AUGUST 7/GOLD BREAKS THROUGH $1500 TO END THE COMEX SESSION UP $31.00 TO $1503//SILVER ALSO HAS A STELLAR DAY UP 74 CENTS//CHINA THREATENS REVERSE SANCTIONS IF INDIA DOES NOT USE HUAWEI PRODUCTS//TREASURY YIELDS PLUMMET/THE ENTIRE USA YIELD CURVE INVERTED///

GOLD:$1503.00  UP $31.00(COMEX TO COMEX CLOSING

 

 

 

 

 

 

 

 

Silver: $17.18 UP 74 CENTS  (COMEX TO COMEX CLOSING)/

 

 

 

 

 

 

 

 

 

 

 

Closing access prices:

 

 

Gold : $1501.65

 

silver:  $17.11

today, gold broke through $1500.00 and silver sliced through $17.00 with reckless abandon.
Expect massive margin calls issued tonight to take effect tomorrow to those who are short the metals.
do not worry about the prices falling in the access market..we have very little counterparties.  The real action will begin at 9 pm tonight through 3 am est
and then when comex opens for trading at 8:20 am

we are coming very close to a commercial failure!!

 

 

 

 

 

 

COMEX DATA

 

 

 

 

 

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

today RECEIVING 7/19

EXCHANGE: COMEX
CONTRACT: AUGUST 2019 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,472.400000000 USD
INTENT DATE: 08/06/2019 DELIVERY DATE: 08/08/2019
FIRM ORG FIRM NAME ISSUED STOPPED
____________________________________________________________________________________________
118 H MACQUARIE FUT 4
661 C JP MORGAN 3 7
686 C INTL FCSTONE 6
690 C ABN AMRO 3
737 C ADVANTAGE 6 2
800 C MAREX SPEC 1
880 H CITIGROUP 6
____________________________________________________________________________________________

TOTAL: 19 19
MONTH TO DATE: 4,400

 

NUMBER OF NOTICES FILED TODAY FOR  JULY CONTRACT: 19 NOTICE(S) FOR 1900 OZ (0.0590 tonnes)

TOTAL NUMBER OF NOTICES FILED SO FAR:  4400 NOTICES FOR 440,000 OZ  (13.688 TONNES)

 

 

 

SILVER

 

FOR JULY

 

 

54 NOTICE(S) FILED TODAY FOR 270,000  OZ/

 

total number of notices filed so far this month: 1132 for   5,660,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Bitcoin: OPENING MORNING TRADE :  $ 11696 UP 216 

 

 

 

Bitcoin: FINAL EVENING TRADE: $ 11799 UP 325

 

 

 

Let us have a look at the data for today

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

IN SILVER THE COMEX OI ROSE BY A FAIR  SIZED 856 CONTRACTS FROM 238,434 UP TO 239,290 WITH THE 5 CENT GAIN IN SILVER PRICING AT THE COMEX.

TODAY WE ARRIVED CLOSER TO  AUGUST’S 2018  RECORD SETTING OPEN INTEREST OF 244,196 CONTRACTS.

WE HAVE ALSO WITNESSED A LARGE AMOUNT OF PHYSICAL METAL STAND FOR COMEX DELIVERY AS WELL WE ARE WITNESSING CONSIDERABLE LONGS PACKING THEIR BAGS AND MIGRATING OVER TO LONDON IN GREATER NUMBERS IN THE FORM OF EFP’S.  WE WERE  NOTIFIED  THAT WE HAD A STRONG SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP:,

0 FOR JULY. 0 FOR AUGUST, 1113 FOR SEPT, AND ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE  1113 CONTRACTS. WITH THE TRANSFER OF 1113 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 1113 EFP CONTRACTS TRANSLATES INTO 5.56 MILLION OZ  ACCOMPANYING:

1.THE 5 CENT GAIN IN SILVER PRICE AT THE COMEX AND

2. THE STRONG AMOUNT OF SILVER OUNCES WHICH STOOD FOR DELIVERY IN THE LAST 12 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.

2.425 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.

2.660 MILLION OZ STANDING FOR SILVER IN JUNE//

22.605 MILLION OZ INITIAL STANDING FOR JULY

7.425   MILLION OZ INITIAL STANDING IN AUGUST.

 

WE MUST HAVE HAD CONSIDERABLE COVERING OF SHORTS AT THE SILVER COMEX LAST NIGHT AND SOME SPREADING ACCUMULATION.

MODUS OPERANDI OF THE CORRUPT BANKERS AS TO HOW THEY HANDLE THEIR SPREAD OPEN INTERESTS:

 

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 WILL NOW SWITCH TO SILVER 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 NOW INTO THE NON ACTIVE DELIVERY MONTH OF AUGUST HEADING TOWARDS THE VERY ACTIVE DELIVERY MONTH OF SEPTEMBER FOR SILVER.

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 AUGUST BUT SO IS THE OPEN INTEREST OF SPREADERS. THE OPEN INTEREST IN SILVER WILL CONTINUE TO RISE UNTIL ONE WEEK BEFORE FIRST DAY NOTICE OF AN UPCOMING ACTIVE DELIVERY MONTH (SEPT), 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 FOR EFP’S/SILVER/J.P.MORGAN’S HOUSE OF BRIBES, / STARTING FROM FIRST DAY NOTICE/FOR MONTH OF JULY:

7368 CONTRACTS (FOR 5 TRADING DAYS TOTAL 7368 CONTRACTS) OR 36.84 MILLION OZ: (AVERAGE PER DAY: 1473 CONTRACTS OR 7.368 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH OF JULY:  36.84 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 5.63% 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:          1364.16   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

JUNE 2019 , TOTAL EFP ISSUANCE:                                               265.38 MILLION OZ

JULY 2019   TOTAL EFP ISSUANCE:                                                175.74 MILLION OZ

RESULT: WE HAD A FAIR SIZED INCREASE IN COMEX OI SILVER COMEX CONTRACTS OF 856, WITH THE 5 CENT GAIN IN SILVER PRICING AT THE COMEX /YESTERDAY... THE CME NOTIFIED US THAT WE HAD A  GOOD SIZED EFP ISSUANCE OF 1113 CONTRACTS WHICH EXITED OUT OF THE SILVER COMEX AND TRANSFERRED THEIR OI TO LONDON AS FORWARDS. SPECULATORS CONTINUED THEIR INTEREST IN ATTACKING THE SILVER COMEX FOR PHYSICAL SILVER (SEE COMEX DATA) .

 

TODAY WE GAINED A VERY STRONG  SIZED: 1969 TOTAL OI CONTRACTS ON THE TWO EXCHANGES: 

i.e 1113 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH INCREASE OF 856  OI COMEX CONTRACTS. AND ALL OF THIS  DEMAND HAPPENED WITH A 5 CENT GAIN IN PRICE OF SILVER AND A CLOSING PRICE OF $16.44 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. 1.199 BILLION OZ TO BE EXACT or 171% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT MARCH MONTH/ THEY FILED AT THE COMEX: 54 NOTICE(S) FOR 270,000 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 2.660 MILLION OZ//JULY 22.605 MILLION OZ;AUGUST 7.425 MILLION
  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 COMEX OPEN INTEREST ROSE BY A TINY SIZED 485 CONTRACTS, TO 600,317 ACCOMPANYING THE  $7.85 PRICING GAIN WITH RESPECT TO COMEX GOLD PRICING// YESTERDAY// /

 

 

 

 

THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A STRONG SIZED 4966 CONTRACTS: AUGUST 2019: 0 CONTRACTS, DEC>  4966 CONTRACTS AND ALL OTHER MONTHS ZERO.  The NEW COMEX OI for the gold complex rests at 600,317,,.  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 STRONG SIZED GAIN IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 5451 CONTRACTS: 485 CONTRACTS INCREASED AT THE COMEX  AND 4966 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI GAIN OF 5451 CONTRACTS OR 545,100 OZ OR 5.620 TONNES.  YESTERDAY WE HAD A GOOD GAIN OF $7.85 IN GOLD TRADING….AND WITH THAT GOOD GAIN IN  PRICE, WE  HAD A GOOD GAIN IN GOLD TONNAGE OF 5.62  TONNES!!!!!! THE BANKERS  WERE SUPPLYING INFINITE SUPPLIES OF SHORT GOLD COMEX PAPER DESPERATE TO CONTAIN THE PRICE RISE.

 

 

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF AUGUST : 65,620 CONTRACTS OR 6,562,000 oz OR 224.51 TONNES (5 TRADING DAY AND THUS AVERAGING: 13,124 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE STRONG SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 5 TRADING DAY IN  TONNES: 224.51 TONNES

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

THUS EFP TRANSFERS REPRESENTS 224.51/3550 x 100% TONNES =6.32% OF GLOBAL ANNUAL PRODUCTION

 

ACCUMULATION OF GOLD EFP’S YEAR 2019 TO DATE:     3715.35  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

JUNE 2019 TOTAL ISSUANCE:                   642.22 TONNES

JULY 2019: TOTAL ISSUANCE:                    591.56 TONNES

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

 

Result: A TINY SIZED INCREASE IN OI AT THE COMEX OF 485 WITH THE  PRICING GAIN THAT GOLD UNDERTOOK YESTERDAY($7.85)) //.WE ALSO HAD  A STRONG SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 4,966 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 4966 EFP CONTRACTS ISSUED, WE  HAD A  STRONG SIZED GAIN OF 5451 CONTRACTS IN TOTAL OPEN INTEREST  ON THE TWO EXCHANGES:

4966 CONTRACTS MOVE TO LONDON AND 485 CONTRACTS INCREASED AT THE COMEX. (IN TONNES, THE GAIN IN TOTAL OI EQUATES TO 5.620 TONNES). ..AND THIS HUGE INCREASE OF  DEMAND OCCURRED WITH THE GAIN IN PRICE OF $7.85 WITH RESPECT TO YESTERDAY’S TRADING AT THE COMEX. WE HAVE NOW STOPPED WITH SPREADING LIQUIDATION OF GOLD OI CONTRACTS AND COMMENCED WITH SILVER SPREADER OI ACCUMULATION.

 

 

 

 

 

 

we had:  19 notice(s) filed upon for 1900 oz of gold at the comex.

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD...

WITH GOLD UP $31.00 TODAY//(COMEX-TO COMEX)

 a deposit of: 1.86 tonnes

 

INVENTORY RESTS AT 836.92 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 74 CENTS TODAY:

NO CHANGE IN SILVER INVENTORY AT THE SLV

 

/INVENTORY RESTS AT 361.907 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 ROSE BY A FAIR SIZED 856 CONTRACTS from 238,434 UP TO 239,290 AND CLOSER TO THE NEW COMEX RECORD SET LAST IN AUG.2018 AT 244,196 WITH A SILVER PRICE OF $14.78/(AUGUST 22/2018)..THE PREVIOUS RECORD WAS SET ON APRIL 9/2018 AT 243,411 OPEN INTEREST CONTRACTS WITH THE SILVER PRICE AT THAT DAY: $16.53). AND PREVIOUS TO THAT, THE RECORD  WAS ESTABLISHED AT: 234,787 CONTRACTS, SET ON APRIL 21.2017 OVER  1 1/3 YEARS AGO.  THE PRICE OF SILVER ON THAT DAY: $17.89.  AS YOU CAN SEE, WE HAVE RECORD HIGH OPEN INTERESTS IN SILVER  ACCOMPANIED BY A CONTINUAL LOWER PRICE WHEN THAT RECORD WAS SET…..THE SPREADERS HAVE COMMENCED THEIR ACCUMULATION OF OPEN INTEREST CONTRACTS IN SILVER AND STOPPED THE LIQUIDATION OF THE SPREADERS IN GOLD

 

 

 

 

 

EFP ISSUANCE: 

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

 

FOR JULY: 0 CONTRACTS FOR AUGUST: 0, FOR SEPT. 1113  AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 1113 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON.  IF WE TAKE THE OI GAIN AT THE COMEX OF 845  CONTRACTS TO THE 1113 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN A  STRONG SIZED GAIN OF 1969 OPEN INTEREST CONTRACTS. THUS IN OUNCES, THE GAIN ON THE TWO EXCHANGES: 9.845 MILLION OZ!!! AND YET WE ALSO HAVE A STRONG DEMAND FOR PHYSICAL AS WE WITNESSED A FINAL STANDING OF GREATER THAN 30 MILLION OZ FOR JULY, A STRONG 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  NOW 2.660 MILLION OZ FOR JUNE WITH JULY AT 22.605 MILLION OZ STANDING AND AUGUST: .7.425 MILLION OZ/

 

 

RESULT: A FAIR SIZED INCREASE IN SILVER OI AT THE COMEX WITH THE 5 CENT GAIN IN PRICING THAT SILVER UNDERTOOK IN PRICING// YESTERDAY. WE ALSO HAD A STRONG SIZED 1113 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)WEDNESDAY MORNING/ TUESDAY NIGHT: 

SHANGHAI CLOSED DOWN 8.88 POINTS OR 0.32%  //Hang Sang CLOSED UP 20.79 POINTS OR 0.08%   /The Nikkei closed DOWN 68.75 POINTS OR 0.33%//Australia’s all ordinaires CLOSED UP .64%

/Chinese yuan (ONSHORE) closed DOWN  at 7.0458 /Oil UP TO 57.21 dollars per barrel for WTI and 64.13 for Brent. Stocks in Europe OPENED MIXED//  ONSHORE YUAN CLOSED DOWN // LAST AT 7.0458 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 7.0781 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

 

3b) REPORT ON JAPAN

3C  CHINA

i)China/India

China threatens “reverse sanctions” if Huawei is excluded from India’s 5 G network plan.  Dr Reddy, a huge Indian pharmaceutical manufacturing company makes a huge amount of global generics in China as labour is cheaper in China than India.  Also the supply of raw pharmaceuticals is located in China.  The Chinese may throw out Dr Reddy and others.

(courtesy zerohedge)

ii)Michael Snyder gives his assessment as to dangers facing us with respect to the tariff war with China and the USA

(Michael Snyder)

iii)The following is a terrific read from Tom  Luongo.  He talks about the huge pressure on China especially Hong Kong and how Trump is at war with the British Deep State

a must read…

(Tom Luongo)

4/EUROPEAN AFFAIRS

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

IRAN/CHINA/USA

My goodness this is actually funny.  China is mulling joining the USA escort coalition in the Gulf even as it defies the Iranian oil embargo as it loads up on Iranian oil

 

\(zerohedge)

6.Global Issues

New Zealand

This surprised the globe after the Central Bank of New Zealand surprised traders with a 1/2 pt rate cut

(zerohedge)

7. OIL ISSUES

Oil prices continue to plunge especially after a huge surprise crude build

(zerohedge)

8 EMERGING MARKET ISSUES

i)India

The global market continues to crash and this time it is India as we witness its auto market implode:  200,000 job losses in 3 months and another 1 million at risk

(zerohedge)

ii)War looks inevitable as Pakistan suspends bilateral trade with India and expels Indian envoy

(zerohedge)

9. PHYSICAL MARKETS

i)Negative interest rates at Swiss banks is forcing more citizens into gold

(Bloomberg//GATA)

ii)Gold which is just 2 atoms thick has been discovered in a lab..this will have tremendous use in medicine plus other areas

(zerohedge)

iii)Craig Hemke believes that there will be an assault on $1500 gold.

(Craig Hemke/Sprott/GATA)

iv)China has been seen supporting the yuan.

(Reuters/GATA)

v)Boy are Mexicans brazen: they just stole a couple of million dollars worth of gold coins form the Mexican mint.

(zerohedge)

vi)Bill Murphy interviewed

(Bill Murphy,GATA)

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

MARKET TRADING//USA

a)Market trading/LAST NIGHT/USA

 

 

b)MARKET TRADING/USA/AFTERNOON

i) Treasury yields crashing!!

ii)Entire USA yield curves inverts

(zerohedge)

iii)Three areas of discussion:

  1. the panic in junk bonds. Even though yields are plummeting in sovereigns, the junk yields are rising indicating lack of liquidity and huge risks
  2. The Kashmir saga.  The partition into3 areas is now basically over as India takes over its Indian Kashmir section. Pakistan is furious and worried about ethnic cleansing.  War is coming in this area.

(courtesy Bill Blain)

ii)Market data/USA

iii) Important USA Economic Stories

a)American Pension funds continue to miss their targets in 2019.  They are terribly offside

(zerohedge)

b)After seeing three nations lower their interest rates, Trump pesters Powell to cut the Fed rate

(zerohedge)

c)Total student and auto loans rise by close to 15 billion dollars: 2.77 trillion.

Revolving Credit: drops by 80 million

the only place the consume is getting money is through the auto loans and student loan sector

(COURTESY ZEROHEDGE)

iv) Swamp commentaries)

v) King report/Courtesy of Chris Powell of GATA which includes the major swamp stories.

 

LET US BEGIN:

 

 

Let us head over to the comex:

 

THE TOTAL COMEX GOLD OPEN INTEREST ROSE BY A TINY SIZED 485 CONTRACTS TO A LEVEL OF 600,317 ACCOMPANYING THE HUGE GAIN OF $7.85 IN GOLD PRICING WITH RESPECT TO YESTERDAY’S // COMEX TRADING)

WE ARE NOW IN THE ACTIVE DELIVERY MONTH OF JULY..  THE CME REPORTS THAT THE BANKERS ISSUED STRONG SIZED  TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS., THAT IS 4966 EFP CONTRACTS WERE ISSUED:

 FOR AUGUST; 0 CONTRACTS: DEC: 4966   AND  ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE:  4966 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 GAINED THE FOLLOWING TODAY ON OUR TWO EXCHANGES: 5451 TOTAL CONTRACTS IN THAT 4966 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE GAINED A TINY SIZED 485 COMEX CONTRACTS.  THE BANKERS SUPPLIED THE NECESSARY AND INFINITE AMOUNT OF SHORT PAPER IN GOLD TO CONTAIN THE PRICE RISE. 

 

NET GAIN ON THE TWO EXCHANGES ::  5451 CONTRACTS OR 545100 OZ OR 5.62 TONNES.

 

We are now in the  active contract month of AUGUST and here the open interest stands at 2754 CONTRACTS as we LOST 144 contract.  We had 92 notices filed yesterday so we LOST 52 contracts or 5200 oz of gold that will NOT stand for delivery AS THERE APPEARS TO BE A LACK OF METAL ON THIS SIDE OF THE POND. THESE GUYS HAVE MORPHED INTO LONDON BASED FORWARDS AND WILL TRY THEIR LACK OVER THERE.

The next non active month is September and here the OI FELL by 150 contracts UP TO 4190.  The next active delivery month is October and here the OI ROSE by 575 contracts UP to 45,450.

 

 

TODAY’S NOTICES FILED:

WE HAD 19 NOTICES FILED TODAY AT THE COMEX FOR  1900 OZ. (0.0590 TONNES)

 

 

 

 

 

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And now for the wild silver comex results.

Total COMEX silver OI ROSE BY A FAIR SIZED 856 CONTRACTS FROM 238,434 UP TO 239,290 (AND CLOSER TO THE NEW RECORD OI FOR SILVER SET ON AUGUST 22.2018.  THE PREVIOUS RECORD WAS SET APRIL 9.2018/ 243,411 CONTRACTS) AND TODAY’S CONSIDERABLE  OI COMEX GAIN OCCURRED WITH A 5 CENT GAIN IN PRICING.//YESTERDAY.

 

WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF AUGUST.  HERE WE HAVE 407 OPEN INTEREST STAND FOR DELIVERY WITH A LOSS OF 7 CONTRACTS.  WE HAD 61 NOTICES FILED YESTERDAY SO WE GAINED A FULL 54 CONTRACTS OR AN ADDITIONAL 270,000 OZ OF SILVER WILL STAND AT THE COMEX…. AND THESE GUYS REFUSED TO MORPH INTO A LONDON BASED FORWARD AS WELL AS NEGATING A FIAT BONUS. LET US WAIT AND SEE IF THEY ARE SUCCESSFUL IN OBTAINING PHYSICAL METAL ON THIS SIDE OF THE POND..  THE NEXT BIG ACTIVE DELIVERY MONTH AFTER AUGUST IS SEPT AND HERE THE OI FELL BY 1943 CONTRACTS DOWN TO 152,073 CONTRACTS. OCTOBER RECEIVED ANOTHER 13 CONTRACTS TO STAND AT 68.  NEXT ACTIVE DELIVERY MONTH IS DECEMBER AND HERE THE OI RISES BY 2473 CONTRACTS UP TO 54,864.

 

 

 

 

TODAY’S NUMBER OF NOTICES FILED:

 

We, today, had 54 notice(s) filed for 270,000 OZ for the AUGUST, 2019 COMEX contract for silver

 

 

Trading Volumes on the COMEX TODAY: 625,347  CONTRACTS  huge vol. today

 

 

 

CONFIRMED COMEX VOL. FOR YESTERDAY:  404,051  contracts

 

 

 

 

 

INITIAL standings for  AUGUST/GOLD

AUGUST 7/2019

Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
nil oz
Deposits to the Dealer Inventory in oz 321.50 oz

 

SCOTIA

 

10 kilobars

 

 

Deposits to the Customer Inventory, in oz  

nil

 

No of oz served (contracts) today
19 notice(s)
 1900 OZ
(0.0590 TONNES)
No of oz to be served (notices)
2735 contracts
(273500 oz)
8.506 TONNES
Total monthly oz gold served (contracts) so far this month
4400 notices
440,000 OZ
13.6898 TONNES
Total accumulative withdrawals of gold from the Dealers inventory this month NIL oz
Total accumulative withdrawal of gold from the Customer inventory this month xxx oz

 

we had 0 dealer entry:

We had 1 kilobar entries

 

 

 

 

total dealer deposits: nil oz

total dealer withdrawals: nil oz

 

we had 0 deposit into the customer account

i) Into JPMorgan:  nil oz

ii ) Into everybody else:  0

i

 

 

 

total gold deposits: nil  oz

 

very little gold arrives from outside/

 TODAY:  no amount  arrived

we had 1 gold withdrawal from the customer account:

i)Out of Scotia 321.50  oz
10 kilobars

 

 

 

total gold withdrawals; 321.50  oz

 

 

i) we had 0 adjustment today
FOR THE AUGUST 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 19 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 7 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 AUGUST /2019. contract month, we take the total number of notices filed so far for the month (4400) x 100 oz , to which we add the difference between the open interest for the front month of  AUGUST. (2754 contract) minus the number of notices served upon today (19 x 100 oz per contract) equals 713,500 OZ OR 22.192 TONNES) the number of ounces standing in this active month of AUGUST

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

No of notices served (4400 x 100 oz)  + (2743)OI for the front month minus the number of notices served upon today (19 x 100 oz )which equals 713,500 oz standing OR 22.192 TONNES in this  active delivery month of AUGUST.

We LOST 52  contracts or an additional 5200 oz will NOT  stand as these guys morphed into London based forwards as well as accepting a fiat bonus. THERE IS NO GOLD ON THIS SIDE OF THE POND,..

SURPRISINGLY LITTLE TO NO  GOLD HAS BEEN ENTERING THE COMEX VAULTS AND WE HAVE WITNESSED THIS FOR THE PAST YEAR!!  WE HAVE ONLY 16.013 TONNES OF REGISTERED (  GOLD OFFERED FOR SALE) VS 22.192  TONNES OF GOLD STANDING// JUDGING BY THE STRONG SIZE OF THE COMEX NOTICES FILED TODAY, IT LOOKS LIKE SOMEBODY IS WILLING TO TAKE ON THE CROOKS AT THE COMEX. WE ALSO HAD SOME BANKER SHORT COVERING.

 

 

 

total registered or dealer gold:  514,823.353 oz or  16.013 tonnes 
total registered and eligible (customer) gold;   7,782,115.992 oz 242.05 tonnes

 

IN THE LAST 34 MONTHS 115 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 AUGUST

INITIAL  standings/SILVER

IN TOTAL CONTRAST TO GOLD, HUGE ACTIVITY IN SILVER TODAY.
AUGUST 7 2019
Silver Ounces
Withdrawals from Dealers Inventory NIL oz
Withdrawals from Customer Inventory
 603,279.435 oz
CNT
Delaware

 

 

Deposits to the Dealer Inventory
nil oz

 

Deposits to the Customer Inventory
nil oz
No of oz served today (contracts)
54
CONTRACT(S)
(270,000 OZ)
No of oz to be served (notices)
353 contracts
 1,765,000 oz)
Total monthly oz silver served (contracts)  1132 contracts

5,660,000 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  0 deposits into the customer account

into JPMorgan:  nil  oz

ii)into everybody else: 0

 

 

 

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

JPMorgan now has 153.4 million oz of  total silver inventory or 50.36% of all official comex silver. (153.4 million/304.6 million

 

 

 

 

total customer deposits today: nil  oz

 

we had 2 withdrawals out of the customer account:

 

 

i) Out of CNT:  598,426.326 oz

ii) Out of Delaware:  4853.109 oz

 

 

 

 

 

 

total 603,279.435  oz

 

we had 1 adjustment :

i) Out of Brinks: 591,250.900 oz was adjusted out of the customer account of brinks and this landed into the dealer account of Brinks

 

total dealer silver:  91.363 million

total dealer + customer silver:  310.312 million oz

 

The total number of notices filed today for the AUGUST 2019. contract month is represented by 54 contract(s) FOR 270,000 oz

To calculate the number of silver ounces that will stand for delivery in AUGUST, we take the total number of notices filed for the month so far at 1132 x 5,000 oz = 5,660,000 oz to which we add the difference between the open interest for the front month of AUGUST. (407) and the number of notices served upon today 54 x (5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the AUGUST/2019 contract month: 1132 (notices served so far) x 5000 oz + OI for front month of AUGUST (407)- number of notices served upon today (54)x 5000 oz equals 7,425,000 oz of silver standing for the AUGUST contract month.

WE GAINED A STRONG 54 CONTRACTS  AS THE DEALERS BYPASSED THOSE STANDING TRYING TO GRAB WHATEVER SILVER THEY CAN. WE THUS HAVE AN ADDITIONAL 54 CONTRACTS OR 270,000 ADDITIONAL OZ STAND FOR DELIVERY ON THIS SIDE OF THE POND. THESE GUYS REFUSED AN OFFER FROM THE BANKERS TO ROLL TO A LONDON BASED FORWARD AND THEY ALSO NEGATED A FIAT BONUS FOR NOT ACCEPTING THIS CROOKED CONTRACT.

 

 

TODAY’S NUMBER OF NOTICES FILED:

 

We, today, had 54 notice(s) filed for 270,000 OZ for the AUGUST, 2019 COMEX contract for silver

 

 

 

 

 

 

 

 

 

 

 

 

TODAY’S NUMBER OF NOTICES FILED:

 

We, today, had 54 notice(s) filed for 270,000 OZ for the AUGUST, 2019 COMEX contract for silver

 

 

 

 

 

 

 

 

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TODAY’S ESTIMATED SILVER VOLUME:  179,558 CONTRACTS (we must have had considerable spreading activity..accumulation

 

CONFIRMED VOLUME FOR YESTERDAY: 84,366 CONTRACTS..

 

 

 

 

 

YESTERDAY’S CONFIRMED VOLUME OF 84366 CONTRACTS EQUATES to 421 million  OZ 60.3% OF ANNUAL GLOBAL PRODUCTION OF SILVER..makes sense!!

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

 

 

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NPV for Sprott 

1. Sprott silver fund (PSLV): NAV FALLS TO -2.35% ((AUGUST 7/2019)
2. Sprott gold fund (PHYS): premium to NAV FALLS TO -1.97% to NAV (AUGUST 7/2019 )

Note: Sprott silver trust back into NEGATIVE territory at +%-/Sprott physical gold trust is back into NEGATIVE/

(courtesy Sprott/GATA)

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

NAV 14.90 TRADING 14.40/DISCOUNT 3.34

END

And now the Gold inventory at the GLD/

August 7/ WITH GOLD UP $31.00//A GOOD PAPER DEPOSIT OF 1.86 TONNES OF GOLD INTO THE GLD INVENTORY//INVENTORY RESTS AT 836.92 TONNES

AUGUST 6.2019: WITH GOLD UP $7.85 A STRONG DEPOSIT OF 4.50 TONNES OF PAPER GOLD INTO THE GLD LATE LAST NIGHT/INVENTORY RESTS AT 835.16 TONNES

AUGUST 5/2019//WITH GOLD UP $18.80/A STRONG DEPOSIT OF 2.94 TONNES OF PAPER GOLD INTO THE GLD/INVENTORY RESTS AT 830.76 TONNES.

AUGUST 2/2019: WITH GOLD UP $25.20: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 827.82 TONNES

AUGUST 1/2019: WITH GOLD DOWN $4.90 TODAY: TWO TRANSACTIONS: i) A PAPER WITHDRAWAL OF 1.47 TONNES (USED IN THE RAID THIS MORNING)/ and ii) A PAPER DEPOSIT OF 4.40 TONNES THIS AFTERNOON!/INVENTORY RISE TO 827.82 TONNES

JULY 31/WITH GOLD DOWN 3.90 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY REMAINS AT 824.89 TONNES

JULY 30//WITH GOLD UP $9.00 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY REMAINS AT 824.89 TONNES

JULY 29/WITH GOLD UP $1.00: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER DEPOSIT OF 6.75 TONNES INTO THE GLD INVENTORY///INVENTORY RISES TO 824.89 TONNES

JULY 26/WITH GOLD UP $4.50: A HUGE INVENTORY WITHDRAWAL OF 4.09 TONNES OF PAPER GOLD LEAVES THE GLD/INVENTORY RESTS AT 818.14 TONNES

JULY 25.2019: WITH SILVER DOWN 19 CENTS: ANOTHER PAPER WITHDRAWAL OF 1.17 MILLION OZ/INVENTORY REST AT 358.213 MILLION OZ

JULY 24…A BIG CHANGE  IN SILVER INVENTORY AT THE SLV: A GAIN OF 1.685 MILLION OZ/INVENTORY RESTS AT 359.383 MILLION OZ

JULY 23/2019: WITH SILVER UP 5 CENTS TODAY: ANOTHER BIG CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 2.221 MILLION PAPER OZ ADDED INTO THE GLD INVENTORY//INVENTORY RESTS AT 357.698 MILLION OZ////

JULY 22.2019/WITH SILVER UP 21 CENTS TODAY: A MASSIVE  CHANGES IN SILVER INVENTORY AT THE SLV: A PAPER DEPOSIT OF 8.939 MILLION OZ ADDED TO THE SLV INVENTORY/INVENTORY RESTS AT 355.919 MILLION OZ//

JULY 19/WITH GOLD DOWN $1.00: A MASSIVE  DEPOSIT OF 11.44 TONNES OF PAPER GOLD INTO THE GLD/INVENTORY RESTS AT 814.62

JULY 18/WITH GOLD UP $5.55 TODAY: A BIG PAPER DEPOSIT OF 3.81 TONNES OF GOLD INTO THE GLD/INVENTORY RESTS AT 803.18 TONNES

JULY 17/WITH GOLD UP $11.35 TODAY: A BIG WITHDRAWAL OF 1.17 TONNES FROM THE GLD//INVENTORY RESTS AT 799.37 TONNES

JULY 16: WITH GOLD DOWN $2.15 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 800.54 TONNES

JULY 15: WITH GOLD UP $1.85 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 800.54 TONNES

JULY 12/WITH GOLD UP $5.20 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 800.54 TONNES

JULY 11.WITH GOLD DOWN $5.25: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 800.54 TONNES

JULY 10//WITH GOLD UP $11.65 A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER GOLD DEPOSIT OF 6.46 TONNES/INVENTORY RESTS AT 800.54 TONNES

JULY 9/WITH GOLD UP 70 CENTS, A HUGE PAPER WITHDRAWAL OF 2.89 TONNES WHICH WAS USED IN THE FUTILE RAID ON GOLD AND SILVER THIS MORNING//INVENTORY RESTS AT 794.08 TONNES

JULY 8/ WITH GOLD DOWN 35 CENTS A HUGE WITHDRAWAL OF 1.47 TONNES FROM THE GLD/INVENTORY FALLS TO 796.97 TONNES

JULY 5TH/WITH GOLD DOWN $19.50/NO CHANGES IN GOLD INVENTORY AT THE GLD//INV RESTS AT 798.44 TONNES

JULY 3// WITH GOLD UP $12.60 TODAY A SURPRISE WITHDRAWAL OF 1.76 TONNES FROM THE GLD//INVENTORY RESTS AT  798.44

 

JULY 2. WITH GOLD UP $18.90 A HUGE “PAPER” DEPOSIT OF 6.16 TONNES INTO THE GLD/INVENTORY RESTS AT 800.20 TONNES

JULY 1: WITH GOLD DOWN $24.70 A HUGE “PAPER GOLD” WITHDRAWAL OF 1.76 TONNES FROM THE GLD/INVENTORY RESTS TONIGHT AT 794.04 TONNES

 

 

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AUGUST 7/2019/ Inventory rests tonight at 836.92 tonnes

 

 

*IN LAST 637 TRADING DAYS: 98.48 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 537 TRADING DAYS: A NET 68.06 TONNES HAVE NOW BEEN ADDED INTO  THE GLD INVENTORY.

 

 

end

 

Now the SLV Inventory/

AUGUST 7/WITH SILVER UP 74 CENTS: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 361.907 MILLION OZ/

AUGUST 6/ WITH SILVER UP 5 CENTS: TWO TRANSACTIONS: A HUGE PAPER DEPOSIT OF 2.34 MILLION OZ WAS DEPOSITED INTO THE SLV LATE LAST NIGHT: THEN A HUGE 2.994 MILLION OZ OF A PAPER DEPOSIT THIS AFTERNOON: INVENTORY RESTS AT 361.907 MILLION OZ//

AUGUST 5.2019: WITH SILVER UP 12 CENTS A TINY 142,000 OZ WITHDRAWAL AND THAW AS TO PAY FOR FEES//INVENTORY RESTS AT 356.573 MILLION OZ..

AUGUST 2/2019: WITH SILVER UP 10 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 356.715 MILLION OZ/

AUGUST 1//WITH SILVER DOWN 23 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY REMAINS AT 356.715 MILLION OZ//

 

JULY 31/WITH SILVER DOWN 14 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY REMAINS AT 356.715 MILLION OZ//

JULY 30/2019: WITH SILVER UP 8 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY REMAINS AT 356.715 MILLION OZ//

JULY 29/2019: WITH SILVER UP 4 CENTS TODAY: A SMALL WITHDRAWAL OF 468000 OZ FROM THE SLV/INVENTORY LOWERS TO 356.715 MILLION OZ//

JULY 26.2019: WITH SILVER DOWN 2 CENTS TODAY:  A HUGE 1.03 MILLION OZ OF PAPER SILVER LEAVES THE SLV/INVENTORY LOWERS TO 357.183 MILLION OZ//

JULY 25.2019: WITH SILVER DOWN 19 CENTS: ANOTHER PAPER WITHDRAWAL OF 1.17 MILLION OZ/INVENTORY REST AT 358.213 MILLION OZ

JULY 24…A BIG CHANGE  IN SILVER INVENTORY AT THE SLV: A GAIN OF 1.685 MILLION OZ/INVENTORY RESTS AT 359.383 MILLION OZ

JULY 23/2019: WITH SILVER UP 5 CENTS TODAY: ANOTHER BIG CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 2.221 MILLION PAPER OZ ADDED INTO THE GLD INVENTORY//INVENTORY RESTS AT 357.698 MILLION OZ////

JULY 22.2019/WITH SILVER UP 21 CENTS TODAY: A MASSIVE  CHANGES IN SILVER INVENTORY AT THE SLV: A PAPER DEPOSIT OF 8.939 MILLION OZ ADDED TO THE SLV INVENTORY/INVENTORY RESTS AT 355.919 MILLION OZ//

JULY 19/WITH SILVER FLAT TODAY: ANOTHER MONSTROUS PAPER DEPOSIT OF 3.276 MILLION OZ ENTERS THE SLV//WHAT A MASSIVE FRAUD//INVENTORY RESTS AT 346.980 MILLION OZ

JULY 18/WITH SILVER UP 24 CENTS TODAY: A BIG CHANGES IN SILVER INVENTORY AT THE SLV: A PAPER DEPOSIT OF 2.668 MILLION OZ INTO THE SLV///INVENTORY RESTS AT 343.704 MILLION OZ//

JULY 17: WITH SILVER UP ANOTHER 29 CENTS: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 8.518 MILLION OZ/INTO THE SLV INVENTORY///INVENTORY RESTS AT 341.036 MILLION OZ//

JULY 16: WITH SILVER UP 31 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 332.518 MILLION OZ

JULY: 15  WITH SILVER UP 11 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 332.518 MILLION OZ

JULY 12/WITH SILVER UP 10 CENTS: NO CHANGE IN SILVER INVENTORY/INVENTORY RESTS AT 332.518 MILLION OZ//

JULY 11/NO CHANGE IN SILVER INVENTORY

JULY 10/WITH SILVER UP 9 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 332.518 MILLION OZ//

JULY 9/WITH SILVER UP A SMALL 7 CENTS A GIGANTIC INVENTORY GAIN OF 4.026 MILLION OZ/ INVENTORY RESTS AT 332.518 MILLION OZ AND NOW IT SHOULD BE QUITE CLEAR THAT THE SLV ( AND GLD ARE FRAUDS)

JULY 8/WITH SILVER UP 7 CENTS: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 328,492 MILLION OZ

JULY 5/WITH SILVER DOWN 32 CENTS WE STRANGELY HAD A HUGE INVENTORY GAIN OF 2,234 MILLION OZ//INVENTORY RESTS AT 328.492 MILLION OZ

JULY 3 WITH SILVER UP 10 CENTS A HUGE INCREASE IN INVENTORY..INVENTORY RESTS AT 326.151 MILLION OZ

JULY 2/WITH SILVER UP 4 CENTS TODAY: NO CHANGES IN SILVER INVENTORY/INVENTORY RESTS AT 323.330 MILLION OZ//

JULY 1/ WITH SILVER DOWN 16 CENTS: A SURPRISING DEPOSIT OF 936,000 OZ INTO THE SLV/INVENTORY RESTS TONIGHT AT 323.330 MILLION OZ/

 

AUGUST 7/2019:

 

Inventory 361.907 MILLION OZ

LIBOR SCHEDULE AND GOFO RATES:

 

 

YOUR DATA…..

6 Month MM GOFO 2.15/ and libor 6 month duration 2.05

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

G0LD LENDING RATE: – .10

 

XXXXXXXX

12 Month MM GOFO
+ 1.98%

LIBOR FOR 12 MONTH DURATION: 1.99

 

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.01

end

GOLD TRADING/LAST NIGHT:

Gold Futures Top $1500 After China Weakens Fix More Than Expected

Update: In what appears to be China’s last warning (to push Trump to offer an olive branch before all hell breaks loose), PBOC fixed the yuan weaker than expected but just firmer than the critical 7.00 level.

The fixing was seen at 6.9977, according to the average projection of 22 traders and analysts surveyed by Bloomberg, but PBOC weakened the fixing by 0.45% to 6.9996 per dollar.

Offshore yuan slipped lower on the fix…

Gold futures topped $1500 (for the first time since 2013) – retracing 50% of the 2011 high to 2015 low plunge.

And Dow futures are leaking on the print…

*  *  *

With expectations for another weaker fix (at around 6.9994) tonight, it appears investors are seeking safe-havens (bonds and bullion bid) as equity futures slide.

Gold is bid…

Dow Futures are leaking lower…

But Treasury yields have plunged back to yesterday’s lows (1.67%), dramatically decoupled from stocks…

Smashing the yield curve to new cycle lows (-36bps is the most inverted since 2008)…

So all eyes will once again be on the CNY Fix…

Is China going to unleash hell again tonight?

If you ask JPMorgan, the answer is a definite maybe as they slashed their forecast for USDCNY to 7.35 by year-end.

The risk profile of our China and global growth forecast has shifted to the downside alongside the global inflation forecast – as indirect demand depressing channels are likely to prove more  powerful than the direct effect of cost increases from trade restrictions. We have already added fiscal policy and monetary policy easing in China and there is likely to be more monetary policy easing than forecast elsewhere in the world.

Pressure on the USD is likely to be upward in this environment, particularly against the EM. While USD/CNY will not likely move in a straight line, we have revised downward the CNY forecast profile.  We are now forecasting USD/CNY to reach 7.35 by end 2019 and 7.40 by the middle of 2020.

In terms of the CFETS CNY basket, we are now expecting an 88.70 level move by year end, which would bring the basket change to 4.6% versus end 2018 levels.

As a reminder, the last time China devalued on that scale, VIX exploded to 40, and we all know what happened last Q3/Q4…

Deja vu all over again?

 

 

end

 

PHYSICAL GOLD/SILVER STORIES
i) GOLDCORE BLOG/Mark O’Byrne

Gold Surges Over $1,500/oz as Investors Seek Shelter From Gathering Storm

FX – 1 Day Relative Performance (Finviz)

via Bloomberg

Gold futures rallied above $1,500 an ounce on sustained demand for the traditional haven as the U.S.-China trade war festers, global growth slows and central banks around the world ease monetary policy.

The metal advanced as much as 1.3% to $1,503.30 an ounce on the Comex, the highest since 2013. The move extends this year’s climb to 17%, with gains underpinned by inflows into exchange-traded funds. Central banks in India and New Zealand both surprised markets on Wednesday with bigger-than-expected interest rate cuts, boosting speculation others will follow.

Silver, gold’s cheaper cousin, also surged. Spot prices rallied as much as 2.2% to $16.8082 an ounce, the highest in more than a year.

Gold has been one of the chief beneficiaries of the turmoil in global financial markets as Washington and Beijing spar over trade. In recent days, the Trump administration threatened fresh tariffs against Chinese goods, the yuan was allowed to sink, and the U.S. branded China as a currency manipulator. The stand-off has boosted the odds of more easing from the Federal Reserve.

“Gold is serving its traditional role as a safe-haven asset,” said Wayne Gordon, executive director for commodities and foreign exchange at UBS Group AG’s wealth management unit. Under the bank’s risk case, marked by a further escalation of the trade fight, prices could go as high as $1,600, he said.

Futures traded at $1,497.80 an ounce at 7:55 a.m. in London, gaining for a fourth day.

NEWS & COMMENTARY

Gold Tops $1,500 as Investors Seek Shelter From Gathering Storm

Gold Hits Over 6-year High as Trade Jitters Spark Safe-haven Rush

Gold Holds Near Six-year Peak as Trade Tensions Simmer

Asian Stocks Turn Lower on Lingering Trade War Fears, Yuan Slips

Scientists Just Created the World’s Thinnest Gold and It’s Two Atoms Thick

Yield Curve Blares Loudest U.s. Recession Warning Since 2007

Silver/Gold Ratio About to Send Multi-year Bullish Breakout Message

China’s Exit From US Agriculture is a Devastating Blow to an Already Struggling Sector  

Pentagon Warns It Will Prevent “Unacceptable” Turkish Invasion of Northern Syria

Scientists Create the World’s Thinnest Gold

 

Gold Prices via LBMA (AM/ PM Fix – USD, GBP & EUR)

06-Aug-19 1461.85 1465.25, 1199.59 1201.21 & 1304.85 1311.11
05-Aug-19 1457.45 1465.25, 1199.92 1203.85 & 1307.92 1310.23
02-Aug-19 1436.05 1441.75, 1184.17 1187.28 & 1294.02 1298.44
01-Aug-19 1406.40 1406.80, 1161.12 1161.74 & 1273.35 1273.29
31-Jul-19 1430.55 1427.55, 1175.48 1167.45 & 1283.20 1281.37
30-Jul-19 1428.45 1425.90, 1173.47 1171.95 & 1281.75 1279.60
29-Jul-19 1418.95 1419.05, 1150.91 1157.94 & 1275.78 1275.30
26-Jul-19 1418.25 1420.40, 1140.27 1144.70 & 1273.02 1275.95
25-Jul-19 1426.35 1416.10, 1143.08 1132.88 & 1281.86 1265.85

Click here to listen to the latest GoldCore Podcast

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Buy, Transfer & Store Gold and Silver in Zurich, Switzerland – Six Months Free Storage

Receive our free Daily or Weekly Updates by signing up here and click here to subscribe to GoldCore’s You Tube Channel

Mark O’Byrne
Executive Director

 

ii) Important gold commentaries courtesy of GATA/Chris Powell

Negative interest rates at Swiss banks is forcing more citizens into gold

(Bloomberg//GATA)

Negative rates at Swiss banks seem to invite customers to move cash into gold

 Section: 

UBS’ Rich Clients to Feel Negative Rates Pain as Fees Extended

By Patrick Winters
Bloomberg News
Tuesday, August 6, 2019

UBS Group plans to expand a policy of charging rich clients for holding excess cash in their accounts as negative interest rates in Europe are poised to stay.

The bank, which has made wealth management its central focus, plans to charge its Swiss clients an annual fee of 0.6% on deposits of more than 500,000 euros ($560,000). The fee previously kicked in at 1 million euros.

… 

Like Swiss rival Credit Suisse Group, UBS is caught between the prospect of losing money to hold client deposits and imposing fees that could prompt customers to take their business elsewhere. Amid an extended period of ultra-low and negative interest rates, the lenders have to pay central banks to park excess cash in Swiss francs or euros.

UBS’ decision comes after Credit Suisse said it will impose a fee of 0.4% on customers with euro accounts of more than 1 million euros from September. UBS has already said it will introduce negative rates for clients holding large Swiss franc balances, while Credit Suisse said it is also considering the step.

Clients of UBS can mitigate the 0.6% charge by moving cash into “fiduciary call deposits” outside of Switzerland — financial instruments that can be called within two working days, the bank said. Those deposits are subject to a 0.375% annual fee. The best scenario for the bank is when clients move their cash into equities or bonds. …

… For the remainder of the report:

https://www.bloomberg.com/news/articles/2019-08-06/ubs-to-charge-wealthy…

END

Gold which is just 2 atoms thick has been discovered in a lab..this will have tremendous use in medicine plus other areas

(zerohedge)

Scientific discovery gives hope for monetary metals derivatives

 Section: 

Get this right over to the Bank of England.

* * *

World’s Thinnest Gold ‘Just Two Atoms Thick’ Created in Lab

By Sean Keach
The Sun, London
Tuesday, August 6, 2019

Gold that is just two atoms thick has been created in a lab by British scientists.

The “world’s thinnest gold” is one million times thinner than a fingernail — and is so thin, it’s technically regarded as “two dimensional.”

… 

The official measurement is 0.47 nanometres, made possible because the gold is made up of just two atoms sitting on top of each other.

This revolutionary material could be used to create new technology and speed up industrial processes, according to its creators at the University of Leeds. …

… For the remainder of the report:

https://www.thesun.co.uk/tech/9662771/worlds-thinnest-gold-two-atoms-thi…

END

Craig Hemke believes that there will be an assault on $1500 gold.

(Craig Hemke/Sprott/GATA)

 

Craig Hemke at Sprott Money: Gold’s next target

 Section: 

4p ET Tuesday, August 6, 2019

Dear Friend of GATA and Gold:

Writing at Sprott Money, Craig Hemke of the TF Metals Report says today that despite gold’s solid rise in recent weeks, bullion banks remain in charge of the gold futures market and will aim to knock the price down when hedge funds and speculators get too long there. The zone between $1,485 and %1,525 looks most important to Hemke. If gold can pass that, Hemke writes, its all-time high will be in sight again.

Hemke’s analysis is headlined “Gold’s Next Target” and it’s posted at Sprott Money here:

https://www.sprottmoney.com/Blog/golds-next-target-craig-hemke-06-082019…

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

END

Bill Murphy interviewed

(Bill Murphy,GATA)

Australia’s ‘As Good As Gold’ brothers interview GATA chairman

 Section: 

5:15p ET Tuesday, August 6, 2019

Dear Friend of GATA and Gold:

Darryl and Brian Panes of As Good As Gold Australia interviewed GATA Chairman Bill Murphy the other day, discussing the prospects for the monetary metals as the longstanding price suppression by central banks and their agents is showing signs of stress.

The Paneses note that gold is already at a record high in Australian dollars, and Murphy thinks that the monetary metal will reach a record high in U.S. dollars before too long. But whether retail investors in the United States will realize any profits from the move is questionable, Murphy says, since U.S. coin shops report that customers are mainly selling, not buying.

… 

Also discussed is whether the gold-silver ratio will ever return to normal levels. Murphy thinks it will, with a silver price surpassing $50 per ounce.

Unlimited naked shorting in the gold and silver futures markets is also covered, with Murphy asserting that it is permitted because the U.S. government is behind it.

The interview is 33 minutes long and can be viewed at You Tube here:

https://www.youtube.com/watch?v=NyilkMtS-y0

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

END

China has been seen supporting the yuan.

(Reuters/GATA)

China state banks seen supporting yuan in forwards market, sources tell Reuters

 Section: 

By Winni Zhou and Andrew Galbraith
Reuters
Tuesday, August 6, 2019

China’s state banks have been active in the onshore yuan forwards market this week, using swaps to tighten dollar supply and support the Chinese currency, four sources with knowledge of the matter told Reuters.

The spot value of the yuan has fallen sharply this week against the dollar as tensions between China and the United States escalated and prompted fears that their trade war could shift into a currency war.

… 

The sources said banks had conducted significant amounts of buy-sell swaps in the onshore market on Tuesday. Buy-sell swaps help to reduce the supply of dollars that the market can access to short-sell the yuan. …

… For the remainder of the report:

https://www.reuters.com/article/us-china-yuan-forwards/china-state-banks…

* * *

Join GATA here:

New Orleans Investment Conference
Hilton New Orleans Riverside Hotel
Friday-Monday, November 1-4, 2019

https://neworleansconference.com/noic-promo/powellgata/

* * *

Help keep GATA going

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

http://www.gata.org

END

Boy are Mexicans brazen: they just stole a couple of million dollars worth of gold coins form the Mexican mint.

(zerohedge)

Robbers steal millions in gold coins from Mexican mint

 Section: 

From Deutsche Welle, Bonn, Germany
Tuesday, August 6, 2019

Mexico’s security ministry announced today that an armed group of robbers broke into the nation’s mint, stealing the equivalent of 50 million Mexican pesos (E2.23 million, $2.5 million) in gold coins.

The announcement came after sources from the Department of Finance and Public Credit confirmed the crime to news agency EFE.

… 

According to a Mexico City police report, two people, one with a firearm, broke into the mint after throwing a security guard to the ground and taking his gun.

One of the robbers then went to an open vault and filled a backpack with 1,567 gold coins. The robbers then carried the gold centennials directly from the scene.

Officials from Mexico City’s Secretariat for Citizen Security are currently in the testimonial process of the case.

Officials from the government coin manufacturer are suspected of assisting the robbers. …

… For the remainder of the report:

https://www.dw.com/en/robbers-steal-millions-in-gold-coins-from-mexican-…

END

iii) Other physical stories:

Goldman Sees Gold Rising To $1,600 “Or Even Higher” On Escalating Trade War” 1

Gold just hit the highest level in 6 years and according to Goldman it is set to go much higher.

In a report by Goldman’s Sabine Schels, the commodity strategist looks at the consequences of the ever-escalating trade war between the US and China, and sees nothing but upside for gold, if not the other industrial metals. As she notes overnight, “the metals complex has weakened significantly, with iron ore down 18% and copper down 4% since the latest US tariff proposal. While there was a softening in iron ore fundamentals, the vast majority of the move was macro related, with copper positioning making fresh lows. Underscoring that, gold prices surpassed our target of $1475/toz.

And with the yuan continuing to sink, as the PBOC is likely to deliver its first ever fixing below 7.00 tonight after the laughable 6.9996 on Tuesday, Goldman warns that a sharp CNY depreciation “could be highly disruptive, with the first order effect likely more dominant while the 2nd order effects may be much slower to take hold.”

Goldman then estimates that a 10% depreciation in the broad-based CNY could spell as much as 13% downside to the industrial metals complex, but of course, that would be good news for gold prices, which have increased further as a weaker CNY sparked substantial US and global growth fears. And with growth worries likely to persist, gold is expected to rise sharply. As a result, Goldman has hiked its 3, 6, 12-month gold price forecasts from $1450, $1475, $1475/toz to $1575, $1600 and $1600/toz, respectively.

Therefore, Goldman upgrades its gold ETF forecast for 2019 from 300 tonnes to 600 tonnes. While Goldman does not expect a global recession, for now, “until DM growth improves and worries ease gold should continue to move higher.” As such, it is upgrading its 3, 6, 12 month gold price forecasts from $1450, $1475, $/1475/toz to $1575, $1600 and $1600/toz, respectively. “At the same time, we see more upside in silver prices, too. When the push into gold is as strong as it now interest in silver tends to get reignited, too” and so Goldman upgrades its silver forecast from $15.4, $16, $/16/toz to $17.6, $18 and $18/toz, respectively.

Of course, gold could go even higher: as the Goldman analyst notes, “if growth worries persist, possibly due to a trade war escalation, gold could go even higher driven by a larger ETF gold allocation from portfolio managers, who still continue to under-own gold. Specifically we argued that 2019 gold ETFs build could reach the pace similar to Jan- Oct 2016, which is the last time DM growth was so low.”  Fast forward to today, when with the DM CAI persistently low, the trade war escalating, global equities selling off and volatility spiking, “it looks our risk scenario is playing out” Goldman admits. Indeed, “gold ETFs have recently built momentum almost as strong as in 2016 and we believe that can be maintained in the short term.”

As Bloomberg calculates, bullion holdings in ETF climbed to the highest since April 2013. The precious metal climbed as much as 1.8% on Wednesday to $1,511.60 an ounce, the highest since April 2013.

To all this we would just add the following usual disclaimer: any time Goldman predicts one thing, the opposite happens…

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

* * *

Your early MONDAY 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: 7.0458/ GETTING VERY DANGEROUSLY CLOSE TO 7:1

//OFFSHORE YUAN:  7.0781   /shanghai bourse CLOSED DOWN 8.88 POINTS OR 0.32%

HANG SANG CLOSED UP 20.79 POINTS OR 0.08%

 

2. Nikkei closed DOWN 68.75 POINTS OR 0.33%

 

 

 

 

3. Europe stocks OPENED ALL GREEN/

 

 

 

USA dollar index UP TO 97.63/Euro FALLS TO 1.1197

3b Japan 10 year bond yield: FALLS TO. –.19/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 106.01/ 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:: 53.43 and Brent: 58.49

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 RISES TO -.59%/Italian 10 yr bond yield DOWN to 1.45% /SPAIN 10 YR BOND YIELD DOWN TO 0.17%…ITALIAN 10 YR BOND YIELD/GERMAN BUND: 2.04: DANGEROUS FOR THE ITALIAN BANKING SYSTEM

3j Greek 10 year bond yield FALLS TO : 2.00

3k Gold at $1498.00 silver at: 16.98   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble UP 26/100 in roubles/dollar) 65.04

3m oil into the 53 dollar handle for WTI and 58 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 106.01 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 .9762 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0930 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 0.59%

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 1.65% early this morning. Thirty year rate at 2.17%

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

6.  TURKISH LIRA:  UP  TO 5.4926..

3 Central Bank Shocks Unleash Overnight Yield Crash, With Yuan On Verge Of Collapse

There is just one way to describe the plunge in bond yields overnight and the events behind it: the global race to the currency bottom is rapidly accelerating in its final lap with a global deflationary Ice Age(take a bow Albert Edwards) waiting on the other side.

The main event, of course, was the latest yuan fixing with the PBOC showing a clear sense of humor when it set the currency at 6.9996laughably not to be confused with 7.0000 (for at least another 24 hours that is), but just a fraction of a percent away from the critical threshold, and weaker than the 6.9977 expected. The result was a resumption in the offshore yuan selloff, a hit to US equity futures and a drop in Treasury yields. Of course, once the PBOC does finally fix the yuan on the wrong side of 7, all bets are off and watch as the CNH crashes… as far as 7.70 according to SocGen, especially once Trump hikes tariffs to 25%.

But there was much more in today’s iteration of the global race to the currency bottom, when first New Zealand, then India and finally Thailand shocked investors by being far more dovish than analysts expected. Indeed, the three Asian central banks delivered surprise interest-rate decisions on Wednesday as central bankers not only took aggressive action to counter a worsening global economy, but are now frontrunning each other – and the Fed – in doing so.

 

As noted last night, New Zealand’s central bank on Wednesday stunned investors by dropping its benchmark rate by 50 basis points, double the expected reduction and sending the kiwi tumbling. Thailand also surprised all but two in a survey of economists, cutting by 25 basis points. Finally, India’s central bank lowered its rate by an unconventional 35 basis points.

The response in the kiwi said it all, while the Australian dollar plunged to a ten year low in sympathy and on expectations that the OZ central bank would be next.

Some more details: the Reserve Bank of India lowered its benchmark rate by an unconventional 35 basis points to 5.4%, its fourth cut this year. New Zealand reduced its rate by 50 basis points to 1%; economists had forecast a 25 basis-point reduction. The Bank of Thailand’s rate cut was the first in more than four yearsAnd it’s not over: the Philippines is set to decide monetary policy Thursday, with 24 of 26 economists predicting a 25-point cut. Bangko Sentral ng Pilipinas Governor Benjamin Diokno this week said there’s space for 50 basis points of easing before year’s end. The question is when will Australia join the party and cut to zero or below.

Traders and economists were shocked by the dovish three-peat:

  • On New Zealand: “This was not what the market was expecting at all, it’s a shock to many. Considering the data isn’t terrible for New Zealand at all, this is an example of a central bank that’s looking beyond current data and trying to get ahead of the global slowdown.” – Kyle Rodda, analyst at IG Markets in Melbourne.
  • On Thailand: “With the U.S.-China trade war spilling into currencies, more Bank of Thailand rate cuts may be forthcoming, especially as Bloomberg Economics expects the People’s Bank of China to cut rates later this year” – Tamara Mast Henderson, Bloomberg Asean economist
  • On India: “The dovish tone in its policy statement signals further easingmight be in the pipeline to get the economy back on its feet” – Abhishek Gupta, Bloomberg India economist

A big picture recap from Chang Wei Liang, macro strategist of DBS, said it all: “Demand is easing globally, and inflation pressures look set to remain highly restrained. The dovish bias could remain somewhat entrenched, until there are signs of green shoots in Europe/China, and some meaningful reduction in trade anxiety.”

Still, the dovish moves by three Asian central banks showed that policy makers still have some power to surprise, and underscore the global shift toward easier policy even after the Federal Reserve‘s unexpectedly hawkish stance last week. Disappointing data may push the European Central Bank to turn toward easier monetary policies when it meets next month.

In short, a race to the bottom, and the US is badly lagging so expect either more rate cuts, more QE or direct currency intervention as Trump gets impatient with the ongoing dollar strength.

The central bank action, coupled with the ongoing currency war, roiled currencies and pushed bond yields to fresh record lows. The New Zealand dollar dropped more than 1% against the U.S. currency and the Thai baht slid 0.2%. But nowhere was the plunge in yield more visible than in the US where the 10Y dropped as low as 1.65%, while the 30Y Treasury tumbled to 2.16%, just 3 basis points above the effective Fed Funds rate, meaning the entire US curve is about to be inverted today.

Away from crashing yields, an eerie calm returned to stock markets on Wednesday as the dovish central bank overtures offset fears of an escalating currency war, thanks to some softer rhetoric from Washington.  U.S. equity futures extended a rebound and European stocks rallied as markets continued to recover from a brutal selloff at the start of the week.

Caution was on display, however, as noted above with bonds soaring while currencies were roiled by a series of dovish central-bank moves in Asia.

U.S. equity futures turned higher following the dovish central bank three-peat in Asia, after slumping earlier following the PBOC fix.

The MSCI world equity index rose 0.2%. The Stoxx Europe 600 index rose for the first time in four days, led by technology stocks after Microchip’s upbeat demand outlook. Chemicals producers advanced after Bayer and Lanxess agreed to sell their stakes in Currenta, while Glencore fell after its profits missed estimates. Shares were mixed but calmer in Asia, with Japanese stocks closing barely changed while equities in Shanghai declined.

But gold, the Japanese yen and government debt remained in high demand as investors remained wary of riskier assets.

Earlier in the session, Asian stocks inched higher, halting a five-day losing streak, after three central banks in the region delivered surprise rate cuts. Markets however were mixed, with Indonesia climbing and India retreating despite the bigger than expected rate cut. The Topix closed 0.1% higher, supported by Toyota Motor, Sony and Kao. The Shanghai Composite Index declined 0.3%, sliding for a sixth day, as the yuan weakened. Shanghai International Port and large financial firms were among the biggest drags. China’s central bank officials reassured foreign firms that the yuan won’t continue to drop significantly. New Zealand shares jumped in mid-afternoon trading after the central bank cut interest rates by more than economists had forecast. The Sensex fell 0.3% in a choppy session, as the Reserve Bank of India cut the annual economic growth forecast while reducing its benchmark interest rate by more than analysts had expected.

In FX, the star once again was the yuan, which dropped 0.3% to 7.0801 in offshore markets after China’s central bank set the daily fixing just a fraction stronger than the key level of 7 per dollar. The People’s Bank of China lowered the reference rate to 6.9996, an 11 year low. That leaves very little room for it to continue tracking the currency lower while setting the rate stronger than 7, a level that if breached could set the stage for further depreciation. “We had a little bit of recovery yesterday, but this morning we are seeing that stalling due to the PBOC fixing the dollar-yen higher again,” said Thu Lan Nguyen, FX strategist at Commerzbank. “It has caused markets to again be in a bit of a risk-off mode.”

Societe Generale SA said the yuan may fall to 7.7 per dollar if the U.S. ramps up tariffs on the nation’s goods, potentially bad news for other emerging markets that have been moving increasingly in lockstep with the currency.  “There will be an inflection point for investors to dip their toes in and position for a tactical rally or to monetize carry in high yielders, but not now,” said Jason Daw, the head of emerging market strategy at Societe Generale in Singapore.

The kiwi slumped after the RBNZ surprised the market with a bigger-than-forecast cut. The Australian dollar fell to a 10 year low in sympathy as traders bet the RBA may follow suit. The yen led gains in the Group-of-10 currencies as the PBOC set fixing close to 7 per dollar. India’s rupee fluctuated and the Thai baht slipped after policy makers in both countries lowered borrowing costs. The euro declined with the pound and the U.S. dollar was steady.

Meanwhile, in rates yields were plunging across the board, with the 10-year Treasury yield falling through 1.7% and German rates dropping to a record after industrial production in the euro-region’s biggest economy registered the biggest annual decline in almost a decade. Semi-core bonds and most peripheral notes lead euro-area gains while curves flattened amid relentless search for yield. Money markets now price in more ECB rate cuts after weaker-than-forecast German data, while China fixes the yuan weaker, stoking trade tensions. Bunds rise as industrial production missed the median estimate; core debt underperforms as Germany’s sale of EU4b five-year sees oversubscription fall to 1.2x versus 1.5x prior and undersubcription of 0.78x after accounting for retentions. German 2s30s curve narrows 8bps to 69bps, the flattest since 2008. Money markets price 30bps of ECB rate cuts in June 2020 versus 28bps on Tuesday. Gilts outperform bunds by 1bp and short sterling strip bull flattens.

Traders remain on tenterhooks after Monday’s moves, which included the biggest one-day plunge in global equities since February 2018. An escalation in the trade war between the world’s two biggest economies continues to unnerve investors, even after China said recent yuan depreciation was decided by the market, not Beijing. “We’re likely to see perhaps another shoe drop as the week progresses because this is not getting fixed,” Kristina Hooper, the Atlanta-based chief global market strategist at Invesco Ltd., told Bloomberg TV. “There really is the potential for it to get worse from here.”

Meanwhile, Gold continued to soar and reached a six-year high of $1,489.76 per ounce. The Japanese yen rose 0.2% to 106.27, although that was still some way from levels seen on Monday when the trade war’s escalation panicked investors.

Finally, in commodity markets, oil prices slipped, with the potential for damage to the global economy and to fuel demand from the Sino-U.S. trade dispute casting a shadow over the market. Brent crude futures were at $58.79 a barrel by 0759 GMT, down 14 cents, or 0.05%, and trading near seven-month lows.

Market Snapshot

  • S&P 500 futures up 0.3% to 2,884.25
  • STOXX Europe 600 up 0.6% to 369.96
  • MXAP up 0.08% to 150.96
  • MXAPJ unchanged at 485.95
  • Nikkei down 0.3% to 20,516.56
  • Topix up 0.05% to 1,499.93
  • Hang Seng Index up 0.08% to 25,997.03
  • Shanghai Composite down 0.3% to 2,768.68
  • Sensex down 0.3% to 36,874.41
  • Australia S&P/ASX 200 up 0.6% to 6,519.46
  • Kospi down 0.4% to 1,909.71
  • German 10Y yield fell 2.9 bps to -0.565%
  • Euro down 0.04% to $1.1194
  • 10Y yield fell 5.3 bps to 1.162%
  • Spanish 10Y yield fell 6.7 bps to 0.164%
  • Brent futures down 0.4% to $58.68/bbl
  • Gold spot up 0.9% to $1,487.18
  • U.S. Dollar Index little changed at 97.72

Top Overnight News from Bloomberg

  • Three central banks across Asia Pacific delivered surprise interest-rate decisions Wednesday as policy makers take aggressive action to counter a worsening global economy. New Zealand and India led with bigger-than-expected interest rate cuts, while Thailand’s 25-point reduction was a surprise to all but two in a Bloomberg survey of economists
  • The escalating trade war between the U.S. and China is nudging the world economy toward its first recession in a decade with investors demanding politicians and central bankers act fast to change course
  • U.S. is still expecting China to visit in September, says Larry Kudlow, the White House’s economic adviser. Things could change in respect to China tariffs, he adds. The U.S. will also take a “careful look” at whether China took steps to reverse the decline in the yuan. In Trump-Xi fight, both leaders make big bets that may backfire
  • German industrial production registered its biggest annual decline in almost a decade, highlighting the severity of the trade- inflicted manufacturing slump in Europe’s largest economy
  • U.K. house prices fell for a second month in July as the market continued to “tread water” amid economic uncertainty, mortgage lender Halifax said.
  • Top European banks, such as Commerzbank, UniCredit, warned of weaker earnings as escalating trade tensions take a toll on their clients and the prospect of lower interest rates erodes their main source of income
  • Michael Gove, the minister in charge of planning for a no-deal Brexit, blamed the European Union for failing to engage on a new agreement, deepening the diplomatic standoff between the two sides less than three months before the U.K. is due to leave the bloc
  • Italy’s government won’t be able to contain the budget deficit below 2% if it’s going to deliver promised investments and tax cuts, Deputy Prime Minister Matteo Salvini said.
  • North Korean leader Kim Jong Un oversaw the test- firing of a “new type” of guided missile Tuesday and the weapon should serve as a warning to the U.S. and South Korea as they conduct joint military drills, the state’s media said
  • Gold futures rallied above $1,500 an ounce on sustained demand for the traditional haven as the U.S.-China trade war festers, global growth slows and central banks around the world ease monetary policy.
  • Brent crude held losses after falling into bear market as lingering U.S.-China trade concerns dent the outlook for global demand
  • The dovish turn sweeping the global economy gathered pace Wednesday as New Zealand shocked markets with a half-percentage point interest-rate cut, sending its currency tumbling

Asian equity markets traded mixed as the region observed caution despite the gains on Wall St. where stocks rebounded from their worst performance of 2019. ASX 200 (+0.6%) was initially indecisive as early gains were nearly wiped out by weakness in energy following a 2% drop in oil and with financials subdued after its largest lender CBA reported a decline in FY profits. However, Australia stocks were then boosted in late trade alongside outperformance in NZX 50 (+1.8%) after the RBNZ over-delivered with a surprise 50bps cut, while Nikkei 225 (-0.4%) was pressured as exporters digested a firmer currency and earnings updates. Hang Seng (U/C) and Shanghai Comp. (-0.3%) were lacklustre as trade concerns lingered and after the PBoC weakened the CNY reference rate to within a whisker of the 7.0000 ‘line in the sand’ level, although losses in the mainland were contained amid reports that China is to revise quota rules for farm product import tariffs in which it will remove soybean oil, rapeseed oil and palm oil import quotas. Finally, 10yr JGBs were underpinned as cautiousness spurred safe-haven demand and with global yields declining amid what some view as an ongoing race to the bottom among some of the world’s major central banks.

Top Asian News

  • Singapore Air Picks Crucial Fight Against Emirates in India
  • Aussie Dollar Slides to 10-Year Low as Traders Bet on Rate Cuts
  • Papua New Guinea Asks for China’s Help to Ease Debt Burden
  • Asia Surprises With Cuts in Global Race to the Monetary Bottom
  • China Summons Hong Kong Officials to Shenzhen to Discuss Unrest

European equities have extended on opening gains [Eurostoxx 50 +1.3%] following on from a cautious Asia-Pac handover in which the antipodean indices cheered a deeper-than-forecast RBNZ OCR cut whilst upside Japan and China were capped by a firmer JPY and ongoing trade concerns.  Major EU bourses are retracing recent losses with gains led by the DAX (+1.2%) as heavyweight Bayer (+7.0%) rallies on the back of its 60% stake sale in Currenta for EUR 1.17bln. The transaction also includes the minority shareholder Lanxess (+5.5%) who is poised to sell its 40% share for around EUR 700mln. Sector wise, healthcare names are lagging with the sector pressured by Novartis (-0.1%) after the US FDA stated that some data from early testing of its Zolgensma treatment was manipulated. Novartis opened lower by 2% before trimming losses. Other individual movers include UniCredit  (-3.1%), Commerzbank (-3.1%) and ABN AMRO (-1.9%) post-earnings, in which the former cut its FY 19 revenue forecast and the latter stated it sees a bleaker margin ahead.

Top European News

  • Commerzbank, UniCredit See Targets Under Threat From Low Rates
  • Ex-HSBC Banker Pleads Guilty in $1.8 Billion French Tax Probe
  • Muddy Waters’ Latest Short Is Woodford Holding Burford Capital
  • Nordea’s Main Owner Opts to Cut Stake to Ease Capital Burden

In FX, NZD/AUD/INR/THB – The Kiwi is trying to claw back some lost ground, but remains the outright G10 underperformer in wake of the RBNZ’s shock decision to slash the OCR by 50 bp overnight against forecasts for -25 bp, and with Governor Orr indicating that there is more to come in post-policy meeting commentary. In fact, NIRP is not out of the realms of possibility as the Bank strives to hit its dual inflation and jobs target. Nzd/Usd slumped to lows around 0.6379 at one stage, but has subsequently reclaimed 0.6400+ status with key Fib support (0.6367) holding for now, while Aud/Nzd has rebounded further from sub-1.0300 levels to almost 1.0500 as Aud/Usd contains knock-on losses to circa 0.6678 even though RBA easing probability for September has risen in response to the more aggressive/pre-emptive RBNZ action. On that note, remarks from RBA’s Bullock later today may be pertinent. Conversely, the Rupee has strengthened in wake of an above consensus 35 bp reduction in benchmark rates from the RBI, and perhaps the vote split with 2 dissents for -25 bp plus the fact that the Bank has already administered 75 bp worth easing via 3 successive moves is being deemed as enough for now, even though the bias remains accommodative. Usd/Inr now circa 70.8000 within 71.000-70.5910 parameters in contrast to Usd/Thb nearer the top of a 30.9200-6900 range after a surprise ¼ point BoT rate cut and pledge to use other measures to curb Baht strength.

  • JPY – Bucking broader trends again, and back on a firmer footing against the Dollar, as US Treasury yields retreat sharply from Tuesday’s fleeting retracement highs and the PBoC nudged the official Usd/CNY nearer 7.0000 to rekindle US-China trade concerns that seemed to abate a tad yesterday. Usd/Jpy is slipping back from just shy of 106.50 as the DXY continues to pivot 97.500 by virtue of greater gains vs riskier currency counterparts more than anything else as GOLD looks poised to breach Usd1500/oz amidst the escalation of trade wars and transition to conflicts of FX interests.
  • CHF/GBP/EUR/CAD – All weaker vs the Greenback, or handing back recent gains, with the Franc approaching 0.9800 vs nearly 0.9700 and underlying safe-haven demand offset by prospects of SNB intervention at any time if the Chf appreciates too much. Indeed, Eur/Chf has also bounced further from recent lows between 1.0925-50 confines even though Eur/Usd remains top heavy on the 1.1200 handle amidst increasingly soft/negative Eurozone bond yields. Elsewhere, Cable is also struggling to maintain recovery momentum through 1.2200 and 0.9200 in Eur/Gbp cross terms amidst ongoing Brexit no deal/UK political risk, while the Loonie is straddling 1.3300 ahead of Canadian Ivey PMI prints.
  • EM – Notwithstanding the wider swings in risk sentiment and specific factors impacting individual currencies and assets, the Lira revival continues, and the latest reversal in Usd/Try looks rather technical as key support ahead of 5.5000 has now given way.

In commodities, a day of respite thus far for the energy market following this month’s losses of almost 10%, pressured by the global oil demand outlook as the US-China saga intensifies. Yesterday saw the first of the monthly oil reports, the EIA STEO cut its 2019 global oil demand growth forecast by 70k BPD to a 1.0mln BPD Y/Y increase, albeit its 2020 forecast was raised slightly by 30k BPD. Investors will be keeping an eye on the IEA (Aug 6) and OPEC (Aug 16) Monthly reports for some harmony on the short-term global oil demand outlook. On the supply side, the weekly API crude stocks data showed a larger-than-forecast draw (-3.4mln vs. Exp. -2.8mln), the release did little to sway prices but may have underpinned the benchmarks in anticipation for today’s DoE data to confirm the drawdown (headline crude Exp. -2.845mln). Elsewhere, spot gold is inching closer to the key 1500/oz level with futures having already topped the level amid safe-haven inflows as US/China developments, global growth outlook and easing by global Central Banks. Spot gold printed a fresh 6yr peak at 1491/oz during early EU trade. Meanwhile, copper prices have rebounded off worst levels, albeit remain contained near 2yr lows with some support derived from news that Glencore is planning to shut its Mutanda cobalt and copper mine (which produced almost 200k tonnes of copper last year) by the end of 2019 due to lower cobalt prices impacting the economic viability of the project. Finally, Dalian iron ore prices extended its slide for a fifth session amid rising supply and weakening demand.

US Event Calendar

  • 7am: MBA Mortgage Applications, prior -1.4%
  • 3pm: Consumer Credit, est. $16.1b, prior $17.1b
  • 9:30am: Fed’s Evans Holds Media Breakfast in Chicago

DB’s Jim Reid concludes the overnight wrap

5 days after my accident and sitting down on a firm surface is starting to be a less harrowing experience again. Nevertheless my coccyx remains sore. I’m still waiting for the call from GAP who must surely want to use me in their advertising campaign as even with a few frays and tears, their trousers managed to hold together and keep my legs from having any external injuries even as I crash landed and skidded. All my cuts and scrapes were from my uncovered arms. I noticed that on Bloomberg’s MVP page, news of my accident has catapulted me several hundred hits ahead of Mr President for the week. So come on GAP, use the publicity and I’ll take a year’s supply of Baby GAP clothes in return.

Despite a fairly light day of newsflow, which might explain the order on Bloomberg’s MVP, markets staged an impressive rebound during the New York trading session yesterday, with the S&P 500 ultimately ending +1.30% higher. At the margin, comments from top Trump economic advisor Larry Kudlow helped to calm markets, with most of the gains coming after he spoke. Kudlow said that “The President and our team is planning for a Chinese visit in September” and “movement towards a good deal would be very positive and might change the tariff situation. But then again, it might not”. Despite the wide bid-offer in those remarks, it did seem that it represented a little shift in rhetoric from the White House. It will probably require something much more substantial to be sustainable though. In May/June markets recovered first because of a massive repricing of central banks expectations and then the news of the Trump/Xi meeting. It’s hard to believe that we could get the same impact from fresh central bank repricing which leaves us waiting for a trade de-escalation. This doesn’t feel that imminent but as ever we are a tweet away from a big shift in sentiment one way or another.

To put the recent moves in context, it’s worth highlighting a note DB’s Alan Ruskin did on Friday which looked at asset price performance through three previous periods where tariffs roiled financial markets (link here ). He found that the S&P 500 declined by a median of 10% and that Chinese equities were down less than the S&P. European equities held in a little better but were far from a great place to hide. As for bonds, in the past Bunds generally rallied more than Treasuries although clearly we’re now starting with the Bund curve mostly in negative territory. Growth sensitive commodities like Oil and Copper also struggled while interestingly the usual perceived safe haven assets like Gold and the Yen did not do as well as one might expect – although with the Fed expected to ease further, these assets might be more robust this time round. Food for thought in any case.

This morning in Asia markets are trading mixed with the Nikkei (-0.42%), Hang Seng (-0.37%) and Kospi (-0.15%) all lower while the CSI (+0.02%) and Shanghai Comp (-0.01%) are trading flat. The Japanese yen is up +0.368%, while the yield on 10yr JGBs in now trading below the lower end of the BoJ target range at -0.203% (-1.2bps). The PBoC has fixed the daily reference rate for the onshore yuan overnight at 6.9996 leading the currency to drop -0.34% to trade at 7.0434. Meanwhile, the RBNZ surprised the market by delivering a larger than expected rate cut of 50bps (market expectations were for a 25bps cut) thereby bringing the key policy rate to 1.0%. As a result, the New Zealand dollar (-1.92%, the largest daily decline in 4 months) and Australian dollar (-0.92%) are both trading weak this morning with the later sliding to a 10 year low. Elsewhere, futures on the S&P 500 are trading down -0.44%.

In other trade related news, the US Department of Commerce said yesterday that it will ask the US Customs and Border Protection to collect cash deposits from importers of wooden cabinets and vanities from China based on subsidy rates of as much as 229%. The preliminary response from the Commerce department came after a petition filed earlier this year by the American Kitchen Cabinet Alliance, alleging at least $2 billion in harm from Chinese shipments. The move is expected to affect $4.4bn in imported cabinets from China and while this is small numerically, the optics could weigh on the trade negotiations.

In addition Bloomberg has reported that the US is investigating hundreds of millions of dollars in financial transactions involving three big Chinese banks that allegedly helped finance North Korea’s nuclear weapons program, according to an appeals court opinion unsealed yesterday. Elsewhere, China’s Ministry of Commerce official said in an interview with MNI that regardless of the trade talks, China will gradually reduce its holdings of Treasuries, in order to diversify its foreign reserves while adding that “there are many options,” for China’s reserves, mentioning gold, other governments’ bonds, and other assets such as real estate and equities. The combination of this news and the uncertainty around escalating trade war has sent spot gold up this morning at 1485.15 (+0.72% ).

As for yesterday, the DOW and NASDAQ joined the S&P 500 rally, posting gains of +1.21% and +1.39% respectively, each bouncing off their morning lows amid higher-than-average trading volumes. That stemmed 6 consecutive daily losses for the S&P and NASDAQ and 5 for the DOW. Energy stocks (-0.06%) were the only sector to retreat, as Brent crude (-1.20%) slid into one definition of a bear market, as its level of $59.09 is now -20.76% off its April peak of $74.57. In Europe, equities actually traded fairly well through much of the session but a late dip saw bourses close in the red with STOXX 600 in particular down -0.47% and the trade sensitive DAX -0.78% after being up by a similar amount in the morning. The S&P 500 was only +0.38% higher at the European close so there is some catch-up likely. In bond markets, ten-year Treasuries rose as much as +6.4bps in line with the risk-on mood, but subsequently pared their gains to close near flat after a strong three-year auction. The 3y notes saw healthy demand and yielded the lowest in almost two years at 1.433%, ahead of today’s 10-year auction. The yield curve ended -1.1bps flatter at 12.1, which is just 1.1bps away from its cyclical low from December. In Europe, yields headed lower with Bunds (-2.0bps) hitting a new record low of -0.536%. Where will it all end!!

From negative yields to (relatively) High Yield. Overnight Nick has published a presentation based note looking at supply and demand trends in EUR HY. It includes the latest data and charts on issuance, redemptions, coupons and transitions between HY and IG (link here ).

Back to yesterday and it was a more typical summer day of light newsflow with the earlier slightly improved tone helped by a comment from the PBoC telling foreign firms that the CNY “won’t keep falling”. Our FX team have argued that some two-way and even a move potentially back below 7.0 in the near-term wouldn’t be a surprise even if the medium path might be further weakness. Indeed our strategists continue to expect additional weakness, forecasting a level of 7.3 versus the dollar for year-end 7.5 by end-2020. Deprecation on that scale would likely be a sticking point with the US, especially since White House trade advisor Peter Navarro took a victory lap on TV yesterday, crediting the stronger CNY fix as evidence that “they heard us.” He said “as soon as the president was firm – ‘You’re a currency manipulator’ – the Chinese announced that they’re stabilising.”

Meanwhile, two regional Fed presidents spoke and sent similar messages to Governor Brainard yesterday, that they are monitoring trade developments closely. St. Louis’s Bullard said that the Fed “cannot reasonably react to the day-to-day give-and-take of trade negotiations,” but he did also emphasize that the fall in rates over the last several months in anticipation of Fed rate cuts will take time to feed through to the economy. He stopped short of fully endorsing market pricing, however, saying that he has one more hike “pencilled in” for this year. Separately, San Francisco’s Daly noted that trade uncertainty has “re-emerged” and said that “I’m really focusing my attention (on) these headwinds.” Bullard is a voting FOMC member this year, though Daly does not vote until 2021.

Meanwhile, there wasn’t much to report in terms of data yesterday. Early on Germany factory orders surprised to the upside in June posting a +2.5% mom rise (vs. +0.5% expected) after a -2.0% fall the previous month (though that was revised up +0.2pp from the initial print). On the other hand, Swedish industrial production, sometimes viewed as a leading indicator for European manufacturing, fell -0.7% yoy, matching its slowest pace since 2016. In the US the sole release was the albeit outdated June JOLTS report which showed that the job opening report slipped to 4.6% from 4.7% in the month prior while the pace of hiring stood pat at 3.8%.

Looking at the day ahead, this morning data releases include June industrial production in Germany, June trade balance in France and July house prices data in the UK. In the US the sole data release is the June consumer credit release. Away from that earnings releases include CVS Health Corp and Glencore.

 

3A/ASIAN AFFAIRS

I)WEDNESDAY MORNING/ TUESDAY NIGHT: 

SHANGHAI CLOSED DOWN 8.88 POINTS OR 0.32%  //Hang Sang CLOSED UP 20.79 POINTS OR 0.08%   /The Nikkei closed DOWN 68.75 POINTS OR 0.33%//Australia’s all ordinaires CLOSED UP .64%

/Chinese yuan (ONSHORE) closed DOWN  at 7.0458 /Oil UP TO 57.21 dollars per barrel for WTI and 64.13 for Brent. Stocks in Europe OPENED MIXED//  ONSHORE YUAN CLOSED DOWN // LAST AT 7.0458 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 7.0781 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

 

b) REPORT ON JAPAN

 

3 C CHINA

China/India

China threatens “reverse sanctions” if Huawei is excluded from India’s 5 G network plan.  Dr Reddy, a huge Indian pharmaceutical manufacturing company makes a huge amount of global generics in China as labour is cheaper in China than India.  Also the supply of raw pharmaceuticals is located in China.  The Chinese may throw out Dr Reddy and others.

(courtesy zerohedge)

Beijing Threatens ‘Reverse Sanctions’ If Huawei Excluded From Indian 5G Network

Just as relations between India and China were beginning to improve, New Delhi has found itself caught in the middle of Washington and Beijing’s war over the future of 5G, according to a recent Reuters report.

Like many countries, India is just beginning the bidding process to find a provider to build out its 5G infrastructure. But thanks to rumors that New Delhi might shut Chinese telecoms giant Huawei out of the bidding process due to Washington’s insistence that Huawei could present a threat to national security – making India vulnerable to espionage directed by China’s Ministry of State Security – China’s Foreign Ministry recently summoned Vikram Misri, India’s ambassador to Beijing, to express its “concerns” about Washington’s campaign to block Huawei equipment from being used in 5G networks around the world.

During the meeting, Chinese officials said they could impose “reverse sanctions” on Indian firms operating on the mainland if India doesn’t allow Huawei to participate in the bidding process, according to a readout of the conversation shared with Reuters.

Neither the Indian foreign ministry nor the Chinese foreign ministry responded to Reuters’ requests for comment.

Indian companies have a far smaller presence in China than in other major economies. But still, Indian companies including Infosys, TCS, Dr Reddy’s Laboratories Reliance Industries and Mahindra & Mahindra operate in the manufacturing, healthcare, technology and financial services space on the mainland.

Now, the row over Huawei threatens to escalate and sour relations between the world’s two most populous countries just as they were getting over their territorial disputes over Arunachal Pradesh.

India is expected to hold trials for installing its next-generation 5G cellular network in the next few months. But it has not yet decided whether it will invite the Chinese telecoms giant to participate, telecoms minister Ravi Shankar Prasad has said.

Prasad recently told parliament that six proposals have been received for 5G technology trials, including from Huawei. He didn’t name the other companies, but there are only a handful of companies in the world who have the capabilities that would allow them to participate, including Finland’s Nokia, Sweden’s Ericcson and South Korea’s Samsung.

And although India’s intelligence service has been looking for evidence that Huawei could use its equipment as an embedded spy network, so far, it has found no evidence of this.

Sources from within India’s government told Reuters that one solution might be using different providers for hardware and software.

Since winning re-election, Indian Prime Minister Narendra Modi has felt the brunt of the Trump Administration’s protectionist bent: Like Turkey, it recently lost its special status granted by the Department of Commerce, which raised tariffs on Indian-made goods entering the US. And thanks to Modi’s flirtations with Russia (it recently agreed to buy the Russia S-400 missile defense system, which could open it up to US sanctions under CAATSA), it’s already in hot water with Washington.

President Xi is presently planning a visit to India in October that was intended as a sign of the improving relations between the two countries. If the dispute over Huawei continues to escalate, he could cancel. If that happens, the dispute over Huawei will officially have gone international.

END

Michael Snyder gives his assessment as to dangers facing us with respect to the tariff war with China and the USA

(Michael Snyder)

The End Of The World As We Know It” – China Going Nuclear Means There’s No Turning Back Now

Authored by Michael Snyder via The End of The American Dream blog,

When will Americans start to wake up and realize what is happening?

At the end of last week, President Trump announced that the U.S. would be imposing a 10 percent tariff on 300 billion dollars worth of Chinese imports, and that marked a dramatic escalation in our trade war with China.  This move by Trump came as a total shock to Chinese officials, and global financial markets were thrown into a state of turmoil.  Since that announcement, we have been waiting for the other shoe to drop, because we knew that the Chinese would retaliate.  But honestly, very few of the experts expected something like this.  On Monday, China announced that it is going to completely stop buying U.S. agricultural products

China confirmed reports that it was pulling out of U.S. agriculture as a weapon in the ongoing trade war.

A spokesperson for the Chinese Ministry of Commerce said Chinese companies have stopped purchasing U.S. agricultural products in response to President Trump’s new 10% tariffs on $300 billion of Chinese goods.

This is essentially a trade war equivalent of a nuclear bomb.

If the Chinese would have slapped U.S. agricultural products with tariffs, that would have been a proportional response.  But to quit buying them entirely is an unprecedented escalation in a trade war that is really starting to spiral out of control.

And it is also clearly a political attack on President Trump.  The Chinese know that Trump is highly popular in rural areas, and this ban on U.S. agricultural products is going to severely hurt farmers in rural areas all across the United States.

U.S. voters tend to be more influenced by their bank accounts than by anything else, and so this is a smart strategic move by the Chinese if they would like to see a Democrat get elected in 2020.

In 2017, the Chinese bought 19.5 billion dollars worth of U.S. agricultural products, and that number dropped to just 9.1 billion dollars in 2018.

Now that number is going to zero, and according to Farm Bureau Federation President Zippy Duvall this latest move by China is going to be “a body blow to thousands of farmers and ranchers who are already struggling to get by.”

Please say a prayer for our farmers, because they really need it.

In addition to ending purchases of U.S. agricultural products, the Chinese also allowed the value of the yuan to decline dramatically on Monday.  This really rattled global financial markets, and shortly thereafter U.S. Treasury officials formally designated China as a “currency manipulator”.  The following comes directly from the official website of the Treasury Department

The Omnibus Trade and Competitiveness Act of 1988 requires the Secretary of the Treasury to analyze the exchange rate policies of other countries. Under Section 3004 of the Act, the Secretary must “consider whether countries manipulate the rate of exchange between their currency and the United States dollar for purposes of preventing effective balance of payments adjustments or gaining unfair competitive advantage in international trade.” Secretary Mnuchin, under the auspices of President Trump, has today determined that China is a Currency Manipulator.

As a result of this determination, Secretary Mnuchin will engage with the International Monetary Fund to eliminate the unfair competitive advantage created by China’s latest actions.

This is the first time since the 1990s that the Treasury Department has used this designation on any of our trading partners, and it is the kind of move that would not be made unless all hopes for a trade deal were completely gone.

Of course the Chinese wouldn’t have made the moves that they made either if they were still holding out hope for a negotiated solution.  According to one market analyst that was quoted by CNBC, the Chinese are “signalling that they have lost confidence that they can reach an agreement with Trump.”

So what this means is that in the short-term things are going to get bad for the global economy.

Really bad.

In the longer term, the structure of the entire global economic system could change dramatically, and this will especially be true if Donald Trump emerges triumphant in 2020.  According to economist Neil Shearingwe could literally be looking at “the end of the world as we know it”…

Among the implications for more deterioration in the global picture that Shearing cites are the “disintegration of the rules-based system” that has governed international commerce since the end of the World War II, and a potential “Balkanization” of the world economy as the U.S. and China develop their own standards, tech platforms and payment systems.

“It’s too soon to say exactly how events will pan out, but this casts the escalation in the US-China trade war over the past year in an altogether more ominous light. We may be witnessing the end of the world as we know it,” he wrote.

It is difficult to imagine a world in which there is no trade between the United States and China, and many would argue that we would be far better off today if we had never gone down that road in the first place.

But now that our two economies are so deeply integrated, trying to decouple is going to be an exceedingly painful process.

If you are familiar with my work, than you already know that I am not a fan of the Chinese government at all.  Something needed to be done about China, because they have been brazenly taking advantage of us and flouting the rules for decades.

Having said that, it is imperative that the American people understand that a messy breakup with China is going to cause an extraordinary amount of pain for us, for them and for the whole world.

It looks like this trade war could be the spark that plunges the global economy into utter chaos, and right now very few Americans seem to understand the true scope of the economic nightmare that appears to be headed our way.

END

The following is a terrific read from Tom  Luongo.  He talks about the huge pressure on China especially Hong Kong and how Trump is at war with the British Deep State

a must read…

(Tom Luongo)

Forget Iran, Maximum Pressure Has Shifted To China

Authored by Tom Luongo,

In the past week the pressure on China by the U.S. has escalated daily. Since the trade delegation came back from China with lunch barely digested the Trump Administration has gone into over drive on demonizing China here at home.

From finally declaring China a currency manipulator after years of threats on Monday the latest is now a planted story in Axios that Vice-President Mike Pence bringing forth a list of Chinese officials to sanction for Human Rights violations under the Global Magnitsky Act.

This is based on a lie, of course. A lie helped along by Bob Fu, the head of ChinaAid, an NGO working, nominally, to alleviate the horrors of the Chinese government. Or, at least, that’s what you’re supposed to believe.

Vice President Mike Pence has signaled that the Trump administration is open to using the Global Magnitsky Act to sanction top officials in Xinjiang, China, where more than 1 million Uighur Muslims are being held in internment camps, according to a Chinese religious freedom advocate who met with Pence at the White House Monday.

Notice how Axios still states this as fact, that the Chinese are running 1 million people in concentration camps, even though the story was quickly debunked as the rogue statement by U.N. committee member, Gay MacDougall, who claimed this 1 million number was real.

It’s not true, because if it was someone credible would have confirmed it. But it’s a lie that has been breathlessly repeated for the past year to create the illusion of reality so that now Pence can pile on to further inflame the ‘China is evil’ story to hapless Trump supporters giddy at their chosen savior’s tough stance on China.

That tough stance on China in economic areas will require even more farm subsidies as China now refuses to buy our soybeans, corn and other agricultural products as a result of Trump’s asinine trade war.

Because Trump cares about farmers. Yeah, right. Trump cares about getting re-elected.

But it is in Hong Kong where things are really dangerous from a geopolitical perspective.

China has had to respond to the riots in Hong Kong with a firm hand and is being backed into a dangerous situation to quell the unrest. The stink of outside influence is very strong.

And it very well could turn into a military intervention in Hong Kong, which will be denounced by the U.S. and the U.K. as a violation of the “1 country, 2 systems” agreement the British left in place until 2047.

See the pattern? This human rights abuse stuff is 1 part truth and 2 parts fiction. It’s an operation on multiple fronts to demonize China.

It’s became clear that to me a long time ago that even if Trump wanted to de-escalate tensions with China he has neither the temperament nor the control of his own administration to do so.

His response to the Fed’s shallow rate cut and policy statement was childish. Forcing down equity prices and creating chaos in the currency markets is not the work of a ‘stable genius.’ Then blaming China for what was a predictable market reaction to what he did was moronic.

If you raise tariffs and retard trade, the exchange rate between the two countries has to adjust. Period.

To then pile on three days later with the nonsensical and mostly symbolic designation of China as a currency manipulator is just sad.

And now this report about sanctions to stoke up more China hatred among Americans of all political persuasions, while honestly bad actors, both within his administration and abroad, are stoking up chaos. And this upcoming speech by Pence that Axios is talking about is a dead giveaway that they are not done yet.

The more I think about it the more Monday was some form of geopolitical coup attempt. The multiple annoyances coming from the Trump administration are one thing. But doing so at the same time the Indian government took the dramatic step to reorganize Kashmir/Jammu using the pretext of recent terrorism and the ongoing riots in Hong Kong to foment a color revolution there is irresponsible.

And that has the fingerprints of someone else.

Look around and you’ll see the level of chaos is rising rapidly but it all has one through-line. The post-WWII established order is, bluntly, freaking out about their inability to control the narratives and maintain control.

My working thesis at this point, and this is conjecture based on my intuitions, not journalism, is that the through-line here revolves around what can best be termed the British Deep State.

British oligarchy has deep roots in India, Israel, Hong Kong, Saudi Arabia and the U.S. intelligence and diplomatic corps. It has deep animosity towards Russia, China and Iran, far deeper than the U.S. does.

This is policy that goes back more than one hundred and fifty years. The City of London is the primary domestic obstacle to Brexit.

Hong Kong is a key cog in the West’s ability to control China’s growth, so destabilizing it now makes sense. The Hong Kong dollar is pegged tightly to the U.S. dollar and the arbitrage trade between offshore and onshore yuan is the source of a lot of ‘tail wagging the dog’ in financial markets.

It makes even more sense if China’s new extradition law was aimed at bankers and prop traders guilty of currency manipulation of the offshore Yuan trade than it is about ‘human rights abuses.’

The key to color revolutions is that there is a nugget of animosity towards the government being protested. But someone is always ashamed of the government they live under, as any decent man should (to quote H.L. Mencken). But that nugget is then stoked into something ugly the minute there is a catalyst by outside actors for political and economic gains.

The extradition law is perfect for that.

And it seems to me that this ratcheting up of tensions world wide began the moment President Trump refused to go to war with Iran over shooting down that Global Hawk drone in June.

Because that war was handed to Trump on a silver platter. And he was supposed to react to it just like he reacted to past British intelligence operations in Syria; with bombs and sanctions.

Iran was in some way simply a stalking horse for the real target, China.

Why are we still talking about the Skripals when their story has been debunked completely? The Brits. Why are we still dealing with the aftermath of RussiaGate, an operation that began within British intelligence and coordinated with multiple U.S. departments and NGOs on behalf of Hillary Clinton to oust Donald Trump from power?

You know the answer to that.

And that feeds into what Matthew Ehret was saying the other day at Strategic Culture Foundation about what Trump’s role is in all of this. Ehret’s thesis is that the ‘special relationship’ between the U.S. and the U.K. is faltering, and good riddance.

I’m not sure I agree with that but I do agree that Trump is a wild card here.

It is Trump, in his blundering manner, that is making that happen because he isn’t, for all of his myriad faults, a “British asset.”

According to Ehret:

He [Trump] has reversed a regime change program active since 9/11. He has fought to put America into a cooperative position with Russia. He has undone decades of WTO/City of London free trade. He has called for rebuilding productive industries following through by reviving the protective tariff. To top it off, he has been at war with the British-directed deep state for over three years and survived. Now that [John] Bolton has been outed as an ally of Sir Darroch, there is an open acknowledgement that Trump is gearing up to replace the neocon traitor as we speak.

One can only hope that he’s right about this. Since Trump’s refusal to go to war in June, he has stepped up his attacks on China in ways that tell me Bolton isn’t done just yet and that Trump may not be fully under their control, but he’s also not anywhere close to a free actor.

For now we have to realize that what is happening here is beyond left or right, it’s beyond patriotism. And we should remain extremely vigilant about who are and who are not our friends. Because if you look at events closely you’ll see that those definitions you’ve been spoon-fed are dubious at best.

END

The White House is now about too unveil a new rule banning agencies form doing business with Huawei

(zerohedge)

White House To Unveil Rule Banning Agencies From Doing Business With Huawei

As has long been expected, the White House is preparing to release a new rule on Wednesday barring government agencies from buying equipment or doing any kind of business with Chinese telecoms giant Huawei – ratcheting up tensions between the world’s two largest economies at an already precarious time for the global economy.

Here’s more from CNBC:

The Trump administration is expected to release a rule Wednesday afternoon that bans agencies from directly purchasing telecom, video surveillance equipment or services from Huawei. The prohibition was mandated by Congress as part of a broader defense bill signed into law last year.

“The administration has a strong commitment to defending our nation from foreign adversaries, and will fully comply with Congress on the implementation of the prohibition of Chinese telecom and video surveillance equipment, including Huawei equipment,” said Jacob Wood, a spokesman for the Office of Management and Budget.

This is a developing story…check back for updates…

end

 

4/EUROPEAN AFFAIRS

 

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

IRAN/CHINA/USA

My goodness this is actually funny.  China is mulling joining the USA escort coalition in the Gulf even as it defies the Iranian oil embargo as it loads up on Iranian oil

 

\(zerohedge)

China Mulls Joining US ‘Escort’ Coalition In Gulf Even As It Defies Iran Oil Embargo

China is, to the surprise of many observers, actually mulling joining a proposed US-led maritime coalition to protect oil shipping lanes in the Gulf following Iran’s military confirming it has seized three foreign tankers this summer. “If there happens to be a very unsafe situation we will consider having our navy escort our commercial vessels,” the Chinese ambassador to the UAE Ni Jian told Reuters in Abu Dhabi.

“We are studying the U.S. proposal on Gulf escort arrangements,” China’s embassy later confirmed. The question that remains, however, is which side would the Chinese escort actually be trying to protect? Perhaps Beijing joining such a joint operation is a strategy for attempting to shape outcomes in the Gulf?

After all, while the consideration is on the table it remains that China is among a handful of countries that continues to defy US sanctions, as it continues to import its crude via at least a dozen Iranian tankers, a New York Times investigation confirmed just days ago.

 

Via Center for International Maritime Security

But at a time the White House has struggled to get its proposed joint maritime mission off the ground, given deep reluctance in Europe, President Trump over a month ago directly appealed to China and Japan via a tweet, saying they should be protecting their own ships”in the contested region.

Donald J. Trump

@realDonaldTrump

China gets 91% of its Oil from the Straight, Japan 62%, & many other countries likewise. So why are we protecting the shipping lanes for other countries (many years) for zero compensation. All of these countries should be protecting their own ships on what has always been….

It remains unclear whether any formal request accompanied the public appeal. China has walked a fine line in the crisis, not wishing to add more fuel to the fire of worsening Sino-US relations, especially with recent failed attempts to mend the trade war.

“We have the position that all disputes should be sorted by peaceful means and by political discussions, not… military actions,” Ambassador Ni continued as part of his comments.

Meanwhile the only European country to enthusiastically jump on board the US administration’s joint patrol plan has been the United Kingdom, with Germany and France trying to distance themselves, even as they attempt to form a European-led maritime initiative.

Should China actually joint US efforts to patrol the Gulf and Strait of Hormuz – an initiative which Tehran has vehemently rejected while saying Iran’s military alone can provide security for the vital waterway – it could highlight an intensely awkward situation and contradiction.

Who stands where on US maritime coalition in the Gulf

Washington has asked more than 60 nations to provide assistance in securing Strait of Hormuz for commercial shipping

It’s ultimately China which plays a large part in preventing Trump’s desire to take Iran’s exports down to zero, as the recent New York Times report describes:

Twelve of the tankers loaded oil after May 2 and delivered it to China or the Eastern Mediterranean, where the buyers may have included Syria or Turkey. Only some of those 12 tankers were previously known to have recently delivered Iranian oil, and an analyst said the scale of the shipments documented by The Times investigation is greater than what had been publicly known.

The continued flow of oil underscores the difficulty the Trump administration has had in using sanctions to bring Iranian oil exports to zero after breaking with allies and partners on Iran policy.

So again the fact that China hasn’t immediately dismissed the US invitation, and appears to be actually considering it, begs the question: perhaps the Chinese navy’s presence as part of a US joint maritime Gulf coalition would gain Beijing leverage in efforts to preserve the JCPOA? Perhaps it could shape outcomes favorable to Iran and block potential US aggressive action in the region?

END

6.Global Issues

New Zealand

This surprised the globe after the Central Bank of New Zealand surprised traders with a 1/2 pt rate cut

(zerohedge)

Kiwi Craters After RBNZ Surprises Traders WIth 50bps Rate-Cut

The New Zealand Dollar is tumbling following a surprise 50bps rate-cut by RBNZ (economists had forecast 25bps) to 1.00%, citing downside risks on inflation and jobs.

Mimiccing The Fed’s apparent lack of data-dependence, this surprise rate-cut followed a strong 3.9% unemployment print; and just like The Fed, RBNZ is clear that global trade issues are an important factor:

“Heightened uncertainty and declining international trade have contributed to lower trading-partner growth.”

Some key quotes from the statement here:

“GDP growth has slowed over the past year and growth headwinds are rising,” the central bank said in a statement.

In the absence of additional monetary stimulus, employment and inflation would likely ease relative to our targets.

Our actions today demonstrate our ongoing commitment to ensure inflation increases to the mid-point of the target range, and employment remains around its maximum sustainable level.”

Kiwi has plunged…

Near its weakest level against the dollar since Jan 2015…

And 10Y Kiwi note yields plunged 17bps to a record low 1.128%!

Clearly the central bank is trying to get ahead of the curve of global easing and as Bloomberg’s Garfield Reynolds notes, RBNZ obviously decided they didn’t dare risk any sort of bounce in the kiwi if they followed the Fed’s playbook and made a so-called hawkish cut. The currency had ticked up into the decision to offer the board a warning about the perils of insufficient action.

Here’s the take from Kyle Rodda, analyst at IG Markets in Melbourne.

“This was not what the market was expecting at all, it’s a shock to many. Considering the data isn’t terrible for New Zealand at all, this is an example of a central bank that’s looking beyond current data and trying to get ahead of the global slowdown.”

They also secured themselves a weaker currency even if the Fed finds itself pushed toward further rate cuts.

Additionally, this brings RBNZ’s policy rate in line with RBA’s rate…

Read the full RBNZ statement here…

END

7. OIL ISSUES

Oil prices continue to plunge especially after a huge surprise crude build

(zerohedge)

 

Oil Prices Plunge After Surprise Crude, Gasoline Build

Oil prices have plunged overnight (back near 7-month lows) as global growth fears accelerate (despite a bigger than expected crude draw from API) as traders wait to see if official DOE data confirms the API print.

“The bearish and deteriorating global macro situation seems to have the upper hand, pushing oil lower and lower,” said Bjarne Schieldrop, Oslo-based chief commodities analyst at SEB AB.

API

  • Crude -3.43mm (-2.8mm exp)
  • Cushing -1.6mm
  • Gasoline -1.1mm (-1.2mm exp)
  • Distillates +1.2mm (+200k exp)

DOE

  • Crude +2.39mm (-2.8mm exp) – biggest build since May
  • Cushing -1.504mm
  • Gasoline +4.44mm  (-1.2mm exp) – biggest build since Jan
  • Distillates +1.529mm (+200k exp)

After 7 straight weeks of draws, DOE reports crude inventory built by 2.39mm barrels last week (and Gasoline stocks also jumped)

 

US Crude production continued to rebound last week from storm-driven shut-ins

 

WTI tumbled to a $51 handle this morning (back near 7-month lows) ahead of the DOE data, but was rebounding at the print before its plunged on the surprise builds…

Brent Crude futures entered a bear market, but WTI is underperforming most recently..

“Brent-WTI differentials have decreased quite a bit for quite a while,” says Bart Melek, head of global commodity strategy at TD Securities.

Narrowers spreads “lead to less incentive to push product out”

Finally, Bloomberg Intelligence Senior Energy Analyst Vince Piazza notes:

Trade tensions have escalated and a deal will be delayed, as we anticipated, while China likely attempts to wait out the Trump administration. We see darker clouds pressuring sentiment for the oil-and-gas complex as well, discounting near-term data on balances.

We were never worried about capacity, but demand remains our biggest concern, even if central banks come to the economic rescue with monetary accommodation. We need hydrocarbon exports to balance out local market, but slower global growth will inflate inventories here given resilient domestic production.

8 EMERGING MARKET ISSUES

India

The global market continues to crash and this time it is India as we witness its auto market implode:  200,000 job losses in 3 months and another 1 million at risk

(zerohedge)

India’s Auto Market Crashes: 200,000 Job Losses In 3 Months, One Million At Risk

A downturn in the Indian automobile industry has led dealerships to cut at least 200,000 jobs in the last three months amid an unprecedented sales decline, reported India Today.

The Federation of Automobile Dealers Associations (FADA) warned that the automobile downturn would continue to cycle down through 2H19, leading to more job losses with dealerships and across the entire industry.

“The majority of job cuts have happened in the last three months…It started around May and continued through June and July,” FADA President Ashish Harsharaj Kale told Press Trust of India.

Kale said, “Right now most of the cuts which have happened are in front-end sales jobs, but if this (slowdown) continues, then even the technical jobs will be affected because if we are selling less then we will also service less, so it is a cycle.”

When asked about job losses, he said, “Close to about two lakh [200,000].”

“It is a guesstimate that our members have already cut 7-8% of the jobs in most of the dealerships as the degrowth has been very high,” he added.

Around 2.5 million Indians were employed directly through 26,000 automobile showrooms operated by 15,000 dealers. Dealerships indirectly employ another 2.5 million, he added.

The 200,000 job cuts in the last three months exceeded the 32,000 layoffs when 286 dealerships closed across the country in the 18 months ended April this year, he said. Job losses in the auto industry point to an Indian economy that is quickly deteriorating through summer.

Figures from the Society of Indian Automobile Manufacturers (SIAM) show vehicle wholesales plunged by 12.35% to 6,085,406 units in April-June versus 6,942,742 units in the same period last year.

Automakers such as Maruti Suzuki Ltd, Tata Motors Ltd, Mahindra & Mahindra Ltd (M&M), Ashok Leyland Ltd and Honda Motorcycle & Scooter India Ltd have closed manufacturing facilities in the last month as demand for vehicles comes to a screeching halt.

July figures show passenger car sales crashed by 29%, making it the worst month for the automobile industry in two decades.

Automakers aren’t alone. Auto part makers in India such as Exide Industries, Continental Automotive Components (India), ZF, Brose India Automotive Systems, Schaeffler India, Brembo Brakes India, Kalyani Maxion Wheels, Varroc Group, Eaton, IAC India have adjusted production to slowing conditions or closed facilities to avoid a dangerous inventory build-up.

Last month, Bosch Ltd, the largest parts maker in India, published a memo that outlined how it suspended operations at its Gangaikondan plant in Tamil Nadu for a week in late July to “avoid unnecessary build-up of inventory.”

Ram Venkataramani, President, Automotive Component Manufacturers Association of India (ACMA), said the 15% to 20% cut in auto production had triggered an auto crisis in India, could lead to at least one million people being laid off.

The current slowdown in the India economy is cyclical and isn’t expected to turn back up for the next several years. Industrials have been the first domino to fall, and next will be Indian consumers.

end

War looks inevitable as Pakistan suspends bilateral trade with India and expels Indian envoy

(zerohedge)

Pakistan Suspends Bilateral Trade With India, Expels Envoy

The Kashmir crisis triggered by India’s revoking of Article 370 from its constitution has exploded into a fast escalating renewed crisis between nuclear armed arch-rivals India and Pakistan.

Merely within the last 24-hours Pakistan has recalled its ambassador while expelling its Indian envoy, and more importantly has taken the drastic step of suspending bilateral trade with India.

“We will call back our ambassador from Delhi and send back their envoy,” foreign minister Shah Mehmood Qureshi announced in televised comments, according to the AFP, while a separate government statement declared trade suspended and a downgrading of diplomatic ties.

 

File image of Pakistani National Security Council meeting

The committee has decided on “downgrading of diplomatic relations with India” and “suspenstion of bilateral trade with India,” according to the statement.

PM Khan further directed the military to “continue vigilance” after previously saying Pakistan would take “all possible options” in support of Kashmir’s Muslim-majority population – this after regional media has reported “tens of thousands” of Indian troops have surged into Jammu and Kashmir (J&K), while a phone and internet blackout is in place.

In a worrisome sign that the two historic rivals and neighbors could be again moving to open war, Khan is reported to have said“We have to choose between dishonor and war.”

Pakistan’s foreign minister informed the United Nations early this week it is prepared to act in response to the “critical situation”- which Khan reiterated to the high level defense committee meeting Wednesday.

The now voided Article 370 is legally and historically what assured a high degree autonomy for the Indian administered Muslim-majority state, enshrined in the constitution, which inhabitants there see as justifying remaining part of India. The Hindu nationalist Bharatiya Janata leadership in New Delhi, led by Prime Minister Narendra Modi, revoked J&K’s status quo ability and rights to maintain their own local governance on Monday.

Khan on Tuesday suggested a “genocide” could be unfolding as Indian reinforcements continue pouring into the restive border region along the contested Live of Control.

 

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

Euro/USA 1.1197 DOWN .0008 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 106.01 DOWN 0.321 (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 1.2151   DOWN   0.0019  (Brexit March 29/ 2019/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED/BREXIT EXTENDED TO OCT 31/2019//

USA/CAN 1.33000 UP .0019 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  MONDAY morning in Europe, the Euro FELL BY 8 basis points, trading now ABOVE the important 1.08 level FALLING to 1.1197 Last night Shanghai COMPOSITE CLOSED DOWN 8,88 POINTS OR 0.72% 

 

//Hang Sang CLOSED UP 20.79 POINTS OR 0.08%

/AUSTRALIA CLOSED UP 0,64%// EUROPEAN BOURSES ALL GREEN

 

Trading from Europe and Asia

EUROPEAN BOURSES ALL GREEN 

 

 

2/ CHINESE BOURSES / :Hang Sang CLOSED UP 20.79 POINTS OR 0.08%

 

 

/SHANGHAI CLOSED DOWN 8.88 POINTS OR 0.72%

 

Australia BOURSE CLOSED UP. 64%

 

 

Nikkei (Japan) CLOSED DOWN 68.75  POINTS OR 0.33%

 

 

 

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1493.70

silver:$16.93-

Early MONDAY morning USA 10 year bond yield: 1.65% !!! DOWN 5 IN POINTS from YESTERDAY’S night in basis points and it is trading WELL BELOW resistance at 2.27-2.32%.

 

The 30 yr bond yield 2.17 DOWN 6  IN BASIS POINTS from YESTERDAY night.

USA dollar index early WEDNESDAY morning: 97.63 DOWN 6 CENT(S) from  YESTERDAY’s close.

This ends early morning numbers WEDNESDAY MORNING

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And now your closing WEDNESDAY NUMBERS \1: 00 PM

Portuguese 10 year bond yield: 0.19% DOWN 8 in basis point(s) yield from YESTERDAY/

JAPANESE BOND YIELD: -.19%  DOWN 1   BASIS POINTS from YESTERDAY/JAPAN losing control of its yield curve/56

SPANISH 10 YR BOND YIELD: 0.17%//DOWN 4 in basis point yield from yesterday.

ITALIAN 10 YR BOND YIELD:1,42 DOWN 9 points in basis points yield from yesterday./

 

 

the Italian 10 yr bond yield is trading 125 points higher than Spain.

GERMAN 10 YR BOND YIELD: FALLS TO –.58% IN BASIS POINTS ON THE DAY//

THE IMPORTANT SPREAD BETWEEN ITALIAN 10 YR BOND AND GERMAN 10 YEAR BOND IS 2.00% 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 WEDNESDAY

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

Euro/USA 1.1232  UP     .0027 or 27 basis points

USA/Japan: 105.62 DOWN .701 OR YEN UP 70  basis points/

Great Britain/USA 1.215 DOWN .0015 POUND DOWN 15  BASIS POINTS)

Canadian dollar DOWN 49 basis points to 1.3329

 

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The USA/Yuan,CNY: AT 7.0602    0N SHORE  (DOWN)..AT DANGEROUS LEVELS

THE USA/YUAN OFFSHORE:  7.0855  (YUAN DOWN)..AT DANGEROUS LEVELS

TURKISH LIRA:  5.4905 EXTREMELY DANGEROUS LEVEL/DEATH WISH.

the 10 yr Japanese bond yield closed at -.19%

 

Your closing 10 yr US bond yield DOWN 7 IN basis points from TUESDAY at 1.63 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.14 DOWN 11 in basis points on the day

Your closing USA dollar index, 97.38 DOWN 25  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 WEDNESDAY: 12:00 PM

London: CLOSED UP 27.01  0.56%

German Dax :  CLOSED UP 82.18 POINTS OR .71%

 

Paris Cac CLOSED UP 24.22 POINTS 0.60%

Spain IBEX CLOSED UP 46.70 POINTS or 0.54%

Italian MIB: CLOSED DOWN 92.89 POINTS OR 0.45%

 

 

 

 

 

WTI Oil price; 50.56 12:00  PM  EST

Brent Oil: 56.34 12:00 EST

USA /RUSSIAN /   RUBLE RISES:    65.58  THE  CROSS HIGHER BY 0.28 RUBLES/DOLLAR (RUBLE LOWER BY 28 BASIS PTS)

 

TODAY THE GERMAN YIELD FALLS  TO –.58 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 :  51.58//

 

 

BRENT :  57.28

USA 10 YR BOND YIELD: … 1.70… very deadly

 

 

 

USA 30 YR BOND YIELD: 2.23.. very deadly

 

 

 

 

 

EURO/USA 1.1207 ( UP 1   BASIS POINTS)

USA/JAPANESE YEN:106.17 DOWN .147 (YEN UP 15 BASIS POINTS/..

 

 

USA DOLLAR INDEX: 97.56 DOWN 7 cent(s)/

The British pound at 4 pm   Britain Pound/USA:1.2143 DOWN 27  POINTS

 

the Turkish lira close: 5.4913

 

 

the Russian rouble 65/37   DOWN 0.06 Roubles against the uSA dollar.( DOWN 6 BASIS POINTS)

Canadian dollar:  1.3301 DOWN 21 BASIS pts

USA/CHINESE YUAN (CNY) :  7.0602  (ONSHORE)/DEADLY

 

 

USA/CHINESE YUAN(CNH): 7.0842 (OFFSHORE) /DEADLY

 

German 10 yr bond yield at 5 pm: ,-0.58%

 

The Dow closed UP 2.65 POINTS OR 0.01%

 

NASDAQ closed UP 22.04 POINTS OR 0.27%

 


VOLATILITY INDEX:  13.53 CLOSED DOWN .44

LIBOR 3 MONTH DURATION: 2.187%//libor dropping like a stone

 

USA trading today in Graph Form

Gold & Silver Soar As “Minsky Moment” Fears Spark Market Turmoil

A manic day in stocks and bonds today with an early collapse panic-bid back to unchanged as precious metals soar and commodities crash.

The extreme vol prompted a warning from Guy Haselmann, chief executive officer of FETI Group LLC and Scotiabank’s former head of capital market strategy, who said global markets are moving closer to a Minsky moment, or a sudden collapse of asset prices. FETI is a Summit, New Jersey-based company that works with portfolio managers.

“An extended period of low volatility like we have seen in recent years significantly increases leverage and risk-seeking behavior,” he said in an interview.

“When volatility turns like it has, people often need to sell assets to meet margin calls. That’s what makes this so combustible”

“Just one more waffer-thin quantitative easing…?” What could go wrong?

A weaker than expected (though fractionally stronger than 7) Fix by the PBOC unleashed hell globally once again overnight…

But, thanks to rate-cuts from New Zealand, Thailand, and India combined with Chicago Fed President Evans comments suggesting more easing and QE4EVA prompted some PPT-sponsored panic-bids in US equities.

“…you could take the view that the risks now have gone up, and as we think we’re going to get closer to the zero lower bound with higher probability, that would also call for more accommodation.”

Nevertheless, investor sentiment has collapsed from euphoric greed just a month ago to “extreme fear” …

 

In the US, markets were mixed with Nasdaq best as desperate panic bids appeared to lift stocks back to unch (and to top the farce off a super-spike at the close)…

 

 

Dow futures ramped 600 points off the overnight lows back into the green and tagged 26k before limping back lower…

 

 

VIX was smashed back to a 19 handle…

 

 

China stocks drifted lower overnight, closing at the lows…

 

 

European stocks (German IP collapse) ended higher as the US open sparked buying off the lows…

 

 

Stocks and bonds decoupled overnight, with stocks tumbling back to bonds reality, but then the US cash open sparked stock-buying, bond-selling all day…

 

 

Treasury yields tumbled again overnight but ramped back higher after Europe closed…ending the day practically unchanged

 

 

30Y Yield plunged to near record lows…

 

And before we leave bond-land – We bet you wish you bought more Austrian Century Bonds…

 

The Dollar roundtripped like everything else to end unch…

 

 

Cryptos were mixed to flat today…

 

 

As Bitcoin once again tested $12k and rejected it…

 

 

 

PMs dramatically outperformed every other asset class today..

 

 

Gold surged to new six-year highs…

 

Silver soared above $17…

Silver dramatically outperforming gold on the day…

 

Oil prices collapsed, as a double-whammy of global demand concerns and a surprise crude build sent WTI prices back to a $51 handle…BUT then late in the day, a Saudi headline promising to do whatever it takes to halt oil price drop sparked a surge back above $52…

 

Finally, with $15 trillion (and rising tonight) in negative-vielding debt, bullion and bitcoin appear the preferred safe haven against policy-maker panic…

Still, global bonds and stocks remain massively decoupled…

So can you guess who will be right in the end?

 end

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

MARKET TRADING//USA

a)Market trading/LAST NIGHT/USA

 

b)MARKET TRADING/USA/EARLY MORNING

Treasury yields crashing!!

Treasury Yields Are Crashing-er

10Y US Treasury yields are down 8bps overnight, accelerating in the last hour to 1.62% (as 30Y yields crash below Effective Fed Funds rates) and stocks are starting to catch down…

 

Stocks have started to tumble after a low volume ramp overnight

As the yield curve collapses…

 

But Stocks have a long way to fall yet to catch down to bonds’ reality…

And gold is seeing safe-haven binds…

end

Entire USA yield curves inverts

(zerohedge)

Entire US Curve Inverts As 30Y Yield Drops Below Effective Funds Rate

We have a bingo.

With yields crashing across the world after the overnight panic by three central banks to cut rates more than expected, it was only a matter of time before the 30Y tumbled below the effective Fed Funds Rate, which most recently was at 2.13%.

That happened moments ago when he 30Y tumbled as low as 2.12%, 1 basis point below the EFF, and in the process inverting the entire US yield curve and basically telling Bernanke he has to cut rates another 4 times (and/or start QE) or else suffer the coming recession.

end

Three areas of discussion:

  1. the panic in junk bonds. Even though yields are plummeting in sovereigns, the junk yields are rising indicating lack of liquidity and huge risks
  2. The Kashmir saga.  The partition into 3 areas is now basically over as India takes over its Indian Kashmir section. Pakistan is furious and worried about ethnic cleansing.  War is coming in this area.

(courtesy Bill Blain)

Blain: There Is A Panic In Junk Bonds As Spreads Blow Out

Blain’s Morning Porridge, submitted by Bill Blain of Shard Capital

“Well, what can possibly go wrong now? ”

First, a question for my chum Charlie Corbett, author of the excellent The Art of Plain Speaking: How to Write and Speak in a Way that Will Impress the People that Matter. (Seriously, buy a copy and keep it by your desk.) Charlie: Please explain to me what new HSBC CEO meant by “We need to be more granular in the execution plan to deliver.” It sounds incisive, cerebral and utterly brilliant. But wtf does it actually mean?

The morning after the days before…

Was yesterday’s modest stabilization the start of a new buying window? Probably not – it’s still too early to clarify exactly where this market is going. Trade war or a settlement? I doubt the latter. The Chinese stabilised the Renminbi – largely to demonstrate they can, and that they hold the cards – while Trump blustered about resuming negotiations as if he hadn’t called China lying fatherless sons currency manipulators just few days before.

Stocks recovered, largely, I suspect, on the fact investors can’t think of anything else to do with money. I don’t think anyone seriously believes a trade agreement is now likely. Remember: stocks are about optimism and hope things will turn out better than you think. But, Hope is never a Strategy.

If you are looking for market truth, then look at corporate credit, and especially the Junk Bond market – it ballooned wider on the trade ructions and shows no sign of coming back in yet. Government bond markets may be rallying on the flight to safety and expectations of low rates for longer, but corporate debt looks likely to wobble. In Debt Markets there is simple truth.

What’s driving the hiatus in corporate debt? There is a mix of genuine signals of a trade driven recession, and the fear corporate debt/junk will prove a chronic illiquidity trap. There is a growing realization Junk Bond yields this tight simply don’t justify their risk-return profile. And that’s true across the credit curve.  We’re likely to see increasingly thin illiquid bond markets – so if you have positions to shift, now is a good time to try. (Although summer markets are never an easy time to shift portfolios…)

The other issue to consider is the Global Economy near the top of the cycle. The evidence points to slowing Occidental activity. Some recent German numbers have been vaguely positive, others miserable. Across Europe data remains very weak. In the US, the inverted yield curve has been a fixation for many economist – who confidently say inversion predicts a slow-down. Yet, the numbers remain resolutely strong in terms of employment, wages and many other factors. The outliers are issues like declining capital spending and future investment plans – and boards focused on stock buybacks rather than beating the competition. Debt investors are looking at the ability of heavily indebted Junk and near-Junk companies to repay debt – and don’t like their prospects!

Do stocks justify such high valuations if the whole Occidental economy is heading down and Trump is cutting off the Orient? Probably not, but the distortion of insanely low interest rates does not help. 

The big question is portfolio allocations – where would you want to be when stocks are looking so distorted and overpriced, government bonds are in negative yield territory and corporate debt looks unsustainable and likely to prove illiquid? I have ideas like long-term alternatives, but I asked the question to a leading investment manager yesterday and his answer may surprise you: “Cash and a raft of derivative plays to benefit from further market corrections.” Makes sense.

And what if the market becomes even less stable? What about a big No-See-Em shock?

India/Pakistan

Some think the current flare-up in Kashmir could go, well, literally ballistic. Nothing is more guaranteed to run out of control than a passionate Pakistan/India punch up.

Kashmir is divided three-ways following wars and landgrabs since Partition in 1947. India and Pakistan each hold territory, while China also grabbed chunks. The story of the region is viciously complex – with innumerable sub-stories that make the roots of the divisions incredibly difficult to address. The one thing that is certain is just how deeply the passion for the region is ingrained across both Hindu and Muslim  society. You can’t possibly expect any Indian or Pakistani to discuss the topic rationally – the other side is invariably the bad guy.

It boils down to religious intolerance. (Religious intolerance is just a marginally politer way of calling it racism – and don’t think it’s just India. The problems in Norn Iron boil down to similar intolerances for people who are different.) It’s difficult for Westerners to understand just how bloody, murderous and destructive Partition became as rival populations slaughtered each other. Has much really changed since then? (It’s too easy to blame the UK as the departing colonial power, they gave Indian and Pakistani politicians what they demanded.)

India and Pakistan have fought over Kashmir and remained on a war footing since partition over 70 years ago. They’ve been duking it out over a high-altitude glacier for years. The posturing has created a pustulating sore across one of the most beautiful places on the planet. They are both Nuclear capable Nations.

Kashmir was the only Muslim state that joined India. During partition, and after much  tribal violence, the Hindu Maharaja of Kashmir and Jammu joined his state with India. Effectively it remained a separate state within India, ceding only key areas like Defence and Communications to India. It received special privileges – including the critical right to deny land sales to Indians from other states, thus ensuring the state would not be swamped by non-Muslims. For 72 years Kashmir remained a state within the Indian State. Despite the special treatment there has been a festering terror campaign and repeated border wars – each side claiming to be protecting their citizens from the other.

The Indians undid Kashmir on Monday – effectively ending its quasi-statehood and subsuming it into the rest of India, triggering fury in Pakistan. Former cricketer and president Imran Khan is fulminating about ethnic cleansing. Pakistan has previously made clear its nuclear “first strike” strategy if India was to successfully invade. India aren’t saying what they will do – they’ve demonstrated their intent many times.

Itchy triggers and religious hatred don’t sit well together.

Watch very closly to see how this plays out. Pakistan benefits from both US and Chinese support, but the Chinese want border resolution with India and may see this as an interesting strategic opportunity, especially how the Trump administration plays it. Its’ unlikely Trump will perceive any electoral gains from supporting Pakistan, which Americans equate with Islamic terrorism.

Blain’s Brexit Watch

Not much to add today except the stakes get higher. The Tories are blaming Europe for intransigence. Europe asks what’s the point in dealing with Boris since he’s already decided on no-deal. Come-on chaps, play nice and talk to each other! Europe declaring nothing will change plays rights into the arms of the Hard Brexit Camp.

October 31st Brexit Mayhem, here we come.

Sorry for late porridge, but computer problems and an interview to film this morning. Out of time, well behind schedule, and what else does the day hold… ?

end

Market data/USA

iii) Important USA Economic Stories

American Pension funds continue to miss their targets in 2019.  They are terribly offside

(zerohedge)

America’s Largest Pension Funds Missed Their Targets Again In 2019

As we’ve documented time and time again, even the epic bull run in stocks and bonds that has transpired since the financial crisis hasn’t been enough to make up the liabilities shortfall at America’s pension funds. In fact, if anything, the problem has only gotten worse, as the amount owed to retirees is accelerating faster than assets on hand to pay those future obligations.

Liabilities of major US pensions are up 64% since 2007, while assets are up only 30%. And that problem has only gotten worse over the past fiscal year, as pensions funds largely missed their targets by the widest margin since…2016, WSJ reports.

Public pension plans with more than $1 billion in assets reported a median return of 6.79% for the year ended June 30, according to Wilshire Trust Universe Comparison Service data. That’s short of the 7.25% long-term return that most funds need to get back to a place where they can cover their liabilities.

Missing these projections is a huge problem for pension funds, because its the projections – not the actual returns – that determine how much money state and local governments chip in.

 

And although the 10-year bull market has been good for pensions – large public plans had five years of double-digit returns and a 10-year annualized return of 9.7% through June 30 – most funds aren’t anywhere near covering the long-term costs of benefits,especially as more employees are living longer, and birth rates decline, meaning there will eventually be fewer tax dollars to support state contributions. Many state governments have started to cut back on benefits, but these cuts won’t have an impact for decades. Plus, in the aftermath of the financial crisis, many state governments skimped on pension contributions for politically expedient reasons, as state resources were badly needed elsewhere.

According to data from the Federal Reserve, state and local pension plans have about $4.4 trillion in assets, which is $4.2 trillion less than they need to pay for promised future benefits (the data in the chart below covers a slightly different universe of funds, but the theme is consistent, and clear).

To help make up the shortfall, many pension funds have increased their allocations to ‘alternative’ investments like private equity. Which is ironic, considering that many of the best performing investments in recent years were regular ol’ stocks and bonds (and once fees are factored in, their outperformance is even greater).

“For a public defined-benefit plan, we just feel like if you can focus on high-quality stocks and bonds and take a long-term approach, you’ll be better off, especially after fees,” Jay Bowen, president and CEO of Bowen, Hanes & Co., told WSJ.

According to Wilshire’s calculations, a portfolio of 60% domestic stocks and 40% domestic bonds would have returned 9.13% for the year ended June 30.

And any funds that sold during the brutal Q4 selloff or the trade-inspired turbulence this Spring probably missed out on rebounds that ultimately would have helped their bottom line.

Some of the states with the most troubled pension systems – like New Jersey, for example – have taken steps recently to right the ship. Others are considering radical ideas like transferring public assets to their pensions funds (as is the case in Illinois).

But unless state governments dramatically increase their funding levels, a nationwide pension crisis could arrive seemingly out of nowhere…since the public is largely ignorant of what’s truly at stake.

END

After seeing three nations lower their interest rates, Trump pesters Powell to cut the Fed rate

(zerohedge)

Trump Renews Powell Attack: “I Was Right… Fed Must Cut Rates BIgger And Faster”

The ink on the Fed’s latest rate cut – the first in a decade – still hasn’t dried, and here comes the president demanding, drumroll… more.

As we expected earlier, when we noted the not one, not two, but three surprise rate cuts by Asian central banks, and said that it’s only a matter of time for Trump to chime in, Donald Trump did just that when in a trio of tweets, the president once again lashed out at Powell for not only not cutting more than just 25 bps – because it is “too proud to admit their mistake of acting too fast and tightening too much (and that I was right!)” – but also because the rest of the world is now winning the race to the bottom: “They must Cut Rates bigger and faster, and stop their ridiculous quantitative tightening NOW” Trump boomed, even though the Fed ended their “ridiculous quantitative tightening” LAST WEEK.

Trump also unveiled that he is now a yield curve expert, although what he means by “yield curve is at too wide a margin” is not exactly clear since the 3M-10Y curve just hit a new 12 year low of -40bps as the entire yield curve now screams recession.

Donald J. Trump

@realDonaldTrump

“Three more Central Banks cut rates.” Our problem is not China – We are stronger than ever, money is pouring into the U.S. while China is losing companies by the thousands to other countries, and their currency is under siege – Our problem is a Federal Reserve that is too…..

Donald J. Trump

@realDonaldTrump

….proud to admit their mistake of acting too fast and tightening too much (and that I was right!). They must Cut Rates bigger and faster, and stop their ridiculous quantitative tightening NOW. Yield curve is at too wide a margin, and no inflation! Incompetence is a…..

Donald J. Trump

@realDonaldTrump

….terrible thing to watch, especially when things could be taken care of sooo easily. We will WIN anyway, but it would be much easier if the Fed understood, which they don’t, that we are competing against other countries, all of whom want to do well at our expense!

So what happens next? As we said first thing this morning, “we are now in a race to the bottom, and the US is badly lagging so expect either more rate cuts, more QE or direct currency intervention as Trump gets impatient with the ongoing dollar strength.

How will this happen? Read “The “National Emergency Loophole”: How Trump Will Intervene In The Market To Crush The Dollar” It lays out all you need to know what happens next, and why gold and cryptos are about to soar much, much higher.

And just in case Powell gets an angry phone call this morning, don’t be surprised if we get an emergency rate cut from the Fed one of these days.

end

Mac Slavo gives details as to why trump is losing the trade war

(Mac Slavo/Brandon Smith)

Is Trump Losing The Trade War?

 

Authored by Mac Slavo via SHTFplan.com,

As the trade deficit continues to widen and President Donald Trump ramps up his rhetoric on China, one thing is for certain: the data points show that the United States is the loser in this trade war.

There is no coming out on top when the tariffs, which are paid in whole by American consumers and businesses, are a financial burden and additional tax on your own. According to a report by Reason, investment in American businesses has fallen sharply since the start of the trade war, and American exports are way down too.

The gap between how much America exports to China and how much it imports from the Asian nation grew to $30.2 billion in July, up from $30.1 billion the previous month, according to Commerce Department figures. But there are three more data points of importance that prove the United States is losing the trade war.

The widening gap was due to a decrease in the value of American exportsBloomberg reported. The trade deficit has been a problem for Trump and one of the main reasons he started the trade war. Trump has used America’s trade deficit as a key justification for his trade policies, and he has repeatedly promised that tariffs on China would reduce that deficit. But as predicted, when one uses central planning and government intervention to mess with the free market, things get worse. Economists generally agree that trade deficits don’t matter, as free trade is more important for a stable economy. This is the same reason that you wouldn’t worry about running a “deficit” with a grocery store, Reason stated.

Trump’s tariffs are having an impact, but not in positive ways for the United States. During the first six months of 2018, U.S. exports to China fell by 18 percent relative to the same period last year. Imports from China slipped by 12 percent. Both sides are doing less trading, but the trade deficit persists.

Three other data points are showing the trade war as an abject failure too:

Business Investments Plummeted

According to the Commerce Department, investment in American businesses has fallen off sharply since the start of Trump’s trade war in mid-2018.

This is a sign that businesses are holding off on hiring and expanding in the face of uncertainty and higher costs.

Loss of Goods-Producing Jobs

Trump has also tried to justify his bellicose trade policies by citing the importance of American manufacturing jobs. Not only is the manufacturing sector officially in a recession, but the job losses will have a ripple effect across the landscape of the American economy.

Loser for The Treasury

The trade war has been a net loss for the treasury. Sure, there are the billions of tariff dollars paid by American consumers and businesses, but the amount paid to farmers to offset the damage done to them is higher.

It’s time to remove the partisan political blinders that keep people supporting the horrible trade war policies and open our eyes to what’s really happening.  The U.S. is losing this trade war and the American consumer is the biggest loser of all.

More government intervention will not fix the problem. Central planning has only made things worse, and it’s past time we realize exactly what’s happening.

Brace yourself; the future economy’s outlook is bleak.

*  *  *

As Brandon Smith, Founder of Alt-Market.com, explains:

It’s important to mention that some tariffs on foreign made goods can help to alleviate the “need” for government taxes on the populace of a particular country.  This has been done in the past in America with some success.  However, certain conditions have to be met first:  Domestic manufacturing must be bolstered by incentives and factories must be built within the US BEFORE tariffs are initiated.

The US CANNOT have vast amounts of national debt that it is paying interest on and cannot be reliant on foreign central banks (or any central bank) in order to keep its economy afloat.  And, the overall economy must be balanced and stable; a trade war during times of economic weakness only hastens a crash, or provides cover for central banks as they cause a crash.

None of these conditions exist in the US today.  None.

That said, Trump’s trade war has accomplished nothing tangible because that is the point.  The goal of the trade war is to act as a distraction and scapegoat for the implosion of the Everything Bubble.  As I have said for the past year, the trade war is not meant to be won, it is meant to be lost.

end

Total student and auto loans rise by close to 15 billion dollars: 2.77 trillion.

Revolving Credit: drops by 80 million

the only place the consume is getting money is through the auto loans and student loan sector

(COURTESY ZEROHEDGE)

Consumer Credit Rises To Record $4.1 Trillion As Student, Auto Loans Hit All Time High

After two months of torrid gains for revolving, or credit card debt, moments ago the Fed reported in its monthly consumer credit report that in June US consumer hit the breaks hard on new credit-fueled spending.

 

In June, revolving credit declined by $80.5 million, the first such drop since March, and only the sixth decline since 2015. However, this was more than offset by a $14.7 billion increase in non-revolving, or student and auto loan, credit as total consumer credit in June rose by $14.6 billion, modestly below the $16.1 billion expected. Meanwhile, the May data was revised upward, from $17.1 billion to $17.8 billion.

 

 

And while the reversal in June credit card use may prompt fresh questions about the strength of the US consumer despite the latest upward revision in the personal saving rates, one place where there were no surprises, was in the total amount of student and auto loans: here as expected, both numbers hit fresh all time highs, with a record $1.605 trillion in student loans outstanding, an increase of $6.8 billion in the quarter, while auto debt also hit a new all time high of $1.174 trillion, an increase of $8.4 billion in the quarter.

 

In short, whether they want to or not, Americans continue to drown even deeper in debt, and enjoying every minute of it.

 

iv) Swamp commentaries)

v) King report/Courtesy of Chris Powell of GATA which includes the major swamp stories.

China blinked on Tuesday, which generated a manic 97 handle rally from the 19:45 ET low of 2775.75 on Monday night to the 2872.75 high, 15 minutes after the NYSE open.  For those playing along at home, that’s a 3.5% rally – which occurred mostly while the NYSE closed.  After the US Treasury designated China ‘a currency manipulator’, ESUs plunged to 2775.75 on Monday night.  When China set a higher than expected official yuan rate, ESUs rallied 49 handles.

China’s Central Bank Tells Foreign Firms Yuan Won’t Keep Falling

The central bank held a meeting with a number of foreign exporters in Beijing Tuesday, at which officials also said that companies’ ability to buy and sell dollars would remain normal…

https://www.bloomberg.com/news/articles/2019-08-06/china-s-central-bank-tells-foreign-firms-yuan-won-t-keep-falling

Stocks, Yuan Pop As PBOC Issues Statement Claiming ‘All Is Well’

https://www.zerohedge.com/news/2019-08-06/stocks-yuan-pop-pboc-issues-statement-claiming-all-well

After the PBoC’s yuan assurance, ESUs rallied to 2849.25 during the final hour of Asian trading.

@realDonaldTrump: As they have learned in the last two years, our great American Farmers know that China will not be able to hurt them in that their President has stood with them and done what no other president would do – And I’ll do it again next year if necessary!

ESUs got a boost before the NYSE open when Uncle Lar surfaces to issues positive verbal intervention.  Trade hawk Navarro also did some positive verbal intervention.

Kudlow: Trump is flexible on China tariffs depending on how trade talks go

  • President Trump remains open to a trade deal with China… Larry Kudlow tells CNBC.
  • The two sides are set to meet again in September…

https://www.cnbc.com/2019/08/06/kudlow-trump-is-flexible-on-china-tariffs-depending-on-how-trade-talks-go.html

Trump trade adviser Navarro calls on Fed to cut rates further

“The Federal Reserve before the end of the year has to lower interest rates by at least another 75 basis points or 100 basis points to bring interest rates here in America in line with the rest of the world,” Navarro told Fox News. “We have just too big a spread between our rates and that costs us jobs.”

https://www.reuters.com/article/us-usa-fed-navarro/trump-trade-adviser-navarro-calls-on-fed-to-cut-rates-further-idUSKCN1UW1PU

This ended the rally: VP Pence Signals US Plans to Sanction Top China Officials over Human Rights Abuse    https://www.zerohedge.com/news/2019-08-06/vp-pence-signals-us-plans-sanction-top-china-officials-over-human-rights-abuse

A surprisingly hawkish Bullard contributed to the morning retrenchment.

Fed’s Bullard: Let’s see what the rate cut did before approving more

https://www.cnbc.com/2019/08/06/feds-bullard-says-it-will-take-time-to-gauge-the-effects-of-the-interest-rate-cut.html

ESUs and stocks retreated from 15 minutes after the NYSE open until the afternoon rally took ESUs and stocks to session highs during the last hour of the session.

@Jkylebass: Chinese “negotiators” shoot off their nose to spite their face. By year-end, the gen pop in china will be begging the world for all forms of protein (pork, beef, poultry) as Chinese Pig Ebola is killing millions. It’s likely they lose 50-100% of their pigs

@zerohedge: JPMorgan hits the weakest spot in China with a downgrade of Chinese banks: “we see rising risk of large banks being requested to bail out failed small banks with opaque terms; this could lead to a trading multiple de-rating risk”

@GordonGChang: Designation of China carries no practical consequences–Treasury is required only to start negotiations–but it demonstrates Washington is no longer showing deference to the ChineseWe now have a whole new approach, and we aren’t going to be pushed around anymore. Good.

As we mentioned a few weeks ago, Trump is in 2020 Campaign mode.  He knows he was elected by ‘forgotten Americans’, or Flyover America.  People who were upset that globalism (unfair trade and illegal immigration) was destroying their wellbeing.

China greatly miscalculated on Trump.  Xi thought that DJT needed a trade deal for the 2020 election.  Trump’s incessant stock market bragging reinforced that notion.  However, as we opined a few missives ago, no trade deal with China while DJT plays tough with Xi is a better campaign scheme

@realDonaldTrump: @sundarpichai of Google was in the Oval Office working very hard to explain how much he liked me… that Google was not involved with China’s military, that they didn’t help Crooked Hillary over me in the 2016 Election, and that they are NOT planning to illegally subvert the 2020 Election… It all sounded good until I watched Kevin Cernekee, a Google engineer, say terrible things about what they did in 2016 and that they want to “Make sure that Trump losses in 2020.”… @peterschweizer stated with certainty that they suppressed negative stories on Hillary Clinton, and boosted negative stories on Donald Trump.All very illegal. We are watching Google very closely!

Made money on bitcoin? IRS wants a bite!

At the end of July, the IRS started sending letters to people who trade cryptocurrencies like bitcoin, reminding them that they owed taxes on any profits they may have made…the biggest lure was the fact that traders thought they could make money and not pay taxes. The IRS is now telling them that’s not so.

https://nypost.com/2019/08/05/made-money-on-bitcoin-irs-wants-a-bite/

Disney earnings miss forecasts as costs rise for its streaming future

Shares of Disney, which had risen 27% this year and hit an all-time high last week, dropped as much as 5% in after-hours trading to $135.  Excluding certain items, Disney earned $1.35 per share for the quarter that ended in June, below average analyst estimates of $1.75 per share…

https://www.cnbc.com/2019/08/06/reuters-america-update-4-disney-earnings-miss-forecasts-as-costs-rise-for-its-streaming-future.html

Today – We opined that traders would try to affect a Turnaround Tuesday to the upside in yesterday’s missive.  We stated in Monday & Tuesday’s missives: the daily trend for stocks is down; but there will be vicious rallies on short covering and FOMO buying…  This is a big vacation week…in a thin market…

China’s stronger than expected yuan fix unleashed the vicious short-covering and FOMO rally that we warned could appear at any time.  ESUs traded -12.00 early last night on Disney’s disappointing earnings.  They rallied to -2.00 ahead of the yuan fix.  ESUs are -13.50 at 22:00 ET because China set the yuan at 6.9996/$.  6.9977 was expected.

Gold soared above $1500 on the weaker than expected yuan fix.

@realDonaldTrump: “Did George Bush ever condemn President Obama after Sandy Hook. President Obama had 32 mass shootings during his reign. Not many people said Obama is out of Control. Mass shootings were happening before the President even thought about running for Pres.” @kilmeade

@BowenXiao3: WH Deputy Press Secretary Hogan Gidley told reporters just now that President Donald Trump is spending a no-public-event day “meeting with staff on a wide range of policies, having conversations in prepping for his trip to these communities.  This is a very, very serious moment in our country’s history. This president recognizes the gravity of this moment… There are plenty of people in this country who commit acts of evil in the names of politicians, of celebrities and all types of things. It’s not the politician’s fault when someone acts out their evil intention…. we would never dream of blaming Elizabeth Warren for the shooter who supports Elizabeth Warren. Quite frankly, it’s ridiculous to make those connect in some way … You have to blame the people here who pulled the trigger.”

Mental Illness and Mass Murder

The FBI found 70% of shooters had ‘stressors’ or ‘concerning behaviors’ prior to the attack.

   Multiple studies done between 2000 and 2015 suggest that about a third of mass killers have an untreated severe mental illness…In 93% of the incidents, the authorities found that the suspects had a history of threats or other troubling communications… About one-fourth of the mass shooters had spent time in a mental health facility or program…

https://www.wsj.com/articles/mental-illness-and-mass-murder-11564955203

Stop Teaching Our Kids to Kill: A Call to Action against TV, Movie and Video Game Violence Hardcover – October 5, 1999    https://www.amazon.com/Stop-Teaching-Our-Kids-Kill/dp/0609606131

@DailyMail: Dayton gunman Connor Betts’ ex-girlfriend reveals he showed her a video of a mass shooting on their first date – Another ex-girlfriend who dated Betts briefly in high school recalls him hearing voices and having hallucinations… The pair met in a community college class and Johnson said they bonded over both having mental illnesses. She said Betts told her he suffered from bipolar disorder and possibly OCD…  https://www.dailymail.co.uk/news/article-7326841/Connor-Betts-ex-girlfriend-says-showed-massacre-video.html

The hateful politics that are intensifying in the US is another reason why we like and own gold. At some point, a critical mass of investors will believe that violence, not compromise, is the probable denouement in the US.  They will then restructure the holdings in their portfolios accordingly.

Leftist vitriol has intensified to the point that a few Dems surfaced to rebuke some acts.  The hatred for DJT has induced Dems leaders and MSM to abdicate their responsibility to reign in their ideological brethren. If the hate doesn’t abate soon, provoked entities will retaliate.  If that transpires, the confrontations could be worse than what occurred in the Sixties.

Fourth Turning Economics [Some large institutions have been following this since the 2008 Crisis.]

Strauss and Howe, when writing The Fourth Turning in 1997, did not know the exact circumstances and events which would propel the next Turning. But their study of economic and demographic trends along with the attitudes of generations and historical precedents in prior Fourth Turnings, led them to conclude the driving factors of this Crisis would be debt, global disorder and civic decay…

     The economic, social, political, and military distress pervading the world should be terrifying the average American, but most are blissfully ignorant of the coming anguish… 

The social and political distress we are presently experiencing are already tearing the fabric of civil societyPoliticians on the left are promising trillions more in freebies, with absolutely no plan to pay the bill. They have no intention of deterring anyone from crossing our southern border illegally. They see them as added votes in future elections. They use every mass shooting by mentally disturbed individuals as an opportunity to confiscate the guns of the law abiding “deplorables” in flyover country…

    The left-wing corporate media stokes the flames of societal distress by making every issue racial.Screaming racism or white supremacy at every opportunity creates anger on both sides and will lead to further violence… We are fifteen months from an election which will likely ignite civil chaos in this country of confrontationIt doesn’t matter who wins, the losers will not accept the result…   https://www.theburningplatform.com/2019/08/05/fourth-turning-economics-part-two/

WaPo: Trump plans visits to El Paso and Dayton, where he won’t be universally welcome

Jerry Nadler Renews Effort to Target Justice Brett Kavanaugh – Asking the National Archives to release more information about Kavanaugh’s work in the White House under President George W. Bush…https://www.breitbart.com/politics/2019/08/06/jerry-nadler-renews-effort-to-target-justice-brett-kavanaugh/

When the NY Times published a Monday headline, Trump Calls for Unity vs. Racists, leftists flooded the NYT with protests.  They demanded that the NYT change its headline because it did express vitriol (AKA hate) for DJT.  Under threat of subscription cancellations, the NYT changed its headline.

@mattdizwhitlock: New York Times releases a second edition with a different headline after Twitter backlash and liberals announce they’re canceling subscriptions.

https://twitter.com/1776Stonewall/status/1158737405001814017?s=09

NYT: A Times Headline about Trump Stoked Anger. A Top Editor Explains.

“We needed to deliver a nuances message in a very small space under tight deadlines, and unfortunately, our first attempt at that did not hit it right.”… [The NYT has lost what little credibility it had.]

https://www.nytimes.com/2019/08/06/reader-center/trump-mass-shootings-headline.html

Ex-Clinton pollster @Mark_Penn: The day a twitter mob can change a headline on the New York Times this paper is truly finished and replaced by a new kind of 1984 Ministry of Truth. The news is now what people say it is.

Ex-Dem Senate Leader Harry Reid’s chief of staff @AJentleson: The NYT is a failing institution and I’m not going to spend my money on it anymore, at least until it improves.

Protesters gather outside McConnell’s Kentucky home, one calls for his stabbing ‘in the heart’

Approximately 25 demonstrators stood on the sidewalk near McConnell’s Louisville home, shouting “No Trump, no KKK, no Fascist USA!” while others called him names like “Murder Turtle” and made loud noises by banging objects and dragging a shovel back and forth on the ground as a group of security personnel stood between the protestors and the home, WLKY reported…

https://www.foxnews.com/media/protestors-gather-outside-mcconnells-ky-home-one-calls-for-his-stabbing-in-the-heart

CNN, NYT Contributor Wajahat Ali Pushes #MassacreMoscowMitch Hashtag about McConnell

https://www.breitbart.com/the-media/2019/08/06/cnn-nyt-contributor-wajahat-ali-pushes-massacremoscowmitch-hashtag-about-mcconnell/

Last week, the WaPo ran a headline: Mitch McConnell is a Russian Asset.  [Besos’ blog, 0 cred]

Actress Debra Messing Celebrates Potential Violence against Dana Loesch, Mitch McConnell

https://www.dailywire.com/news/50297/debra-messing-celebrates-potential-violence-paul-bois

Dem Rep. Joaquin Castro Posts Names, Employers of Trump Donors [The intent is obvious.]

Castro, whose district includes much of San Antonio, claimed the donors “are fueling a campaign of hate that labels Hispanic immigrants as ‘invaders.’”… “Democrats want to talk about inciting violence? This naming of private citizens and their employers is reckless and irresponsible. He is endangering the safety of people he is supposed to be representing,” Murtaugh told the Daily Caller News Foundation..

https://dailycaller.com/2019/08/06/joaquin-castro-names-trump-donors/

Rep. @SteveScalise: People should not be personally targeted for their political views… This isn’t a game. It’s dangerous, and lives are at stake. I know this firsthand. [Was shot by Sanders supporter]

MSNBC’s Nicolle Wallace: Trump Is ‘Talking about Exterminating Latinos’ [Should be fired]

https://www.newsbusters.org/blogs/nb/mark-finkelstein/2019/08/06/nicolle-wallace-trump-talking-about-exterminating-latinos

@NicolleDWallace: I misspoke about Trump calling for an extermination of Latinos.  My mistake was unintentional and I’m sorry. Trump’s constant assault on people of color and his use of the word “invasion” to describe the flow of immigrants is intentional and constant.

Sen. Kamala Harris willing to send cops to people’s homes to confiscate banned firearms.

https://twitter.com/dcexaminer/status/1158196376418885632

Elizabeth Warren: People Who Are Hateful ‘Celebrate’ President Trump

“He is a racist. He has made one racist remark after another. He has put in place racist policies, and we’ve seen the consequences of it,” she continued, seemingly bashing Trump supporters by calling those who “celebrate” and support the president “hateful…

https://www.breitbart.com/politics/2019/08/06/elizabeth-warren-people-who-are-hateful-celebrate-president-trump/

‘Death Camps for Trump Supporters Now!!!’ Emblazoned on ANTIFA-style Fliers in New York

https://bigleaguepolitics.com/death-camps-for-trump-supporters-now-emblazoned-on-antifa-style-fliers-in-new-york/

@Tiff_FitzHenry: A leaked 2009 memo in a State Department email exchange singled out “The Ellen Degeneres Show” which could be used to “amplify and deliver messages that advance policymaking.”

Well, you don’t say. It’s almost like Ellen Degeneres is a willing government asset…or something.

https://twitter.com/Tiff_FitzHenry/status/1158891119037636609

@Tiff_FitzHenry: In another leaked Official State Department exchange, a top government aide and the Secretary of State discuss a great meeting in LA with Ellen Degeneres, in which Ellen said she is, quote, “willingness to do whatever we ask.”   https://twitter.com/Tiff_FitzHenry/status/1158892557151145985

end

Charles Nenner Warns: “Easy Money’s Not Going To Work Anymore”

Via Greg Hunter’s USAWatchdog.com,

Renowned geopolitical and financial cycle expert Charles Nenner says forget what the mainstream financial channels are saying about more Fed easy money policies pushing the markets higher.

 

Nenner explains, “The clever institutions I work with were selling all the time when the S&P was around 3,000, and the small investor and public were buying, buying and buying…”

The clever money was so happy then…The small investor buys and all the time they (clever money) get a chance to sell, sell and sell until they are finished selling. Then, suddenly something happens. Then the small investor who holds the cash and he’s in a crisis, and here we go down. I always stress to the small investor, understand how this game works.

Day before yesterday, the Dow was down 1,000 (inter-day). I heard one person say maybe you should sell. It’s always buy, buy, buy. They don’t do anybody any favors because there are so many losses. I never hear CNBC say sell, sell, sell. So, it’s a crooked game.

What does he say to people waiting for the Fed to drive markets back up with easy money? Nenner says:

We are finished with the cheap money. It’s not going to work anymore. That’s what the big investors understand.

Even if we have 0% rates, it’s not going to keep this economy going. They cannot keep it going anymore.”

Last time Nenner was on USAWatchdog.com, he said “gold was going up” and “interest rates were going to continue to fall.”

He was correct and says those two trends are going to continue. Nenner says:

We are in a new bull market in gold, and the price is headed to at least $2,500 per ounce

The stock market is going to continue to go down over the next 2 ½ years.”

Nenner is standing by his call he’s had in place for years for a “bottom in the DOW at 5,000.”

Nenner is not backing off that call one bit. So, you’ve been warned.

As far as silver, Nenner says, “Silver is going to go up too, but it won’t take off for a few months.”

Join Greg Hunter as he goes One-on-One with Charles Nenner, one of the very best geopolitical and financial market cycle experts on the planet.

*  *  *

To Donate to USAWatchdog.com Click Here. There is free information on CharlesNenner.com. If you want to try a free subscription of Charles Nenner’s cycle work, click here.

end

 

Well that is all for today

I will see you Thursday night.

 

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