98.000, albeit marginally. The Buck awaits key US data in the form of April PCE prices as traders look for any clues if the “dip in inflation was transitory” as the Fed stated at its most recent meeting. On a technical front, to the downside DXY sees its 50 DMA just under the 97.50 level at 97.47 ahead of clean air down to 97.00.

  • MXN, CAD – The clear underperformers today, more-so the Peso after President Trump dampened USMCA hopes by taking aim at Mexico. The Peso immediately saw downside and continued that trajectory throughout the session, with USD/MXN spiking higher from around 19.1500, through its 50 WMA (19.2766) and 200 DMA (19.3360) to a high of 19.7360. Meanwhile, from Canada’s side, the potential ramifications on the USMCA deal, coupled with lower energy prices sent USD/CAD higher to around 1.3550 from a low of around 1.3494 ahead of a barrage of Canadian data including Q1 GDP.
  • JPY, CHF – The Yen stands as the clear G10 outperformer this morning amid the overall risk aversion in the market with downside vs. the USD exacerbated as Trump spills his trade war into Mexico. USD/JPY cleanly broke below the 109.00 figure and continues to lose ground below the level, having traded within a wide 109.62-108.76 band, with buyers reported at 108.75 ahead of the Jan 28 low just above 108.50. Following the latest developments, Morgan Stanley believes that a breach below 109.00 support opens downside potential to 107.70. Meanwhile, the Swiss Franc also posts gains, albeit to a lesser extent, with traders speculating potential SNB intervention to keep the CHF strengthening further. USD/CHF currently rests just above the 1.0050 mark ahead of its 100 DMA at 1.0037.
  • EM – The EM space is weaker across the board amidst the Trump-sparked collapse in the Mexican Peso, albeit the TRY has shown some resilience as it consolidates following yesterday’s stellar performance. However, geopolitical risks for the Lira remain as the Turkish Foreign Ministry spokesperson has dismissed reports that the Russian S-400 delivery will be delayed, which comes after US pressured the country to dump the USD 2.5bln deal with Russia, which contradicted prior reports that the Russian system will be delivered ahead of scheduled. Either way, markets are looking at any potential US sanctions on Turkey if the delivery does go through, which Turkey noted was “a done deal”
  • AUD, NZD, EUR, GBP – All marginally firmer against the Greenback (ex-GBP), albeit more due to a pullback in the USD than individual factors. The Antipodeans were little fazed by the overnight miss in the Chinese NBS manufacturing PMI as currencies await the Caixin release next week alongside the RBA’s “live” rate decision and Aussie GDP. Elsewhere, the expectations for a post-Easter collapse sees the EUR largely shrugging off the downticks in German state inflation numbers, as markets gear up for the national release at 1300BST. EUR/USD resides closer to the top of today’s 1.1126-54 band with resistance reported at 1.1155 ahead of 1.1170. Meanwhile, the Pound has lost some ground in recent trade, particularly vs the EUR with some citing RHS demand and EUR/GBP bids at 0.8850 as factors.

Commodities are mixed with the energy markets plumbing the depths as risk sentiment further deteriorates amid trade war escalations coupled with rising US crude production. WTI (-2.1%) straddles around the USD 55/bbl level, having already dipped below the figure whilst its Brent (-2.5%) counterpart follows the same trajectory as it hovers around USD 64.50/bbl. Furthermore, some geopolitical risk premium may have also unwound in the oils amid reports that US has delayed tougher sanctions Iran’s petrochemical sectors in an attempt to dial back tensions. Elsewhere, gold (+0.6%) benefits from the risk aversion and the receding USD as it creeps closer to the USD 1300/oz level, whilst copper extends its decline below the USD 2.600/lb level amid the soured risk tone coupled with disappointing Chinese PMI data.

US Event Calendar

  • 8:30am: Personal Income, est. 0.3%, prior 0.1%; Personal Spending, est. 0.2%, prior 0.9%
  • 8:30am: PCE Deflator MoM, est. 0.3%, prior 0.2%; PCE Deflator YoY, est. 1.6%, prior 1.5%
  • 9:45am: MNI Chicago PMI, est. 54, prior 52.6
  • 10am: U. of Mich. Sentiment, est. 101.5, prior 102.4; Current Conditions, prior 112.4; Expectations, prior 96d

DB’s Jim Reid concludes the overnight wrap

The final day of May probably couldn’t come soon enough for most given the change in tide driven by a 102-word tweet from President Trump 26 days ago. Well, somewhat fittingly, the month was bookended by another surprise tweet from the US President last night, this time announcing a set of tariffs on imports from Mexico. According to Trump, the US will institute a 5% tariff on imports from Mexico effective June 10, with the rate set to rise by 5% every month until it reaches 25% in October. However, the new duties will be removed on Mexico if “illegal migrants coming through Mexico, and into our country, STOP” as per his tweet. For reference, the US imports around $30bn of goods from Mexico each month, and around 30% of those are autos. Tariffs at 25% on that flow of goods, in addition to the duties on China, would start having a significant and potentially crippling impact on US industry, so it’s possible that this move is aimed at pushing the US Congress to act on either the USMCA deal or on an immigration package. So far Mexico has stated that they will not retaliate until talking with the US, however the damage is likely to be already done to US-Mexico relations which since President AMLO was elected, had been improving. As for markets, the Mexican Peso has weakened -2.14% as we go to print, S&P 500 futures are down -0.65%, 10y Treasuries are down -3.1bps at 2.182% and WTI oil is down -1.15%. So, June starts right where May finished with tweet/tariff-induced selloffs.

As we’ve been arguing, these tweets have the potential to change the dynamics of global markets and it now seems like we could get a serious trade escalation that wasn’t likely at the start of last month, especially as it had appeared Trump had looked like he wanted to get a deal done in 2019. The landscape has changed dramatically and it could be an interesting summer ahead. The reality also is that with it being the first day of June tomorrow, tariffs will officially kick in between the US and China with the US applying 25% tariffs on $200bn of China exports to the US, while China will apply 5-25% tariffs on $60bn of US exports to China.

Needless to say, this also means economic data will be closely scrutinized as to the impact that the trade escalation has had, with next week’s final PMIs and ISM report top of that list. In the meantime this morning we’ve already had the final official May PMIs in China, which slid more than expected. The manufacturing print came in at 49.4, and the new orders and new export orders sub indexes were notably soft at 49.8 and 46.5. The non-manufacturing print came in at 54.3 as expected, bringing the composite PMI to 53.3 and slightly lower versus April. Equity markets in China initially opened in the red, however have since recovered with the Shanghai Comp (+0.01%) and CSI 300 (+0.06%) now pretty much unchanged. The Nikkei (-0.70%) and Hang Seng (-0.19%) are in the red, however markets do appear to be holding their own for the most part given both this data and the tariff news and it’s the same with Asia FX which has been broadly stable. That said it’s worth noting that the auto sector has borne the brunt of the pain, with Japanese automakers currently down -2.60%. To add to the headline risk the moves this morning also come despite China announcing that it is prepared to restrict exports of rare earths to the US if needed as per Bloomberg.

The overnight newsflow is clearly the main story and in any case it follows a mostly dull session on Wall Street yesterday prior to the latest tariff announcement. The good news is that risk assets did stage a rebound – albeit a modest one – with the S&P 500 rising +0.21%, however it still did close below the 2,800 level. Overnight, Binky Chadha published a timely note (available here ) estimating that the trade war has cost around $5 trillion in forgone equity gains, equal to 12-years’ worth of the bilateral trade deficit with China. Meanwhile the NASDAQ ended +0.27% while in Europe the STOXX 600 rose +0.42%. Volumes were however well below average across most markets, though markets did experience some late-session volatility after Vice President Pence said that the US can “more than double” tariffs on China if needed. As we highlighted yesterday, speculation also continued to swirl about a planned Pence speech next week which could be used to announce new sanctions on specific companies (per CNBC).Equities slipped into the red but ultimately closed higher, while bonds yields fell more persistently. Indeed 10y Treasuries rallied -4.9bps, though Bunds had already closed flat near their all-time lows at -0.177% before the rally. The US 2s10s was steady at 14.9bps while the 3m10y curve slid another -6.7bps to -15.9bps, its lowest level since May 2007. The VIX (-0.6pts) closed at 17.3, though high yield credit spreads in the US finished +3bps wider. HY spreads were flat in Europe.

Away from trade it’s worth noting that Italy could be a talking point again today with the government expected to respond to the EU’s request for an explanation of the violation of the debt rule for 2018. However, our economists have pointed out that there are more arguments for not opening a procedure right now. In particular they flag Italy’s deteriorating growth outlook, for which corrective measures could prove to be pro-cyclical. They also highlight different estimations of the output gap between Rome and Brussels, conciliatory steps adopted by Italy and the potential impact of the European election. Yesterday, Italian press reports – including from Il Messaggero and Il Corriere della Sera – claimed that Italy will argue that a corrective measure will be counterproductive and result in further growth deterioration. In any case, one to potentially watch. We should note that Italian assets underperformed yesterday with the FTSE MIB down -0.24% and 10y BTPs up +1.6bps in yield (compared to -4.3bps at the lows) following headlines suggesting that Deputy PM Salvini is ready to end the coalition government should he not get backing for his flat tax plan and other priority measures.

Elsewhere, though it didn’t end up moving markets, Fed Vice Chair Clarida’s comments yesterday did get some attention, since he was one of the key officials who initiated the pivot away from hikes earlier this year. He said that the economy is in a “very good place” and that the “current stance of policy remains appropriate.”He thinks policy should remain patient, which “means that we should allow the data on the US economy to flow in and inform our future decisions.” When asked about the yield curve’s recent flattening, Clarida seemed relatively sanguine, citing global and financial factors as the main drivers. He said that the curve is roughly flat right now, but that he would only be worried if it inverted more deeply and more persistently.

As for the data yesterday, where the second reading for Q1 PCE was revised down three-tenths to +1.0% qoq. So a fairly dovish print, however we should flag that the details did show that the revisions were mostly in financial services and insurance – a category that was already known to be weak in Q1 and is still expected to bounce back. Looking ahead, it’s worth noting that today we’ll get the April PCE reading which is expected to print at +0.2% mom for the core. Our US economists are forecasting a +0.3% reading which in their view would provide evidence that at least some of the recent weakness in the Fed’s preferred measure was likely transitory.

Meanwhile the second reading for Q1 GDP in the US was revised down to +3.1% qoq saar, marginally better than expected.However it didn’t go unnoticed that corporate profits were down -2.8% qoq, the second quarterly decline and biggest fall since Q4 2015. Elsewhere, claims printed at 215k, a small uptick on the week prior but more or less in line with expectations, while the April advance goods trade balance showed a deficit of $72.1bn compared to $71.9bn in March. Retail and wholesale inventories rose +0.5% mom and +0.7% mom respectively while April pending home sales fell -1.5% mom (vs. +0.5% expected).

To the day ahead now, which this morning kicks off in Germany where we’ll get April retail sales data, followed by the final Q1 GDP revisions in Italy, April money and credit aggregates data in the UK, and preliminary May CPI readings for Italy and Germany. In the US the big focus will be on that April PCE data, while personal spending and income data for April, the May Chicago PMI and final May revisions for the University of Michigan survey. Away from the data the Fed’s Visco is due to speak this morning while this afternoon the Fed’s Bostic is due to moderate a discussion on the global economy, while the Fed’s Williams speaks this evening on the topic of monetary policy theory and practice. Expect the fallout from the latest tariff announcement to be the big talking point however.

 

 

3. ASIAN AFFAIRS

I)FRIDAY MORNING/ THURSDAY NIGHT: 

SHANGHAI CLOSED DOWN 7.11 POINTS OR 0.24%  //Hang Sang CLOSED DOWN 213.79 POINTS OR 0.79%   /The Nikkei closed DOWN 341.34 POINTS OR 1.63%//Australia’s all ordinaires CLOSED UP 0.04%

/Chinese yuan (ONSHORE) closed DOWN  at 6.9097 /Oil DOWN TO 57,28 dollars per barrel for WTI and 68.41 for Brent. Stocks in Europe OPENED RED//  ONSHORE YUAN CLOSED DOWN // LAST AT 6.9097 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.9437 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY CLOSE TO 7:1//TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED  : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /TRADE DEAL NOW DEAD..TRUMP  RAISED RATES TO 25%

 

 

 

 

 

3 a NORTH KOREA/SOUTH KOREA

SOUTH KOREA

end

3 b JAPAN AFFAIRS

3 C CHINA/CHINESE AFFAIRS

The bond markets are correct:  the trade war is taking a huge bit out of China manufacturing as its PMI tumbles back into

contraction mode

(courtesy zerohedge)

Trade War Bites As China Manufacturing PMI Tumbles Back Into Contraction

China’s Official May Composite PMI printed modestly lower than April’s at 53.3, with Services at 54.3 (in line with last month and goal-seeked expectations), while Manufacturing (expected to decline into contraction at 49.9) was considerably worse than expected, printing 49.4.

This was below the lowest analyst estimate of 49.5, and close to the lowest level in about a decade.

Under the hood of the manufacturing data, Output growth slowed, New Orders tumbled into contraction (with export orders plunging), inventories rose, employment slipped, and input & output prices contracted. The most affected were Small Enterprises.

The Services data also showed weaker new orders and employment with selling prices slumping into contraction

The drop clearly reflects pressure on the production side of the economy from the escalating trade war (following some pre-tariff stocking-up).

None of this should be a big surprise as much of Asia’s flash PMIs were weak and after spiking on record credit injections in the early part of the year, China’s macro data has collapsed against renewed optimistic expectations…

Looks like we are “gonna need a bigger boat” of cash to keep this red ponzi afloat, which is a problem as the signal from China’s April credit data was also negative. The unexpectedly large fallback in credit raised fresh doubts about whether the economy has found a bottom.

end
Beijing has reportedly developed its plan for rare earth export ban
(courtesy zerohedge)

Beijing Has Reportedly Developed Plan For Rare-Earth Export Ban

Despite last night’s disappointing PMI print, the latest sign that the trade-war backlash is hurting the mainland economy (especially since the credit injections from earlier this year are fading into the distance), Beijing is apparently undeterred, and on Friday, it continued to ratchet up threats about invoking the “nuclear option” of curbing exports of rare earth metals to the US, a move that would cause significant disruptions to supply chains for everything from microchips to to fighter jets.

Beijing has reportedly prepared a plan to cut off exports of rare earths to the US, Bloomberg reports, though it didn’t offer any details about what this plan might entail.

Beijing has readied a plan to restrict exports of rare earths to the U.S. if needed, as both sides in the trade war dig in for a protracted dispute, according to people familiar with the matter.

The government has prepared the steps it will take to use its stranglehold on the critical minerals in a targeted way to hurt the U.S. economy, the people said. The measures would likely focus on heavy rare earths, a sub-group of the materials where the U.S. is particularly reliant on China. The plan can be implemented as soon as the government decides to go ahead, they said, without giving further details.

China produces 80% of the world’s rare earth metals – which, contrary to what their name might suggest, are actually more plentiful than precious metals like gold.

China

However, most rare earths imported by the US travel through intermediaries before arriving at US ports. Washington exempted the critical metals, which are used in a broad range of high-tech products, from tariffs.

One analyst cautioned that nothing is yet set in stone.

“Currently, it’s still just a possibility that China may ban or do some kind of restrictions,” Racket Hu, a researcher at Shanghai Metals Market, said in a Bloomberg TV interview. “But if it does happen, then we believe prices of rare earths will surge,” he said, citing what happened in 2010 when China curbed shipments to Japan.

Indeed, it appears traders are already starting to price in the export curbs, as the VanEck Vectors Rare Earth ETF has risen off its 2019 lows since Trump’s Huawei blacklisting elicited threats of retaliation from Beijing.

REMX

Though miners, including Australia’s Lynas, are scrambling to open new mines…

BBG

…the new capacity likely won’t be ready in time to prevent significant supply disruptions should Beijing make good on its threats.

end

4/EUROPEAN AFFAIRS

 

i) EUROPE

Countries are continuing to shun the USA , which is not good for USA hegemony

a very important commentary from Tom Luongo
(courtesy Tom Luongo)

In Today’s Politics, Messages Are Sent But Rarely Read

Authored by Tom Luongo,

This weekend’s European Parliamentary elections sent a lot of messages around the continent. The Eurosceptics gained while at the same time, their threat was met with a similar show of support for the European project.

The message was clear. The European Union isn’t working for many of the people in specific countries around Europe. From the U.K. to Hungary, Italy to Poland, there is a hardening of the dissatisfaction with the direction Brussels is going.

But is anyone there listening? No. They are all so committed to their planned future Europe and their smarmy version of cheap communism that all they can do is see the positives.

By gaming the outcomes through tying local elections to the European vote, for the first time in over 20 years voter turnout in Europhile countries was high enough to beat back the threat of the Eurosceptics and create the illusion of greater support than there actually is.

Winning through tilting the table is what Brussels does. The EU has been built, inch by inch, over the past 70+ years on lie after lie after lie. Vote after re-vote until they got the desired outcome.

When I call them cheap communists I mean it. Power is all they care about and the end, no matter what, justify the means. That the whole affair is covered in the thickest layer of smarm and virtue signaling makes it only that much more nauseating to watch.

The votes were barely counted when chief smarm-master himself, Donald Tusk, came out and told the world that Brexit was the vaccine for euroscepticism.

As if these election results, with inflated numbers for ALDE and the Greens, were a refutation of Eurosceptics; that the EU’s scare tactics in strong-arming the U.K. into submission actually worked.

But it didn’t. Brexit is more popular now than ever before. And no amount of spin will change that. The same thing goes for Hungary where Viktor Orban no longer needed a coalition to take 56% of the vote and 13 seats in parliament. His Fidesz party did that on their own.

The same goes for Italy. Matteo Salvini is on a roll, taking 34%.His Prime Minister Giuseppe Conti then cucks out asking what the agenda will be because he may not be able to support it.

Yet another example of the political casualties of Brussels’ scorched earth policy. Count him alongside Silvio Berlusconi, David Cameron, Theresa May, Francois Hollande, Alexis Tsipras in Greece and possibly Salvini’s coalition partner Luigi Di Maio who is calling for a confidence vote in his leadership of M5S.

At the same time, the markets are sending Donald Trump, the Federal Reserve and the rest of the monetary cranks the sternest message possible with inverting sovereign bond curves across developed markets.

The U.S. Yield Curve is collapsing into a complete joke as FOMC Chair Jerome “Deer in Headlights” Powell seems stunned by this turn of events. He can’t control Trump or the State or Treasury departments who are hellbent on isolating the U.S. on every front economically and diplomatically.

Bond auctions this week gave us the clearest picture of what’s going on. A blistering 2 year auction, followed by an unspectacular 5 year and a downright ugly 7 year.

Short duration is in higher demand than longer. Iceberg Dead Ahead.

So while the markets are screaming for a rate cut, Powell is worried that he’ll be blamed for blowing an equity bubble if he cuts rates. The dollar is busting out of its trading range while the euro and pound grind their way lower.

Trump looks willing to blow up the world economy in order to get his crappy Israeli/Palestinian ‘Deal of the Century’ passed. He’s been given warning after warning by everyone — Russia, China, Iran, Germany, the GCC nations — that this deal is a non-starter but he’s intent on getting it done so he can claim to have achieved something none of his predecessors have.

He’s unleashed the worst people in his administration to threaten and cajole the world into accepting their version of geopolitical reality. In his quest to make the world safe for Israel through forcing deals there and in North Korea, Trump is blackmailing the world with his reckless behavior.

We have military intelligence accusing Russia without evidence of violating the Comprehensive Test Ban Treaty. Presumably this is a preamble to John Bolton convincing Trump to ditch this agreement as well before it expires like the INF Treaty.

Meanwhile Fat Ass Mike Pompeo is threatening Europe with sanctions for using the EU’s flawed but available INSTEX vehicle for evading U.S. prohibitions on trading with Iran.

The message is clear, sell blue jeans to Iran and we’ll steal your money.

The time has come for Europe to decide if it is an independent actor or not. Is the EU ready to actually defend its members from the depredations of outside actors or does it just exist to leech off of them preferentially.

Because the message from Trump is clear. Everyone seems to want to just wait out Trump’s bullying in the vain hope it will end. But it won’t. Bullies don’t stop until they get their nose bloodied.

The only ones who have told Trump to go scratch at this point are Russia and Iran.

The Iranians refuse to talk to Trump because he’s an asshole and Putin won’t accept any unilateral demands made on him or his people, though he’ll take Trump’s phone calls. Putin just continues building relationships built on trust rather than tearing that trust down.

The Eurasian Economic Union (EAEU) held a summit in Nur-Sultan, Kazakhstan where Serbia and Tajikistan observed and the members hammered out details for free trade agreements with India, Egypt and Israel. Iran already has a free trade deal with the EAEU.

Next week the St. Petersburg International Economic Forum begins. The U.S. won’t be sending anyone over there. The same number we sent to China’s Belt and Road Forum last month. Meanwhile everyone else will be.

Putin will meet with Xi Jinping for the third time in four months while billions in deals settled without the U.S. dollar and therefore the purview of Trump’s threats will get done.

The message is clear. People are increasingly unwilling to buy what the West’s leadership is selling. In both Brussels and D.C., however, no one is listening.

Even if Trump isn’t down with where things are headed, even if he wants to do a deal with North Korea, climb down off the clock tower and put away the rifle he’s pointed at Iran his advisors won’t let him.

The bureaucracy around him refuses to implement his directives. Fingers stuck firmly in ears with agendas tucked under their arms whistling past their graveyards.

end
FRANCE
Journalist Ariane Chemin has been questioned by French police after she refused to reveal her sources for a report exposing alleged corruption in Macron’s inner circle.
(courtesy zerohedge)

Macron’s Security Service Threatens French Journalists With Prison And Fines

France has been turning up the heat on journalists who expose government wrongdoing, according to AFP.

The latest, Le Monde journalist Ariane Chemin, said was questioned by French security services for 45 minutes after she refused to reveal her sources for a report exposing alleged corruption and cronyism within President Emmanuel Macron’s inner circle.

“They asked me many questions on the manner in which I checked my information, which was an indirect way of asking me about my sources,” said Chemin – who wrote a series of articles on Macron’s former bodyguard Alexandre Benalla, who was fired after video emerged of Benalla roughing up a protester. The incident, and Chemin’s ongoing reporting, resulted in a spate of resignations by government officials.

A file photo of Le Monde journalist Ariane Chemin. Photo: Eric Feferberg / AFP

According to AFPLe Monde‘s managing director, Louis Dreyfus, was also questioned by the General Directorate for Internal Security (DGSI) on Wednesday. “Everything is done to make it intimidating,” Dreyfus wrote in an editorial describing his own DGSI interrogation.

“I explained that I never read the articles before they were published, and that I was not meant to do so. And they kept telling me that the offense was punishable by five years in prison and a fine of €75,000.

In total, the French secret service has summoned eight reporters who have published negative stories on the government, including French arms being sold to Saudi Arabia and the UAE used in Yemen’s civil war. Aside from Chemin, the others involved are Geoffrey LivolsiMathias Destal and Michel Despratx of the investigative news site Disclose; France Inter’s Benoît Collombat; and Valentine Oberti of the TV news show Quotidien along with a Quotidien cameraman and a Quotidien sound technician, according to Reporters Without Borders.

DGSI interrogated the Disclose journalists earlier this month – threatening them with five-year prison sentences under a 2009 law prohibiting “attacks on national defense secrets” over the publication of a classified document suggesting that the French government was willingly violating a 2014 arms treaty.

“We fear that the authorities are using these summonses in an attempt to intimidate the journalists and their news organizations and to identify their sources so as to punish them or deter them,” said RSH secretary-general Christophe Deloire.

“Investigative journalism is now in danger in France because it is under attack and, in particular, it is threatened with legal proceedings. If the confidentiality of journalists’ sources is not guaranteed in a country, if it is undermined by such actions as these, its citizens will be deprived of their right to non-official information. We call on the government to explain the domestic intelligence agency’s apparent attempts to intimidate the media.”

In response to the investigations, the SNJ-CGT union called for a demonstration outside of the DGSI headquarters Wednesday “in support of those journalists summoned by the French state in violation of the law on press freedom.”

Not a threat?

French Justice Minister Nicole Belloubet told the French Senate on Wednesday that the summons should “in no way be seen as an attempt at intimidation or a threat,” and that the summons of Chemin was simply part of a preliminary inquiry following a complaint by a special forces member whose identity was revealed by the paper.

Senior journalists from 37 French media outlets, including Agence France-Presse, Le Figaro daily, France 2 TV and Mediapart, signed a statement supporting the journalists who were questioned over the Yemen controversy, saying they were “just doing their jobs”. –AFP

Disclose, meanwhile, has pressed ahead with its Yemen reporting, claiming that a shipment of munitions for French Caesar cannons would be loaded onto a Saudi ship through a Mediterranean port.

Last year, France passed a law allowing the government to shut down any news agency for four months before an election if it could be deemed “under foreign influence.”

END
ITALY
Interesting developments this morning from Italy:
1. The 5 star party will now back Salvini’s plan for a flat tax which will save his citizens huge amounts of money
2.  They deny that they wish a “parallel currency”
3.  The Bank of Italy warned this morning that Italy’s public debt is very high at 2.3 trillion euros and they must pare it to stay solvent.
(zerohedge)

Five Star Capitulates, Will Back Salvini’s Tax-Cut Plan As Rome Denies “Parallel Currency”

Like we said earlier this week (and several times in the not-too-distant past), anyone who didn’t anticipate the latest selloff in BTPs and position accordingly has only themselves to blame.

 

Italian yields continue to climb on Friday, with the two-year yield on track for its biggest one-day rise in two months, after the Bank of Italy warned that Italy’s public debt could rise more than anticipated in 2019, the latest in a string of warnings by Italian and European institutions that the budget-deficit projections that formed the basis of last year’s truce between the Italian populists and the European Commission were wildly off the mark.

The Bank of Italy warned on Friday that public debt could rise more than forecastby the government in relation to domestic output this year, and called for measures to cut Rome’s 2.3 trillion euro ($2.6 trillion) debt pile. (Reporting by Virginia Furness; Editing by Dhara Ranasinghe)

The Treasury denied that it planned to issue the mini T-bills to help repay public administration suppliers and creditors, according to a statement.

BTPs also suffered from President Trump’s decision to slap tariffs on imports from Mexico, which hurt risk sentiment more broadly, Reutersreports.

Italy’s two-year government bond yield jumped 16.5 basis points to 0.813%, its highest level in two weeks.

But yields trimmed their gains after the Italian Treasury announced that it has no plans to issue so-called “mini BOTs” – debt securities that some have warned would be tantamount to a “parallel currency”, taking Italy one step closer to abandoning the euro. The notion was revived by Telegraph Business Editor Ambrose Evans Pritchard in a column on Thursday.

Meanwhile, Italy’s 10-year spread over Germany also hit its widest point since December at 293 basis points, before it also retraced some if its climb.

In another major development, an anonymous source purporting to speak for the Five Star Movement, one of the two parties in Italy’s ruling populist coalition, told Reuters that the party will back League leader Matteo Salvini’s plan to implement a “flat tax”, which would cut taxes for millions of Italians. The tax cuts would be financed with a higher deficit. Yesterday, Salvini threatened to collapse the governing coalition if Five Star didn’t go along with his plans.

The League’s proposal to finance the flat-tax via a higher deficit finds us in agreement,” the source said.

“Even more so if, as we are hearing, (Economy Minister Giovanni) Tria shares this idea: we welcome a regime with an income tax rate of 15 percent for people earning up to 65,000 euros (a year).”

The decision will further embolden Salvini just days after the League won a sweeping plurality of votes in the EU Parliamentary elections – which Salvini described as a popular mandate to pursue his agenda. To try and contain the ascendant populists, we imagine the ECB, other European institutions, and internationalist bond vigilantees will try to punish the Italians by jacking up borrowing costs – and the possibility that BTP yields will return to their highs from late last year, when the Italians were embroiled in a game of chicken with Brussels over Italy’s proposed 2019 budget, is starting to look more like an inevitability.

end
Late this morning:  right on cue..Italy says what the EU wants to hear..but do they mean it?
It worked temporarily as it knocked the yield on the 10 yr Italian bond down
(courtesy zero hedge)

Italy Folds? Bond Yields Tumble As Govt Promises EU To Cut Welfare Costs

Euro is rallying against the dollar and BTP yields are tumbling after the Italian government has responded to EU concerns (threats of fines) about the southern European nation’s surging debtload.

In what appears like a “say whatever they want to hear” statement, Italian officials promised that the country is planning to reduce the cost of new welfare measures for income support (“citizens income”) and earlier retirement age in 2020-2022, Italian news agency Adnkronos reports.

Additionally, Italy will reportedly tell the EU that its structural deficit can improve without a rise in VAT:

The government is “launching a new spending review and we believe that it will be possible to reduce spending projections for new welfare policies,” news wire cites the letter as saying.

And sure enough, the market is buying it…

Italy told the EU that it expects a drop in bonds yields, lowering borrowing costs as a consequence:

“We are convinced that once the budget program will be finalized in agreement with the European Commission, yields on Italian government bonds will decrease and interest expenditure projections will be revised downwards”

And as can be seen – whether or not Treasury is buying again – that is happening right on cue.

end

5.RUSSIAN AND MIDDLE EASTERN AFFAIRS

Iraq

An explosion rips through the oil city of Kirkuk in the Kurdistan region of Iraq

(courtesy zerohedge)

Six Explosions Rip Through Iraq’s Oil City Of Kirkuk In Terror Attack

A series of explosions have rocked the oil-rich northern Iraq city of Kirkuk, which lies 150 miles north of Baghdad in a disputed region which Iraqi Kurdistan leaders have jostled with the national government for control over.

On Thursday evening half a dozen or more explosions ripped across a central avenue, leaving at least five people dead and a dozen or more wounded, according to unconfirmed early conflicting reports. Some reports have cited as many as six or more among the dead what may have numbered eight total explosions.

Dramatic footage captured the moment of one of the bombs being detonated on a busy street during the heart of the evening in an area known as a popular commercial hub filled with cafes and malls.

Baxtiyar Goran

@BaxtiyarGoran

The moment of one of the explosions in Quds street in .
At least 6 killed 12 wounded. pic.twitter.com/4n2psyxLtj

Embedded video

According to regional Kurdistan 24 media:

According to initial reports, five explosions were heard in the center of the province near the Peace Mall on Jerusalem Street. A source in the area told Kurdistan 24 the incident left many killed and injured.

Other reports said at least seven blasts targeted various areas inside the city, including Jerusalem Street and Baghdad Road.

The attack is believed to have involved improvised explosive devices (IEDs) and possibly car bombs in what was clearly a terror attack on the ethnically diverse northern Iraqi city.

There have been early reports that suicide bombers may have been involved. No group has claimed responsibility, however, the city has seen a remnant ISIS insurgency wreak havoc on the area of late, for which Kurdish Peshmerga forces have reportedly been deployed to root out.

Regional gulf media outlet Al-Arabiya reports the death toll may be rising as hospitals take in more casualties:

At least five people were killed and 18 injured in the blasts, sources in the Kirkuk general hospital said.

The statement from the military said the Iraqi security forces defused two of the explosive devices in the city.

KirkukNow@Kirkuknow_DT

has been hit by a fresh wave of attacks, reporters said. pic.twitter.com/hppd8Sh67x

View image on Twitter
See KirkukNow’s other Tweets

Kirkuk has historically and in recent years been disputed by Erbil and its regional ‘Kurdistan’ government and Baghdad.

Over the past month the whole region has been on edge with the United States’ saber-rattling over Iran and its proxies in Iraq – the Shia popular mobilization units nominally under Baghdad’s control.

end

IRAN

Bolton backs off the Iran escalation.

(courtesy zerohedge)

Bolton Finally Backs Off Iran Escalation: It’s “Not Over” But US “Deterred” Threat

In perhaps the best sign thus far that a potential US war with Iran has been averted (at least for the near term), given the possibility that both heightened saber-rattling and the potential for an “accidental” deadly encounter between IRGC forces and the recent build-up of American deployments could have led to a major conflict, White House National Security Adviser John Bolton himself appears to now be fast climbing down the escalation ladder.

According to Reuters on Thursday Bolton is singing a different tune compared to the war rhetoric of the past weeks since the crisis began“The threat from Iran is not over but quick action from the United States has helped deter it.” This echoes a prior Pentagon statement essentially saying the “clear” Iran threat intelligence against US forces was accurate but that the US carrier and other extra force deployments to the Persian Gulf region thwarted Iran’s intentions.

“I don’t think this threat is over, but I do think you can make at least a conditional claim that the quick response and the deployment and other steps that we took did serve as a deterrent,” Bolton told reporters during a visit to London on Thursday.

 

Image source: The New York Times

When pressed over whether he was at odds with President Trump who has repeatedly stated the US is not looking for regime change in Tehran, Bolton responded:

“The policy we’re pursuing is not a policy of regime change. That’s the fact and everybody should understand it that way.”

Bolton even seemed to have backed away from prior statements of defense officials which accused Iran’s leaders of having “ordered” attacks on oil tankers near the Strait of Hormuz as well as a Saudi oil pipeline in the past weeks.

Late last week an official Pentagon statement said “the leadership of Iran at the highest level” ordered a spate of disruptive attacks.

But now Bolton seems have have introduced more ambiguity, identifying Iran’s “surrogates” – and stopping short of prior direct and more aggressive “top leadership” accusations – as possibly behind the attacks. Per Reuters:

Bolton said there was some prospect that evidence Iran was behind attacks this month on oil tankers in the Gulf would be presented to the United Nations Security Council next week.

“I don’t think anybody who is familiar with the situation in the region, whether they have examined the evidence or not, has come to any conclusion other than that these attacks were carried out by Iran or their surrogates,” he said.

Over the past week, following Trump’s extended hand for Iran’s leaders to “call me,” we’ve seen a consistent deescalation following weeks of dangerous escalation, including threats and counter-threats of military action by both sides.

Iranian President Hassan Rouhani reportedly said this week that the “road is not closed” on talks with the US if Washington drops the sanctions and returns to upholding the 2015 nuclear deal (JCPOA) – something not at all likely to happen.

end

RUSSIA/TURKEY

Russia has figured out Turkey.  Turkey wanted a ceasefire in Idlib province because iSIS folks over there are Turkey’s friends. Now Russia has rejected Turkey;s overtures

due to the many failed promises in the past.  Turkey only wants to annihilate the Kurds in the Northern part of Syria.

(courtesy AlmasdairNews)

Russian Jets Unleash Hell On Idlib After Ceasefire Talks With Turkey Collapse

Via AlmasdarNews.com,

On Thursday over five Russian fighter jets began launching airstrikes over the Idlib Governorate following the collapse of ceasefire talks with Turkey.

According to a military source in northwestern Syria, the ceasefire talks collapsed after Turkey demanded that the Syrian Arab Army (SAA) withdraw from all the areas they captured in northwestern Hama.

The Russian military reportedly rejected Turkey’s demands and restarted their aerial campaign over the Idlib province.

 

Russian warplanes pounded al-Qaeda held Idlib on Thursday, file photo.

The Syrian Air Force had already launched airstrikes over the Idlib Governorate on Thursday, but the Russian military had only carried out limited attacks due to their ceasefire talks with Turkey.

The source added that the Syrian Army has yet to receive the green light to resume their ground offensive against the jihadist forces in northwestern Hama.

The Turkish regime had been pushing for a new ceasefire deal around the Idlib deescalation zone after their rebel allies lost a great deal of territory in northwestern Hama.

Speaking to Al-Masdar from Damascus, a Syrian Arab Army (SAA) officer said that Ankara is pushing Moscow for an open-ended ceasefire in northwestern Syria.

The officer said Turkey wants to prevent any more Syrian Army advances in northwestern Syria, while also demanding that the latter withdraw from the areas they recently captured.

Ben Norton

@BenjaminNorton

Syria is trying to retake its province Idlib—which is controlled by rebranded al-Qaeda—with help from Russia & Iran.

So the US gave the “greenlight” to NATO member Turkey to send more weapons, including anti-tank TOW missiles, to AQ-allied “rebel” proxieshttps://uk.reuters.com/article/uk-syria-security-idlib/turkey-sends-weapons-to-syrian-rebels-facing-russian-backed-assault-syrian-sources-idUKKCN1SV0FM 

Turkey sends weapons to Syrian rebels facing Russian-backed assault…

Turkey has equipped an array of mainstream Syrian rebels it backs with fresh supplies of weaponry to help them try to repel a major Russian-backed assault, senior opposition officials and rebel.

He added that Russia is resisting Turkey’s pleas because they have made similar requests in the past and they have repeatedly failed to deliver on their promises.

Turkey was supposed to force the rebel groups to withdraw from the demilitarized zone last October; however, the militant groups remained inside this region, prompting the Syrian military to increase their presence along the front-lines.

As of now, the Syrian Army has halted its offensive in northwestern Syria, but this could change in the coming days if Russia and Turkey cannot reach an agreement.

end

SYRIA/SYRIAN DEMOCRATIC FORCES/USA
You need to keep a score card to see who are the players and on which side they are on.
Today a USA coalition of USA and SDF raided transport boats on the Euphrates River starving Assad of badly needed oil
(courtesy zero hedge)

US Coalition Attacks Syrian Oil Transport Boats On Euphrates River

In a huge development out of eastern Syria, where US-backed Syrian Democratic Forces (SDF) share tense front lines with pro-Assad forces on the other side, the American coalition has reportedly attacked at least two Syrian government boats that were transporting oil across the Euphrates River to the government side.

The news broke via the Beirut-based Middle East News site Al-Masdar which is well-known for often being the first to report Syria news, given its rare sources in the Syrian military. According to the Al-Masdar report:

According to reports from the Deir Ezzor Governorate, the U.S. Coalition and the SDF both targeted the Syrian government boats with heavy machine gun fire in front of the town of Al-Shuhayl.

Pro-SDF accounts later released photos showing smoke rising from one of the ferries that were targeted by their machine gun fire.

 

Image via Al-Masdar News

Kurdish media and SDF accounts, along with a number of Middle East analysts also confirmed the incident, which is reportedly the second such attack on government oil supplies in under a month.

Washington has imposed a complete oil and fuel embargo on Syria, which Damascus’ close ally Iran has recently sought to circumvent.

Joshua Landis

@joshua_landis

US-led coalition blows up 3 oil tankers in eastern Syria & kills 4 as tankers carrying oil from PKK-besieged Deir ez-Zor to Syrian regime come under attack. US gets serious about stopping commerce among Syrians. https://www.yenisafak.com/en/world/us-led-coalition-strikes-oil-tankers-in-eastern-syria-3482392 

US-led coalition strikes oil tankers in eastern Syria

Tankers carrying oil from PKK-besieged Deir ez-Zor to Syrian regime comes under attack

yenisafak.com

34 people are talking about this

Turkish media also confirmed the attack, which according to early reports left four dead. According to the Turkish daily Yeni Safak:

In the early hours of Friday, the coalition forces raided on the area where an oil trade had been carried out between the PKK/YPG and the Syrian regime in the eastern outskirts of Deir ez-Zor with Hummer brand vehicles, according to the local sources who spoke anonymously due to fears of safety.

The coalition planes hit three of the tankers. The attack left four people dead and smoke was seen rising from the area.

The coalition is yet to issue a statement on the attack.

Though US-backed forces maintain control of eastern Syria’s largest oil and gas fields, such as al-Omar, the country’s largest oil field, located in the Deir Ezzor region, it’s long been suspected that Syrian Kurdish groups have cut secret deals with the Assad government to purchase and transfer supplies to the fuel-starved government side of the Euphrates.

Apparently this is what the US is attempting to disrupt amid a broader campaign to economically starve the Assad government and further prevent its army from operating effectively.

View image on TwitterView image on Twitter

Qalaat Al Mudiq@QalaatAlMudiq

E. : today boat bringing oil from -held areas was destroyed in outskirts of (S. ). Cause unknown. http://wikimapia.org/#lang=en&lat=35.081146&lon=40.425911&z=12&m 

Regional reports have noted that in past weeks the fuel crisis in Syria which had created miles-long lines at gas pumps across major cities found some relief due to a covert Iranian shipment of oil that arrived in the port city of Baniyas in early May.

Meanwhile, the WSJ reported previously that Iranian oil had been routinely delivered to Syria throughout most of the war, but now “U.S. sanctions have cut off Iranian oil shipments to Syria, taking an unprecedented toll on a flow of crude that had persisted in the face of long-term international restrictions and helped sustain the Assad regime through years of civil war.”

Ironically, since ISIS took temporary hold over broad swathes of eastern Syrian territory starting in 2014 and 2015, leaders in Damascus and Moscow had accused both the United States and Turkey of looking the other way while ISIS financed its expansion through the sale of stolen Syrian oil.

And once US-supported Syrian Kurdish militias wrested control of those vital oil and gas fields in Syria’s Deir Ezzor province, it never gave them back to Damascus.

The White House still fundamentally prioritizes weakening Syria as crucial in its ultimate long-term goal of regime change in Tehran. This also as Russian and Syrian warplanes are ratcheting up strikes on al-Qaeda held Idlib, which has received US condemnation.

6.GLOBAL ISSUES

This is the reason for stock markets around the world collapsing:  Trump unleashes tariffs on Mexico for allowing illegal immigration through its borders.  He has initiated firstly a 5% rate and that will increase until they get their act together.

(courtesy zerohedge)

“This Is A Black Swan Event”: Futures, Peso Tumble As Trump Unleashes Tariffs On Mexico “Until Illegal Immigration Stops”

Update 2some borderline apocalyptic observations from Bloomberg markets live managing editor, Mark Cudmore who writes the following:

This Mexico tariff news is far worse than even the initial market reaction makes it out to be. The timing is almost immediate. Chaos for both companies and bureaucrats. No time for anyone to prepare or make contingencies. The only way the S&P 500 doesn’t sink massively today is if Trump rows back on this. The U.S. imported almost $350b worth of goods from Mexico in 2018.

What makes it even worse again, if possible, is that so many traders were hoping Trump would soon take a more conciliatory trade zone because U.S. stocks have weakened.

This is a black swan event for markets and people aren’t even registering. Maybe traders are all hoping there’s some mistake or that this won’t be implemented.

* * *

Update 1: it’s going from bad to worse, with the White House warning that it will hike Mexico tariffs to 25% by October 1, if the border crisis persists, as Trump is activating a scorched earth approach whereby he will “punish” any offshore nation that he believes is transgressing, by imposing tariffs.

Meanwhile, moments after Trump’s shock tweet, the Mexican deputy foreign minister Seade said that if President’s threat to impose tariffs is carried out, “it would be disastrous”, and Mexico would “respond strongly”, adding that “we will not remain with out arms folded” before the tariff deadline “to see if it is serious.”

* * *

Following an earlier leaked story from the Wall Street Journal, President Trump has confirmed that he will impose tariffs on Mexico until the illegal immigration problems at the southern US border are fixed.

Amid negotations and escalations in the process of moving USMCA through Congress, Trump has decided to go after one on America’s closest trade partners: On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. The Tariff will gradually increase until the Illegal Immigration problem is remedied, at which time the Tariffs will be removed. Details from the White House to follow.”

Donald J. Trump

@realDonaldTrump

On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. The Tariff will gradually increase until the Illegal Immigration problem is remedied,..

Donald J. Trump

@realDonaldTrump

On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. The Tariff will gradually increase until the Illegal Immigration problem is remedied,..

Donald J. Trump

@realDonaldTrump

….at which time the Tariffs will be removed. Details from the White House to follow.

The reaction in markets was swift. Futures slumped…

And the peso plunged…

So it appears ‘Tariff Man’ is true to his word – imposing arbitrary tariffs on anyone and everyone until he gets what he wants to Make America Great Again.

end

seems Mnuchin and Lighthizer reportedly opposed trump’s Mexico tariffs because they felt it would hinder their New NAFTA no2 dea

(courtesy zerohedge)

Mnuchin, Lighthizer Reportedly Opposed Trump’s Mexico Tariffs

Update: That didn’t take long…

Robert Lighthizer – perhaps having seen the latest headlines about what happened to a senior North Korean envoy who got out of line – has issued a statement denying the contents of the WSJ story.

  • LIGHTHIZER’S OFFICE DENIES REPORT CHINA TARIFFS ON HOLD: CNBC

* * *

This shouldn’t surprise anybody who possesses even a glancing familiarity with the policy-making dynamics in the West Wing, but WSJ and CNBC are reporting that Robert Lighthizer and Steve Mnuchin opposed President Trump’s plan to slap new punitive tariffs on Mexico over its failure to curb the flow of illegal immigrants.

It’s yet another example of Trump overruling senior administration officials on policy issues.

Mnuchin

The senior administration officials feared the tariffs could jeopardize USMCA, the ‘Nafta 2.0’ trade deal that the administration negotiated with Mexico and Canada. But in the end, Trump’s frustration with the border crisis won out.

According to WSJ, Trump’s frustration with the border situation led to the tariffs (though we could have told you that). Since Mexico responded when Trump threatened 25% tariffs and a possible border closure, he felt like giving it another try might produce a similar result.

In recent days the president lost his patience, according to one of the people who spoke about Mr. Lighthizer’s concerns and a senior administration official. He had listened to his advisers for months, who told him not to take action against President Andrés Manuel López Obrador’s new administration while it was forming its government, they said.

“He got tired of waiting for the new government to settle in,” one of the people familiar with the situation said.

“The last time he did tariffs on Mexico, Mexico responded, so he wanted to try again in the context of border security,” the senior administration official said.

There was a meeting with the president’s trade team on Wednesday and again on Thursday, when the president phoned in from Air Force One, according to one of the people.

“In both meetings, the president made very clear that he wants to do this,” one of the people said.

But Trump did find one ally among his top aides who fully supported the plan: Steve Miller,who has been quietly consolidating control over the administration’s immigration policy, according to CNBC. Furthermore, with Mike Pence in Canada and Larry Kudlow undergoing surgery,two potential moderating voices were effectively absent when the decisions were made. And, judging by his interview with CNBC earlier today, Peter Navarro appears to also have supported the policy.

With that in mind, the motivation behind this latest ‘leak’ is pretty transparent: It looks like an effort by Lighthizer’s camp to salvage his ‘working relationship’ with Pelosi. “Lighthizer is not happy,” one of CNBC’s sources said.

Meanwhile, WSJ stressed that Lighthizer was responsible for successfully softening Democratic resistance to USMCA.

U.S. officials, including Mr.  Lighthizer, have stressed to Congress the importance of enacting USMCA, meant to replace the North American Free Trade Agreement, in part to show other trading partners that high-pressure talks with Mr. Trump can lead to a win for all sides.

One of the officials noted that Mr. Lighthizer has a particularly good working relationship with House Speaker Nancy Pelosi, and behind closed doors, he has managed to leverage that relationship to make progress in advancing the USMCA through Congress. Some in the administration now fear that the president’s latest move may derail any progress Mr. Lighthizer has made, the people familiar with the situation said.

Goldman said in a note published Friday that it still expects USMCA to pass eventually, but if Trump follows through with the tariffs, furious Democrats might force the administration to put USMCA on the shelf until after the 2020 vote.

end

Goldman Sachs is

Trump’s Mexico Tariffs Have Killed ‘Nafta 2.0’ – For Now, Goldman Says

Vice President Mike Pence may have assured Canadian Prime Minister Justin Trudeau that the Trump administration was “absolutely committed” to passing USMCA this summer, but that was before Robert Lighthizer infuriated Democrats by starting the clock on bringing legislation to ratify the treaty before Congress – and also before President Trump revealed his plans to impose tariffs on Mexican imports.

Avocado

Millennials better stock up on their avocados before June 10.

The chances of USMCA passing were already looking tenuous, as Democrats have appeared reluctant to work with President Trump to facilitate what would be his biggest trade triumph to date. But now that Trump has angered Mexico and Democrats with the new tariffs, chances of USMCA passing have fallen from ‘low’ to ‘nearly zero’, according to a team of analysts at Goldman Sachs.

In a note to clients published on Friday, Goldman explained that it believes Trump will move ahead with 5% tariffs on Mexican imports on June 10 – at least that’s the bank’s base case, even as its analysts concede that Trump never followed through on threats to close the southern border.

And, assuming the tariffs do take effect, Democrats in the House will likely slow consideration of USMCA – likely missing the 90-day window for consideration triggered by Lighthizer on Thursday – and greatly increasing the chances that the deal won’t be ratified until after the 2020 election (thought Goldman still believes ratification is likely in the long run, given the support from the business community).

Read Goldman’s full note below:

* * *

BOTTOM LINE: President Trump has announced the intent to levy a 5% tariff on all imports from Mexico effective June 10, rising by 5pp July 1 and every month thereafter until it reaches 25%. The President states he will remove the tariffs when Mexico “substantially stops the illegal inflow of aliens coming through its territory.” The White House yesterday (May 30) also submitted draft USMCA text to Congress; Canada and Mexico also just took steps to begin legislative consideration of their implementing legislation. We view this as an attempt to show action on the immigration issue while also pressuring congressional Democrats to pass USMCA. While still possible, enactment of USMCA prior to the 2020 election would no longer be our base case if these tariffs are implemented as proposed.

MAIN POINTS:

1. President Trump has announced the intent to levy a 5% tariff on all goods entering the US from Mexico effective June 10. The tariff would increase by 5pp on July 1 and every month thereafter until the President determines that Mexico “substantially stops the illegal inflow of aliens coming through its territory.” Given the specific and near-term implementation date the President cites, we believe at least the first tariff at 5% is likely to be implemented as stated. That said, we note that another of the President’s proposed immigration actions – closing the US-Mexico border – was also threatened but never implemented. The odds of this tariff are at least somewhat higher, we believe; while the tariff would be highly disruptive, it would be less so than full closing of the border would have been, and also has been proposed in a more specific way.

2. This action is also linked to congressional consideration of USMCA, in our view. While there had long been a possibility that the President would announce the intent to withdraw from NAFTA as a means of pressuring Congress to pass USMCA—and it is still possible he could do this—the proposed tariffs might also be intended to put pressure on Congress to pass USMCA. The White House sent draft text to Congress yesterday (May 30) to trigger the first procedural step for consideration. However, it is extremely unlikely that Congress would take any action on USMCA prior to June 10. Congress must wait 30 days to introduce the formal legislation, and would likely need at least a few more weeks to pass it (the Trade Promotion Authority (TPA) process limits consideration to 90 legislative days).

3. If the tariffs take effect, we believe this would make USMCA ratification less likely to occur prior to the 2020 election. We have believed that House Democratic leaders would be inclined to eventually allow USMCA passage – primarily with Republican votes but a substantial number of Democrats – because of substantial support from the business community and because the TPA process requires the House to vote on the measure, so simply declining to address the matter is not an option. However, if these tariffs take effect, we expect Democratic leaders to slow USMCA consideration, which would lower the odds of enactment this year and, we believe, prior to the 2020 election since enactment in an election year is likely to be difficult. Moreover, we expect that Mexico will slow its ratification process if tariffs are in place.

4. The US imported $352bn in goods from Mexico in 2018, and exported $265bn. At a 5% tariff rate, this would generate roughly $18bn in tariff revenue annually, well under the $62bn that the 25% tariffs already in place on $250bn in imports from China will raise at an annual rate. The largest categories of imports from Mexico are autos and auto parts ($93bn), computers ($27bn), routers ($10bn), and other electronics ($17bn), and other categories shown below in Exhibit 1. Some products from Mexico account for a substantial share of imports in that category, such as air conditioners (44%) and TVs (35%). If tariffs on imports from Mexico as well as tariffs on List 4 imports from China are imposed, then a significant majority of US imports of some products would be subject to additional tariffs, such as computers and equipment (79%), TVs (84%), personal electronics (79%), and others.

* * *

And for reference, here’s a breakdown of what the US imports from Mexico (it’s unclear which line encompasses the avocado trade, but in 2017, the US imported $2.6 billion of avocados from Mexico).

Goldman

end

7  OIL ISSUES

 

8. EMERGING MARKETS

VENEZUELA/

Another good look at Venezuela where the cost of bullets are too expensive even for the criminals.  Nothing pays in Venezuela, even crime

(courtesy Mac Slavo)

Nothing Pays In Venezuela Anymore, Not Even Crime: There’s Nothing Left To Steal

Authored by Mac Slavo via SHTFplan.com,

Socialism in Venezuela has destroyed so much of the country’s economic well being that even criminals are having a hard time making ends meet.  Bullets and weapons have become too expensive for even the most violent out there, plus, there’s just nothing left to steal.

Bullets are expensive at $1 each for the distressed Venezuelan criminal. And with less cash circulating on the street, gang members say robberies just don’t pay like they used to. Imagine that.

According to the Associated Press, criminals are even having a hard time in the nation ripped apart by socialism.  Not even breaking the law is helping anymore because most people have nothing left to steal.

“If you empty your clip, you’re shooting off $15,” said El Negrito a “feared street gangster” who spoke to The Associated Press on the condition that he is identified only by his street name and photographed wearing a hoodie and face mask to avoid attracting unwelcome attention. “You lose your pistol or the police take it and you’re throwing away $800.”

After the initial exponential rise in violent crime in the immediate aftermath of socialism’s failure, the crime rate is falling rapidly. Nothing pays anymore in Venezuela, including crime. “These days, nobody is doing well — not honest citizens who produce wealth or the criminals who prey on them,” said El Negrito.

Officials of President Nicolás Maduro’s socialist administration have drawn criticism for not releasing robust crime statistics, but the government on Tuesday gave the AP figures showing a 39 percent drop in homicides over the same three-year period, with 10,598 killings in 2018. The Associated Press

20 years of the socialist revolution launched by the late President Hugo Chávez, who expropriated once-thriving businesses that today produce a fraction of their potential under government management, have caused massive erosion in the way of life in Venezuela.

While assaults are down, other crimes have risen. Reports of theft and pilfering of everything from copper telephone wires to livestock are surging as people seek a way to provide food for themselves. Meanwhile, drug trafficking and illegal gold mining have become default activities for organized crime, or others just looking to survive. Even with the drop in assaults and murder, Venezuela remains a very violent country.

“Venezuela remains one of the most violent countries in the world,” said Dorothy Kronick, who teaches political science at the University of Pennsylvania and has carried out extensive research in Caracas’ slums. “It has wartime levels of violence — but no war.”

When someone looks out at the world and sees all manner of suffering and injustice, stretching back for thousands of years and continuing today, he invariably blames such problems on someone else’s hatred, greed, or stupidity. Rarely will someone consider the possibility that his own belief system is the cause of the pain and suffering he sees around him. But in most cases, it is. The root cause of most of society’s ills–the main source of man’s inhumanity to man–is neither malice nor negligence, but a mere superstition–an unquestioned assumption which has been accepted on faith by nearly everyone, of all ages, races, religions, education and income levels. –The Most Dangerous Superstition, book description

end

Your early morning currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings FRIDAY morning 7:00 AM….

Euro/USA 1.1149 UP .0002 REACTING TO MERKEL’S FAILED COALITION/ REACTING TO +GERMAN ELECTION WHERE ALT RIGHT PARTY ENTERS THE BUNDESTAG/ huge Deutsche bank problems ///ITALIAN CHAOS /AND NOW ECB TAPERING BOND PURCHASES/JAPAN TAPERING BOND PURCHASES /USA RISING INTEREST RATES /FLOODING/EUROPE BOURSES /GREEN

 

 

USA/JAPAN YEN 108.72 DOWN 0.615 (Abe’s new negative interest rate (NIRP), a total DISASTER/NOW TARGETS INTEREST RATE AT .11% AS IT WILL BUY UNLIMITED BONDS TO GETS TO THAT LEVEL…

GBP/USA 1.2593   DOWN   0.00013  (Brexit March 29/ 2019/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED/BREXIT EXTENDED TO OCT 31/2019//

USA/CAN 1.3561 UP.0029 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  FRIDAY morning in Europe, the Euro ROSE BY 20 basis points, trading now ABOVE the important 1.08 level RISING to 1.1149 Last night Shanghai COMPOSITE CLOSED DOWN 7.11 POINTS OR 0.24% 

 

 

 

 

 

//Hang Sang CLOSED DOWN 213.79 POINTS OR 0.79% 

 

 

 

 

/AUSTRALIA CLOSED UP 0.04%// EUROPEAN BOURSES ALL RED

 

 

 

 

 

 

The NIKKEI: this FRIDAY morning CLOSED DOWN 341.34 POINTS OR 1.63% 

 

 

 

 

 

 

 

 

Trading from Europe and Asia

EUROPEAN BOURSES ALL RED

 

 

 

 

2/ CHINESE BOURSES / :Hang Sang CLOSED DOWN 213.79 POINTS OR 0.79%

 

 

 

 

 

 

/SHANGHAI CLOSED DOWN 7.11 POINTS OR 0.24% 

 

 

 

 

 

 

 

 

 

Australia BOURSE CLOSED UP 0.04% 

 

 

Nikkei (Japan) CLOSED DOWN 6341.34  POINTS OR 1.63%

 

 

 

 

 

 

 

 

 

 

 

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1297.50

silver:$14.52

Early FRIDAY morning USA 10 year bond yield: 2.15% !!! DOWN 7 IN POINTS from YESTERDAY’S night in basis points and it is trading WELL ABOVE resistance at 2.27-2.32%.

 

The 30 yr bond yield 2.60 DOWN 5  IN BASIS POINTS from THURSDAY night.

USA dollar index early FRIDAY morning: 98.00 DOWN 14 CENT(S) from  THURSDAY’s close.

This ends early morning numbers FRIDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

And now your closing FRIDAY NUMBERS \12: 00 PM

Portuguese 10 year bond yield: 0.81%  DOWN 5 in basis point(s) yield from YESTERDAY/

JAPANESE BOND YIELD: -.09%  DOWN 1   BASIS POINTS from YESTERDAY/JAPAN losing control of its yield curve/

 

SPANISH 10 YR BOND YIELD: 0.72% DOWN 4   IN basis point yield from YESTERDAY

ITALIAN 10 YR BOND YIELD: 2.67 UP 1  POINTS in basis point yield from YESTERDAY/

 

 

the Italian 10 yr bond yield is trading 195 points HIGHER than Spain.

GERMAN 10 YR BOND YIELD: FALLS –.20%   IN BASIS POINTS ON THE DAY//

THE IMPORTANT SPREAD BETWEEN ITALIAN 10 YR BOND AND GERMAN 10 YEAR BOND IS 2.87% AND NOW ABOVE THE  THE 3.00% LEVEL WHICH WILL IMPLODE THE ENTIRE ITALIAN BANKING SYSTEM. AT 4% SPREAD THERE WILL BE A HUGE BANK RUN…

 

END

IMPORTANT CURRENCY CLOSES FOR FRIDAY

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

Euro/USA 1.1159  DOWN   .0028 or 28 basis points

USA/Japan: 108.58 DOWN .756 OR YEN DOWN 76  basis points/

Great Britain/USA 1.2629 UP .0023 POUND UP 23  BASIS POINTS)

Canadian dollar UP 16 basis points to 1.3516

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

The USA/Yuan,CNY: AT 6.9050    0N SHORE  (DOWN)..GETTING DANGEROUS

THE USA/YUAN OFFSHORE:  6.9323  (YUAN DOWN)..GETTING REALLY DANGEROUS

TURKISH LIRA:  5.8440 EXTREMELY DANGEROUS LEVEL/DEATH WISH.

the 10 yr Japanese bond yield closed at -.09%

 

Your closing 10 yr US bond yield DOWN 6 IN basis points from THURSDAY at 2.16 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.60 DOWN 5 in basis points on the day

Your closing USA dollar index, 97.83 DOWN 31  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 FRIDAY: 12:00 PM

London: CLOSED DOWN 56.45  0.78%

German Dax :  CLOSED DOWN 175 POINTS OR 1.47%

Paris Cac CLOSED  DOWN 41.28 POINTS 0.79%

Spain IBEX CLOSED DOWN 153.60 POINTS or 1.68%

Italian MIB: CLOSED DOWN 145.81 POINTS OR 0.73%

 

 

 

 

 

WTI Oil price; 54.96 12:00  PM  EST

Brent Oil: 63.23 12:00 EST

USA /RUSSIAN /   ROUBLE CROSS:    65.28  THE CROSS HIGHER BY 0.14 ROUBLES/DOLLAR (ROUBLE LOWER BY 14 BASIS PTS)

 

TODAY THE GERMAN YIELD FALLS  TO –.20 FOR THE 10 YR BOND 1.00 PM EST EST

END

 

This ends the stock indices, oil price, currency crosses and interest rate closes for today 4:30 PM

Closing Price for Oil, 4:00 pm/and 10 year USA interest rate:

WTI CRUDE OIL PRICE 4:30 PM :  53.30//WORLD DEFLATING

 

 

BRENT :  61.69

USA 10 YR BOND YIELD: … 2.13…   VERY DEADLY// AND INDICATIVE OF A HUGE RECESSION COMING UPON US

 

 

 

 

 

 

 

 

 

USA 30 YR BOND YIELD: 2.57..VERY DEADLY/ AND INDICATIVE OF A HUGE RECESSION COMING UPON US:

 

 

 

 

 

EURO/USA 1.1169 ( UP 40   BASIS POINTS)

USA/JAPANESE YEN:108,37 DOWN .962 (YEN UP 96 BASIS POINTS/..

 

 

USA DOLLAR INDEX: 97.76 DOWN 38 cent(s)/

The British pound at 4 pm   Britain Pound/USA:1.2634 UP 27  POINTS

 

the Turkish lira close: 5.8412 (AFTER GOV’T INTERVENTION THIS MORNING)

 

the Russian rouble 65.41   DOWN 0.29 Roubles against the uSA dollar.( DOWN 29 BASIS POINTS)

Canadian dollar:  1.3515 UP 17 BASIS pts

USA/CHINESE YUAN (CNY) :  6.9050  (ONSHORE)/we need to watch these levels/anything greater than 6.95 will be deadly./

 

USA/CHINESE YUAN(CNH): 6.9346 (OFFSHORE) we need to watch these levels/anything greater than 6.95 will be deadly/

German 10 yr bond yield at 5 pm: ,-0.20%

 

The Dow closed  DOWN 354,84 POINTS OR 1.41%

 

NASDAQ closed DOWN 114.57 POINTS OR 1.51%

 


VOLATILITY INDEX:  18.76 CLOSED UP 1.46

 

LIBOR 3 MONTH DURATION: 2.520%//

 

 

 

FROM 2.521

 

 

 

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

TRADING IN GRAPH FORM FOR THE DAY/WEEKLY SUMMARY/

Trade Turmoil Wipes $5 Trillion Off Global Stocks In Worst May Since 2010

Global Equity markets lost almost $5 trillion in May, more than they did in December!

 

Everything was going so great too…

All major US equity markets were ugly in May…

But, on the week, spot the odd one out…

Big week for China, thanks to a huge PBOC-panic liquidity injection…

 

Europe’s worst month since early 2016…

Not helped by Deutsche Bank closing at record lows…

 

All major US equity indices were down this week, led by Trannies and Small Caps… (today was a one-way street lower after Europe closed)

Biggest weekly drop for the S&P 500 since December

US equity markets had an ugly month – the first losing month of the year and worst May since 2012…

This was the Dow’s 6th straight weekly loss (longest losing streak in 8 years)

But still remain comfortably green on the year…

 

All the major US equity indices are back below their 200DMAs…

 

The S&P broke below the key 2800 level…

 

Semis suffered their worst month since Nov 2008…

 

As the broad S&P tech sector tumbled…

 

S&P Energy sector plunged…

 

Credit markets blew wider in May (led by HY) and for now, VIX is holding in (even with its curve inversion)

 

HY Spreads are shouting their warning that something is up…

 

Treasury yields collapsed around 35bps on the month and accelerated lower this week despite talking heads claiming pension rebalancing would bid stocks and offer bonds into month-end…

This is the biggest May drop in yields since 2010, slamming yields to their lowest in years…

 

10Y hit 2.13% intraday as the yield plunge accelerated…

 

The yield curve crashed in May, inverting out to around the 15Y maturity…

 

With 3m10Y plunging to -22bps…

 

 

Inflation breakevens collapsed – the biggest monthly drop since December…

 

The Dollar Index rose for the 4th month in a row

 

And as the Dollar surged, EM FX cratered…

 

Cryptos managed to hold on to the week’s gains after yesterday’s ugliness…

This was Cryptos best month since August 2017…

 

Ugly week for commodities broadly with crude getting crushed but gold managed solid gains…

And Gold managed gains on the month as WTI collapsed…

 

WTI’s worst month since November, tumbling back below $54…And worst May since 2012

 

Gold’s best month since January, soaring back above $1300…

 

And finally, the market is pricing in 1 rate-cut in 2019 and 2.5 rate-cuts by the end of 2020…

Stocks will have to sink considerably for those expectations to come true…

i) Market trading

Last night, after the bell:

Pence warns that the uSA can double tariffs..bond yields tumble.

Treasury Yields Tumble As Pence Warns US “Can More Than Double” Tariffs On China

Speaking at a press conference after meeting Canadian Prime Minister Justin Trudeau, US VP Mike Pence warned China that US “could more than double tariffs if needed.”

His words sent stocks lower modestly but tumbled yields back to yesterday’s lows…

 

And crashed the yield curve to new cycle lows…

 

Additionally, Pence is expected to stir things even further, as CNBC reports that Pence is planning a speech around the 30th anniversary of the Tiananmen Square massacre, according to two sources familiar with the matter.

The remarks are expected to be a censure of China’s religious freedom and human rights record from one of the Trump administration’s highest ranking China hawks. They are set to come amid rising trade tensions between the world’s two largest economies.

A White House official confirmed a Pence speech is in the works – potentially in mid-June, following the anniversary – but declined to comment on its contents.

end
10 yr yield at 1 am est:
USGG10YR:IND

US Generic Govt 10 Year Yield

2.17USD
-0.04-1.82%
end
Early morning, Wall Street reaction and response to Trump’s shock tariff announcement:
(zerohedge)

Stunned Wall Street Responds To Trump’s Shock Tariff Announcement

Just as the trade war with China was heating up to the point where it had become consensus that i) the war would last a long time, ii) it would adversely impact global GDP, and iii) US inflation would likely spike, Trump stunned the investor community when he vowed late on Thursday to impose a 5% tariff on Mexican goods escalating to 25% until the “immigration problem, is remedied.”

The fear is that not only will the move further upend supply chains, shake trade diplomacy and diminish the likelihood of a near-term breakthrough with China, but that a grave new threat to the world economy has emerged. .

Below, courtesy of Bloomberg, are reactions from a mix of strategists, trade experts and market analysts:

Mary Lovely, Syracuse University economics professor

“This is another attack on supply chains,” she told Bloomberg Television. “This is really going to hurt American businesses who use Mexico to reduce their costs and stay competitive with European and Asia. One thing which Donald Trump has said which we know is true now is that he is a tariffs man. He sees tariffs as the solution to all kinds of problems. It’s just throwing the entire card table over, this is just saying we don’t play by anybody’s rules, we can use tariffs when we want.”

David Mann, global chief economist at Standard Chartered

“This news does leave the world wondering whether Trump’s use of tariffs could become ever broader. This is a step change as previously we had been seeing delays in trade-related decisions on Europe and Japan as we thought the administration was so focused on China. It does add to the reasons to worry that any country running a trade surplus with the U.S. could come into the spotlight in the future.”

Rob Carnell, Asia-Pacific head of research at ING Bank

“It’s clearly a further risk-off development, and keeps alive the bond rally, undermines thoughts of an upward equity correction and should keep the dollar grinding stronger. It also dampens hopes for any resolution to the U.S.-China conflict, showing just how easily the U.S. administration resorts to tariffs, not just threats of tariffs, when they don’t get what they want.”

Torsten Slok, economist at Deutsche Bank AG

“If this is implemented it will be a serious downside risk to the U.S. economy. Looking carefully at the trade data between the U.S. and Mexico shows that 67% of all imports from Mexico are related-party trade which is another way of saying intra-company trade. What this means is that U.S. companies are using Mexico for production. Put differently, most of the trade between Mexico and the U.S. is the global supply chain. And the trade data further shows that the biggest import categories from Mexico to the U.S. are cars and car parts and trucks and buses.”

Deborah Elms, executive director of the Asian Trade Centre

“The first thing to note is that there is no plausible legal mechanism for applying tariffs in this way. Trump can do it, but this action will be subject to global condemnation. It is unlikely to matter to him, of course, but it will make the global trading system much more precarious. The largest player will have clearly ‘gone rogue.’”

“You may ask what is the difference with steel, aluminum, washing machines, China, etc. and Mexican immigrants? The former actions all had at least a thin veneer of legal justification. Most of these decisions are being fought over at the World Trade Organization now, but they had rules to argue about.”

“The Mexican immigration issue is simply not allowed. There is no provision that lets a member block trade over migrants. The consequences are therefore much bigger than just what happens to companies operating between the U.S. and Mexico or within NAFTA. This is a global concern.”

Sean Callow, senior currency strategist at Westpac Banking Corp.

“Global investors worried about U.S.-driven protectionism have been focused firmly on China so a flare-up in trade tensions with Mexico was definitely not on the market radar. Just this week the Bank of Canada expressed ‘increasing prospects for the ratification’ of USMCA. This seemed reasonable given U.S. VP Pence has just arrived in Canada to call for quick passage of the agreement. Pence appears to be completely out of the loop, with every indication from the White House statement that this is very much a Trump decision, not a carefully crafted team policy.”

“This is obviously a major setback for CAD, MXN and the thousands of U.S. businesses that use products made in Mexico (much of which is by U.S.-owned firms). Markets may temper their negative response slightly, if only in hope that corporate America will lobby the White House hard enough to produce some form of backdown before the virtually unthinkable 25% tariffs threatened by October. But it will be a fresh cause for concern for central banks with looming policy decisions such as the RBA and ECB.”

Cliff Tan, East Asian Head of Global Markets Research, MUFG Bank

“Econometric studies have suggested the North America trade engine (USMCA) could benefit as the China trade engine slows down. This is throwing sand into USMCA. When you only have a hammer, every problem looks like a nail”

Shane Oliver, chief economist at AMP Capital

“This may be about immigration but it will just add to trade war fears and cause a further blow to business confidence in the U.S. – as businesses will be wondering who will be hit next in their supply chain.”

“Shares are likely to see more short-term downside until the trade issues are resolved. In fact, this may be necessary to put pressure on President Trump to negotiate. So it remains a time for caution for the short-term focused.”

Stephen Innes, head of trading at SPI Asset Management

“It will be a warning to the world, especially Canada and Europe, that Tariff man means business. It sends a horrible signal to risk markets as we tack to the key G20 which is starting to look like a make or break scenario when it comes to U.S.-China negotiations.”

Chua Hak Bin, economist at Maybank Kim Eng Research Ltd.

“Trump is broadening the trade war to multiple fronts and tariffs have become his favorite weapon. There is the big trade war with China and there are smaller battles with the EU over Airbus subsidies, and Germany and Japan over autos, and now with Mexico over migrants.”

“American consumers will bear an increasing proportion of the cost from tariff hikes, as the coverage spreads to consumer goods. Both tariffs and export controls are disrupting and wreaking havoc to supply chains.”

END

ii)Market data/

As we pointed out to you yesterday, Trump is not winning in the trade battle. Last night imports fell by 2.7% and imports a drop of 4.0%

This caused the trade deficit to rise despite the tariffs.  Remember the words of Alasdair Macleod..unless the USA saves, the trade deficit will continue to rise

He is right…

(courtesy Mish Shedlock/Mishtalk)

 

‘Not Winning’ – Collapse In Global Trade Escalates: Imports -2.7%, Exports -4.0%

Authored by Mike Shedlock via MishTalk,

Those who claim that Trump has already won or is sure to win the trade war need to ponder actual trade results.

Exports rose 1.0% in March with imports up a reported 0.9%. That progress was taken away and then some in April.

The Census Bureau Advance Trade report shows the balance of trade widened by 0.3%. The details, as noted by Econoday are downright ugly.

Sharp declines in exports are unwelcome headlines in April’s advance data on goods trade. The monthly deficit remains very deep, at $72.1 billion with exports falling 4.2 percent year-on-year and with imports also down, 2.7 percent lower. The deficit compares unfavorably with a $71.3 billion monthly average in the first quarter that marks a weak opening for net exports in the second quarter.

Capital goods are the US’s largest exports and these fell 6.5 percent in the month to $44.3 billion. Compared with April last year, capital goods exports are down 3.7 percent. Auto exports are also down, 7.2 percent lower to $12.9 billion and 6.7 percent below last year. The only export component showing a gain is food & feeds which rose 0.5 percent to $11.2 billion but which is nevertheless 6.2 percent below April last year.

The decline on the import side is also led by a 3.5 percent decline for capital goods ($55.4 billion) but also includes 3.1 percent and 2.3 percent monthly declines in autos ($30.9 billion) and consumer goods ($54.2 billion) as well as a 1.1 percent drop in foods ($12.8 billion).

Global trade figures have been contracting and the latest US numbers are part of that picture. Today’s report gets second-quarter GDP, already held down by contractions for April retail sales and industrial production, off to a slow start.

Note that country balances aren’t posted with the advance report but will follow with the subsequent international trade report that will also include data on services.

Evaluating Winning Claims

Yesterday, I saw yet another claim that Trump is winning the trade war. Last week I saw claim that Trump “already” won the trade war.

A third person claimed this is all part of 3-D outmaneuvering and that Trump has more resolve than China.

Not Winning

This is not winning and it will never be winning.

  1. Trump changes his mind every month if not week, yet he supposedly has more resolve. Yeah, right.
  2. Trump, a proven piss poor negotiator, is somehow supposed to negotiate magically.
  3. Trump has an election to win. The Chinese leader, Xi Jinping, doesn’t.
  4. Trump is a braggart who demand the other side admit Trump’s prowess.

Dealing With Trump

North Korea figured out how to deal with Trump.

Embedded video

The Hill

@thehill

President Trump: “Kim Jong un made a statement that Joe Biden is a low IQ individual. He probably is, based on his record. I think I agree with him on that.” http://hill.cm/IpN8O4q

Kim Jong Un gave Trump false praise while knocking Joe Biden.

Problem for China

The problem for China (and the US), is Trump demands China give in on “core” principles.

At that point China walked away. China had no other choice.

Pain Game

Mathematically, the US can likely inflict more pain on China. It is always the case that importers like the US can place more tariffs than vice versa.

But since when does losing less constitute winning?

Rare Earths

China does have some serious ways to strike back such as blocking Rare Earth Elements used in weapons, magnets, cell phones, and other sensitive devices.

Once again,we have seen superficial commentary that rare earths are not really rare (a true statement) thus the US can get other suppliers(a falsehood).

The problem is rare earths are extremely polluting and one does not exactly start a mine overnight. China reduces supply once before and this is what happened.

  1. China reduced supply of rare earths
  2. Rare earth prices skyrocketed
  3. New sources came into production within a couple years
  4. Price crashed
  5. China further flooded the markets
  6. The new Western sources lost money and went out of business.

This is not exactly winning by either side, but the position is the same as before: China supplies 80% of the production as no countries other than China are willing to deal with the toxic, radioactive sludge that producing rate earths entails.

Meanwhile, us weapons manufacturers, cell phone makers, etc. need these rare earths.

For further discussion, please see Trade Hardball: China Threatens to Cut Off US Supply of Rare Earth Elements.

Those who downplay the rare earth angle because there is plenty of “supply” have not thought things through.

Bond Market, Stock Market

The bond market, the stock market, and the global trade numbers all tell the same story: Trump isn’t winning.

Full-Blown Trade War is Now the Base Case.

Trade War Over Quickly?

The joke of the week, last week was Trump’s blowhard comment Trump Says “Trade War Could be Over Quickly”.

I asked: Why should anyone believe Trump?

The only way the trade war will be over quickly is if Trump, not China, caves.

Recession Warning

Meanwhile, the yield curve flashes a bright red recession flag.

Good luck with that.

-END-

After soaring in the preliminary data, the final print for the UMich Sentiment survey printed out at 100.00 on expectations of 1.015. This is a soft data and indications are showing that the USA economy is faltering

(courtesy zerohedge)

Final May UMich Sentiment Survey Sinks From Flash Highs

UMich Sentiment survey ‘expectations’ soared in the preliminary data sending the headline to its highest since Jan 2004, but the final prints were marked down notably.

Against expectations of 101.5, and flash print of 102.4 (highest since Jan 2004), the final data for UMich sentiment printed 100.0 (the highest since Aug 2018 only)

This is still the highest “expectation” print since Dec 2003 (albeit notably lower from 96.0 flash to 93.5 final) and current conditions slipped from 112.3 in April (112.4 flash) to 110.0 final for May.

 

Middle-income Americans saw sentiment weaken as the top and bottom income cohorts rose…

 

Buying attitudes towards homes and household durables tumbled…

As UMich notes, the combination of higher inflation and lower spending provide conflicting signals for monetary policy, with the divergence further heightening if, as is likely, the trade war escalates. Will the Fed risk higher inflation with lower interest rates, or risk higher unemployment with higher interest rates? Either choice would threaten the highest level since 2002 in consumer confidence in the government’s policies to keep both unemployment and inflation at reasonably low levels (see the chart below).

The economic optimism now expressed by consumers is characteristically different than when the Index first reached the May level in the mid 1960s.

In the earlier era, optimism was primarily based on expected growth in incomes, in the current era, optimism is based more on expected income and job security. The shift is partly the legacy of the Great Recession and partly due to an aging population. This shift has been reflected in personal economic evaluations as well as in political choices.

The proportion of consumers who anticipated an economic downturn during the next five years fell to 38%, the lowest level since 2004.

iii)USA ECONOMIC/GENERAL STORIES

Trump approval rating hits a two year high:

(courtesy zerohedge)

Trump Approval Rating Hits Two-Year High

President Trump’s job approval rating has soared to its highest level in two years, according to the latest Harvard CAPS/Harris Poll survey.

Fueled by voter optimism about the economy, the survey found that 48% of respondents approve of the job Trump is doing, up from 45% in March. That said, 52% of those asked say they disapprove. The last time Trump’s approval hit 48% was in June of 2017.

Trump appears to be getting a lift from the economy, with a record 62 percent approving of his approach to employment and 59 percent approving of his handling of the economy.

While only 39 percent of voters said the country is on the right track, 51 percent said the economy is heading in the right direction. Seventy-one percent of voters said the economy is very strong or somewhat strong. –The Hill

“People’s views on the economy are gradually pushing Trump’s numbers up and his actions on other issues like China and immigration are neutral to positive,” said Harvard CAPS/Harris poll co-director Mark Penn. “Every point of increase in this range of 45 to 50 improves the possibility of re-election.

The CAPS/Harris Poll survey, which included 1,295 registered voters, is higher than other recent polls. An average of polls tracked by RealClearPolitics revealed a 42.5% job approval rating – with a recent Rasmussen poll matching that of CAPS/Harris, yet six other polls coming in between 38% and 44% approval rate.

Gallup showed that Trump’s job approval rate jumped from 39% in March to 46% in late April, only to fall back to 42% in May.

That said, The Hill notes that there are “some warning signs” for Trump contained in the surveys.

Only 37 percent of voters said they would definitely or probably vote for Trump in the 2020 presidential election, compared to 42 percent who said they would definitely or probably vote for the Democratic nominee. Twelve percent of voters are unsure, and 9 percent said they’d vote for an independent or third-party candidate.

And a slim majority of voters, 52 percent, say they disapprove of Trump’s handling of immigration, his signature campaign issue. –The Hill

It will be interesting to see if Trump’s new Mexico tariffs has an impact next month.

SWAMP STORIES

Barr strikes back on Mueller and stated that he should have reached a decision on obstruction if he wanted to.  He also stated that 3 times Mueller told Barr that his decision is not based on the

Office of Council’s opinion that you cannot indict a sitting president.

(courtesy zerohedge)

Barr Strikes Back, Says Mueller “Could Have Reached A Decision If He Wanted To”

Almost immediately after Robert Mueller stepped away from the podium on Wednesday after giving his first and final remarks on the Russia probe, speculation turned to Attorney General William Barr, as Democrats and the media speculated that the special counsel had just delivered a painful snub to his longtime friend and erstwhile boss.

Barr

Some felt that Mueller’s terse account of the investigation, and more critically, his explanation for why he and his team stopped short of making a recommendation about wrongdoing allegedly committed by the president, contradicted the summary of the report’s findings released by Barr a few weeks before the redacted report was made public. In his summary,Barr said Mueller found no evidence of collusion or obstruction committed by the president,a conclusion that Mueller apparently felt was misleading.

But two can play at that game, and in a brief excerpt from an interview with CBS News that’s set to air on Friday morning, Barr undermined Mueller’s account of his team’s conclusion by telling CBS that he felt Mueller could have made a conclusion about presidential wrongdoing if he wanted to – the Office of Legal Counsel opinion Mueller cited simply suggests a sitting president can’t be indicted.

I personally felt he could have reached a decision as to whether it was criminal activity…the opinion says you can’t indict…but he had his reasons for not doing it which he explained…but when he didn’t make a decision the Deputy Attorney General Rod Rosenstein and I felt it necessary as the heads of the department to make a decision.”

After Mueller decided to leave the conclusion open-ended, Barr and Deputy AG Rod Rosenstein felt they needed to say something about Mueller’s conclusions in their summary. But presumably, if Mueller really felt Trump had committed crimes, he could have conclusively said so in his report.

During yesterday’s press conference, Mueller appeared to press Congress to pursue impeachment, saying “if we had confidence that the president had not committed a crime, we would have said so.”

As for Mueller’s argument that he would leave the task of prosecuting the president to Congress, Barr said the DOJ typically doesn’t resign itself to playing second fiddle to Congress.

“The DoJ doesn’t use our powers of investigating crimes as an adjunct to Congress.”

In a second clip, Barr responded to criticisms that he was protecting the president by saying these claims “just go with the territory of being the attorney general in a hyperpartisan time.”

“We live in a hyperpartisan age where people no longer really pay attention to the substance of what’s said but instead who said it…the Department of Justice is all about the law and the facts and the substance…I’m going to make the decision based on the law and the facts…I think it just goes with the territory of being attorney general in a hyperpartisan period of time.”

END

 

SWAMP STORIES/KEY STORIES/KING REPORT

(COURTESY OF CHRIS POWELL/GATA)

Though Q1 GDP topped Street consensus by 0.1, the headline number is fiction.  A ridiculous low GDP Deflator of .48 was applied.  Without this fraud, GDP would have had a one handle for Q1.  CPI-U, even though it’s another fiction, is 2.27%. The hokey Intellectual Property component added 0.32 to GDP.

Q1 GDP full tables: https://www.bea.gov/system/files/2019-05/gdp1q19_2nd.pdf

First-quarter economic growth up 3.1%, slightly better than Wall Street expected

Net exports were a big contributor, adding nearly 1 percentage point, despite the U.S.-China trade war.

     Exports rose 4.8%… while imports… declined 2.5%…

     Corporate profits fell during the quarter, with nonfinancial corporations seeing a decline of $62.1 billion compared with an increase of $13.6 billion in the fourth quarter. Financial companies saw an increase of $7.2 billion compared with a decrease of $25.2 billion for the previous period.

    Personal consumption expenditures rose 1.3% in the quarter, compared with a rise of 2.5% in the previous quarter but well above the 0.5% in Q1 of 2018…

https://www.cnbc.com/2019/05/30/gdp-q1-2019-second-reading.html

U.S. Pending Home Sales Unexpectedly Drop, Adding to Market Woes

The index of pending home sales declined 1.5% from the prior month, missing all economist estimates, after a 3.9% increase in March, according to data Thursday from the National Association of Realtors in Washington. The measure was up 0.4% from a year earlier on an unadjusted basis, the first positive reading in a year, suggesting some stabilization…a 2.5% drop in the South. The Midwest was the only area to record a gain, at 1.3%…

https://www.bloomberg.com/news/articles/2019-05-30/u-s-pending-home-sales-unexpectedly-drop-adding-to-market-woes

@realDonaldTrump: On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. The Tariff will gradually increase[25% by Oct.1] until the Illegal Immigration problem is remedied at which time the Tariffs will be removed.  Details from the White House to follow.

The US imported $346.5B of goods from Mexico in 2018, up 768% since NAFTA (1993).  Vehicles $93B, electrical machinery $64B, machinery $63B

Today – Normally, the peak of performance gaming intensity appears on the penultimate session of the period.  However, the May performance gaming scheme on Thursday was inadequate.  With equities down smartly for May, most professional money managers have disappointing report cards to date.  Ergo, there is strong need to manipulate stock prices higher today.  Unfortunately for performance gamers, Trump fouled the punch bowl with his Mexican tariff threat.

Traders will anticipate that NY Fed President Williams will wax dovish when he speaks on Monetary Policy Theory and Practice at Noon ET.

The S&P 500 Index high yesterday was 2799.  Bulls need to get S&P 500 Index back above 2800.

ESMs tanked 27.00 on DJT’s Mexico tariff threat (issued at 19:30 ET).  ESMs are -21.00 at 21:36 ET.

The Caixin May China Mfg. PMI fell to 49.4 [contraction] from 50.1; 49.9 was consensus.

The S&P 500 Index 50-day MA: 2872; 100-day MA: 2795; 150-day MA: 2745; 200-day MA: 2776

The DJIA 50-day MA: 26,033; 100-day MA: 25,605; 150-day MA: 25,244; 200-day MA: 25,430

S&P 500 Index support: 2775-77, 2765, 2750, 2740, 2731, 2720, 2700, 2680

Resistance: 2793.50 (afternoon high), 2800, 2813, 2820, 2833, 2841, 2844-50, 2865-68, 2872 (50 DMA)

Expected economic data: Apr Personal Income 0.3% m/m, Spending 0.2%, PCE Deflator 0.3%, PCE Core 0.2%; May Chicago PMI 54; May UM Sentiment 101.5; Atlanta Fed Prez Bostic 9:15 ET, NY Fed Prez Williams Noon ET

S&P 500 Index – Trender trading model and MACD for key time frames

Monthly: Trender andMACD are negative – a close above 3057.16 triggers a buy signal

Weekly: Trender is positive; MACD is negative – a close below 2792.66 triggers a sell signal

Daily: Trender and MACD are negative -a close above 2884.22 triggers a buy signal

Hourly: Trender is negative; MACD is positive -a close above 2798.62 triggers a buy signal

@OANN: The North Korean envoy was executed following the failed summit between Pres. Trump and Kim Jong Un. Kim Hyok Chol, along with 4 other officials, were executed in March. Kim’s top aide (Kim Yong Chol) is undergoing hard labor.

Fox’s Catherine Herridge reports FBI special agent Peter Strzok never told the Trump campaign that Flynn and Papadopoulos were under investigation during an FBI briefing in August 2016 that was supposed to warn the campaign of national security threats.

Barr Says Mueller Was Wrong, ‘Could’ve Reached a Decision’ on Obstruction [CBS interview]

“I personally feel he could’ve reached a decision… He could’ve reached a conclusion. The opinion says that you can’t indict a President while he’s in office. But he could have reached a decision as to whether it wascriminal activity

The Department of Justice is all about the law and the facts and the substance…I’m going to make the decision based on the law and the facts…I think it just goes with the territory of being attorney general in a hyperpartisan period of time… I’m not sure what he was suggesting [Mueller inciting Dems to impeach].  But the Department of Justice doesn’t use our powers of investigating crimes as an adjunct to Congress…” https://news.ntd.com/barr-says-mueller-was-wrong-couldve-reached-a-decision-on-obstruction_336871.html

@LouDobbs: diGenova: Mueller’s conference was vindictive, abusive, unprofessional & unethical under all bar associations & DOJ rules.He should be disbarred for his outrageous accusation against Trump. @POTUS is presumed innocent until he’s proved of otherwise in a court.

@ABCPolitics: President Trump: “I think Mueller is a true never-Trumper. He’s somebody that dislikes Donald Trump” https://abcn.ws/2EK3rWZ

     President Trump: “No, Russia did not help me get elected. You know who got me elected? You know who got me elected? I got me elected” http://abcn.ws/2EDC1Sf

@ABC: Pres. Trump again claims that special counsel Robert Mueller “wanted to be the FBI director and I said no.” “And he loves Comey … whether it’s love or deep like, but he was conflicted, Look, Robert Mueller should have never been chosen,” he adds.    http://abcn.ws/2EDC1Sf

@realDonaldTrump: Robert Mueller came to the Oval Office (along with other potential candidates) seeking to be named the Director of the FBI. He had already been in that position for 12 years, I told him NO. The next day he was named Special Counsel – A total Conflict of Interest. NICE!

More from Trump on Thursday: “Do you think the media helped Hillary Clinton get elected?”

    “I think in the end, I will consider what’s happening now to be one of my greatest achievements, exposing this corruption.”

Stephen McIntyre @ClimateAudit: 1/ collusion between Mueller and Comey began earlier. It dates back to Mueller’s contortions to assign Khobar Towers investigation to Comey in EDVA in early 2001. Comey compliantly charged “Saudi Hezbollah”, rather than obvious candidate Al Qaeda.

   2/ one can’t help but wonder how next two decades might have developed if Mueller and Comey had spent early 2001 investigating Al Qaeda for Khobar Towers. The questionable attribution of Khobar Towers bombing remains policy relevant, since it is cited as Iran-backed terrorism.

Robert Mueller Unmasked by Congressman Louie Gohmert,April 2018 [Lengthy account of venality]

Robert Mueller has a long and sordid history of illicitly targeting innocent people that is a stain upon the legacy of American jurisprudence. He lacks the judgment and credibility to lead the prosecution of anyone.  I do not make these statements lightly…

It appears clear that President Obama and his myrmidons knew of Mueller’s reputation, that he could be used to take out their political opponents should such extra-legal actions become politically necessary.  To the great dismay of the many good, decent and straight arrow FBI agents, Obama begged Mueller to stay on for two more years than the 10 years the law allowed. Obama then asked Congress to approve Mueller’s waiver allowing him to stay on two extra years…

https://www.hannity.com/wp-content/uploads/2018/04/Gohmert_Mueller_UNMASKED.pdf

@CarpeDonktum: Hillary Clinton is going to be the Keynote Speaker at a Cyber Defense Summit in October… THIS IS REAL LIFE.  People are going to pay between $795 and $2000 to listen to a presentation (mostly coughing) from a person who was hacked by everyone on Earth.

https://twitter.com/CarpeDonktum/status/1134192849170370560

@VicToensing: Why does @JudgeNap continue to misstate law? He claimed AGAIN a President can be indicted. NO. He claimed Clinton was indicted for perjury. NO. On last day in office Clinton agreed to give up law license and admit perjury. Or he would have been indicted AFTER leaving office.

END

Let us close out of the week as is our custom, with this offering courtesy of Greg Hunter

(courtesy Greg Hunter/USAWatchdog)

Trump Guilty Until Proven Innocent, Mexico Tariffs, Crop Crisis

By Greg Hunter On May 31, 2019

Like a supernova flaming out, Special Prosecutor Robert Mueller announced he’s closing his office and stepping down. Before he did, he gave a short press conference to trash President Trump on the way out by not giving him the presumption of innocence. Mueller said he would not “exonerate” Trump, even though his own report did not find any chargeable crimes. Mueller did give the Russians he charged with crime the presumption of innocence. Slimey Mueller proved it was a partisan “witch hunt” all along, and gave the Democrats new reasons to try for an impeachment.

The President just hit Mexico with a brand new tariff because it is allowing massive amounts of illegal aliens to cross Mexico to get to the USA. The tariffs are scaring the markets, and stock futures are tanking.

On the crop front, more bad news. Corn and soybean planting is still way behind. Agriculture experts are warning of lower crop yields and higher prices.

Join Greg Hunter as he talks about these stories and more in the Weekly News Wrap-Up.

.

-END-

-END

 

WELL THAT ABOUT DOES IT FOR TONIGHT

I WILL SEE YOU FRIDAY NIGHT.

HARVEY

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