OCT 1/REPO PROBLEMS STILL EXIST ON FIRST DAY OF Q4 AS 55 BILLION DOLLARS IS TAKEN UP//WORSE MFG DATA IN 10 YRS AND BOTH OF THESE DATA POINTS SENDS THE DOW DOWN 343 POINTS//GOLD DOES AN OUTSIDE REVERSAL TO THE UPSIDE GAINING $15.25 TO $1482.65/SILVER ADVANCES 30 CENTS TO $17.28//QUEUE JUMPING ON BOTH GOLD AND SILVER ON DAY 2 OF THE DELIVERY CYCLE//YESTERDAY WITH SILVER DOWN 58 CENTS NOBODY LEAVES THE SILVER ARENA AND FEW LEAVE THE GOLD ARENA//HONG KONG WITNESSES MORE PROTESTS ON THE 70TH ANNIVERSARY OF COMMUNIST RULE//EU SIGNALS THAT IT MAY GIVE A TIME LIMIT ON THE IRISH BACKSTOP//

GOLD:

$1482.65 UP $15.25 (COMEX TO COMEX CLOSING)

 

 

 

 

 

 

 

 

 

 

 

 

 

Silver:$17.28 UP 30 CENTS  (COMEX TO COMEX CLOSING)

 

 

Closing access prices:

Gold : $1480.50

 

silver:  $17.26

 

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  120/283

EXCHANGE: COMEX
CONTRACT: OCTOBER 2019 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,465.700000000 USD
INTENT DATE: 09/30/2019 DELIVERY DATE: 10/02/2019
FIRM ORG FIRM NAME ISSUED STOPPED
____________________________________________________________________________________________
072 H GOLDMAN 48
092 C DEUTSCHE BANK 11
118 H MACQUARIE FUT 58
657 C MORGAN STANLEY 1
661 C JP MORGAN 29
661 H JP MORGAN 120
686 C INTL FCSTONE 9
690 C ABN AMRO 141 5
737 C ADVANTAGE 49 10
800 C MAREX SPEC 41 5
880 H CITIGROUP 33
905 C ADM 3 3
____________________________________________________________________________________________

TOTAL: 283 283
MONTH TO DATE: 7,497

NUMBER OF NOTICES FILED TODAY FOR  OCT CONTRACT: 283 NOTICE(S) FOR 28,300 OZ (0.8802 tonnes)

TOTAL NUMBER OF NOTICES FILED SO FAR:  7497 NOTICES FOR 749700 OZ  (23.32 TONNES)

 

 

 

SILVER

 

FOR 0CT

 

 

585 NOTICE(S) FILED TODAY FOR 2,925,000  OZ/

 

total number of notices filed so far this month: 706 for 3,530,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Bitcoin: OPENING MORNING TRADE :  $ 8312 UP 22 

 

 

 

Bitcoin: FINAL EVENING TRADE: $ 10640 UP 823

 

 

 

Let us have a look at the data for today

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IN SILVER THE COMEX OI FELL BY A TINY  SIZED 255 CONTRACTS FROM 213,543 DOWN TO 213,288 DESPITE THE HUGE 58 CENT LOSS IN SILVER PRICING AT THE COMEX. AGAIN IN SILVER NOBODY LEFT THE SILVER COMEX ARENA

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

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

FOR OCT 0,; DEC  1726 AND ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE  1726 CONTRACTS. WITH THE TRANSFER OF 1726 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 1726 EFP CONTRACTS TRANSLATES INTO 8.63 MILLION OZ  ACCOMPANYING:

1.THE 58 CENT LOSS 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.

2.955 MILLION OZ STANDING FOR FEBRUARY.:

27.120 MILLION OZ STANDING IN MARCH.

3.875 MILLION OZ STANDING FOR SILVER IN APRIL.

18.845 MILLION OZ STANDING FOR SILVER IN MAY.

2.660 MILLION OZ STANDING FOR SILVER IN JUNE//

22.605 MILLION OZ  STANDING FOR JULY

10.025   MILLION OZ  STANDING IN AUGUST.

43.030   MILLION OZ  STANDING IN SEPT. (HUGE)

5.925     MILLION OZ INITIALLY STANDING IN OCT.

YESTERDAY, ANOTHER MAJOR ATTEMPT BY THE BANKERS TO COVER THEIR MASSIVE SHORTFALL AT THE SILVER COMEX AS ANOTHER RAID WAS INITIATED.  OUR OFFICIAL SECTOR//BANKERS AGAIN USED HUGE COPIOUS NON BACKED PAPER IN THEIR SUCCESSFUL ENDEAVOUR TO WHACK SILVER’S PRICE (58 CENTS). HOWEVER TO THEIR SHOCKING SURPRISE, AGAIN AND AGAIN NOBODY LEAVES THE SILVER COMEX ARENA AS THE TOTAL OF OUR TWO EXCHANGES ROSE BY  1575 CONTRACTS MAKING THEIR RAID TOTALLY USELESS TO THEM AS THEIR PRIMARY AIM IS TO FLEECE LONGS.  THE MAJORITY EITHER MORPHED INTO LONDON FORWARDS OR  THEY ARE STANDING FOR DELIVERY HERE AS THEY  SEEK OUT PHYSICAL METAL ON BOTH SIDES OF THE POND

THE SPREADING LIQUIDATION OPERATION IS NOW OVER FOR GOLD..AND WE WILL NOW MORPH INTO AN ACCUMULATION PHASE OF SPREADING CONTRACTS FOR SILVER.  THEY WILL ACCUMULATE CONSIDERABLE AMOUNT OF THE CONTRACTS AND THEN LIQUIDATE ONE WEEK PRIOR TO FIRST DAY NOTICE

FOR THOSE OF YOU WHO ARE NEWCOMERS HERE IS A BRIEF SYNOPSIS OF HOW THE CROOKS FLEECE UNSUSPECTING LONGS IN THE SPREADING ENDEAVOUR;

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

 

 

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 OCT HEADING TOWARDS THE  ACTIVE DELIVERY MONTH OF OCTOBER FOR GOLD.

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

YOU WILL ALSO NOTICE THAT THE COMEX OPEN INTEREST  STARTS TO RISE IN THIS NON ACTIVE MONTH OF OCT 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 (OCT), 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 OCT:

1726 CONTRACTS (FOR 1 TRADING DAY TOTAL 1726 CONTRACTS) OR 8.630 MILLION OZ: (AVERAGE PER DAY: 1726 CONTRACTS OR 8.630 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH OF AUGUST:  8.630 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 1.23% 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:          1680.73   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

AUG. 2019  TOTAL EFP ISSUANCE;                                                 216.47 MILLION OZ

SEPT 2019 TOTAL EFP ISSUANCE                                                  174.900 MILLION OZ

RESULT: WE HAD A SMALL SIZED DECREASE IN COMEX OI SILVER COMEX CONTRACTS OF 255, DESPITE THE HUGE 58 CENT LOSS IN SILVER PRICING AT THE COMEX /YESTERDAY... THE CME NOTIFIED US THAT WE HAD A  HUGE SIZED EFP ISSUANCE OF 1726 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 STRONG  SIZED: 1471 TOTAL OI CONTRACTS ON THE TWO EXCHANGES: 

i.e 1726 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH DECREASE OF 255  OI COMEX CONTRACTS. AND ALL OF THIS  DEMAND HAPPENED WITH A 58 CENT LOSS IN PRICE OF SILVER AND A CLOSING PRICE OF $16.98 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. 1.067 BILLION OZ TO BE EXACT or 153% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT MARCH MONTH/ THEY FILED AT THE COMEX: 585 NOTICE(S) FOR 2925,000 OZ OF SILVER

IN SILVER,PRIOR TO TODAY, WE  SET THE NEW COMEX RECORD OF OPEN INTEREST AT 244,196 CONTRACTS ON AUG 22.2018 AND AGAIN THIS HAS BEEN SET WITH A LOW PRICE OF $14.78.  

 

.

 

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 10.025 MILLION OZ/ SEPT 43.030 MILLION OZ// OCT: 5.925 MILLION OZ/  
  2.  THE  RECORD WAS SET IN 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 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 FELL BY A HUMONGOUS  SIZED 19,123 CONTRACTS, TO 610,343 ACCOMPANYING THE HUGE  $32.50 PRICING LOSS WITH RESPECT TO COMEX GOLD PRICING// YESTERDAY// /

 

THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A STRONG SIZED 10,382 CONTRACTS:

OCT 2019: 0 CONTRACTS, DEC>  10,382 CONTRACTS AND ALL OTHER MONTHS ZERO.  The NEW COMEX OI for the gold complex rests at 610,343,.  ALSO REMEMBER THAT THERE WILL BE A DELAY IN THE ISSUANCE OF EFP’S.  THE BANKERS REMOVE LONG POSITIONS OF COMEX GOLD IMMEDIATELY.  THEN THEY ORCHESTRATE THEIR PRIVATE EFP DEAL WITH THE LONGS AND THAT COULD TAKE AN ADDITIONAL, 48 HRS SO WE GENERALLY DO NOT GET A MATCH WITH RESPECT TO DEPARTING COMEX LONGS AND NEW EFP LONG TRANSFERS. . EVEN THOUGH THE BANKERS ISSUED THESE MONSTROUS EFPS, THE OBLIGATION STILL RESTS WITH THE BANKERS TO SUPPLY METAL BUT IT TRANSFERS THE RISK TO A LONDON BANKER OBLIGATION AND NOT A NEW YORK COMEX OBLIGATION. LONGS RECEIVE A FIAT BONUS TOGETHER WITH A LONG LONDON FORWARD. THUS, BY THESE ACTIONS, THE BANKERS AT THE COMEX HAVE JUST STATED THAT THEY HAVE NO APPRECIABLE METAL!! THIS IS A MASSIVE FRAUD: THEY CANNOT SUPPLY ANY METAL TO OUR COMEX LONGS BUT THEY ARE QUITE WILLING TO SUPPLY MASSIVE NON BACKED GOLD (AND SILVER) PAPER KNOWING THAT THEY HAVE NO METAL TO SATISFY OUR LONGS. LONDON IS NOW SEVERELY BACKWARD IN BOTH GOLD AND SILVER  AND WE ARE WITNESSING DELAYS IN ACTUAL DELIVERIES.

IN ESSENCE WE HAVE A CONSIDERABLE LOSS IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 8741 CONTRACTS: 19,123 CONTRACTS DECREASED AT THE COMEX  AND 10,382 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI LOSS OF 8741 CONTRACTS OR 874,100 OZ OR 27.188 TONNES.  YESTERDAY WE HAD A HUGE LOSS OF $32.50 IN GOLD TRADING….AND WITH THAT LOSS IN  PRICE, WE  HAD A STRONG LOSS IN GOLD TONNAGE OF 27.188  TONNES!!!!!! THE BANKERS/OFFICIAL SECTOR WERE SUPPLYING INFINITE SUPPLIES OF SHORT GOLD COMEX PAPER WITH RECKLESS ABANDON AS ANOTHER RAID WAS INITIATED. THE BANKERS WERE VERY SUCCESSFUL IN THEIR ATTEMPT TO LOWER GOLD’S PRICE WHICH MEANT THAT NO UNDERWRITTEN CONTRACT WOULD BE EXERCISED.  THEY WERE MILDLY SUCCESSFUL IN FLEECING SOME GOLD LONGS FROM THE GOLD ARENA. 

 

 

 

 

 

 

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF OCT : 10,382 CONTRACTS OR 1,038,200 oz OR 32.29 TONNES (1 TRADING DAY AND THUS AVERAGING: 10,382 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE STRONG SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 1 TRADING DAYS IN  TONNES: 32.29 TONNES

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

THUS EFP TRANSFERS REPRESENTS 32.29/3550 x 100% TONNES =0.909% OF GLOBAL ANNUAL PRODUCTION

 

ACCUMULATION OF GOLD EFP’S YEAR 2019 TO DATE:     4439.92  TONNES

JANUARY 2019 TOTAL EFP ISSUANCE;   531.20 TONNES

FEB 2019 TOTAL EFP ISSUANCE:             344.36 TONNES

MARCH 2019 TOTAL EFP ISSUANCE:       497.16 TONNES

APRIL 2019 TOTAL ISSUANCE:                 456.10 TONNES

MAY 2019 TOTAL ISSUANCE:                    449.10 TONNES

JUNE 2019 TOTAL ISSUANCE:                   642.22 TONNES

JULY 2019: TOTAL ISSUANCE:                    591.56 TONNES

AUG. 2019 TOTAL ISSUANCE:                    639.62 TONNES

SEPT. 2019 TOTAL ISSUANCE:                    509.57  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 STRONG SIZED DECREASE IN OI AT THE COMEX OF 19,123 WITH THE HUGE  PRICING LOSS THAT GOLD UNDERTOOK YESTERDAY($32.50)) //.WE ALSO HAD  A HUGE SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 10,382 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 10,382 EFP CONTRACTS ISSUED, WE  HAD A CONSIDERABLE AND CRIMINALLY SIZED LOSS OF 8,741 CONTRACTS IN TOTAL OPEN INTEREST  ON THE TWO EXCHANGES:

10,382 CONTRACTS MOVE TO LONDON AND 19,123 CONTRACTS DECREASED AT THE COMEX. (IN TONNES, THE LOSS IN TOTAL OI EQUATES TO 27.188 TONNES). ..AND THIS HUGE INCREASE OF  DEMAND OCCURRED WITH THE LOSS IN PRICE OF $32.50 WITH RESPECT TO YESTERDAY’S TRADING AT THE COMEX.

THE COMEX IS NOW UNDER FULL ASSAULT WITH RESPECT TO GOLD AND SILVER.

 

 

 

 

 

 

 

 

we had:  283 notice(s) filed upon for 28,300 oz of gold at the comex.

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD...

WITH GOLD UP$15.25 TODAY//(COMEX-TO COMEX)

A HUGE PAPER WITHDRAWAL OF 2.05 TONNES

INVENTORY RESTS AT 920.83  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 30 CENTS TODAY: 

 

A HUGE CHANGE IN SILVER INVENTORY AT THE SLV//

A PAPER DEPOSIT OF 1.87 MILLION OZ INTO THE SLV

 

/INVENTORY RESTS AT 383.656 MILLION OZ.

 

 

 

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

 

 

 

end

 

 

 

OUTLINE OF TOPICS TONIGHT

 

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

1. Today, we had the open interest in SILVER FELL BY A TINY SIZED 255 CONTRACTS from 213,543 DOWN TO 213,288 AND FURTHER FROM A  NEW COMEX RECORD.  THE LAST RECORDS WERE SET  IN AUG.2018 AT 244,196 WITH A SILVER PRICE OF $14.78/(AUGUST 22/2018)..THE PREVIOUS RECORD TO THAT 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  2 YEARS AGO.  THE PRICE OF SILVER ON THAT DAY: $17.89.

 

 

 

 

EFP ISSUANCE: 

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

 FOR OCT. 0; FOR DEC  1726  AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 1726 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON.  IF WE TAKE THE OI LOSS AT THE COMEX OF 255  CONTRACTS TO THE 1726 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN AN ATMOSPHERIC AND CRIMINALLY SIZED GAIN OF 1471 OPEN INTEREST CONTRACTS DESPITE THE RAID. THUS IN OUNCES, THE GAIN ON THE TWO EXCHANGES: 7.355 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 AUGUST AT 10.025 MILLION OZ// SEPT: 43.030 MILLION OZ//AND FINALLY OCT: 5.925 MILLION OZ//

 

 

RESULT: A SMALL SIZED DECREASE IN SILVER OI AT THE COMEX DESPITE THE 58 CENT LOSS IN PRICING THAT SILVER UNDERTOOK IN PRICING// YESTERDAY. WE ALSO HAD A STRONG SIZED 1726 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)TUESDAY MORNING/ MONDAY NIGHT: 

SHANGHAI CLOSED DOWN   //Hang Sang CLOSED   /The Nikkei closed UP 129.40 POINTS OR 0.59%//Australia’s all ordinaires CLOSED UP .77%

/Chinese yuan (ONSHORE) closed DOWN  at 7.1483 /Oil UP TO 54.30 dollars per barrel for WTI and 59.77 for Brent. Stocks in Europe OPENED MOSTLY RED//  ONSHORE YUAN CLOSED DOWN // LAST AT 7.1483 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 7.1485 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY PAST  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

With the central bank of Japan stating that it may not buy Japanese bonds in October, investors ran for cover as bond prices collapsed.  Yields rose around the globe as now it may not be safe to front run bond purchases anymore. Japan’s central bank owns just too many bonds.

(zerohedge)

3C  CHINA

i)The Pig Ebola is killing China as over 140 billion dollars worth of pork meat has been destroyed. Pork prices are now at record levels.

(zerohedge)

ii)Hong Kong citizens protest again on Tuesday on a day coinciding with the 70th anniversary of Communist rule in China

(zerohedge)

4/EUROPEAN AFFAIRS

the EU is now ready to give a time limit on the Irish backstop

(zerohedge)

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

IRAQ/ISRAEL

Iraqi PM for the first time confirms it is Israel behind the multiple strikes on Iraq

(zerohedge)

6.Global Issues

 

7. OIL ISSUES

 

8 EMERGING MARKET ISSUES

 

9. PHYSICAL MARKETS

i)As more and more countries shift away from the dollar it’s share of global currency reserves falls.  It is now at its lowest level since 2013

(Reuters/GATA)

ii)They are now beginning to understand that negative rates are having a devastating effect on markets because of the pricing of risk

(Bloomberg/GATA)

iii)No question about it, helicopter money or direct funding of government is only one step away

Rees/London Telegraph/GATA)

iv)We now hear that Deutsche bank’s headquarters were raided last week. It is Pam and Russ Martens contention that banks are refusing to loan any money to DB

(courtesy Russ and Pam Martens/Wall Street on Parade)

v)China will still import close to 1700 tonnes of gold this year.

(Lawrie Williams)

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

ii)Market data/USA

iii) Important USA Economic Stories

a)For those of you who thought that the repo mess was going away..guess again..another high 55 billion repo operation.  Our guess is that the main bank in trouble is Deutsche bank

(zero hedge)

b)Here is how billions of loans are exposed to a potential WeWork bankruptcy

(zerohedge)

c)USA manufacturing is the weakest in 10 years(zerohedge)

iv) Swamp commentaries)

a)Trump asked the Australian PM months ago to investigate the origins of the Mueller probe.  And now guess what we have a new whistleblower

(zerohedge)

b)This is so true:  Adam Schiff does epitomize the total collapse of the Democratic party’s integrity

(courtesy Paul Roberts)

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 FELL BY A HUMONGOUS SIZED 19,123 CONTRACTS TO A LEVEL OF 612,926 ACCOMPANYING THE LOSS OF $32.50 IN GOLD PRICING WITH RESPECT TO YESTERDAY’S // COMEX TRADING)

WE ARE NOW IN THE ACTIVE DELIVERY MONTH OF AUGUST..  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 10,382 EFP CONTRACTS WERE ISSUED:

 FOR OCT; 0 CONTRACTS: DEC: 10,382   AND  ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE:  10,382 CONTRACTS.

THE OBLIGATION STILL RESTS WITH THE BANKERS ON THESE TRANSFERS. ALSO REMEMBER THAT THERE IS NO DOUBT A HUGE DELAY IN THE ISSUANCE OF EFP’S AND IT PROBABLY TAKES AT LEAST  48 HRS AFTER OUR LONGS GIVE UP THEIR COMEX CONTRACTS FOR THEM TO RECEIVE THEIR EFP’S AS THEY ARE NEGOTIATING THIS CONTRACT WITH THE BANKS FOR A FIAT BONUS PLUS THEIR TRANSFER TO A LONDON BASED FORWARD.

ON A NET BASIS IN OPEN INTEREST WE LOST THE FOLLOWING TODAY ON OUR TWO EXCHANGES: 8,741 TOTAL CONTRACTS IN THAT 10,382 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST A HUMONGOUS SIZED 19,123 COMEX CONTRACTS

INCLUDED IN THE LOSS AT THE COMEX IS THE FINAL LOSS OF CONSIDERABLE SPREADING CONTRACTS…SO THE REAL LOSS AT THE GOLD COMEX IS IN REALITY MUCH LOWER.

 

NET LOSS ON THE TWO EXCHANGES ::  8741 CONTRACTS OR 874,100 OZ OR 27.188 TONNES.

We are now in the active contract month of OCTOBER.  This month is generally the poorest delivery month of the year as must players prefer to go straight to the big active delivery month of December. Strangely October will turn out to be a huge delivery month. Today we have 2206 contracts still standing for a loss of 7146 contracts. Yesterday we had 7214 notices served upon so we despite the raid, we have a gain of 68 contracts or an additional 6800 oz will stand as these guys refused to morph into London based forwards as well as negating a fiat bonus. We again have queue jumping by the bankers in their attempt to find physical metal.

 

The next active delivery month after October is the non active contract month of November. Here we saw a loss of 31 contracts and thus the OI is lowered to 798.  The very big December contract month saw its oi FALL by 11,767 contracts DOWN to 475,380.

 

 

 

 

TODAY’S NOTICES FILED:

WE HAD 283 NOTICES FILED TODAY AT THE COMEX FOR  28,300 OZ. (0.8802 TONNES)

 

 

 

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And now for the wild silver comex results.

Total COMEX silver OI FELL BY A TINY SIZED 255 CONTRACTS FROM 213,543 DOWN TO 213,288 (AND FURTHER FROM THE NEW RECORD OI FOR SILVER SET ON AUGUST 22.2018.  THE PREVIOUS RECORD WAS SET APRIL 9.2018/ 243,411 CONTRACTS) AND TODAY’S TINY  OI COMEX GAIN OCCURRED WITH A CONSIDERABLE 58 CENT LOSS IN PRICING.//YESTERDAY.

WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF OCTOBER.  HERE WE HAVE 1064 OPEN INTEREST STAND FOR DELIVERY WITH A LOSS OF ONLY 109 CONTRACTS. WE HAD 121 CONTACTS SERVED UPON YESTERDAY SO WE GAINED 12 CONTRACTS OR 60,000 ADDITIONAL OZ WILL STAND FOR DELIVERY IN THIS NON ACTIVE MONTH.  THE ALSO REFUSED TO MORPH INTO LONDON BASED FORWARDS AS WELL AS NEGATING A FIAT BONUS.

 

AFTER OCTOBER WE HAVE THE NON ACTIVE MONTH OF NOVEMBER AND HERE  WE HAD A SMALL GAIN OF 33 CONTRACTS TO STAND AT 448. THE NEXT ACTIVE DELIVERY MONTH AFTER SEPT IS DECEMBER AND HERE THE OI FALLS BY 1005 CONTRACTS DOWN TO 163,857.

TODAY’S NUMBER OF NOTICES FILED:

 

We, today, had 585 notice(s) filed for 2,925,000, OZ for the OCT, 2019 COMEX contract for silver

 

Trading Volumes on the COMEX TODAY: 435,874  CONTRACTS 

 

 

 

CONFIRMED COMEX VOL. FOR YESTERDAY:  464,668  contracts

 

 

 

 

 

INITIAL standings for  OCT/GOLD

OCT 1/2019

Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
128.60 oz
Scotia
4 kilobars
Deposits to the Dealer Inventory in oz nil oz

 

 

 

 

 

Deposits to the Customer Inventory, in oz  

nil

 

No of oz served (contracts) today
283 notice(s)
 28,300 OZ
(0.8802 TONNES)
No of oz to be served (notices)
1923 contracts
(192,300 oz)
5.9813 TONNES
Total monthly oz gold served (contracts) so far this month
7497 notices
749,700 OZ
23.32 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

 

 

 

 

total gold deposits: nil  oz

 

very little gold arrives from outside/ zero amount  arrived   today

we had 1 gold withdrawal from the customer account:

i ) a  phony kilobar withdrawal of 128.60 oz from Scotia Bank

(4 kilobars)

 

 

total gold withdrawals; 128.60  oz

FOR THE OCT 2019 CONTRACT MONTH)Today, 3121 notice(s) were issued from JPMorgan dealer account and 29 notices were issued from their client or customer account. The total of all issuance by all participants equates to 283 contract(s) of which 120 notices were stopped (received) by j.P. Morgan dealer and 0 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 OCT /2019. contract month, we take the total number of notices filed so far for the month (7497) x 100 oz , to which we add the difference between the open interest for the front month of  OCT. (2206 contract) minus the number of notices served upon today (283 x 100 oz per contract) equals 940,200 OZ OR 29.300 TONNES) the number of ounces standing in this  active month of OCT

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

No of notices served (7497 x 100 oz)  + (2206)OI for the front month minus the number of notices served upon today (283 x 100 oz )which equals 940,200 oz standing OR 29.40 TONNES in this  active delivery month of OCT.

 

 

SURPRISINGLY WE HAVE BEEN WITNESSING NO REAL PHYSICAL GOLD ENTERING THE COMEX VAULTS FOR THE PAST YEAR!! ..ONLY PHONY KILOBAR ENTRIES…. WE HAVE ONLY 32.51 TONNES OF REGISTERED

HERE IS WHAT STOOD DURING THESE PAST 3 MONTHS:  AUGUST 27.153 TONNES

SEPT:      5.4525 TONNES

 

AND NOW……………………………………………………………………………     OCT. 29.40 TONNES

 

 

ACCORDING TO COMEX RULES:

FOR A SETTLEMENT YOU NEED A TRANSFER FROM THE DEALER (REGISTERED) ACCOUNT OVER TO AN ELIGIBLE ACCOUNT. FOR THE  ENTIRE MONTH OF AUGUST WE HAD O TRANSACTIONS ON THIS FRONT IN SEPT 2 TRANSACTIONS FOR 2.6 TONNES.

IF WE ADD THE THREE DELIVERY MONTHS: 62.00 TONNES- 2.60 TONNES DEEMED SETTLEMENT = 59.40 TONNES STANDING FOR METAL AGAINST 32.51 TONNES OF REGISTERED OR FOR SALE COMEX GOLD! THIS IS WHY GOLD IS SCARCE AT THE COMEX.

 

total registered or dealer gold:  1,045,289.998 oz or  32.51 tonnes 
total registered and eligible (customer) gold;   8,188,292.958 oz 254.69 tonnes

IN THE LAST 35 MONTHS 107 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 OCT.

INITIAL  standings/SILVER

IN TOTAL CONTRAST TO GOLD, HUGE ACTIVITY IN SILVER TODAY.
OCT 1 2019
Silver Ounces
Withdrawals from Dealers Inventory NIL oz
Withdrawals from Customer Inventory
 1,211,330.905 oz
CNT
HSBC
Scotia

 

 

Deposits to the Dealer Inventory
nil oz

 

Deposits to the Customer Inventory
1,805,220.812 oz
CNT
Delaware
Scotia
Brinks
No of oz served today (contracts)
585
CONTRACT(S)
(2,925,000 OZ)
No of oz to be served (notices)
479 contracts
 2,395,000 oz)
Total monthly oz silver served (contracts)  706 contracts

3,530,000 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  4 deposits into the customer account

into JPMorgan:  nil  oz

ii)into CNT:  604,397.000 ??/ oz

iii) Into Delaware: 1017.600 oz

iv) Into Scotia: 599,548.590 oz

v) Into Brinks:  600,257.622 oz

 

 

*** 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:  1,805,220.812  oz

 

we had 3 withdrawals out of the customer account:

 

 

i) Out of CNT:  999.76 oz

ii) Out of Scotia: 602,865.485 oz

iii) Out of HSBC  607,465.660 oz

 

 

 

 

 

 

total 1,211,330.905  oz

 

we had 1 adjustment :

i) Out of CNT: 399,026.940 oz was adjusted out of the customer account of CNT and this landed into the dealer account of CNT

 

total dealer silver:  76.713 million

total dealer + customer silver:  314.196 million oz

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

The total number of notices filed today for the OCT 2019. contract month is represented by 585 contract(s) FOR 2,925,000 oz

To calculate the number of silver ounces that will stand for delivery in OCT, we take the total number of notices filed for the month so far at 706 x 5,000 oz = 3,530,000 oz to which we add the difference between the open interest for the front month of OCT. (1064) and the number of notices served upon today 585 x (5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the OCT/2019 contract month: 706 (notices served so far) x 5000 oz + OI for front month of OCT (1064)- number of notices served upon today (585)x 5000 oz equals 5,925,000 oz of silver standing for the OCT contract month. 

WE  gained 12 contracts or an additional 60,000 oz of silver will stand at the comex.

 

LADIES AND GENTLEMEN:  THE COMEX IS UNDER ASSAULT FOR BOTH PHYSICAL GOLD AND SILVER WITH SILVER IN THE LEAD BY FAR. DESPITE  MASSIVE RAIDS, LONGS CONTINUE WITH THEIR HUNT AT THE COMEX FOR PHYSICAL METAL.. IT WILL NOT BE LONG BEFORE WE WITNESS A COMMERCIAL FAILURE..STAY TUNED..WE WITNESSED CONSIDERABLE BANKER SHORT COVERING IN SILVER TODAY AND AN ATTEMPTED BANKER SHORT COVERING IN GOLD WITH ZERO SUCCESS.

 

 

TODAY’S NUMBER OF NOTICES FILED:

 

We, today, had 121 notice(s) filed for 605,000 OZ for the OCT, 2019 COMEX contract for silver

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

 

TODAY’S ESTIMATED SILVER VOLUME:  82,152 CONTRACTS

 

 

CONFIRMED VOLUME FOR YESTERDAY: 102,294 CONTRACTS..

 

 

 

 

 

YESTERDAY’S CONFIRMED VOLUME OF 102,294 CONTRACTS EQUATES to 511 million  OZ 73.0% 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 RISES TO -1.47% ((OCT 1/2019)
2. Sprott gold fund (PHYS): premium to NAV FALLS TO -1.09% to NAV (OCT 1/2019 )
Note: Sprott silver trust back into NEGATIVE territory at +%-/Sprott physical gold trust is back into NEGATIVE/ -1.47%

(courtesy Sprott/GATA)

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

NAV 14.77 TRADING 14.34///DISCOUNT 2.94

 

 

END

And now the Gold inventory at the GLD/

OCT 1/WITH GOLD UP $15.25 A HUGE PAPER WITHDRAWAL OF 2.05 TONNES FROM THE GLD///INVENTORY REST AT 920.83 TONNES

SEPT 30/WITH GOLD DOWN $32.50: A SMALL CHANGE IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.06 TONNES FROM THE GLD /INVENTORY RESTS AT 922.88 TONNES

SEPT 27.WITH GOLD DOWN $8.20 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 924.94 TONNES

SEPT 26//WITH GOLD UP $2.70 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 924.94 TONNES

SEPT 25/WITH GOLD DOWN $26.90 A HUGE  PAPER DEPOSIT OF:  16.42 TONNES//INVENTORY RESTS AT 924.94 TONNES

 

SEPT 24/WITH GOLD UP $8.65 TODAY: A MONSTROUS CHANGE IN GOLD INVENTORY AT THE GLD: AN OUT OF THIS WORLD DEPOSIT OF 14.37 TONNES OF GOLD INTO THE GLD/INVENTORY RESTS AT 894.15 TONNES

SEPT 23/WITH GOLD UP $16.25 ON THE DAY: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER ADDITION OF 10.65 TONNES//INVENTORY RESTS AT 894.15 TONNES

SEPT 20/WITH GOLD UP $8.60 ON THE DAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 883.06 TONNES

SEPT 19/WITH GOLD DOWN $8.90 TODAY: A BIG CHANGES IN GOLD INVENTORY AT THE GLD: A PAPER DEPOSIT OF 3.23 TONNES OF GOLD INTO THE GLD///INVENTORY RESTS AT 883.60 TONNES

SEPT 18/WITH GOLD UP $2.40 TODAY: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER DEPOSIT OF 5.86 TONNES/INVENTORY RESTS AT 880.37 TONNES

SEPT 17/WITH GOLD UP $1.50: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 874.51 TONNES

SEPT 16/WITH GOLD UP $11.75 TODAY: A BIG CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER WITHDRAWAL OF 5.86 TONNES FROM THE GLD///INVENTORY RESTS AT 874.51 TONNES

SEPT 13/WITH GOLD DOWN $7.75 TODAY: A BIG PAPER WITHDRAWAL OF 2.05 TONNES FROM THE GLD/INVENTORY RESTS AT 880.37 TONNES

SEPT 12//WITH GOLD UP $4.70 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 882.42 TONNES

SEPT 11/WITH GOLD UP $5.30 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 882.42 TONNES

SEPT 10/WITH GOLD DOWN $11.75 TODAY: A HUGE 7.33 PAPER TONNES OF GOLD WAS WITHDRAWN FROM THE GLD/INVENTORY RESTS AT 882.42 TONNES

SEPT 9/WITH GOLD DOWN $4.75 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 889.75 TONNES

SEPT 6//WITH GOLD DOWN $9.80: A BIG CHANGE IN GOLD INVENTORY AT THE SLV: A PAPER WITHDRAWAL OF 6.15 TONNES//INVENTORY RESTS AT 889.75 TONNES

SEPT 5/WITH GOLD DOWN $33.80 TODAY: A BIG ADDITION (DEPOSIT) OF 5.86 OF PAPER GOLD TONNES PROBABLY ADDED BEFORE THE RAID/EXPECT A HUGE PAPER WITHDRAWAL TOMORROW:  INVENTORY RESTS AT 895.90 TONNES

SEPT 4/WITH GOLD UP $5.00 TODAY: A BIG CHANGE: A HUGE PAPER DEPOSIT OF:  11.73 TONNES/INVENTORY RESTS AT ….890.04 TONNES

SEPT 3/WITH GOLD UP $25.60 TODAY: STRANGE: A WITHDRAWAL OF 2.05 PAPER TONNES FROM THE GLD// /INVENTORY RESTS AT 878.31 TONNES

AUGUST 30 WITH GOLD DOWN $7.00: A BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.05 TONNES/INVENTORY RESTS AT 880.36 TONNES

AUGUST 29/WITH GOLD DOWN $11.65: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 9.09 PAPER TONNES OF GOLD INTO THE GLD INVENTORY/INVENTORY RESTS AT 882.41 TONNES

AUGUST 28/WITH GOLD DOWN $2.15 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 873.32 TONNES

AUGUST 27//WITH GOLD UP $14.50 TODAY: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER DEPOSIT OF 13.49 TONNES INTO THE GLD///INVENTORY RESTS AT 873.32 TONNES

AUGUST 26/WITH GOLD UP 0.25 TODAY: A BIG CHANGE IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 4.99 TONNES/INVENTORY RESTS AT 859.83 TONNES

AUGUST 23/WITH GOLD UP $28.50 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 854.84 TONNES

 

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OCT 1/2019/ Inventory rests tonight at 920.83 tonnes

 

 

*IN LAST 672 TRADING DAYS: 28.33 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 572- TRADING DAYS: A NET 138.32 TONNES HAVE NOW BEEN ADDED INTO  THE GLD INVENTORY.

 

end

 

Now the SLV Inventory/

OCT 1.2019 //WITH SILVER UP 30 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER DEPOSIT OF 1.87 MILLION OZ INTO THE SLV///INVENTORY RESTS AT 383.656 MILLION OZ//

SEPT 30/WITH SILVER DOWN 58 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 381.786 MILLION OZ/

SEPT 27/WITH SILVER DOWN 34 CENTS TODAY/ NO CHANGE IN SILVER INVENTORY AT THE SLV//.INVENTORY RESTS AT 381.786 MILLION OZ/

SEPT 26/WITH SILVER DOWN 12 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER DEPOSIT OF 3.975 MILLION OZ INTO THE SLV//INVENTORY RESTS AT 381.786 MILLION OZ/

SEPT 25.//WITH SILVER DOWN 58 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 377.811 MILLION OZ//

SEPT 24/WITH SILVER DOWN 5 CENTS TODAY: A BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 2.338 MILLION OZ INTO THE SLV///INVENTORY RESTS AT 377.811 MILLION OZ//

SEPT 23.2019/WITH SILVER UP 80 CENTS TODAY; NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 375.473 MILLION OZ.

SEPT 20/ WITH SILVER UP 3 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 375.473 MILLION OZ.

SEPT 19/WITH SILVER DOWN 4 CENTS TODAY; A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER WITHDRAWAL OF 1.029 MILLION OZ FROM THE SLV///INVENTORY RESTS AT 375.473 MILLION OZ/

SEPT 18/WITH SILVER DOWN 24 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 376.502 MILLION OZ//

SEPT 17/WITH SILVER UP 14 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 376.502 MILLION OZ//

SEPT 16/WITH SILVER UP 41 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV; A PAPER WITHDRAWAL OF 2.899 MILLION OZ OF SILVER LEAVES THE SLV///INVENTORY RESTS AT 376.502 MILLION OZ/

SEPT 13/ NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 379.401 MILLION OZ//

SEPT 12/ NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 379.401 MILLION OZ//

SEPT 11/WITH SILVER DOWN ONE CENT TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 379.401 MILLION OZ//

SEPT 10/WITH SILVER UP 2 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV” A WITHDRAWAL OF 1.778 MILLION PAPER OZ OF SILVER///INVENTORY RESTS AT 379.401 MILLION OZ//

SEPT 9/WITH SILVER DOWN 6 CENTS TODAY: A MAMMOTH CHANGE IN SILVER INVENTORY: A WITHDRAWAL OF 5.425 MILLION PAPER OZ/INVENTORY RESTS AT 381.179 MILLION OZ../

SEPT 6/WITH SILVER DOWN ANOTHER 60 CENTS TODAY: A RATHER TIMID CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 842,000 PAPER OZ FROM THE SLV///INVENTORY RESTS AT 386.604 MILLION OZ//

SEPT 5/WITH SILVER WHACKED 68 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 387.446 MILLION OZ//

SEPT 4/WITH SILVER UP 28 CENTS TODAY:STRANGE!! A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 708,000 OZ FROM SLV’S INVENTORY:/INVENTORY RESTS AT 387.446 MILLION OZ//

SEPT 3/WITH SILVER UP 83 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT  388.154 MILLION OZ/

AUGUST 30/WITH SILVER DOWN 2 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 388.154 TONNES

AUGUST 29/WITH SILVER DOWN 13 CENTS TODAY: A HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A PAPER DEPOSIT OF 2.714 MILLION OZ INTO THE SLV INVENTORY//INVENTORY RESTS AT 388.154 MILLION OZ/

AUGUST 28/WITH SILVER UP 19 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 385.440 MILLION OZ/

AUGUST 27/WITH SILVER UP 52 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 385.440 MILLION OZ//

AUGUST 26/WITH SILVER UP 23 CENTS TODAY: A BIG  CHANGE IN SILVER INVENTORY AT THE SLV; A DEPOSIT OF 1.59 MILLION OZ INTO SLV INVENTORY///INVENTORY RESTS AT 385.440 MILLION OZ//

AUGUST 23/WITH SILVER UP 37 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 383.850 MILLION OZ//

 

OCT 1/2019:

 

 

Inventory 383.656 MILLION OZ

LIBOR SCHEDULE AND GOFO RATES:

 

 

YOUR DATA…..

6 Month MM GOFO 2.17/ and libor 6 month duration 2.06

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

G0LD LENDING RATE: – .11

 

XXXXXXXX

12 Month MM GOFO
+ 2.03%

LIBOR FOR 12 MONTH DURATION: 2.03

 

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.00

end

 

 

end

 

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

Video: Gold $16,000 and Silver $770 Per Ounce? Focus On Safe Haven Value, Not Price

Watch Video Here

– “The possibility of gold over $16,000 per ounce and silver over $770 per ounce … I hear people gasp in dismay when I say those figures and I will qualify them”

– “There are a lot of important developments in the precious metals market … the outlook for gold and silver has never been more positive”

– “Price is what you pay; value is what you get” – Warren Buffett’s phrase regarding value stocks is very apt with regard to the safe have value of gold and silver today

– Most investors remain gold cynics, some of whom know the price of gold and silver but very few of whom know the real hedging and safe haven value as seen in the data, research and all of history including that of recent years

– Gold and silver’s fundamentals and the heady cocktail of macroeconomic monetary, geo-political and systemic risk have never been more bullish

– “Ignore the short term noise and focus on the long term value of gold and silver”

Watch Latest GoldCore Video Here

NEWS and COMMENTARY

Gold prices dip as fears of widening trade war ease

Sliver and Nickel Outshine Gold to Score Biggest Commodities Gains Since June

Gold app Glint collapses just months after fundraising

Asian shares, yuan off to calm start; focus on China

China Sept factory activity surprises, expands fastest in 19 mths

Dollar supported as fears of ramp up in Sino-U.S. trade war ease

September Container Shipping Rates Collapse 43% Forcing Carriers To Slash Capacity

 “The Semmelweis Reflex” – Why Experts Don’t Understand Gold – Salinas Price

 

 

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

27-Sep-19 1496.15 1489.90, 1218.17 1209.05 & 1369.58 1362.51
26-Sep-19 1507.05 1506.40, 1223.72 1219.28 & 1378.50 1374.89
25-Sep-19 1530.85 1528.75, 1231.11 1234.62 & 1391.24 1391.77
24-Sep-19 1520.25 1520.65, 1220.76 1216.67 & 1382.36 1381.36
23-Sep-19 1519.50 1522.10, 1222.13 1225.90 & 1385.48 1385.11
20-Sep-19 1504.10 1501.90, 1199.07 1203.62 & 1361.06 1362.52
19-Sep-19 1498.40 1500.70, 1200.67 1201.76 & 1354.85 1357.08
18-Sep-19 1502.20 1503.50, 1206.27 1204.90 & 1360.39 1359.92
17-Sep-19 1499.30 1502.10, 1208.89 1207.24 & 1361.51 1360.45
16-Sep-19 1502.05 1497.20, 1207.35 1203.30 & 1357.25 1359.46
13-Sep-19 1506.30 1503.10, 1209.41 1208.19 & 1356.88 1358.35
12-Sep-19 1502.95 1515.20, 1219.94 1227.46 & 1362.88 1373.53
11-Sep-19 1493.65 1490.65, 1208.21 1209.07 & 1354.74 1355.90

SIGN UP FOR OUR AWARD WINNING MARKET UPDATES HERE

Mark O’Byrne
Executive Director

 

ii) Important gold commentaries courtesy of GATA/Chris Powell

As more and more countries shift away from the dollar it’s share of global currency reserves falls.  It is now at its lowest level since 2013

(Reuters/GATA)

U.S. dollar share of global currency reserves hits lowest since 2013

 Section: 

From Reuters
Monday, September 30, 2019

https://www.reuters.com/article/us-forex-reserves/u-s-dollar-share-of-gl…

The U.S. dollar’s share of currency reserves reported to the International Monetary Fund fell in the second quarter to its lowest level since the end of 2013, while the yen’s share of reserves grew to the largest in nearly two decades, data released on Monday showed.

..Reserves held in U.S. dollars totaled $6.79 trillion, or 61.63% of allocated reserves, in the second quarter, compared with $6.74 trillion, or 61.86%, in the first quarter.

This was the greenback’s smallest share of overall reserves since the fourth quarter of 2013 when it was 61.27%.

* * *

Join GATA here:

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

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

* * *

.END

They are now beginning to understand that negative rates are having a devastating effect on markets because of the pricing of risk

(Bloomberg/GATA)

Negative rates are rewriting the rules of modern finance

 Section: 

By Brandon Kochkodin
Bloomberg News
Monday, September 30,2019

Negative interest rates have quite literally broken one of the pillars of modern finance.

As economists and central bankers weigh the pros and cons of sub-zero rates and their impact on the world, traders have been contending with a rather more mundane, but fundamental issue: How to price risk on trillions of dollars of financial instruments like interest-rate swaps when their complex mathematical models simply don’t work with negative numbers.

… 

Out are certain variations of the Black-Scholes model, the framework that allowed derivatives to flourish in the past four decades. In are a hodgepodge of approximations and workarounds, including one dating to the 19th century.

Granted, the current state of affairs is more a nuisance than a serious problem. And it’s one that has been largely confined to Europe and Japan. But with sub-zero interest rates becoming a long-term economic feature and the number of negative-yielding bonds reaching $15 trillion, it’s an issue more and more traders, particularly in the U.S., are trying to wrap their heads around. …

… For the remainder of the report:

https://www.bloomberg.com/news/articles/2019-09-30/how-negative-rates-br…

* * *

END

No question about it, helicopter money or direct funding of government is only one step away

Rees/London Telegraph/GATA)

‘Helicopter money’ may be only weapon to confront next recession

 Section: 

By Tom Rees
The Telegraph, London
Monday, September 30, 2019

A radical world of “helicopter money” – where central banks fund government spending – is “inevitable” as policymakers run out of ammunition ahead of the next recession, top economists have warned.

Central banks are likely to “explore more unconventional policies” in the next downturn and blur the lines between fiscal and monetary policy with radical new tools, such as monetary financing, Deutsche Bank argued.

… 

Recession fears are mounting but central banks have very little firepower remaining with traditional monetary policy — the control of the money supply and interest rates — blunted.

Helicopter money to stimulate the economy therefore “seems inevitable over the medium to longer term,” said Jim Reid, a Deutsche analyst. He argued that central banks “effectively invited governments to experiment with more unconventional policies” with ultra-low interest rates on debt.

Helicopter money is when central banks finance government spending through money printing but can also refer to cash transfers into individuals’ bank accounts and haircuts to debt already held by central banks.

“If the post global financial crisis decade has all been about printing money to buy financial assets, we think the next decade will be more about printing money and injecting it into the real economy,” Mr. Reid said.

The German bank’s analysis found that the world is already drenched in debt in the wake of the financial crisis. Total debt has tripled since the turn of the century to $247 trillion while government debt as a percentage of GDP in advanced economies is at a record peacetime high. …

… Dispatch continues below …

https://www.telegraph.co.uk/business/2019/09/29/helicopter-money-may-wea…

* * *

END

We now hear that Deutsche bank’s headquarters were raided last week. It is Pam and Russ Martens contention that banks are refusing to loan any money to DB

(courtesy Russ and Pam Martens/Wall Street on Parade)

Pam and Russ Martens: The repo loan crisis, dead bankers, and Deutsche Bank

 Section: 

By Pam and Russ Martens
Wall Street on Parade
Monday, September 1, 2019

Last week, as the Fed was carrying out hundreds of billions of dollars in emergency loan operations on Wall Street for the second week in a row — the first such operations since the financial crisis — Deutsche Bank’s headquarters office in Frankfurt, Germany was being raided by police for the second time in less than a year. That’s not the sort of thing that inspires confidence among depositors to keep their money in your bank.

.Deutsche Bank has been a constant headache for the U.S. financial system because it is heavily intertwined via derivatives with the big banks on Wall Street, including JPMorgan Chase, Citigroup, Goldman Sachs, Morgan Stanley and Bank of America. It has become the dark cloud on the horizon in the same way Citigroup cast a negative pall in the early days of the financial crisis of 2008. (It’s not a good omen that Citigroup’s stock eventually went to 99 cents and the bank received the largest taxpayer and Federal Reserve bailout in U.S. history. The Fed alone secretly pumped $2.5 trillion in revolving loans into Citigroup from December 2007 to the middle of 2010.)

The latest raid at Deutsche Bank occurred on Tuesday and Wednesday of last week, September 24 and 25, and was related to the $220 billion money laundering probe of Danske Bank, Denmark’s largest lender. Deutsche Bank served as correspondent bank to Danske’s Estonia branch where the laundering is alleged to have occurred. On Wednesday, as the raid was proceeding, the body of Aivar Rehe who previously ran the Estonia business of Danske Bank, was discovered by police in Estonia. Rehe had been questioned by prosecutors and was considered a key witness in the probe. His death is being called an apparent suicide by European media.

On the day the police raid started at Deutsche Bank, Tuesday, September 24, the Federal Reserve Bank of New York offered $30 billion in 14-day emergency term loans and had demand for more than twice that amount. That led the New York Fed to increase its subsequent 14-day term loans from $30 billion to $60 billion later in the week. The Fed’s overnight repo loans that were offered every day last week were also increased from $75 billion per day to $100 billion per day.

As the timeline below illustrates, Deutsche Bank has been in a slow motion collapse as a result of its serial crime charges while international regulators have failed to address the fact that it is a counterparty to $49 trillion notional (face amount) in derivatives according to its 2018 annual report and thus presents systemic risk throughout the global financial system.

Wall Street On Parade believes that the repo crisis on Wall Street may, at least in part, relate to big Wall Street banks backing away from lending to Deutsche Bank. You can read the timeline below and make up your own mind. …

… For the remainder of the report:

https://wallstreetonparade.com/2019/09/the-repo-loan-crisis-dead-bankers…

* * *’

end

China’s golden week explains fully the whack on our precious metals yesterday.

(zerohedge)

China’s Golden Week holiday explains gold’s counterintuitive weakness, Zero Hedge says

 Section: 

Is This The Real Driver Of Gold’s Recent Weakness?

From Zero Hedge, New York
Sunday, September 29, 2019

Despite uber-dovish Fed jawboning (and a re-expansion of their balance sheet), a liquidity crisis prompting repo action by New York Fed, re-escalated trade tensions, a breakdown in talks with North Korea, and, of course, the Trump impeachment process, safe-haven precious metals were pummeled lower the last few days, breaking back down below $1,500.

The question on many investors’ minds is: Why?

The answer is surprisingly simple: China’s Golden Week holiday. …

… For the remainder of the commentary:

https://www.zerohedge.com/commodities/gold-prices-plunge-right-cue-china.

iii) Other physical stories:

LAWRIE WILLIAMS: China gold imports still hugely significant despite earlier cuts

China will still import close to 1700 tonnes of gold this year.

(Lawrie Williams)

Gold investors may have had their attention drawn to reports that China has been severely curtailing its gold imports earlier this year. This is true – at least in part – with significant cutbacks in May, June and July, but the Middle Kingdom nonetheless still remains a hugely important importer and consumer of gold – and the gold import numbers appear to have been beginning to pick up again.

So far this year (to end-August), according to Nick Laird; http://www.goldchartsrus.com figures, China has imported a shade under 700 tonnes of gold as against 1,126 tonnes to August 2018 and 864 tonnes in the first 8 months of 2017. It is still on track for imports over the full year to exceed 1,000 tonnes, which together with the country’s own domestic gold production, plus an allowance for gold scrap recycling, would probably still put China’s annual gold absorption at around 1,600 to 1,700 tonnes. This is well above the figures publicised by major consultancies like GFMS and Metals Focus, which seem to limit their consumption estimates to only some limited demand categories. This latest figure would still leave China as comfortably the world’s largest annual consumer of gold, despite the apparent slowdowns implemented earlier in the year and supported by lower Shanghai Gold Exchange withdrawal data so far this year.

But does this signify a global gold demand slowdown. We don’t think so because of the big pick up in gold inflows into the gold-based ETFs around the world which has happened at the same time, along with the overall gold price advance. Gold is up around 13% year to date and even silver, which has been underperforming gold so far, is up 9% this year, despite the latest sharp price falls. These are reasonably respectable performances vis-a-vis equities which have the overhanging ongoing likelihood of a major crash ahead according to many respected financial commentators.

According to the World Gold Council, Gold ETFs added some 292 net tonnes of gold up until end-August, and the figures have risen further since. The biggest gold ETF of all, GLD in the USA, has alone added 126 tonnes of gold to its holdings since the beginning of the year, and as a guide to global inflows in the past month, added around 31 tonnes in September alone. Assuming global totals rose at a similar rate to those of GLD, global ETF holdings will have risen by a total of around 360 tonnes of gold year to date – countering most of the fall-off in Chinese imports.

Total global gold production, while it may not have peaked quite yet – with continuing production growth in countries like Australia, Russia and Canada countering declines in many other gold producers like China and South Africa – is pretty well flat. Maybe it will rise between 0.5 and 2 percent this year depending on whose data one follows. Peak gold may not be with us yet, but it is close, so we are not expecting any big supply increases, National demand reductions, like that we are seeing this year in China, is the primary supply/demand balance factor – but as we have pointed out above, this is largely being counterbalanced by ETF gold inflows, plus continuing central bank purchases, so the actual supply/demand fundamentals are little changed by the Chinese gold import curtailment, big though it may be, which will thus have little direct impact on the gold price.

Ed Steer has published a graphic in his daily newsletter demonstrating that movements in the gold price correlate extremely closely to COMEX trades by Managed Money traders, which brings an interesting context into precious metals price movements in that the other precious metals are all influenced by the gold price. I quote Ed: “If they’re [the managed Money Traders] buying, the act of them doing that is what causes prices to rise — and if they’re selling, prices fall. It has nothing do with interest rates, the stock market, the Fed…or the price of tea in China.” Of course some of the factors that Ed notes as not being relevant will influence the aforesaid Managed Money traders’ decisions whether to buy or sell! Nevertheless it’s an important observation, and one which is well-supported by the graphic Ed supplies.

Overnight trade and early activity in Europe today saw a further sharp gold price downturn, although silver was less affected. It seems that every time gold looks as if it might approach the $1,550 mark, as it did early last week, it is brought back down very sharply driven by activity in the COMEX futures market. It is already picking up a little and we wouldn’t be surprised to see it regain the $1,500 level in the next few days – geopolitical events continue to create uncertainty, and the latest Chicago PMI data is far from encouraging for the U.S. markets, but perhaps positive for gold. However, beware if it gets to the $1,530s or 40s as it may well be brought back down heavily again, although we see this as a short to medium term temporary setback in an overall ongoing upwards movement in precious metals prices. The world remains an uncertain place and that tends to be positive for gold and silver in particular.

01 Oct 2019

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

i) Chinese yuan vs USA dollar/CLOSED / LAST AT: 67.1483/ GETTING DANGEROUSLY PAST TO 7:1

//OFFSHORE YUAN:  7.1485   /shanghai bourse CLOSED

HANG SANG CLOSED

 

2. Nikkei closed UP 129.40  POINTS OR 0.59%

 

 

3. Europe stocks OPENED MOSTLY RED/

USA dollar index UP TO 99.44/Euro RISES TO 1.0903

3b Japan 10 year bond yield: RISES TO. –.15/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 108.27/ 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:: 54.70 and Brent: 59.77

3f Gold DOWN/JAPANESE Yen DOWN 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 -.53%/Italian 10 yr bond yield UP to 0.85% /SPAIN 10 YR BOND YIELD UP TO 0.18%…ITALIAN 10 YR BOND YIELD/GERMAN BUND: 1.38: DANGEROUS FOR THE ITALIAN BANKING SYSTEM

3j Greek 10 year bond yield RISES TO : 1.37

3k Gold at $1468.25 silver at: 17.10   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 28/100 in roubles/dollar) 65.11

3m oil into the 54 dollar handle for WTI and 59 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 108.27 DESTROYING JAPANESE CITIZENS WITH HIGHER FOOD INFLATION

30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning 1.0087 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0914 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 RISING to 0.53%

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 1.73% early this morning. Thirty year rate at 2.18%

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

6.  TURKISH LIRA:  UP  TO 5.6961..

US Stock Futures Levitate, Ignore Bond Market Blowout

In a session market by fireworks in the bond market, stocks were relatively tame and well-behaved as we officially entered the last quarter of the year.

 

S&P e-mini futures gained on Tuesday as trade talk optimism returned, and ahead of the release of key US manufacturing data as investors looked for fresh signs of domestic demand in the world’s largest economy amid softening global growth. The ISM’s PMI data is expected to show the manufacturing sector rebounded to 50.0 in September after contracting for the first time in 3-1/2 years to 49.1 in August. The US ISM data comes on the heels of euro zone data, which showed manufacturing activity in the bloc contracted at its steepest rate in almost seven years as the global economy flashed clearer warning signs as a wave of data showed manufacturing stuck in a slump, exports falling and sentiment sliding: as the trade war between the U.S. and China rages, industry executives from Japan and Russia to Germany and Italy complained of contracting business, while the World Trade Organization cut its forecast for commerce to the lowest in a decade.

The latest dismal European numbers only added to the gloom for investors facing a laundry list of threats just now, including everything from the drawn-out trade war and Brexit to protests in Hong Kong and an impeachment probe of President Trump; they even barely blinked at the news of the first shot protesters in Hong Kong. Nonetheless, stocks continue to ignore the looming threat in what has been yet another perplexing risk-on start to the week (propelled by more stock buybacks ahead of the blackout period), perhaps because the outcome of each risk seems impossible to predict and the safest assets are looking expensive.

The overnight session started with subdued Asian markets as Hong Kong and China were closed for holidays. Japanese shares rose about 1%, while Australia’s dollar slid after the central bank cut its benchmark interest rate to a record low.

Yet while European stocks slipped amid the disappointing factory and inflation data, global stocks generally ignored the latest dismal manufacturing data, bonds were rather active, and as noted earlier, Japan’s 10Y JGBs suffered the biggest drop since August 2016 on a trifecta of negative developments, following a BOJ warning it would further trim its bond purchases, the GPIF saying it would shift to offshore bond purchases, and the ugliest 10Y bond auction in three years; the violent plunge set off a brief margin call which only made the selloff worse.

Treasuries and bunds then promptly joined the JGB selloff which gradually spread across the world.

The yield on 10-year U.S. bonds headed for the first increase in four days in the wake of the Japanese fiasco.

In FX, the Bloomberg dollar index rose for a second day, while the pound fluctuated as British Prime Minister Boris Johnson prepares to present his blueprint for a new Brexit deal to the European Union.

The Australia dollar tumbled as Australia’s central bank was dragged further into the global easing tide as it cut interest rates for the third time this year, to a new record low, even as it risks refueling excesses that Governor Philip Lowe warned against just weeks ago. The Reserve Bank reduced the cash rate by 25 basis points to a record-low 0.75% and said it may ease even further, venturing deeper into levels where unconventional measures may need to be adopted. The move is in part designed to prevent a rebound in the depreciating currency that might have been triggered if it stood pat while global counterparts eased. “The global race to the bottom is, in a sense, dragging the RBA along,” said Michael Blythe, chief economist at the Commonwealth Bank of Australia. “Failure to participate could see the Australian dollar move higher.”

In other geopolitical news, Chinese President Xi said no force can stop the Chinese people and the Chinese nation forging ahead, must uphold path of peaceful developments. Xi added that the central government would “maintain long-term prosperity and stability of Hong Kong and Macao.”

Gold extended recent declines and West Texas oil climbed.

On today’s calendar, expected data include PMIs and construction spending. McCormick and Stitch Fix are reporting earnings

Market Snapshot

  • S&P 500 futures up 0.3% to 2,987.25
  • STOXX Europe 600 down 0.07% to 392.86
  • MXAP up 0.2% to 156.70
  • MXAPJ down 0.03% to 501.93
  • Nikkei up 0.6% to 21,885.24
  • Topix up 1% to 1,603.00
  • Hang Seng Index up 0.5% to 26,092.27
  • Shanghai Composite down 0.9% to 2,905.19
  • Sensex down 1.6% to 38,050.80
  • Australia S&P/ASX 200 up 0.8% to 6,742.85
  • Kospi up 0.5% to 2,072.42
  • German 10Y yield rose 4.5 bps to -0.526%
  • Euro down 0.06% to $1.0893
  • Italian 10Y yield fell 0.2 bps to 0.484%
  • Spanish 10Y yield rose 4.4 bps to 0.189%
  • Brent futures down 1.5% to $59.90/bbl
  • Gold spot down 0.6% to $1,464.37
  • U.S. Dollar Index up 0.1% to 99.50

Top Overnight News from Bloomberg

  • British Prime Minister Boris Johnson will present a new plan for a Brexit deal to the European Union within days but there are signs that it may fail. While some purist euro-skeptics in Johnson’s ruling Conservative party are willing to compromise, the Irish government has said his proposals so far for resolving the Brexit impasse are a non-starter
  • The euro area’s manufacturing sector slumped in September as German factories experienced their worst month since the depths of the financial crisis. IHS Markit’s index for manufacturing in the euro region came in at 45.7 last month, slightly higher than the initial estimate of 45.6, but still the lowest level since October 2012
  • Police shot tear gas volleys at protesters as simultaneous rallies raged across Hong Kong, including a march through the city center, hours after celebrations for a holiday marking 70 years of Communist rule in China began in Beijing
  • Gold sank to an eight-week low as investors weighed the impact of a stronger dollar — which traded near the highest level since 2017 — together with unfavorable chart patterns and prospects of renewed, high-level U.S.-China trade talks next week
  • Japanese bond traders just had a taste of what it’s like when the nation’s central bank and pension fund aren’t there to support them. Bond futures tumbled by the most since 2016, triggering margin calls for investors, after the worst 10-year debt auction in three years. Yields across the curve climbed, while the sell- off also spilled into Treasuries and European debt.

Asian equities traded higher across the board after Wall Street wrapped up the third quarter with a session in the green ahead of principle-level US-Sino trade talks in Washington next week. In terms of Q3 performance, the S&P and DJIA both advanced for a third consecutive quarter, rising in excess of 1% each, whilst the Nasdaq dipped 0.1% Q/Q. Upside in the ASX 200 (+0.8%) was capped as base and precious metal miners bore the brunt of softer prices, whilst Nikkei 225 (+0.6%) cheered favourable currency moves and largely side-lined the planned sales tax hike which came into effect today. Elsewhere, the KOSPI (+0.5%) conformed to the risk appetite despite South Korean exports declining for the tenth straight month and semi-conductor exports slumping 31.5% Y/Y, albeit inflation metrics fell short of forecasts. As a reminder, Mainland China and Hong Kong markets were closed today due to National Day Holiday, although protests were underway in Hong Kong whilst China celebrated the 70th anniversary of the People’s Republic with a military parade. Finally, 10yr JGB futures were softer amid the risk-sentiment, however downside was more pronounced after the Japanese 10yr auction was received poorly as results showed a bid-to-cover at multi-year lows, which pressured UST and Bund futures in sympathy, Japan Securities Clearing Corporation then said an emergency margin call has been triggered on JGB futures.

Top Asian News

  • Japan’s GPIF Positions Itself for More Foreign Debt Buying
  • Marubeni Is Said to Sound Out Potential Buyers for Gavilon
  • Taiwan Dollar Is a Surprise Winner From U.S.-China Trade War
  • Japan Post Favors CLOs for U.S. Loan Purchases Over Mutual Funds

Major European bourses (Euro Stoxx 50 -0.1%) pared initial gains, following a positive AsiaPac lead, where stocks took impetus from a solid Wall Street session and better than expected Japanese Tankan manufacturing data. The FTSE 100 (-0.3%) is a marginal laggard, amid Sterling strength on renewed Brexit deal hopes and after the second reading of September’s Manufacturing PMI data proved not as grim as expected, while Switzerland’s SMI (-0.4%) is also lower amid weakness in some of its heavyweights. Negative ticks were seen across European bourses (although most pronounced in the DAX [-0.1%]) after the second reading of Germay’s Manufacturing PMI data, which although coming in better than expected, confirmed a deterioration in the sector in the month of September. Amid the initially firmer risk tone, defensives (Utilities (-0.3%), Health Care (-0.6%) and Consumer Staples (-0.9%)) are on the back foot while Tech (+0.3%) is in the lead. In terms of individual movers; MediaSet (+1.3%) was buoyed after posting decent earnings. PostNL (-2.7%) sunk on the news that the Co. is to combine its network with Sandd, in a deal worth EUR 105mln. ASML (+1.8%) advanced after the Co. was reiterated buy at UBS. Ryanair (+3.1%) and Air France (+2.7%) both moved higher after the Co’s were upgraded to buy at BAML. Atlantia (-2.3%) after Italy PM Conte said the process to revoke highway concessions is underway.

Top European News

  • Euro-Area Manufacturing Slump Deepens in Worst Month Since 2012
  • Euro-Area Inflation Slows, Adding to Case for ECB Stimulus Move
  • U.K. Mulls Help-to-Buy Future to Avoid Shock End for Developers
  • U.K. Factories Extend Slump Even as Brexit Preparations Resume

In FX, it has been a lively start to the new month and Q4 amidst ongoing Greenback strength, but with independent weights exacerbating declines and underperformance. The Aussie rebounded initially after the RBA cut rates by a further 25 bp and inserted a relatively upbeat line in the accompanying statement about a gentle turning point in the economy, but with guidance for further easing retained recovery gains were short-lived and Aud/Usd subsequently slipped below 0.6700, while Aud/Nzd retreated from another test of resistance around 1.0800 even though the Kiwi eventually succumbed to contagion and Nzd/Usd reversed through 0.6250 again to a 0.6220 low following another downbeat NZ business sentiment survey overnight. Meanwhile, the Swedish Krona slumped in wake of a significantly weaker than forecast sub-50 manufacturing PMI that was compounded by a downward revision to the previous month, and its Scandinavian counterpart has fallen in sympathy as Norway’s manufacturing sector only just escaped contraction and decelerated sharply from almost 54.0 in August. Eur/Sek has tested 10.8000 following a breach of technical resistance circa 10.7742 and Eur/Nok rallied beyond 9.9550 from lows of around 9.9080 and just below 9.8850 at one stage on Monday.

  • USD – The Dollar continues to prosper, partly at the expense of others, but also as US Treasury yields rebound and curves re-steepen with some extra impetus via Fed’s Evans advocating a policy pause after the 2 insurance cuts administered in July and September. Accordingly, the DXY has forged a fresh ytd high and breached 99.500 in the process, at 99.590, eyeing the Markit PMI, ISM and more Fed speakers for further direction.
  • CHF/CAD/JPY – The Franc has also bowed to disappointing Swiss macro news in the form of retail sales and deeper manufacturing PMI recession, with Usd/Chf up through parity and Eur/Chf crossing 1.0900 even though the single currency is struggling to cope with the aforementioned broad Buck advance and its own frailties. Elsewhere, the Loonie is still pivoting 1.3250 and awaiting Canadian GDP and/or Markit’s manufacturing PMI for extra inspiration, while the Yen appears more attuned to the latest gains in UST yields rather than a post-auction plunge in JGB futures that triggered emergency Japanese SCC margin calls. Indeed, Usd/Jpy has extended gains above 108.00 towards 108.50, with upside chart levels at 108.43 (Fib) and 108.48 (September’s peak) proving tough to break convincingly, thus far.
  • GBP/EUR – Relative G10 outperformers, or at least putting up a fight against the Greenback with the aid of an unexpected bounce in the UK manufacturing PMI and a steady pan Eurozone final print thanks to a German upgrade from the dire preliminary reading. However, Cable is still not making much headway beyond 1.2300 and Eur/Usd has waned just above 1.0900, with the former down through the 55 DMA (1.2279), Fib support (1.2271) and a late September base before the Brexit re-stocking PMI recovery and latter having another close look at bids at 1.0880 that are protecting a deeper retracement to 1.0864 (strong Fib support).
  • EM – Blanket losses vs the Greenback, and with sub-50 manufacturing PMIs across the region, bar Turkey, not helping, as the Lira loses more ground amidst rebounding oil prices and further investor disenchantment with the Finance Minister’s latest grand economic plan.
  • The RBA cut its cash rate by 25bps to 0.75% as expected. RBA reiterated that it is reasonable to expect that an extended period of low interest rates will be required in Australia to reach full employment and achieve the inflation target. RBA added “A gentle turning point, however, appears to have been reached”. The Central Bank noted the low level of interest rates, recent tax cuts, ongoing spending on infrastructure, signs of stabilisation in some established housing markets and a brighter outlook for the resources sector should all support growth, but repeated that the Board will continue to monitor developments, including in the labour market, and is prepared to ease monetary policy further if needed to support sustainable growth in the economy, full employment and the achievement of the inflation target over time.

In commodities, the crude complex is consolidating, with both benchmarks having found support around their 12 September lows around USD 54.00/bbl for WTI and USD 59.00/bbl for Brent respectively, following yesterday’s steep declines which were exacerbated by bearish supply signals re. Saudi Aramco’s recovery to full output. News flow on the Middle Eastern geopolitical front has been light, although reports that Iran has sentenced one person to death for spying for the US could be providing some support to the complex. However, further details regarding who the person is and what the wider implications, if any, may be are scant. Elsewhere, amid continued constructive risk tone and possible technical selling after it convincingly lost its grip on the USD 1500/oz handle yesterday, Gold continues to move lower. The fall in Gold prices comes despite continued escalations in protestor/police tensions in Hong Kong, as markets more broadly remain seemingly unperturbed by developments for now. Meanwhile, Copper futures remain unable to derive support from the more constructive risk tone, and have extended on their overnight declines after broking below short-term resistance around USD 2.572/lbs.

US Event Calendar

  • 8:50am: Fed’s Clarida Makes Brief Remarks at AI Conference
  • 9:30am: Fed’s Bowman Speaks at Community Banking Conference
  • 9:45am: Markit US Manufacturing PMI, est. 51, prior 51
  • 10am: ISM Manufacturing, est. 50, prior 49.1
  • 10am: Construction Spending MoM, est. 0.5%, prior 0.1%
  • Wards Total Vehicle Sales, est. 17m, prior 17m

DB’s Jim Reid concludes the overnight wrap

Welcome to Q4 and only 85 days until Xmas. Craig has just published the Sept/Q3/YTD performance review. Q3 ended up being relatively positive for global assets with 29 of our 38 asset sample finishing with a positive total return although only 14 did so in dollar adjusted terms owing to the stronger greenback. September saw 23 out of 38 (22 in dollar terms) higher and reversed a tough August where only 18 of the 38 saw positive returns (14 in dollars). See Craig’s full review here .

I am on an advisory board for a research centre at the University of Warwick where I studied Economics (the no.1 place in the UK to study it according to last week’s Sunday Times). It’s called CAGE (Competitive Advantage in the Global Economy) and has published many interesting pieces over the years helping to shape policy and debate. However on a more fun theme it has very recently been associated with a report that debunked an old assertion that winning the lottery doesn’t make you happy. It’s been in a lot of newspapers over the last few days with the new research suggesting (using a much bigger sample than earlier work on this topic) that it absolutely does make you happier and the bigger the better. This made me smile as our new house was commissioned over a hundred years ago by someone that won a small lottery in the UK around the time of WWI. However much of the infrastructure (windows, plumbing, electrics, drainage etc.) hadn’t been touched since and as such I now feel like I’ve lost a lottery renovating it. However I’m blissfully happy living there so I can confirm that spending money you don’t have can also make you very happy – well at these interest rates it can.

One part of the world that’s not very happy at the moment is the global manufacturing sector and today brings the final PMIs/US ISM on this front with Europe’s numbers the most important. Ahead of that, the Chicago PMI yesterday wasn’t indicative of strong activity. Indeed the 47.1 reading for September compared to expectations for an even 50.0 and the print represented a decline of 3.3pts from August. Yesterday’s number tied for the third worst reading in this cycle although it did hit as low as 44.4 in July, although that means the three-month average is just 47.3. More concerning were some of the details though with the employment component at 45.6 which means the quarterly average of 44.1 is the lowest since Q4 2009. Our US economists also made the point that the ISM adjusted for the Chicago PMI was 46.2 and the lowest since 2009.

This comes ahead of today’s September US ISM manufacturing report. A reminder that the August reading fell into contractionary territory at 49.1 for the first time since August 2016. The consensus today is for a slight rebound back to 50.0 and our US economists expect a 50.8 reading. The Chicago number is a worry though.

Ahead of the European PMIs remember that the flash Euro Area reading fell to just 45.6 while Germany hit 41.4. France also only just stayed in expansionary territory at 50.3. We’ll also get a look at the non-core with Italy expected to print at 48.1, while here in the UK the consensus expects a 47.0 reading.

So a rare chance to focus on the data following what feels like nothing but politics for the past few weeks. As for markets, the partial walk back over the weekend of the US restricting capital to China story helped the S&P 500 and NASDAQ to gains of +0.50% and +0.75% respectively last night. Markets got a further boost after Peter Navarro said that the reports about capital controls were “inaccurate.” He’s one of the biggest China hawks in the White House, so his denial carries more weight. On the impeachment front, there weren’t any major new developments, though President Trump’s personal lawyer Rudy Giuliani was subpoenaed by the House Intelligence Committee. Our economists did note, that amid the heightened political noise, the Baker, Bloom, Davis economic policy uncertainty index has risen to 6-year high. Meanwhile, overnight the New York Times reported that President Trump pushed the Australian prime minister during a recent telephone call to help Attorney General William P. Barr gather information for a Justice Department inquiry that Trump hopes will discredit the Mueller investigation.

This morning in Asia markets are largely up in thin trading as Chinese and Hong Kong markets are closed. The Nikkei (+0.76%), Kospi (+0.53%) and ASX (+0.09%) are all higher. Elsewhere, futures on the S&P 500 are up +0.41% while yields on 10yr JGBs are up +5.6bps to -0.170% as a 10yr note auction saw the weakest demand since 2016 in the wake of a steady cutback in bond purchases by the BoJ. Yields on 10Y USTs are also up +3.6bps this morning. As for overnight data releases, Japan’s final September manufacturing PMI came out in line with the initial read of 48.9 while the Q3 Tankan survey results were largely better than expected. Meanwhile, South Korea’s September manufacturing PMI came in at 48.0 (vs. 49.0 last month) while CPI came in at -0.4%yoy (vs. -0.3%yoy expected) and exports printed at -11.7%yoy (vs. -9.6%yoy expected) with imports standing at -5.6%yoy (vs. +0.8% yoy expected).

In terms of markets, Europe also had a good day yesterday with the STOXX 600 (+0.35%) rising to its highest closing level in more than 16 months. It was a quiet quarter end for bond markets with 10y Treasuries and Bunds little changed by the end of play although Treasuries did rally a couple of basis points after that Chicago PMI data. Meanwhile, the dollar rallied (+0.27%; up a further +0.11% this morning) to its strongest level in 29 months, to the disadvantage of both oil (-1.83%) and gold (-1.59%).

Meanwhile on Brexit, Irish broadcaster RTE reported overnight that the UK has proposed customs checks five to 10 miles away from the Irish border with PM Johnson likely to present his plans to Brussels later this week. The Irish finance minister has already responded to the reports and said this plan would be a “non-starter”. The Daily Telegraph reported late last night that PM Johnson will unveil his detailed Brexit plan to EU leaders within the next 24 hours. The report added that the plan is expected to be based on the creation of an all-Ireland “economic zone” which would allow agricultural and food products to move between Ulster and the republic without checks at the border, and on customs the plan is expected to rely on technology and “alternative arrangements,” such as trusted-trader schemes and exemptions for small businesses. Elsewhere, the Times reported that PM Johnson is likely to ask the EU to rule out a further extension as part of a new Brexit deal. Assuming there is a deal agreed which still appears a Herculean effort, this would force MPs to back this deal or risk crashing out with no deal. It would put pressure back on the MPs desperate to avoid no deal. However to get to such a scenario remains a very big ask.

Moving to fiscal, late yesterday Italy released its new budget outlook document which sets a target for a 2020 deficit at 2.2% of GDP and aims to boost growth to 0.6%. This means that the structural deficit will worsen by 0.1pp next year, instead of the 0.6pp improvement that Italy had committed to, while debt will rise to 132.5% in 2019 and start declining only slowly in the following years. Finance Minister Roberto Gualtieri wrote in the outlook document that ”The debt rule would not be satisfied in any of its configurations. But the reduction in the debt-to-GDP ratio in 2022 compared to the previous year would be significant, at 2.2 percentage points.”

In other news, the overnight speech by Chinese President Xi fell shy of delivering any remarks on trade and instead focused on national unity and Xi reiterated the commitment towards China’s complete unification. Meanwhile, Japan’s planned sales tax hike to 10% from 8% takes effect today.

Back to yesterday where the other US data release was the September Dallas Fed manufacturing survey which nudged down to 1.5, albeit slightly better than the consensus for 1.0, but still down 1.2 points. Meanwhile in Europe the data included German retail sales, which were in line with expectations at 0.5% mom, though the previous figures were revised up meaningfully. Also, the German unemployment rate stayed steady at 5.0%, while Italy’s jobless rate fell to 9.5%, its lowest level since 2011, though almost all of the most recent decline was due to declining labour force participation rates rather than higher employment.

Looking at the day ahead, the focus this morning will be on the aforementioned PMIs while other data releases in Europe include September house prices data in the UK and September CPI for the Euro Area. In the US this afternoon we’ve got the September ISM manufacturing, manufacturing PMI and August construction spending. Later today we’re also expecting September vehicle sales. Away from the data we’re due to hear from the Fed’s Evans this morning at a Bundesbank conference while later this afternoon Clarida and Bowman will speak. We’ll also hear from the Bundesbank’s Weidmann this evening.

 

3A/ASIAN AFFAIRS

I)TUESDAY MORNING/ MONDAY NIGHT: 

SHANGHAI CLOSED DOWN   //Hang Sang CLOSED   /The Nikkei closed UP 129.40 POINTS OR 0.59%//Australia’s all ordinaires CLOSED UP .77%

/Chinese yuan (ONSHORE) closed DOWN  at 7.1483 /Oil UP TO 54.30 dollars per barrel for WTI and 59.77 for Brent. Stocks in Europe OPENED MOSTLY RED/ONSHORE YUAN CLOSED DOWN // LAST AT 7.1483 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 7.1485 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY PAST  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

With the central bank of Japan stating that it may not buy Japanese bonds in October, investors ran for cover as bond prices collapsed.  Yields rose around the globe as now it may not be safe to front run bond purchases anymore. Japan’s central bank owns just too many bonds.

(zerohedge)

“It’s Almost Impossible To Buy”: Japanese Bond Crash, Margin Call Send Shockwaves Around The Globe

For a dramatic preview of what will happen in a flash to all those record low interest rates without the backstop of central banks and ravenous pension fund, look no further than what happened in Japan overnight, where bond futures suffered the biggest one-day crash since August 2, 2016, sliding as much as 0.97 yen to 154.05, and triggering margin calls for investors after the worst 10-year debt auction in three years.

More ominously, once the rout started it quickly spread outside of Japan, because as yields jumped, the sell-off spilled into US Treasuries and European debt.

There were three things behind the swift collapse: the first catalyst was the Bank of Japan’s 1. Monday decision to slash bond purchases in October for the four major maturity buckets in order to steepen the curve and avoid further flattening which Kuroda has repeatedly expressed concern about in the past; the BOJ had indicated it may even stop buying debt of more than 25 years. It also sought to anchor yields from the one-to-three year zone by raising purchases in a regular operation earlier in the day and lifting the purchase band for the sector in October.

 

“The BOJ is showing its clear intention to correct distortions in the curve through flexible adjustments in market operations,” said Mari Iwashita, chief market economist at Daiwa. “While cutting the lower end of purchases in bonds maturing over 25 years to zero looks shocking, the BOJ will probably cut buying in this zone slowly.”

“The BOJ’s operation change had a huge psychological impact,” said Eiji Dohke, chief bond strategist at SBI Securities in Tokyo. “Investors are reluctant to buy given the risk of the BOJ skipping a purchase.”

2.Then, there was the announcement by Japan’s Government Pension Investment Fund (GPIF) that it was pivoting toward buying more FX-hedged foreign debt. Specifically, the world’s largest pension fund said it will consider currency-hedged overseas bond holdings as similar to domestic debt investments. That would allow GPIF to buy more foreign debt, as it’s already close to the 19% limit in its current mandate; and while good news for US Treasurys this was bad news for local JGBs.

Takahiro Sekido, a strategist at MUFG Bank, estimated that the GPIF may allocate more than 30% of its existing JGB holdings to currency hedged-foreign bonds: “There could be many funds following GPIF’s allocation change,” said Sekido, a former BOJ official.

As it turned out, he was right, and as Bloomberg put it, “all of a sudden, investors were left wondering what other changes were in store.”

3.Then the cherry on top came on Tuesday morning, when the latest 10-year JGB auction confirmed the investor panic as the debt drew a bid-to-cover ratio of 3.42, the lowest since 2016, with the cut-off price of 102.33 falling short of the 102.64 estimated by traders, while the 0.29 tail was widest since March 2015. If Japan can ever have a failed bond auction, this was about as close to it as it could get.

The “auction results were much worse than expected amid increased caution after the BOJ cut bond purchases on Monday”, says Eiji Dohke, chief bond strategist at SBI Securities in Tokyo. He noted that the “results reflect caution that the central bank may refrain from buying bonds during one of its regular operations in October” and said that given the weak outcome of Tuesday’s sale, JGB volatility is likely to remain elevated until the BOJ’s policy meeting at month-end and investors will be wary about taking positions.

Following this three-peat of doom for bond bulls, yields on Japan’s 10-year cash bond rose 5.5 basis points to minus 0.16%. The heavy selling sparked a margin call at the Japan Securities Clearing Corp, which then drove prices even lower in a second acute selloff about two hours later.

Tuesday’s rout was merely the latest hit for Japanese sovereign bonds, which were already reeling from a dismal September, when they lost 1.1%, their first monthly drop since April.

And as JGBs dumped, so did Bunds and US Treasurys in a coordinated global move that saw yields in the US and German both spike as a result of tremors started in little, old Japan, confirming that once the central banks lose control, the collapse will be quick and painful (this is for all you MMT watchers out there).

Summarizing this ominous day for Japan’s bond market – and economy – MUFG Bank’s Takahiro Sekido put it best: “Japanese bonds have reached the point where it’s almost impossible to buy.”

For the sake of Japan, the global bond market, and the entire global financial system, he better be wrong.

3 C CHINA

The Pig Ebola is killing China as over 140 billion dollars worth of pork meat has been destroyed. Pork prices are now at record levels.

(zerohedge)

Pig Ebola Has Cost China Over $140 Billion As Locals Get Angry At Record High Pork Prices

There is a reason why an increasingly desperate Beijing is willing to suspend tariffs on US pork exports, and it has nothing to do with trade war de-escalation or concessions, and everything to do with preventing an angry and hungry mob from running rampant across China’s streets.

As Caixin reports, the widespread outbreak of African swine fever that has prompted China to slaughter millions of pigs has caused 1 trillion yuan ($140 billion) of direct losses, an industry expert estimates; if correct, the direct damage from the “pig ebola” is far greater than the monetary damages incurred from two years of escalating trade tariffs with the US.

The shocking number was unveiled at a pig industry forum last Tuesday by Li Defa, who heads the College of Animal Science and Technology at China Agricultural University, and who notes that the upstream and downstream of the pork industry chain, such as pig feed and catering industry, were not included in the calculation, suggesting the full indirect losses from the crippling pork virus could be orders of magnitude greater.

For over a year, China’s pork industry has been crippled by an outbreak of the deadly pig virus since at least August 2018, when the first case was reported in Northeast China’s Liaoning province. It has since spread to all provincial level regions in the country, wiping out between one-third and half of all Chinese hog stocks and sending pork prices to record highs.

 

That’s contributed to broader food inflation. In August, China’s consumer price index, which measures the prices of a select basket of consumer goods and services, rose 2.8% year-on-year, according to data from the National Bureau of Statistics (NBS). The average pork price increased 46.7% year-on-year — the fastest pace in more than eight years — adding 1.08 percentage points to CPI growth.

Global AgriTrends@AgriTrends

China pork price inflation jumped from +38% in August to +84% in September – WOW. All meat prices now record high. Shortages reported. Imports rumored. Hang on!

View image on Twitter

The price of live pigs has surpassed 40 yuan per kilogram in late -September, more than doubling from when the epidemic first became publicly known in August last year.

Even the WaPo recently noted that “the most pressing political problem facing China’s leaders this week may not be the ongoing protests in Hong Kong. Nor the protracted trade war with the United States. No, it is probably a shortage of pork — during the Chinese zodiac year of the pig, no less — that has become so severe that the rulers of the Communist Party declared stabilizing pork supply and prices to be an ‘important political task’.”

Pork, as is widely known, is the main meat consumed in China, accounting for more than 60% of the country’s meat demand. The country is expected to consume 55 million tons of pork in 2020 with an estimated population of 1.4 billion, said Li: the Chinese love to eat pork. Red fried pork. Sweet-and-sour pork ribs. Glazed pork belly. Twice-cooked pork. Pork dumplings. Trotters. Chinese eat an average of 120 pounds of pork a year. Half the world’s pork is consumed here.

But with a slew of holidays on deck, officials are increasingly worried that public discontent will overshadow the celebrations. They are particularly concerned that pork shortages will ruin the “happy and peaceful atmosphere” required during the upcoming commemoration of the 70th anniversary of the founding of the People’s Republic of China, the biggest event on the Communist Party’s calendar this year.

“We should ensure pork supply by all means,” Vice Premier Hu Chunhua said at the end of last month, adding that China’s pork shortages would be “extremely severe” in the last quarter of this year and the first half of 2020.

“We must strengthen the guidance and management of public opinion,” he continued, according to a state media account of his remarks.

“If China loses more than half of its domestic pork production, it will not be easy to meet the demand gap by relying on foreign supplies,” Li said, failing to mention that if China is truly unable to restore its pork herds and prices continue to soar, the country’s massive lower and middle classes will soon become very angry.

To try to stabilize prices and feed domestic supply, the central government pledged to raise purchases of pork from overseas markets, including the U.S., a move which was seen as an olive branch in the trade war, but which in reality was just Beijing desperate to give the angry population what it wants.

China also released 10,000 tons of pork from state reserves last week to cope with a supply shortfall ahead of the weeklong National Day holiday, although not only did the move fail to put a dent on the soaring price of pork, it was instantly absorbed as it represented less than 2 hours of pork need across China.

Global AgriTrends@AgriTrends

China math: pork eaten = 6,200 mt per hour. China’s 10,000 mt release is less than 2 hours needs across China. https://tinyurl.com/y2mx8tog

China to release more meat from state reserves to secure supplies

China auctioned 10,000 tonnes of pork from state reserves on Thursday to secure meat supply during the National Day holiday, the country’s commerce ministry said, after disease ravaged the world&…

reuters.com

Should China fail to stabilize the country’s collapsing pork population, the following scene from the SCMP, which shows women in China fighting over the last piece of discounted pork at a market, will become increasingly more frequent, and violent.

SCMP News

@SCMPNews

“Pulled” pork? These women in China were filmed fighting over the last piece of discounted pork at a market

Embedded video

In the meantime, the authorities are trying to turn consumers away from China’s favorite meat: the Life Times, a newspaper affiliated with the Communist Party, even suggested in a front-page special that eating too much pork was not healthy. “Eat less pork: Both your wallet and your body will thank you,” the publication wrote on Weibo, the Chinese version of Twitter.

China’s Internet users were not impressed. “This is a modern version of ‘Let them eat cake,’ ” responded Jiang Debin, quoting the line often attributed to Marie Antoinette when French peasants ran out of bread shortly before the revolution. “They are using so-called expert advice to deceive people, but dare not say don’t eat meat unless you have money.”

END

Hong Kong citizens protest again on Tuesday on a day coinciding with the 70th anniversary of Communist rule in China

(zerohedge)

Hong Kong Protester Shot In Chest During National Day Demonstrations

An illegal march in Hong Kong held on Tuesday to coincide with the 70th anniversary of Communist Party rule in China had mostly petered out by the late afternoon, as the bulk of protesters left the starting point near Sogo, the SCMP reports.

Still, as has become a pattern in recent weeks, a small but dedicated group of protesters clashed with police, hurling Molotov cocktails and coming to physical blows.

But for the first time since the protests started four months ago, a protester was shot by Hong Kong police officers on Tuesday.

As video circulating online shows, a group of protesters attacked a police van, hurling sticks and other projectiles. Several officers got out and tried to chase them away, but one of the officers slipped and fell to the ground, where he was assaulted by several protesters.

That reportedly led to the firing of several warning shots at the intersection of Waterloo and Nathan Roads in Kowloon. The shots can be heard in the video below:

SCMP Hong Kong@SCMPHongKong

A video circulating online shows warning shots fired as protesters and police clash at the junction of Waterloo and Nathan Roads

Embedded video

Two officers suffered head injuries during the attack.

Chungyan Chow

@ChungyanChow

Two police officers fired live-round warning shots skywards in Waterloo road, Kowloon after two police vehicles attacked by protesters. https://twitter.com/Dualman/status/1178941299774218240 

Dualman@Dualman

【1540】彌敦道窩打老道交界兩架警車遇上彌敦道嘅示威者雙方發生衝突,最後兩名警員向天開咗兩槍。

Copyright CC by 4.0:Pakkin Leung@Rice Post

View image on Twitter

Shortly after this incident, during a separate scene on Hoi Pa Street in Tsuen Wan, a man was shot in the chest with a live round: First responders and police were seen tending to the victim at the scene, though it’s unclear whether he survived the shooting.

Outside Beijing’s representative offices in Admiralty, police lobbed tear gas at protesters and sprayed crowds with blue-colored water, Reuters reports.

Once again, HK mass transit shut down, with 25 out of 91 stations closed across the city, including the entire Tsuen Wan line.

According to SCMP, five live rounds were fired during Tuesday’s demonstrations. Though police haven’t commented on the shootings, Reuters reports that the police said protesters threw a ‘corrosive fluid’ on officers in Tuen Mun, wounding several officers and reporters.

By early evening local time, the streets had calmed down.

It’s worth pointing out that the timing of this unprecedented escalation. Beijing has been pushing hard to discredit the protest movement, an effort that has met with limited success. But could this be the ultimate coup by the protesters to win back the sympathy of all Hong Kongers and rejuvenate the movement?

Then again, shortly after the shooting occurred, Beijing was already trying to paint the protesters as ruthless murderers.

Hu Xijin 胡锡进

@HuXijin_GT

HK police said, citing intelligence, that core rioters are planning serious violence on Oct 1, including killing police officers, disguising as police killing people, arson inside mall. Mob are also recruiting suicide attackers. Does the West support such ‘democratic protest’?

View image on Twitter

For a few more thoughts about Beijing and its economic vulnerabilities, check out this clip from Hyman Capital’s Kyle Bass:

END

4/EUROPEAN AFFAIRS

the EU is now ready to give a time limit on the Irish backstop

(zerohedge)

Pound Rallies On Reports EU Ready To Offer Johnson Major Brexit Concession

The British pound swiftly erased a session’s worth of losses Tuesday evening local time following reports that the EU is ready to work with UK PM Boris Johnson to include a time limit on the controversial Irish Backstop.

Remember: The Irish backstop is a provision in the withdrawal agreement that would purportedly impose a hard border between Northern Ireland and the rest of the UK if the two sides can’t come up with a permanent trade deal during the post-Brexit negotiating period. The provision is a ‘backstop’ – meaning it only comes into effect if no binding agreement is reached.

But according to Bloomberg, the EU is reportedly on the verge of making a major concession to Johnson: Possibly agreeing to time-limit the backstop, which would help assuage British concerns that the backstop could leave them ‘trapped’ in the EU customs regime without any say over policy. Johnson himself has compared this status to being a “vassal state”.

If the report is accurate, this would be the most serious sign yet that the EU might be willing to fold to Johnson and grant him the concessions he needs to pass an updated version of Theresa May’s withdrawal agreement.

Per BBG, any time limit granted by the EU could be linked to giving the Northern Ireland Assembly a vote in whether the province remains in the backstop, which is designed to prevent a hard Irish border, the people said.

The news sent the pound surging.

Still, with Parliament in turmoil, it’s unclear whether Johnson would even be able to sell a modified Irish backstop. The deal would also need to be accepted by the Irish government.

But for months now, we’ve been pointing out that the EU doesn’t have the legal authority to force the UK and Ireland to build physical barriers – meaning that the bloc’s refusal to budge on the withdrawal agreement is merely a bluff.

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

IRAQ/ISRAEL

Iraqi PM for the first time confirms it is Israel behind the multiple strikes on Iraq

(zerohedge)

Iraqi PM For First Time Confirms Israel Responsible For Multiple Strikes On Iraq

For the first time Iraq’s government has issued formal charges blaming Israel for a spate of attacks on Iraqi soil over the past months. Iraqi Prime Minister Adel Abdul Mahdi said on Monday the result of weeks-long investigations into multiple airstrikes and violations of Iraq’s airspace show Israel’s military to be the culprit.

“Investigations into the targeting of some Popular Mobilization Forces positions indicate that Israel carried it out,” Abdul Mahdi told Al Jazeera. Though Tel Aviv was long suspected of prior ‘mystery’ airstrikes on Iran-backed paramilitary bases in July and August, with even Netanyahu strongly hinting responsibility in an Aug. 30 campaign speech, Mahdi’s condemnation marks the first high level allegation from a top Iraqi official.

 

Adil Abdul-Mahdi, Prime Minister of Iraq, via Middle East Monitor

The ‘mystery’ explosions that have rocked ammunition depots and bases in and around Baghdad have been stepped up through September, including incidents on Sept. 9, 19, and 22, resulting in dozens of killed and wounded; and more recently last Friday on Imam Ali base near the border with Syria.

 

In total international reports count nine strikes on Iraq’s Popular Mobilization Forces (PMF) — in some cases while they were allegedly operating just across the country’s western border with Syria.

Iraq’s prime minister also raised the spectre of war amid a broader standoff between Tel Aviv’s and Tehran, saying “many indicators show that no one wants war in the region except for Israel,” according to a translation by Reuters.

 

Alleged Israeli airstrike on a military base southwest of Baghdad, Iraq in August. Image source: AP

Israel has long accused Iran of hosting IRGC officers and missiles, with Israeli and Saudi media also claiming Lebanese Hezbollah maintains a presence in the Boukamal region, which was bombed reportedly by either Israeli drones or jets last week.

There’s currently speculation that the Trump administration may have greenlighted stepped up Israeli attacks on Iranian proxies in the region as an alternative to direct war with Iran.

This after defense officials have voiced concern Iran is utilizing Iraq’s PMF units to aid Syrian forces in establishing a security corridor stretching along the Syrian-Iraq border, or so-called Iranian “land bridge”.

END

6.Global Issues

 

7. OIL ISSUES

 

8 EMERGING MARKET ISSUES

 

 

 

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

Euro/USA 1.0903 UP .0004 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 /MOSTLY RED EXCEPT ITALY

 

 

USA/JAPAN YEN 108.27 UP 0.210 (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 1.2302   UP   0.0013  (Brexit March 29/ 2019/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED/BREXIT EXTENDED TO OCT 31/2019//

USA/CAN 1.3272 UP .0029 CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA/CANADA HAS A HUGE HOUSEHOLD DEBT/GDP PROBLEM)

Early THIS  TUESDAY morning in Europe, the Euro ROSE BY 4 basis points, trading now ABOVE the important 1.08 level RISING to 1.0903 Last night Shanghai COMPOSITE CLOSED 

 

//Hang Sang CLOSED 

 

/AUSTRALIA CLOSED UP 0,77%// EUROPEAN BOURSES MOSTLY RED

 

Trading from Europe and Asia

EUROPEAN BOURSES MOSTLY RED 

 

 

2/ CHINESE BOURSES / :Hang Sang CLOSED

 

 

/SHANGHAI CLOSED DOWN 

 

 

Australia BOURSE CLOSED UP 0.77% 

 

 

Nikkei (Japan) CLOSED UP 129,49  POINTS OR 0.59%

 

 

 

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1468.25

silver:$17.10-

Early THURSDAY morning USA 10 year bond yield: 1.73% !!! UP 6 IN POINTS from MONDAY’S night in basis points and it is trading WELL BELOW resistance at 2.27-2.32%.

 

The 30 yr bond yield 2.18 UP 6  IN BASIS POINTS from MONDAY night.

USA dollar index early TUESDAY morning: 99.44 UP 7 CENT(S) from  MONDAY’s close.

This ends early morning numbers TUESDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx6

And now your closing TUESDAY NUMBERS \1: 00 PM

Portuguese 10 year bond yield: 0.18% DOWN 2 in basis point(s) yield from YESTERDAY/

JAPANESE BOND YIELD: -.15%  UP 6   BASIS POINTS from YESTERDAY/JAPAN losing control of its yield curve/56

SPANISH 10 YR BOND YIELD: 0.15%//DOWN 3 in basis point yield from yesterday.

ITALIAN 10 YR BOND YIELD:0.86 DOWN 2 points in basis points yield from yesterday./

 

 

the Italian 10 yr bond yield is trading 71 points higher than Spain.

 

GERMAN 10 YR BOND YIELD: FALLS TO –.56% IN BASIS POINTS ON THE DAY//

THE IMPORTANT SPREAD BETWEEN ITALIAN 10 YR BOND AND GERMAN 10 YEAR BOND IS 1.42% 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 TUESDAY

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

Euro/USA 1.0934  UP     .0035 or 35 basis points

USA/Japan: 107.76 DOWN .294 OR YEN UP 29  basis points/

Great Britain/USA 1.2295 UP .0006 POUND UP 6  BASIS POINTS)

Canadian dollar UP 28 basis points to 1.3214

 

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The USA/Yuan,CNY: AT 7.1483    ON SHORE  (DOWN)..GETTING DANGEROUS

THE USA/YUAN OFFSHORE:  7.1455  (YUAN DOWN)..GETTING REALLY DANGEROUS

TURKISH LIRA:  5.7184 EXTREMELY DANGEROUS LEVEL/DEATH WISH.

the 10 yr Japanese bond yield closed at -.15%

 

Your closing 10 yr US bond yield DOWN 2 IN basis points from MONDAY at 1.65 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.11 DOWN 2 in basis points on the day

Your closing USA dollar index, 99.14 DOWN 24  CENT(S) ON THE DAY/1.00 PM/

 

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

London: CLOSED DOWN 42.89  0.65%

German Dax :  CLOSED DOWN 164.25 POINTS OR 1.32%

 

Paris Cac CLOSED DOWN 57.96 POINTS 1.32%

Spain IBEX CLOSED DOWN 78.70 POINTS or 0.85%

Italian MIB: CLOSED UP 180.13 POINTS OR 0.81%

 

 

 

 

 

WTI Oil price; 53.59 12:00  PM  EST

Brent Oil: 58.98 12:00 EST

USA /RUSSIAN /   RUBLE FALLS:    65.28  THE CROSS HIGHER BY 0.45 RUBLES/DOLLAR (RUBLE LOWER BY 45 BASIS PTS)

 

TODAY THE GERMAN YIELD FALLS  TO –.56 FOR THE 10 YR BOND 1.00 PM EST EST

END

 

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

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

WTI CRUDE OIL PRICE 4:30 PM :  53.98//

 

 

BRENT :  58.98

USA 10 YR BOND YIELD: … 1.65…DOWN 2 BASIS PTS…

 

 

 

USA 30 YR BOND YIELD: 2.11  DOWN 2 BASIS PTS…

 

 

 

 

 

EURO/USA 1.0934 ( UP 35   BASIS POINTS)

USA/JAPANESE YEN:107.76 DOWN .297 (YEN UP 30 BASIS POINTS/..

 

 

USA DOLLAR INDEX: 99.14 DOWN 24 cent(s)/

The British pound at 4 pm   Britain Pound/USA:1.2295 UP 6  POINTS

 

the Turkish lira close: 5.7184

 

 

the Russian rouble 65.28   DOWN 0.45 Roubles against the uSA dollar.( DOWN 45 BASIS POINTS)

Canadian dollar:  1.3214 UP 28 BASIS pts

USA/CHINESE YUAN (CNY) :  7.1483  (ONSHORE)/

 

 

USA/CHINESE YUAN(CNH): 7.1455 (OFFSHORE)

 

German 10 yr bond yield at 5 pm: ,-0.56%

 

The Dow closed DOWN 343.79 POINTS OR 1.28%

 

NASDAQ closed DOWN 90.65 POINTS OR 1.13%

 


VOLATILITY INDEX:  18.39 CLOSED UP 2.15

LIBOR 3 MONTH DURATION: 2.085%//libor dropping like a stone

 

USA trading today in Graph Form

Global Growth Scare Sparks Safe-Haven Surge, Slam Stocks

“Everything was awesome” overnight – China was closed, futures drifted higher, hope remained, impeachment headlines had calmed down… and then the growth scare started in Asia with South Korean CPI deflated for the first time ever, then European PMIs plunged… But markets held in (hey, The Fed’s got our bank, right) as it’s just a fleshwound…

…and then US Manufacturing ISM survey missed by a mile, dropping to its biggest contraction since 2009 – and all hell broke loose.

Instantly, stocks and the dollar were dumped and safe haven flows sent gold higher and bond yields lower…

Source: Bloomberg

The moves today were quite shocking: Dow futures dropped 500 points from their overnight highs, 30Y Yields crashed 13bps from overnight highs, the dollar tumbled 0.6% intraday, and gold spiked $30. Additionally, rate-cut odds for October jumped higher to 60%…

Source: Bloomberg

Chinese markets were closed last night (and all week) due to Golden Week celebrations but China ADRs in the US traded down

Source: Bloomberg

European stocks tumbled today…

Source: Bloomberg

US stocks were all red today led by Trannies and Small Caps…

Futures show the stable drift higher overnight that was abruptly ended by the ISM Manufacturing data…

S&P filled the gap from 9/5

Led by selling in cyclicals…

Source: Bloomberg

And momentum was very bid today…

Source: Bloomberg

VIX surged back above 18 once again…

All the major US indices tested or broke key technical levels today… (NOTE – The Dow was strongest until the last minute and it tumbled back to the 50DMA)

Treasury yields tumbled intraday, all now lower on the week…

Source: Bloomberg

30Y Yields collapsed 13bps from overnight highs…

Source: Bloomberg

JGBs spooked global bond yields overnight, but that was entirely erased by Treasuries…

Source: Bloomberg

The dollar surged overnight to fresh highs, then cratered after the ISM data…

Source: Bloomberg

Cable whipped around on backstop headlines today (and its 50DMA)

Source: Bloomberg

With China closed, offshore yuan continued to drift lower…

Source: Bloomberg

Cryptos managed to hold on to gains since last week’s carnage…

Source: Bloomberg

Commodities were mixed with PMs bid today as crude tumbled…

Source: Bloomberg

WTI broke below the pre-Saudi attack levels, retested them, then plunged to almost a $52 handle…

Gold rebounded from yesterday’s losses but remains red on the week…

 

Finally, lower earnings estimates for the largest U.S. companies may only be a matter of time, according to Mike Wilson, Morgan Stanley’s chief U.S. equity strategist.

Source: Bloomberg

And the September “use it or lose it” surge in macro data… is over

Source: Bloomberg

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

MARKET TRADING//USA

a)Market trading/THIS MORNING/USA

Stocks, Bond Yields Plunge After Dismal Manufacturing Data

A 2nd consecutive contraction in US Manufacturing, according to ISM, has sparked selling in stocks and a bid for safe-havens like bonds and gold.

ISM respondents

“General market is slowing even more than a normal fourth-quarter slowdown.” (Fabricated Metal Products)

“Business has been flat for us. Year-over-year growth has slowed dramatically.” (Miscellaneous Manufacturing)

“We have seen a reduction in sales orders and, therefore, a lower demand for products we order. We have also reduced our workforce by 10 percent.” (Plastics & Rubber Products)

Stocks tanked…

Led to the downside by The Dow and S&P…

Bonds were bid…

Source: Bloomberg

And gold bounced…

As the dollar slid off multi-year highs…

Source: Bloomberg

Source: Bloomberg

And before we hear the usual bullshit commentary that “manufacturing is only blah in the economy”, consider…

zerohedge@zerohedge

Note that whatever the so-called pundits tell you, the vast majority of US corporate profits are from the manufacturing sector

View image on Twitter

Get back to work Mr.Powell!

b)MARKET TRADING/USA/AFTERNOON

ii)Market data/USA

iii) Important USA Economic Stories

For those of you who thought that the repo mess was going away..guess again..another high 55 billion repo operation.  Our guess is that the main bank in trouble is Deutsche bank

(zero hedge)

 

NY Fed Starts New Quarter With Unexpectedly High $55BN Repo Operation

Many expected the funding shortage sweeping across the US financial community to be mostly a function of one-time mid-September items coupled with traditional quarter-end liquidity: it explained why in addition to three term repos, on the last day of the quarter, the Fed conducted an overnight repo which saw a surprisingly high, $63.5BN uptake on Monday.

Well, it’s now the new quarter… and contrary to clearly erroneous conventional wisdom, the funding shortage still persists. Moments ago the NY Fed reported that in the first overnight repo operation of the quarter, one which saw the maximum allotted size shrink from $100 billion to $75 billion, dealers submitted a surprisingly high $54.85BN in collateral, all of which was accepted by the Fed.

Specifically, dealers tendered $50BN in TSYs and $4.75BN in MBS, as well as a $100MM in Agencies, to boost their liquidity.

The continued demand for reserves, even with $139BN in liquidity locked up in 2-week term repo which expire in the second week of October, suggests that the funding shortage is anything but a calendar event, and confirms that there is an acute reserve shortage, one which the Fed will have to address, most likely by resuming POMO operations to the tune of roughly $20BN per month… which for all the QE denialists, will be the same size as QE1.

END
Here is how billions of loans are exposed to a potential WeWork bankruptcy
(zerohedge)

Here Are The Billions Of Loans Exposed To A Potential WeWork Bankruptcy

With the WeWork IPO now dead and buried, and as attention shifts to the company which for years was world consciousness elevating Adam Neumann’s personal piggybank (he cashed out to the tune of $740 million, while stranding his thousands of employees with worthless stock) many are noticing what we highlighted last week, namely that WeWork now has just a few months of cash left.

As we noted recently, the most immediate task facing WeWork is that once the IPO was called off, it unraveled a $6 billion financing package. It is also the gargantuan challenge facing the company’s two new co-CEOs brought in to replace Neumann – Sebastian Gunningham and Artie Minson – who have to find a way forward for a company that was until just a few weeks ago one of the world’s most valuable private startups with a valuation of $47 billion… but has not only never made a penny in profit but saw its losses grow the more its revenue increased.

Meanwhile, as we also reported, in an attempt to shore up its rapidly shrinking cash balance, WeWork has been in talks with Goldman and JPMorgan about a new $3 billion loan, but that’s as good as dead: any new deal requires the company to successfully IPO, which we now know is not happening.

There is one final option: going to Masayoshi Son’s, SoftBank, the Japanese company that has already pumped in more than $10 billion, hat in hand and begging for a bailout. But is Son willing to jeopardize the future of his VisionFund, and perhaps his entire organization, to throw even more money after what is clearly a terrible investment?

For now, the answer is unknown. What is known is that the company lost $690 million in the first six months and is expected to generate a loss from operations approaching $3 billion as it burns through tens of millions in cash daily. Which means that according to analyst estimates, with its existing $2.5 billion in cash as of June 30, the company could run out of money by mid-2020.

And then there is the real liquidity crisis staring everyone in the face: as part of its tremendous growth, by the end of 2019 WeWork will have not only burned $6 billion since 2016, but will have accrued $47 billion of future rent payments due in the form of lease liabilities. On average it leases its buildings for 15 years. Yet as Bloomberg reported previously, its tenants are committed to paying only $4 billion, and on average have leases for 15 months.

in short, a WeWork solvency crisis (read: bankruptcy) would send a shockwave across the US Commercial Real Estate market. Correction, it would send a shockwave across the global commercial real estate market. The reason is that with over $47 billion in lease liabilities, WeWork is already one of the world’s largest lessees, trailing only oil exploration giants Petrobras and Sinpec, an astonishing feat for the flexible office space provider “which was founded less than a decade ago, bleeds cash, and doesn’t plan to become profitable any time soon.”

And then there is the not so subtle fact that WeWork is already the single biggest tenant in New York City, as well as Chicago, Denver and central London.

Said otherwise, a WeWork insolvency would send the Commercial Real Estate market in New York, London, and most major metropolises into a tailspin.

Which brings up the next logical question: who is exposed?

Luckily, commercial real estate expert TREPP has already done work when it comes to WeWork’s US-facing exposure in the CRE realm and has found that co-working giant is flagged as a top five tenant behind $3.3 billion in CMBS debt across 36 properties. Courtesy of Trepp, here is a summary of WeWork’s exposure by state, which as expected, shows New York and California as the top CMBS markets with WeWork exposure.

Drilling down on some of the key properties, we find the following Top 10 locations that will find themselves scrambling to undo their billions in contractual exposures to a potentially insolvent WeWork:

Here is a different way of representing the exposure, this time from the Deal side perspective:

Readers seeking the full list of WeWork exposure are urged to contact Trepp  directly.

For those asking why is any of the above information relevant, the answer is simple: in a year when a record 11,000 stores are expected to shutter…

… as a result of the ongoing “retail apocalypse” which today claimed its latest victim, fast-fashion pioneer Forever 21, which is set to close as many of 350 of its 800 stores around the world…

… commercial real estate is looking at an unprecedented rental payment “hole” as countless tenants file for bankruptcy and put their lease payments on indefinite halt.

Throw WeWork – and its $47 billion in lease obligations in the mix – and CRE is facing a CREsh of epic proportions, because in a bankruptcy, all those obligations would be frozen and squeezed among all the other pre-petition claims, which of course means that the commercial real estate market of cities where WeWork is especially active – like New York and London – would suddenly find itself paralyzed, as a deflationary tsunami is unleashed among one of the strongest performing markets since the financial crisis.

Whether that will in fact happen remains to be seen: after all, with so much hanging on whether the cashflow burning WeWork lunacy can continue, one could argue that when it comes to the commercial real estate market, the company has become too big to fail.

That’s precisely what Boston Fed president Eric Rosengren said on September 20, when he warned just how serious WeWork’s leveraged debacle has become. In a speech delivered to New York University, the Boston Fed head seems to have seen the light, fearing financial instability from WeWork and its ilk:

Mr. Rosengren noted the risks posed by commercial real estate, which have long been a concern of his, as a possible vector to amplify trouble.

Without naming any firms, Mr. Rosengren noted the particular concerns posed by co-working companies. He made this comment as the parent of office-sharing firm WeWork postponed its initial public offering amid investor doubts about its valuation and concerns about its corporate governance. Office-sharing firms are particularly exposed to risks should the economy run into trouble, and could wound landlords in the process, Mr. Rosengren said.

“In a downturn the co-working company would be exposed to the loss of tenant income, which puts both them and the property owner at risk if they cannot make lease payments to the owner of the building,” he said.

“I am concerned that commercial real estate losses will be larger in the next downturn because of this growing feature of the real estate market, which could ultimately make runs and vacancies more likely due to this new leasing model,” Mr. Rosengren said.

“The fact that the shared office model relies on small-company tenants with short-term leases, combined with the potential lack of recourse for the property owner, is potentially problematic in a recession. This also raises the issue of whether bank loans to property owners in cities with major penetration by co-working models could experience a higher incidence of default and greater loss-given-defaults than we have seen historically.”

Ironically, unless some last ditch source of emergency WeWork funding emerges – and there is about 6 months for that to happen – Rosengren’s warning about a crash in the commercial real estate market will come true. Why ironic? Because it will be none other than the Fed which will be “forced” to provide said emergency funding, making the global moral hazard hole even deeper in a world in which not even one too big to fail zombie company is allowed to fail ever again

END

USA manufacturing is the weakest in 10 years

(zerohedge)

US Manufacturing Weakest Since 2009: “Business Sentiment Stuck At Gloomy Levels”

It’s been an ugly night for global economic surveys. September manufacturing PMIs from South Korea, Indonesia, South
Africa, Italy, and the UK all printed below 50.0, confirming ongoing global weakness, and Sweden was a disaster.

Only Canada and Brazil managed upside surprises as all eyes are firmly focused on US manufacturing surveys – hoping they will track the massive surge in US economic surprise data.

  • Markit Manufacturing PMI 51.1 (51.0 exp), up from 50.3 in August
  • ISM Manufacturing 47.8 (50.0 exp), down from 49.1 in August

This is the weakest ISM since June 2009, with New Orders weakest since March 2009.

Source: Bloomberg

This is the second straight reading below 50, the line separating expansion and contraction, extending the drop from a 14-year high just over a year earlier.

The pullback in the employment gauge, to 46.3 from 47.4, comes amid economist projections that the main monthly Labor Department report Friday will show limited manufacturing payroll growth. Economists forecast a 3,000gain in factory employment for a second month.

The measure of export orders, a proxy for overseas demand, fell to 41, the lowest level since March 2009, while the imports index remained in contraction.

“Global trade remains the most significant issue, as demonstrated by the contraction in new export orders that began in July 2019. Overall, sentiment this month remains cautious regarding near-term growth,” says ISM’s Timothy Fiore.

Of the 18 manufacturing industries, three reported growth in September:

  • Miscellaneous Manufacturing;
  • Food, Beverage & Tobacco Products;
  • and Chemical Products.

The 15 industries reporting contraction in September — in the following order — are:

  • Apparel, Leather & Allied Products;
  • Printing & Related Support Activities;
  • Wood Products;
  • Electrical Equipment, Appliances & Components;
  • Textile Mills;
  • Paper Products;
  • Fabricated Metal Products;
  • Plastics & Rubber Products;
  • Petroleum & Coal Products;
  • Primary Metals;
  • Transportation Equipment;
  • Nonmetallic Mineral Products;
  • Machinery;
  • Furniture & Related Products;
  • and Computer & Electronic Products.

Chris Williamson, Chief Business Economist at IHS Markit said:

“News of the PMI hitting a five-month high brings a sigh of relief, but manufacturing is not out of the woods yet. The September improvement fails to prevent US goods producers from having endured their worst quarter for a decade. Given these PMI numbers, the manufacturing recession appears to have extended into its third quarter.

“The current situation contrasts markedly with earlier in the year, when companies were struggling to keep up with demand. Now, spare capacity appears to be developing, which is causing firms to curb their hiring compared to earlier in 2019 and become more cautious about costs and spending.“

As good as it gets?

However, as we detailed here, this is the reason for the rebound in US Macro – and why its all over now. Given the rapid surge in borrowing recently, 2019’s seasonality is even more dramatic on the spending side (and thus the unprecedented spike in economic surprises)

Source: Bloomberg

All of which begs the question: is the only reason why the economy tends to pick up momentum dramatically as the summer ends just a function of a surge in government spending permeating the broader economy as agencies scramble to spend all the money they have before the end of the September 30 Fiscal Year End (just so they get allocated the same or greater budget in the coming fiscal year), which subsequently plunges or is outright halted as the case may be right now?

As Williamson notes:

“It’s also far from clear that the trend will improve in the fourth quarter. Inflows of new work remain worryingly subdued, to the extent that current production growth is having to be supported by firms increasingly eating into order book backlogs. Business sentiment about the year ahead is also stuck at gloomy levels.

Hardly sounding an optimistic tone about this bounce going anywhere.

iv) Swamp commentaries)

Trump asked the Australian PM months ago to investigate the origins of the Mueller probe.  And now guess what we have a new whistleblower

(zerohedge)

Trump Asked Australian PM To Investigate Origins Of Mueller Probe: New Whistleblower

As we enter a new era of anonymous whistleblowers heading into the 2020 election (a new anti-Trump strategy telegraphed by former CIA Director, John Brennan), the New York Times is out with a report that President Trump asked the Australian Prime Minister to help Attorney General William Barr uncover the origins of “Russiagate,” according to yet another ‘whistleblower.’

A transcript of the call has been restricted to a small group of the president’s aides, according to the Times, which compared it to the “unusual decision” similar to how the Trump administration restricted access to the transcript of a July call with the President of Ukraine (which the last administration routinely did according to former national security adviser Susan Rice).

According to the Times, Trump was “using high-level diplomacy to advance his personal political interests,” however “Justice Department officials have said that it would be neither illegal nor untoward for Mr. Trump to ask world leaders to cooperate with Mr. Barr.

President Trump initiated the discussion in recent weeks with Mr. Morrison explicitly for the purpose of requesting Australia’s help in the Justice Department review of the Russia investigation, according to the two people with knowledge of the discussion. Mr. Barr requested that Mr. Trump speak to Mr. Morrison, one of the people said. –NYT

Of note, Barr appointed career prosecutor John H. Durham to investigate the origins of “Russiagate,” a move which Trump and his allies have suggested may be potentially helpful for the White House.

Trump’s request effectively meant that Australia would be investigating itself over the participation of Australian diplomat Alexander Downer in an alleged spying – and potential setup – on the Trump campaign.

Shortly after Trump aide George Papadopoulos announced his intention to work for the 2016 campaign, he was lured to London in March of 2016, where Maltese professor and self-described Clinton foundation member Joseph Mifsud fed him the rumor that Russia had damaging information on Hillary Clinton.

George Papadopoulos@GeorgePapa19

We have now pinned Peter Strzok’s boss, Bill Priestap, in London the week of May 6th, 2016 and on the 9th. The day before Alexander Downer was sent to spy on me and record our meeting. Congress must release the transcripts and embarrass the deep state.

Papadopoulos would later relay this information to Downer, who passed it to the FBI, which in turn launched Operation Crossfire Hurricane – the FBI’s official investigation into the Trump campaign.

The F.B.I.’s counterintelligence investigation into Russian interference in the 2016 election began after Australian officials told the bureau that the Russian government had made overtures to the Trump campaign about releasing political damaging information about Hillary Clinton.

Australian officials shared that information after its top official in Britain met in London in May 2016 with George Papadopoulos, a Trump campaign foreign policy adviser who told the Australian about the Russian dirt on Mrs. Clinton.

Mr. Papadopoulos also said that he had heard that the Russians had “thousands” of Mrs. Clinton’s emails from Joseph Mifsud, an academic. Mr. Mifsud, who was last seen working as a visiting professor in Rome, has disappeared. –NYT

Barr began a review of the Russia investigation earlier this year with the stated goal of determining whether the US intelligence community under Obama acted inappropriately – for example, when they sent Stefan Halper – a spy who had been paid over $1 million during Obama’s presidency – to infiltrate Trump campaign aides Papadopoulos and Carter Page.

Last week the DOJ announced that it was exploring how other countries, including Ukraine, “played a role in the counterintelligence investigation directed at the Trump campaign.”

Whatever the findings, we’re sure the new ‘whistleblower strategy’ is sure to deflect from any actual wrongdoing which may have been committed by government officials.

Dan Bongino

@dbongino

The NY Times, & their Democrat Party allies, are desperate to cover up the Obama administration’s collusion with Ukrainian, UK, and Australian officials, & the spying operation against Trump. This is all media noise to distract you from the biggest political scandal in history.

View image on Twitter
END
This is so true:  Adam Schiff does epitomize the total collapse of the Democratic party’s integrity
(courtesy Paul Roberts)

Adam Schiff Epitomizes the Total Collapse of Democratic Party Integrity

Adam Schiff Epitomizes the Total Collapse of Democratic Party Integrity

Paul Craig Roberts

US Rep. Adam Schiff, Democrat from California and chairman of the House Intelligence Committee, had no qualms about lying through his teeth in his opening statement prior to the testimony of Acting Director of National Intelligence Joseph Maguire.  Everyone present had read the transcript of the telephone conversation between President Trump and Ukrainian President Zelensky, and everyone knew that what Schiff, who said he was reading from the transcript of the telephone call, was saying was not in the transcript.  How can it be that the chairman of a House committee in a room full of newspersons and TV cameras has no qualms about intentionally misrepresenting the written record in order to make it conform to the lies the Democrats and their stable of corrupt presstitutes have spread about a telephone call revealed by an alleged whistleblower, a likely Democrat operative, who claimed to have heard it second hand. https://www.foxnews.com/media/schiff-parody

When I was a member of the Congressional staff, any Representative who so dishonored a committee of the House and the House itself as Schiff has done would have been reprimanded, brought before the Ethics Committee, and forced to resign.  But the Democrats have ground integrity under their heel in their fanatical determination to prevent Trump’s reelection.

In his opening statement Adam Schiff further showed his total lack of integrity in his assault on the integrity and character of Joseph Maguire and made wild and irresponsible charges probably never witnessed previously in the halls of Congress.

The transcript of the telephone call shows that what the alleged whistleblower said is false.  Yet in the face of the evidence Adam Schiff speaks as if the evidence does not exist and that the alleged whistleblower’s second hand statement is true.  Once again we hear the Democratic Party say, “Evidence? We don’t need no stinkin’ evidence.” They don’t need evidence because the presstitutes support their lies and control the explanations given to Americans.

The Democrats are betting their future on their lies being shielded by their media whores and that the  insouciant American people will hear nothing but false allegations against Trump repeated endlessly, as was the case with Russiagate.  If the people realize that the “impeachment investigation” is another hoax like Russiagate, Schiff will have destroyed the Democrats’ chances in the next election.

The extraordinary rudeness and incivility of Democrat members of the committee toward Maguire, cutting him off before he could answer their accusatory questions, thus leaving the accusation unanswered, together with Schiff’s lies demonstrate that political and social collapse in the United States is far advanced.  American democracy was never very democratic, but when an entire political party disrespects truth and is determined to gain power at all cost,  we know that the end is near.

The Republican ranking member of the committee, Devin Nunes, explained what the successor to the failed Russiagate witchhunt is all about.  https://www.youtube.com/watch?v=5ZODiMjDKLY

For those with the stomach for it, the hearing can be watched here: https://www.youtube.com/watch?v=XsPzPzk8chM

end

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

On Monday afternoon, the Deep State and its MSM allies went into panic mode over what Barr and Durham have uncovered.  A series of seemingly coordinated stories tried to besmirch Barr/DJT.

Another Deep State leak of Trump’s phone calls: Trump Pressed Australian Leader to Help Barr Investigate Mueller Inquiry’s Origins… according to two officials with knowledge of the call…

https://www.nytimes.com/2019/09/30/us/politics/trump-australia-barr-mueller.html?smid=tw-nytimes&smtyp=cur

@GeorgePapa19: I have been right about Downer from the beginning. A wannabe spy and Clinton errand boy who is about to get exposed on the world stage. Great reporting, NYTs! Mifsud is next.

Australian government statement within 1 hour on NYT report: “The Australian Government has always been ready to assist and cooperate with efforts that help shed further light on the matters under investigation. The PM confirmed this readiness once again in conversation with the President” 

No crime except for the people that leaked the story.  Plus, Trump pushing Australia about Australia/Downer’s role in Spygate was reported months ago.

May 24, 2019 Trump ‘Hopes’ Barr Scrutinizes British and Australian Role in ‘Hoax’ Investigation

https://dailycaller.com/2019/05/24/trump-barr-australia-surveillance-uk

BBG @business: 3:53pm Giuliani subpoenaed by House in impeachment inquiry

4:04pm Pompeo took part in Trump-Zelensky phone call: DJ

4:17pm Trump pressed Australian leader to help investigate Mueller inquiry’s origins: NYT

5:16 ET ABC News: Barr asked Trump for introductions to Italy, Australia in Russia probe review

As a part of his review of the origins of the investigation into members of President Donald Trump’s 2016 campaign, Attorney General William Barr asked President Trump on several occasions to initiate introductions between him and the leaders of Australia and Italy, among other countries, a Department of Justice official with direct knowledge of the calls told ABC News on Monday. https://abcnews.go.com/Politics/barr-asked-trump-introductions-australia-italy-review-russia/story

5:38 ET WaPo: Attorney General William Barr said to have urged foreign governments to aid probe of CIA, FBI activities related to 2016 election – Barr has traveled overseas to seek help with a Justice Department inquiry that President Trump hopes will discredit U.S. intelligence agencies’ examination of Russian interference in the 2016 election, according to people familiar with the matter…

https://www.washingtonpost.com/national-security/attorney-general-barr-personally-asked-foreign-officials-to-aid-inquiry-into-cia-fbi-activities-in-2016/2019/09/30/d50cd5c4-e3a5-11e9-b403-f738899982d2_story.html

@JordanSchachtel: Another piece specifically designed to delegitimize the results of AG Barr’s investigation into the origins of the Trump-Russia hoax

WSJ’s @KimStrassel: As for “discrediting,” this story is part of a growing campaign by media/Democrats to discredit Barr, Durham, Horowitz, and any DOJ effort at getting the truth of 2016. Gotta wonder why everyone is so scared of those findings….

Note what NYT is doing here–trying to suggest questions about 2016 are beyond the pale. Since when is getting to the truth a “personal political interest”? They loved it when Mueller was investigating 2016; but now want all further queries to stop.

Letter from Australian Official Emerges That Casts Doubt On Report from New York Times

The letter, reported by Nine News Australia’s Kerrie Yaxley, is dated May 28, 2019, from Australian Ambassador Joe Hockey to Barr, and states: I refer to President Trump’s announcement on 24 May that you will investigate the origins of the Federal Bureau of Investigations probe into Russian links to the 2016 US election…

     The Australian Government will use its best endeavors to support your efforts in this matter. While Australia’s former High Commissioner to the United Kingdom, The Hon. Alexander Downer, is no longer employed by the government, we stand ready to provide you with all the relevant information to support your inquiries…  https://www.dailywire.com/news/breaking-letter-from-australian-official-emerges-that-casts-doubt-on-new-york-times-report/

@realDonaldTrump: Rep. Adam Schiff illegally made up a FAKE & terrible statement, pretend

Author Peter Schweizer Drops Biden Corruption Documents – Shows Hunter Involved in Sale of US Company to China with Potential Military Applications

https://www.thegatewaypundit.com/2019/09/breaking-author-peter-schweizer-drops-biden-corruption-documents-shows-hunter-involved-in-sale-of-us-company-to-china-with-potential-military-applications/

@charliekirk11: Fact: Joe Biden’s brother, James Biden was given a $1.5 Billion dollar government contract to build homes in Iraq during the Obama Administration.  How many more billion dollar deals were given to the Biden family while he was VP that we don’t know about?  Where is the MSM?

Now we know why Obama didn’t want Biden to run and refused to endorse him.

OAN’s @EmeraldRobinson: Isn’t it weird that @JoeBiden sent a letter to ABC, NBC, CBS, FOX & CNN telling them NOT TO ALLOW Rudy Giuliani on TV?  It’s almost like the American news media works for the Democrats.

Well that is all for today

I will see you Wednesday night.

 

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