OCT 8//GOLD DOWN 35 CENTS IN COMEX HRS BUT RISES BIG TIME ON NEWS OF QE 4//SILVER UP 15 CENTS..

GOLD:$1499.00 DOWN $0.35(COMEX TO COMEX CLOSING

 

 

 

 

 

 

 

 

 

 

 

 

 

Silver:

$17.64 up 15 CENTS  (COMEX TO COMEX CLOSING)

 

 

 

 

Closing access prices:

Gold : $1506.40

 

silver:  $17.71

I HAVE PROVIDED FINAL COMEX DATA TODAY CANNOT PROVIDE A COMMENTARY TOMORROW BUT
YOU MAY RECEIVE SOME DATA EARLY THURSDAY MORNING
EVENTUALLY I WILL FINALIZE ALL COMEX DATA BY THIS WEEKEND.

 

COMEX DATA

 

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

today RECEIVING 5/13

EXCHANGE: COMEX
CONTRACT: OCTOBER 2019 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,497.700000000 USD
INTENT DATE: 10/07/2019 DELIVERY DATE: 10/09/2019
FIRM ORG FIRM NAME ISSUED STOPPED
____________________________________________________________________________________________
118 H MACQUARIE FUT 1
661 C JP MORGAN 5
737 C ADVANTAGE 13 4
800 C MAREX SPEC 1
905 C ADM 2
____________________________________________________________________________________________

TOTAL: 13 13
MONTH TO DATE: 10,403

 

NUMBER OF NOTICES FILED TODAY FOR  OCT CONTRACT: 13 NOTICE(S) FOR 1300 OZ (0.0404 tonnes)

TOTAL NUMBER OF NOTICES FILED SO FAR:  10,403 NOTICES FOR 1,040,300 OZ  (32.357 TONNES)

 

 

 

SILVER

 

FOR 0CT

 

 

7 NOTICE(S) FILED TODAY FOR 35,000  OZ/

 

total number of notices filed so far this month: 921for 4,605,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

 

 

 

 

 

 

we are coming very close to a commercial failure!!

 

 

 

 

 

 

 

 

 

 

 

Bitcoin: OPENING MORNING TRADE :  $ 8184 DOWN 2

 

 

 

Bitcoin: FINAL EVENING TRADE: $ 8163  DOWN 3

 

 

 

Let us have a look at the data for today

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IN SILVER THE COMEX OI FELL BY A CONSIDERABLE  SIZED 554 CONTRACTS FROM 212,647 DOWN TO 211,282 WITH THE 6 CENT LOSS IN SILVER PRICING AT THE COMEX.

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 GOOD SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP:,

FOR SEPT 0,; DEC  813 AND ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE  813 CONTRACTS. WITH THE TRANSFER OF 813 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 813 EFP CONTRACTS TRANSLATES INTO 4.06 MILLION OZ  ACCOMPANYING:

1.THE 6 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 INITIAL STANDING IN AUGUST.

43.030   MILLION OZ INITIALLY STANDING IN SEPT. (HUGE)

6.275     MILLION OZ INITIALLY STANDING IN OCT

yESTERDAY, ANOTHER MAJOR ATTEMPT BY THE BANKERS TO COVER THEIR MASSIVE SHORTFALL AT THE SILVER COMEX WHICH FAILED MISERABLY.  OUR BANKER /OFFICIAL SECTOR SAW THE WRITING ON THE WALL AS THEY TRIED TO COVER SOME OF THE HUGE SHORTS BUT NO NO AVAIL.  THE TOTAL ON THE TWO EXCHANGES ROSE AND  THAT DOOMED OUR BANKER-OFFICIAL SECTOR INITIATIVE. WE ARE NOW BACK FROM GOLDEN WEEK AND THE CHINESE HAVE STARTED THEIR MASSIVE PURCHASE OF THE PRECIOUS METALS.

 

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 SEPT:

5916 CONTRACTS (FOR 6 TRADING DAYS TOTAL 5916 CONTRACTS) OR 29.580 MILLION OZ: (AVERAGE PER DAY: 986 CONTRACTS OR 4.930 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH OF AUGUST:  29.58 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 4.22% 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:          1701.69   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

RESULT: WE HAD A SMALL SIZED DECREASE IN COMEX OI SILVER COMEX CONTRACTS OF 554, WITH THE 6 CENT LOSS IN SILVER PRICING AT THE COMEX /YESTERDAY... THE CME NOTIFIED US THAT WE HAD A  GOOD SIZED EFP ISSUANCE OF 813 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 SMALL  SIZED: 259 TOTAL OI CONTRACTS ON THE TWO EXCHANGES: 

i.e 813 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH DECREASE OF 554  OI COMEX CONTRACTS. AND ALL OF THIS  DEMAND HAPPENED WITH A 6 CENT LOSS IN PRICE OF SILVER AND A CLOSING PRICE OF $17.49 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. 1.056 BILLION OZ TO BE EXACT or 151% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT MARCH MONTH/ THEY FILED AT THE COMEX: 24 NOTICE(S) FOR 120,000 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: 6.275 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 CONSIDERABLE SIZED 5435 CONTRACTS, TO 614,549 DESPITE THE $7.00 PRICING LOSS WITH RESPECT TO COMEX GOLD PRICING// YESTERDAY// /

 

THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A GOOD SIZED 4107 CONTRACTS:

OCT 2019: 0 CONTRACTS, DEC>  4107 CONTRACTS AND ALL OTHER MONTHS ZERO.  The NEW COMEX OI for the gold complex rests at 614,549,,.  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 SMALL LOSS IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 1328 CONTRACTS: 5435 CONTRACTS DECREASED AT THE COMEX  AND 4107 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI LOSS OF 1328 CONTRACTS OR 132,800OZ OR 4.13 TONNES.  YESTERDAY WE HAD A LOSS OF $7.00 IN GOLD TRADING….

AND WITH THAT LOSS IN  PRICE, WE HAD A SMALL LOSS IN GOLD TONNAGE OF 4.13 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  SUCCESSFUL IN THEIR ATTEMPT TO LOWER GOLD’S PRICE BUT UNSUCCESSFUL IN FLEECING MANY GOLD COMEX 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 : 18,399 CONTRACTS OR 1,839,900 oz OR 57.22 TONNES (6 TRADING DAYS AND THUS AVERAGING: 3066 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE STRONG SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 6 TRADING DAYS IN  TONNES: 57.22 TONNES

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

THUS EFP TRANSFERS REPRESENTS 57.22/3550 x 100% TONNES =1.61% OF GLOBAL ANNUAL PRODUCTION

 

ACCUMULATION OF GOLD EFP’S YEAR 2019 TO DATE:     4720,94  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 GOOD SIZED DECREASE IN OI AT THE COMEX OF 5435 WITH THE  PRICING LOSS THAT GOLD UNDERTOOK YESTERDAY($7.00)) //.WE ALSO HAD  A GOOD SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 4107 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 4107 EFP CONTRACTS ISSUED, WE  HAD A SMALL SIZED LOSS OF 1328 CONTRACTS IN TOTAL OPEN INTEREST  ON THE TWO EXCHANGES:

4107 CONTRACTS MOVE TO LONDON AND 5435 CONTRACTS DECREASED AT THE COMEX. (IN TONNES, THE LOSS IN TOTAL OI EQUATES TO 4.13 TONNES). ..AND THIS DECREASE OF  DEMAND OCCURRED WITH THE LOSS IN PRICE OF $7.00 WITH RESPECT TO YESTERDAY’S TRADING AT THE COMEX.

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

 

 

 

 

 

 

 

 

we had:  13 notice(s) filed upon for 1300 oz of gold at the comex.

 

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

GLD...

WITH GOLD DOWN 0.35 TODAY//(COMEX-TO COMEX)

 

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 15 CENTS TODAY: 

NO CHANGE IN SILVER INVENTORY AT 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 GOOD SIZED  554 CONTRACTS from 212,647 DOWN TO 211,282 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  813  AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 813 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 554  CONTRACTS TO THE 813 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN A SMALL SIZED GAIN OF 259 OPEN INTEREST CONTRACTS. THUS IN OUNCES, THE GAIN ON THE TWO EXCHANGES: 1.295 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//OCT: 6.275MILLION OZ//

 

 

RESULT: A SMALL SIZED DECREASE IN SILVER OI AT THE COMEX WITH THE 6 CENT LOSS IN PRICING THAT SILVER UNDERTOOK IN PRICING// YESTERDAY. WE ALSO HAD A GOOD SIZED 813 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 30.52 POINTS OR 1.04%  //Hang Sang CLOSED DOWN 131.51 POINTS OR 0.46%   /The Nikkei closed DOWN 422.94 POINTS OR 1.97%//Australia’s all ordinaires CLOSED DOWN .42%

/Chinese yuan (ONSHORE) closed DOWN  at 6.8807 /Oil UP TO 57.21 dollars per barrel for WTI and 64.13 for Brent. Stocks in Europe OPENED MIXED//  ONSHORE YUAN CLOSED DOWN // LAST AT 6.8807 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.8834 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY CLOSE TO 7:1//TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED  : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /TRADE DEAL NOW DEAD..TRUMP  RAISED RATES TO 25%

 

3A//NORTH KOREA/ SOUTH KOREA

 

3b) REPORT ON JAPAN

3C  CHINA

 

4/EUROPEAN AFFAIRS

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

 

6.Global Issues

 

7. OIL ISSUES

 

8 EMERGING MARKET ISSUES

 

9. PHYSICAL MARKETS

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

iv) Swamp commentaries)

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

 

LET US BEGIN:

 

 

Let us head over to the comex:

 

THE TOTAL COMEX GOLD OPEN INTEREST FELL BY A GOOD SIZED 5435 CONTRACTS TO A LEVEL OF 621,535  WITH THE LOSS OF $7.00 IN GOLD PRICING WITH RESPECT TO YESTERDAY’S // COMEX TRADING)

WE ARE NOW IN THE ACTIVE DELIVERY MONTH OF OCT..  THE CME REPORTS THAT THE BANKERS ISSUED G00D SIZED  TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS., THAT IS 4107 EFP CONTRACTS WERE ISSUED:

 FOR SEPT; 0 CONTRACTS: DEC: 4107   AND  ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE:  4107 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: 1328 TOTAL CONTRACTS IN THAT 4107 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST A G00D SIZED 5435 COMEX CONTRACTS. 

 

NET LOST ON THE TWO EXCHANGES ::  1328 CONTRACTS OR 132800 OZ OR 4.130TONNES.

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 414 contracts still standing for a gain of 19 contracts. Yesterday we had 44 notices served upon so we despite the raid, we have a gain of 63 contracts or an additional 6300 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 GAIN of 36 contracts and thus the OI is ROSE to 998.  The very big December contract month saw its oi FALL by 5782 contracts DOWN to 479,624.

 

 

 

 

TODAY’S NOTICES FILED:

WE HAD 13 NOTICES FILED TODAY AT THE COMEX FOR  1300 OZ. (0.040 TONNES

 

 

 

 

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And now for the wild silver comex results.

Total COMEX silver OI FELL BY A SMALL SIZED 554 CONTRACTS FROM 212,647 DOWN TO 211,282 (AND FURTHER FROM A NEW RECORD OI FOR SILVER SET ON AUGUST 22.2018.  THE PREVIOUS RECORD WAS SET APRIL 9.2018/ 243,411 CONTRACTS) AND TODAY’S CONSIDERABLE  OI COMEX GAIN OCCURRED WITH A 6 CENT LOSS IN PRICING.//YESTERDAY.

WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF OCTOBER.  HERE WE HAVE 348 OPEN INTEREST STAND FOR DELIVERY WITH A LOSS OF ONLY 17 CONTRACTS. WE HAD 24 CONTACTS SERVED UPON YESTERDAY SO WE GAINED 7 CONTRACTS OR 35,000 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 LOSS OF 7 CONTRACTS TO STAND AT 481. THE NEXT ACTIVE DELIVERY MONTH AFTER SEPT IS DECEMBER AND HERE THE OI FALLS BY 745 CONTRACTS DOWN TO 159,450.

TODAY’S NUMBER OF NOTICES FILED:

 

We, today, had 7 notice(s) filed for 35,000, OZ for the OCT, 2019 COMEX contract for silver

Trading Volumes on the COMEX TODAY: 376,792  CONTRACTS 

 

 

 

CONFIRMED COMEX VOL. FOR YESTERDAY:  271,811  contracts

 

 

 

 

 

INITIAL standings for  OCT/GOLD

OCT 8/2019

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

 

 

 

 

Deposits to the Customer Inventory, in oz  

nil

 

No of oz served (contracts) today
13 notice(s)
 1300 OZ
(0.0404 TONNES)
No of oz to be served (notices)
401 contracts
(40100 oz)
1.247 TONNES
Total monthly oz gold served (contracts) so far this month
10,403 notices
1,040,300 OZ
32.357TONNES
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

 

 

total gold withdrawals; nil  oz

FOR THE OCT 2019 CONTRACT MONTH)Today, 0 notice(s) were issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 13 contract(s) of which 5 notices were stopped (received) by j.P. Morgan dealer and 5 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account and 0 notices by the squid  (Goldman Sachs)

 

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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 (10,403) x 100 oz , to which we add the difference between the open interest for the front month of  OCT. (414 contract) minus the number of notices served upon today (13 x 100 oz per contract) equals 1,080,400 OZ OR 33.61 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 (10403 x 100 oz)  + (414)OI for the front month minus the number of notices served upon today (13 x 100 oz )which equals 1,074100oz standing OR 33.61 TONNES in this  active delivery month of OCT.

We gained a strong 63 contracts OR 6300 ADDITIONAL OZ which queue jumped as our bankers //official sector were searching for badly needed physical

 

SURPRISINGLY WE HAVE BEEN WITNESSING NO REAL PHYSICAL GOLD ENTERING THE COMEX VAULTS FOR THE PAST YEAR!! ..ONLY PHONY KILOBAR ENTRIES.… WE HAVE ONLY 35.696 TONNES OF REGISTERED

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

SEPT:      5.4525 TONNES

 

AND NOW……………………………………………………………………………     OCT. 33.61 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: 66.21

TONNES- 2.60 TONNES DEEMED SETTLEMENT = 63.61 TONNES STANDING FOR METAL AGAINST 35.696 TONNES OF REGISTERED OR FOR SALE COMEX GOLD! THIS IS WHY GOLD IS SCARCE AT THE COMEX.

 

total registered or dealer gold:  1,147,640.808 oz or  35.696 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 8 2019
Silver Ounces
Withdrawals from Dealers Inventory NIL oz
Withdrawals from Customer Inventory
 301,895.740 oz
CNT
Scotia

 

 

Deposits to the Dealer Inventory
nil oz

 

Deposits to the Customer Inventory
1,134,863.019 oz
CNT
Delaware
Scotia
No of oz served today (contracts)
7
CONTRACT(S)
(35,000 OZ)
No of oz to be served (notices)
341 contracts
 1,705,000 oz)
Total monthly oz silver served (contracts)  921 contracts

4,605,000 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

 

 

we had 0 inventory movement at the dealer side of things

 

 

total dealer deposits: nil  oz

total dealer withdrawals: nil oz

we had  XX deposits into the customer account

into JPMorgan:  nXX oz

ii)into XX

 

 

 

*** 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:  XXX  oz

 

we had XX withdrawals out of the customer account:

 

 

i)

 

 

 

 

 

 

 

total XXX  oz

 

we had XX adjustment :

i) Out of XX

 

total dealer silver:  XX million

total dealer + customer silver:  XX million oz

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

The total number of notices filed today for the OCT 2019. contract month is represented by 7 contract(s) FOR 35,000 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 921 x 5,000 oz = 3,530,000 oz to which we add the difference between the open interest for the front month of OCT. (348) and the number of notices served upon today 7 x (5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the OCT/2019 contract month: 921 (notices served so far) x 5000 oz + OI for front month of OCT (348)- number of notices served upon today (7)x 5000 oz equals 6,310,000 oz of silver standing for the OCT contract month. 

WE  gained 7 contracts or an additional 35,000 oz of silver will stand at the comex as they guys refused to morph into london based forwards. For the past several weeks we have been witnessing queue jumping in both gold and silver.

 

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 7 notice(s) filed for 35,000 OZ for the OCT, 2019 COMEX contract for silver

 

 

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TODAY’S ESTIMATED SILVER VOLUME:  91,588 CONTRACTS (we had considerable spreading activity..accumulation

 

CONFIRMED VOLUME FOR YESTERDAY: 37,561 CONTRACTS..

 

 

 

 

 

YESTERDAY’S CONFIRMED VOLUME OF 37,561 CONTRACTS EQUATES to 187 million  OZ 26.7% OF ANNUAL GLOBAL PRODUCTION OF SILVER..makes sense!!

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

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

 

end

 

 

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NPV for Sprott

 

1. Sprott silver fund (PSLV): NAV FALLS TO -1.50% ((SEPT 30/2019)
2. Sprott gold fund (PHYS): premium to NAV RISES TO -1.06% to NAV (SEPT 30/2019 )
Note: Sprott silver trust back into NEGATIVE territory at +%-/Sprott physical gold trust is back into NEGATIVE/ -1.50%

(courtesy Sprott/GATA)

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

NAV 14.66 TRADING 14.17///DISCOUNT 3.34

 

 

 

END

And now the Gold inventory at the GLD/

 

 

 

 

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

OCT 8/WITH GOLD DOWN 35 CENTS//NO CHANGE  IN GOLD INVENTORY AT THE GLD//INVENTORY 923,76 TONNNES

0CT 7 WITH GOLD DOWN 7 DOLLARS//A BIG CHANGE //A DEPOSIT OF 2.93 TONNES//

INVENTORY RISES TO 923.76 TONNES

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 8/2019/ Inventory rests tonight at 923.76 tonnes

 

 

*IN LAST 675 TRADING DAYS: 25.44 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 575- TRADING DAYS: A NET 141.25 TONNES HAVE NOW BEEN ADDED INTO  THE GLD INVENTORY.

 

 

end

 

Now the SLV Inventory/

OCT 8.WITH SILVER UP 15 CENTS TODAY/NO CHANGE IN SILVER INVENTORY AT THE SLV//SLV INTORY 383,496 MILLIONOZ

OCT 7/WITH SILVER DOWN 6 CENTS A SMALL WITHDRAWAL OF 166,000 OZ/INVENTORY LOWERS TO 383.496 MILLION OZ

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 8/2019:

 

 

Inventory 383.496 MILLION OZ

 

LIBOR SCHEDULE AND GOFO RATES:

 

 

YOUR DATA…..

6 Month MM GOFO 2.24/ and libor 6 month duration 2.20

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

G0LD LENDING RATE: – .04

 

XXXXXXXX

12 Month MM GOFO
+ 2.21%

LIBOR FOR 12 MONTH DURATION: 2.22

 

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.01

end

 

 

end

 

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

 

 

ii) Important gold commentaries courtesy of GATA/Chris Powell

Pam and Russ Martens: There’s nothing normal about the Fed pumping hundreds of billions weekly to Wall Street banks

 Section: 

By Pam and Russ Martens
Wall Street on Parade
Friday, October 4, 2019

Yesterday the House Financial Services Committee released its hearing schedule for October. There is not a peep about holding a hearing on the unprecedented hundreds of billions of dollars that the Federal Reserve Bank of New York is pumping into unnamed banks on Wall Street at a time when there is no public acknowledgement of any kind of financial crisis taking place.

… 

Congressional committees should have been instantly on top of the Fed’s actions when they started on September 17 because the Fed had gone completely rogue from 2007 to 2010 in funneling an unfathomable $29 trillion in revolving loans to Wall Street and global banks without authority or even awareness from Congress. The Fed also fought a multi-year court battle with the media in an effort to keep its giant money funnel a secret. …

… For the remainder of the report:

https://wallstreetonparade.com/2019/10/theres-nothing-normal-about-the-f…

* * *

There’s Nothing Normal About the Fed Pumping Hundreds of Billions Weekly to Unnamed Banks on Wall Street: “Somebody’s Got a Problem”

By Pam Martens and Russ Martens: October 4, 2019 ~

John Williams, President of the Federal Reserve Bank of New York

John Williams, President of the Federal Reserve Bank of New York

Yesterday, the House Financial Services Committee released its hearing schedule for October. There is not a peep about holding a hearing on the unprecedented hundreds of billions of dollars that the Federal Reserve Bank of New York is pumping into unnamed banks on Wall Street at a time when there is no public acknowledgement of any kind of financial crisis taking place.

Congressional committees should have been instantly on top of the Fed’s actions when they first started on September 17 because the Fed had gone completely rogue from 2007 to 2010 in funneling an unfathomable $29 trillion in revolving loans to Wall Street and global banks without authority or even awareness from Congress. The Fed also fought a multi-year court battle with the media in an effort to keep its giant money funnel a secret.

According to Section 1101 of the Dodd-Frank financial reform legislation of 2010, both the House Financial Services Committee and the Senate Banking Committee are to be briefed on any emergency loans made by the Fed, including the names of the banks doing the borrowing. The section reads:

“The [Federal Reserve] Board shall provide to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives, (i) not later than 7 days after the Board authorizes any loan or other financial assistance under this paragraph, a report that includes (I) the justification for the exercise of authority to provide such assistance; (II) the identity of the recipients of such assistance; (III) the date and amount of the assistance, and form in which the assistance was provided; and (IV) the material terms of the assistance, including — (aa) duration; (bb) collateral pledged and the value thereof; (cc) all interest, fees, and other revenue or items of value to be received in exchange for the assistance; (dd) any requirements imposed on the recipient with respect to employee compensation, distribution of dividends, or any other corporate decision in exchange for the assistance; and (ee) the expected costs to the taxpayers of such assistance…”

According to multiple sources we queried, the New York Fed has not made the names of these banks doing the borrowing available to either the Senate or House committees. And if there is pushback from the Committees, the public is not hearing about it. It was this exact kind of complacency and lack of leadership on the part of Congress in the early days of the financial crisis in 2007 that gave the Fed the guts to press a button and electronically create trillions of dollars to bail out the worst actors on Wall Street as they used large chunks of that money to reward themselves with tens of millions of dollars in bonuses and pay billions of dollars of the bailout money to lawyers to block their being prosecuted for fraud.

Journalists also failed to properly alert the public to the impending crisis – even when warning bells were loudly clanging.

More than a full year before the worst of the crisis, on August 23, 2007 the New York Times ran the headline “4 Major Banks Tap Fed for Financing.” The correct headline should have been: “Largest Banks in U.S. Take Unprecedented Step of Borrowing from the Fed’s Discount Window.” The article should have appeared on the front page but instead was buried on page C10 of the New York print edition.

Throughout the Fed’s history, a bank that is forced to borrow at the discount window because it can’t get loans elsewhere is seen as being in deep distress. That’s why banks don’t do it. The Times did acknowledge the stigma in the eighth paragraph, writing:

“ ‘Going to the discount window is like someone on the Upper East Side being seen in a Wal-Mart,’ said Charles R. Geisst, a financial historian at Manhattan College. ‘The T-shirts may be cheap, but why would you?’ ”

Geisst added: “ ‘The banks are circling the wagons. Somebody’s got a problem.’ ”

That was perhaps an underwhelming analogy for the situation. Being frugal when shopping for t-shirts is worlds apart from being on the cusp of the greatest banking crisis since the Great Depression.

The four mega banks that borrowed $500 million each at the Fed’s discount window were Citigroup, Bank of America, JPMorgan and Wachovia. Deutsche Bank, Germany’s biggest bank, whose U.S. unit still has a heavy footprint on Wall Street, had tapped the window the prior Friday for an undisclosed amount.

Making the media’s coverage of the early days of the financial crash look even more questionable, the day before the New York Times’ print edition ran the story, the wire service Reuters reported the action with this now infamous quote:

“ ‘The psychology is, if a bank needs to borrow from the discount window, and they think there’s a stigma attached to it, they can say, Citi has done it, too,’ said Robert Albertson, chief strategist at Sandler O’Neill in New York.”

In other words, the general public and even a top Wall Street strategist was under the impression that Citigroup was the strongest of the strong among the Wall Street mega banks at that point in time. In fact, its shakiness was a key source of the unwillingness of banks to lend to one another and why they had to rely on the Fed as a lender of last resort — because they did not know who had exposure to Citigroup. Before the crisis was over, Citigroup would have secretly tapped over $2.5 trillion in revolving loans from the Fed according to the Government Accountability Office (GAO) audit that was released in July 2011.

Sheila Bair, the head of the Federal Deposit Insurance Corporation (FDIC) at the time, wrote this in her subsequent memoir (see Sheila Bair’s Book Gores Citigroup’s Bull):

“By November [2008], the supposedly solvent Citi was back on the ropes, in need of another government handout.  The market didn’t buy the OCC’s and NY Fed’s strategy of making it look as though Citi was as healthy as the other commercial banks. Citi had not had a profitable quarter since the second quarter of 2007. Its losses were not attributable to uncontrollable ‘market conditions’; they were attributable to weak management, high levels of leverage, and excessive risk taking.  It had major losses driven by their exposures to a virtual hit list of high-risk lending; subprime mortgages, ‘Alt-A’ mortgages, ‘designer’ credit cards, leveraged loans, and poorly underwritten commercial real estate. It had loaded up on exotic CDOs and auction-rate securities. It was taking losses on credit default swaps entered into with weak counterparties, and it had relied on unstable volatile funding – a lot of short-term loans and foreign deposits.  If you wanted to make a definitive list of all the bad practices that had led to the crisis, all you had to do was look at Citi’s financial strategies…What’s more, virtually no meaningful supervisory measures had been taken against the bank by either the OCC or the NY Fed…Instead, the OCC and the NY Fed stood by as that sick bank continued to pay major dividends and pretended that it was healthy.”

New York Times’ writers like Andrew Ross Sorkin and Paul Krugman have for years been pushing the narrative that it was not universal banks like Citigroup (where risky securities and derivatives trading are under the same bank holding company roof as the Federally-insured commercial bank) that caused the financial crash of 2008 but rather the investment bank Lehman Brothers and the insurer AIG. In reality, Lehman and AIG were symptoms while Citigroup was the disease. The underlying agenda of Sorkin and Krugman appears to be to thwart Elizabeth Warren’s multi-year efforts to restore the Glass-Steagall Act which prevented these kinds of mergers.

Under the Glass-Steagall legislation of 1933, the U.S. financial system remained safe for 66 years until its repeal in 1999. It took just nine years after the repeal for the U.S. financial system to blow up in a replay of 1929, a time when there had also been no separation between securities speculation and deposit taking.

There are only two ways to look at what is happening today. It starts with basic math. As of June 30 of this year, the four largest commercial banks held more than $5.45 trillion in deposits. The breakdown is as follows: JPMorgan Chase has $1.6 trillion; Bank of America clocks in at $1.44 trillion; Wells Fargo has $1.35 trillion; and Citibank is home to just over $1 trillion.

With $5.45 trillion in deposits, why isn’t there enough liquidity to make loans in the billions. Either the big banks are backing away because of something they see on the horizon or something very troubling has happened to their liquidity.

The New York Fed has trimmed its daily $100 billion in loan offers to just $75 billion per day. This morning, just $38.55 billion of the $75 billion in overnight loans offered by the Fed was taken. But when the New York Fed offered $60 billion in 14-day loans on September 26, there were bids to borrow all of that plus $12.75 billion more or a total of $72.75 billion. (The New York Fed only loaned out the $60 billion.) In other words, one or more banks needed longer-term financing that they could not get elsewhere. As of today, the Fed has made 14-day loans on three different occasions with a total of $139 billion being borrowed by financial institutions that remain anonymous to the American people.

And it is not confidence building that Wall Street players are pointing the finger at JPMorgan Chase, the largest bank in the U.S. with three felony counts which just last month had its precious metals desk named a criminal enterprise and three of its traders criminally charged under the RICO statute that is typically reserved for organized crime.

On October 1, Reuters’ David Henry reported the following:

“Publicly-filed data shows JPMorgan reduced the cash it has on deposit at the Federal Reserve, from which it might have lent, by $158 billion in the year through June, a 57% decline.”

Why isn’t Congress curious about why the country’s largest bank needs to get its hands in a six-month period on $158 billion when it’s supposed to already have $1.6 trillion in deposits and a “fortress balance sheet,” according to its Chairman and CEO, Jamie Dimon.

If Senator Carl Levin were still in Congress and still Chair of the Senate Permanent Subcommittee on Investigations, there would certainly be hearings on this matter happening right now. It was Levin who led the investigation into how JPMorgan Chase had used its depositors’ money to make wild gambles in derivatives in London and lose $6.2 billion in the process. (See our reporting on the London Whale scandal here.)

According to the New York Fed’s annual reports for 2017 and 2018, at the end of 2017 it was holding $1.2 trillion in deposits for its depository institutions, which would have included JPMorgan Chase. But at the end of 2018 that amount had dropped by $314.8 billion or 26 percent.

Compare that drop at the New York Fed to what occurred in the same time frame at the San Francisco Fed. That Fed regional bank had $287.6 billion in deposits at the end of 2017 versus $250.4 billion at the end of 2018, a decline of just $37.2 billion or 12.9 percent.

Thus the question arises, why did the New York Fed allow JPMorgan to withdraw so much liquidity from the system? To help answer that question, Institutional Investor has a must-read article out on the crony operations between Wall Street’s banks and the New York Fed.

end
No fees are attached to Barclay’s new gold and silver funds. And as Chris Powell comments they have no gold and silver either
Flood/London’s Financial Times/Chris Powell)

No fees with Barclays new gold and silver funds — and no gold and silver either

 Section: 

Barclays Launches First Zero-Fee Gold Investment Product

By Chris Flood
Financial Times, London
Monday, October 7, 2019

UK bank Barclays has muscled into the price war in the gold investment market with the launch of the world’s first zero-fee precious metals exchange traded products, which is due to launch in New York on Tuesday.

The aggressive move by Barclays will push competitors, including BlackRock and State Street, to respond with fee cuts at a time when demand for gold from investors is nearing an all-time high.

… 

The Barclays iPath Gold exchange-traded note (ETN) and iPath Silver ETN, which will use the tickers GBUG and SBUG respectively, are structured as unsecured debt obligations issued by the UK-listed bank. Both ETNs will use derivatives to match the total return provided by three-month forward gold and silver prices. Most existing competing products track the spot price and are backed by physical holdings of gold and silver that sit in secure bank vaults. …

… For the remainder of the report:

https://www.ft.com/content/391d13fb-e263-3670-8af4-2e9fa862fd4a

end

Craig Hemke is perfectlyy correct..you cannot have any technical analysis in manipulated markets

(Craig Hemke.Stefan Gleeson)

At Money Metals, TF Metals Report’s Craig Hemke scorns technical analysis of manipulated markets

 Section: 

10:55a ET Monday, October 7, 2019

Dear Friend of GATA and Gold:

Craig Hemke of the TF Metals Report, interviewed by Mike Gleason of Money Metals Exchange, notes the irrelevance of much technical analysis in markets that are as manipulated as those for gold and silver.

The “spoofing” in the gold and futures markets that recently has yielded indictments and convictions of bullion bank traders in the United States is directly related to the strange “waterfall” smashes in gold and silver in recent years, Hemke says.

… 

The gold and silver trading desk of JPMorganChase in New York, whose gold and silver traders have been indicted and convicted, worked closely with the bank’s physical desk in London, Hemke says.

Hemke explains: “Say the physical desk in London has an order that they took a few weeks back and they’ve got to fill. They’ve got to get a ton, 50,000 ounces, whatever. And they’ve got to fill that order and they don’t have it. So they’ve got to go buy it. First they’ve got to get that metal shook free, so they’ve got to convince somebody to sell, but at the same time they might want to save a few bucks when buying that metal and so they get the desk in New York to rig the price lower.

“The guy in London calls up [JPM gold trading desk chief] Michael Nowak and says, ‘Mike, I really could use the price down $10 from here. Could you take care of that for me?’

“Mike gets [confessed JPM gold-spoofing trader John] Edmonds on the phone. They start spoofing away — boom. And you get these waterfall declines where we all sit back and scratch ours head going, ‘Wait a second. Who in their right mind sells 10,000 contracts in 30 seconds?'”

Meanwhile, Hemke says, “Baghdad Bob” financial market letter writers contrive technical analysis explanations for the strange market action, since any candid analysis of it would reveal to their subscribers the uselessness of the technical analysis they’re selling.

Gleason’s interview with Hemke is posted at Money Metals Exchange’s internet site here:

https://www.moneymetals.com/podcasts/2019/10/04/bank-liquidity-crunch-co…

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

end

Powell announces QE4 but does not call it QE 4..POMO equals QE4

(zerohedge)

Watch Live: Fed Chair Powell Announces QE4 (But Don’t Call It QE4)

Update: Fed Chair Powell appears to have announced QE4 (but do not call it QE4!):

Discussing the liquidity shortage and repo-calyps, Powell said:

While a range of factors may have contributed to these developments, it is clear that without a sufficient quantity of reserves in the banking system, even routine increases in funding pressures can lead to outsized movements in money market interest rates. This volatility can impede the effective implementation of monetary policy, and we are addressing it. Indeed, my colleagues and I will soon announce measures to add to the supply of reserves over time. Consistent with a decision we made in January, our goal is to provide an ample supply of reserves to ensure that control of the federal funds rate and other short-term interest rates is exercised primarily by setting our administered rates and not through frequent market interventions. Of course, we will not hesitate to conduct temporary operations if needed to foster trading in the federal funds market at rates within the target range.

“I want to emphasize that growth of our balance sheet for reserve management purposes should in no way be confused with the large-scale asset purchase programs that we deployed after the financial crisis. Neither the recent technical issues nor the purchases of Treasury bills we are contemplating to resolve them should materially affect the stance of monetary policy…”

Roughly translated:Don’t confuse balance sheet growth for “reserve management” with balance sheet growth for “stock market management”

None of this should come as a surprise as we warned in September that “The Fed Will Restart QE In November: This Is How It Will Do It.”

…In the chart below, Goldman summarizes its projections of the Fed’s future gross Treasury purchases. The blue bars show reinvestment of maturing UST, which occur via add-on Treasury auctions. The red bars show reinvestment of maturing MBS, which occur via the secondary market.

The grey bars are where things get fun as they show permanent OMOs to support trend growth of the Fed’s balance sheet, which will occur via intervention of the Fed’s markets desk in the secondary market.

Here, similar to Bank of America, Goldman assumes a roughly $15bn/month rate of permanent OMOs, enough to support trend growth of the balance sheet plus some additional padding over the first two years to increase the size of the balance sheet by $150bn, restoring the reserve buffer and eliminating the current need for temporary OMOs.

That strategy would result in balance sheet growth of roughly $180bn/year and net UST purchases by the Fed (the sum of the red and grey bars) of roughly $375bn/year over the next couple of years.

And so, in just two months QE… pardon the Fed’s open market purchases of Treasurys, will return after a 5 years hiatus. Just don’t call it QE, whatever you do.

*  *  *

For the first time since a slew of economic data released over the past week helped ratchet up odds for another Fed rate cut in October, Fed Chairman Jerome Powell will speak Tuesday at the National Association for Business Economics’ annual meeting in Denver.

Just before Powell speaks, the odds of a rate cut in October hovered just over 75%.

Source: Bloomberg

If Powell is truly data-dependent and seeking insurance for the trade deal, then recent events suggest he will be more dovish than hawkish…

Source: Bloomberg

As macro data surprises begin to disappoint serially…

Source: Bloomberg

Following Powell’s prepared remarks, there will be a brief Q&A. Powell is expected to begin speaking at around 2:30 PM ET.

Powell’s comments come on the heels of Chicago Fed’s Evans’ comments that “certainly, asset valuations are quite high.”

end

iii) Other physical stories:

 

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

i) Chinese yuan vs USA dollar/CLOSED / LAST AT: 6.8807/ GETTING VERY DANGEROUSLY CLOSE TO 7:1

//OFFSHORE YUAN:  6.8834   /shanghai bourse CLOSED DOWN 30.52 POINTS OR 1.04%

HANG SANG CLOSED DOWN 131.51 POINTS OR 0.46%

 

2. Nikkei closed DOWN 422.94 POINTS OR 1.97%

 

 

 

 

3. Europe stocks OPENED ALL MIXED/

 

 

 

USA dollar index UP TO 97.24/Euro FALLS TO 1.1219

3b Japan 10 year bond yield: FALLS TO. –.13/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 107.85/ 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:: 57.21 and Brent: 64.13

3f Gold DOWN/JAPANESE Yen PU 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 -.32%/Italian 10 yr bond yield DOWN to 1.53% /SPAIN 10 YR BOND YIELD DOWN TO 0.39%…ITALIAN 10 YR BOND YIELD/GERMAN BUND: 1.85: DANGEROUS FOR THE ITALIAN BANKING SYSTEM

3j Greek 10 year bond yield FALLS TO : 2.09

3k Gold at $1421.50 silver at: 16.13   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 10/100 in roubles/dollar) 62.99

3m oil into the 57 dollar handle for WTI and 64 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 107.85 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 .9875 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1077 well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.

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

3r the 10 Year German bund now NEGATIVE territory with the 10 year FALLING to 0.32%

The bank withdrawals were causing massive hardship to the Greek bank. the Greek referendum voted overwhelming “NO”. Next step for Greece will be the recapitalization of the banks and that will be difficult.

4. USA 10 year treasury bond at 2.05% early this morning. Thirty year rate at 2.57%

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

6.  TURKISH LIRA:  UP  TO 5.6988..

S&P Futures, Global Stocks Tumble As China Trade Deal Hopes Crash And Burn

It started off well enough, with lots of “optimism” that a trade deal was just around the corner thanks to flashing red headlines from first Larry Kudlow and then China on Monday. However, shortly after 3am ET it all started going terribly wrong as first we got some negative Brexit news, when a Downing Street source said that unless the EU compromises and does a Brexit deal shortly, then the UK will leave the EU without a deal, which was then followed by the main event, namely China’s Ministry of Commerce saying to “stay tuned” for Beijing’s retaliation after the US placed eight Chinese technology companies on its “entity list” which now need to be licensed to access US technology exports.

That was just the start however, as China also said it will halt NBA broadcasts, further souring the mood music ahead of the trade talks scheduled this week, while shortly after the SCMP reported that this week’s trade talks were as good as dead when a “source” told the South China Morning Post that the Chinese delegation may cut short their stay in Washington, removing the possible chance of the talks extending into Friday evening as the delegation would be expected to head to the airport instead of departing at some point on Saturday.

Then, just moments later, Bloomberg doubled down on its originally refuted of soft capital controls by the US on China, when it reported that the Trump administration “is moving ahead with discussions around possible restrictions on capital flows into China, with a particular focus on investments made by U.S. government pension funds” adding that “the efforts are advancing even after American officials pushed back strongly against a Bloomberg News report late last month that a range of such limits was under review. Trump officials last week held meetings on the issue just hours after White House adviser Peter Navarro dismissed the report as “fake news,” and zeroed in on how to prevent U.S. government retirement funds from financing China’s economic rise.”

Faced with this mountain of evidence that the odds of even a watered down deal being announced this week are virtually nil, futures plunged, with the Emini sliding from session highs of 2,950 to as low as 2,910, wiping out almost all post-payrolls gains…

… while global markets had deteriorated to a sea of read despite a solid Asian session.

The news also slammed the offshore yuan, which tumbled 0.5% after earlier climbing the most in a month:

The barrage of negative news hit the European STOXX 600 index, which dropped as much as 1%, with Germany’s trade-sensitive DAX hit hard despite earlier data showing an unexpected rise in industrial output. Mixed corporate news added to the woes, with LSE shares tumbling 6% after Hong Kong pulled out of its takeover bid for the exchange, while Germany biotech Qiagen has plunged 16.5% to three-year lows after a sales warning.

Ironically, Europe’s losses followed healthy gains in Asia, where Japan’s Nikkei climbed 1.0% while MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.55%, led by gains in tech shares in South Korea and Taiwan. Hong Kong extended gains after the territory’s leader said she had no plans to introduce other laws using the emergency regulation ordnance, as it’s too early to say the anti-mask law is ineffective. On the other hand, reports, citing the Chief Executive, noted that the Chinese military could step in if the ongoing protests in the city get worse. The Hong Kong leader also noted that during Golden week, the number of visitors declined 50% Y/Y.

Also of note, China mainland stocks returned from a week-long holiday with a 0.6% rise. The National Holiday celebrations also offered a rare respite to China’s retail sector, with spending on goods and dining returning to growth this year. Yet the latest PMI survey showed China’s services sector grew at its slowest pace in seven months in September, offering little momentum to an economy that has been expanding at its weakest pace in almost three decades.

Source: Bloomberg

Emerging-market stocks advanced as Chinese markets re-opened after a week-long holiday, with most closing as investors still basked in the glow of the positive trade deal sentiment, as China confirmed that a high-level delegation had already left for the talks in Washington, while President Donald Trump said “we’ll see” if a deal could be reached. Of course, all that changed in subsequent hours, but it was too late to hit the majority of EM stocks.

All this happens, of course, as negotiations are getting under way ahead of a scheduled increase in U.S. tariffs on $250 billion worth of Chinese goods, to 30% from 25% on Oct. 15. Trump has said the tariff increase will take effect if no progress is made in the negotiations.

“Since tariffs have been hurting trade, people are hoping Trump may postpone some of the upcoming tariffs,” said Yukino Yamada, senior strategist at Daiwa Securities. “Nevertheless, you can’t ignore that fact that, up until now, the market has underestimated Trump’s determination on tariffs.”

The surge in trade deal uncertainty also added to pressure in fixed income markets with German bund yields nudging lower while U.S. Treasuries yields slumped as low as 1.52% despite some $78 billion in note and bond supply slated for auction this week.

Meanwhile in currencies, the dollar initially lost momentum, dipping 0.1% against a basket of its rivals after posting its biggest single-day rise in a week in the previous session, before rebounding to unchanged. The greenback traded as low as 106.80 yen, after hitting 107.44 earlier. The euro got a boost from the healthy German industrial output data, with the single currency rising 0.2% to $1.0988, not far off the more than a two-year low hit last week.

Besides the yuan, the other big mover was the pound sterling which traded at $1.2217, after Boris Johnson told German Chancellor Angela Merkel a Brexit deal is essentially impossible if the EU demands Northern Ireland should stay in the bloc’s customs union. The call between the leaders, at 8 a.m. Tuesday, came after a text message from one of the prime minister’s officials, reported by the Spectator magazine, said his government is preparing for talks to collapse.

Elsewhere, the lira was poised for its first advance in three days, clawing back some of Monday’s losses, which were fueled by concern Turkey’s planned incursion into Syria will deepen a rift between Washington and Ankara. The Turkish Defense Ministry said all preparations are complete for the military operation into Syria, while reports stated that US does not endorse any Turkish operations in northern Syria, according to a senior administration officials who added that US troops will be withdrawn from the Turkey-Syria border, not out of Syria entirely.

Looking ahead, markets will be keenly watching comments from U.S. Federal Reserve Chairman Jerome Powell later in the day, who’s speaking at the annual meeting of the National Association for Business Economics, after some weak U.S. data last week raised concerns the U.S. economy may be heading towards a protracted slowdown. Other central bank speakers include the Fed’s Evans and Kashkari. There’ll be September’s PPI reading and the NFIB small business optimism index, while from Canada there’s September housing starts and August building permits. Expected data include PPI. Helen of Troy is reporting earnings.

Market Snapshot

  • S&P 500 futures down 0.5% to 2,916.50
  • STOXX Europe 600 down 0.2% to 382.04
  • MXAP up 0.6% to 156.40
  • MXAPJ up 0.6% to 500.32
  • Nikkei up 1% to 21,587.78
  • Topix up 0.9% to 1,586.50
  • Hang Seng Index up 0.3% to 25,893.40
  • Shanghai Composite up 0.3% to 2,913.57
  • Sensex down 0.4% to 37,531.98
  • Australia S&P/ASX 200 up 0.5% to 6,593.43
  • Kospi up 1.2% to 2,046.25
  • German 10Y yield fell 0.4 bps to -0.579%
  • Euro up 0.2% to $1.0987
  • Italian 10Y yield rose 1.9 bps to 0.512%
  • Spanish 10Y yield fell 0.5 bps to 0.132%
  • Brent futures little changed at $58.36/bbl
  • Gold spot up 0.3% to $1,498.34
  • U.S. Dollar Index down 0.1% to 98.90

Top Headline News from Bloomberg

  • China signaled it would hit back after the Trump administration placed eight of the country’s technology giants on a blacklist over alleged human rights violations. Asked on Tuesday if China would retaliate over the blacklist, foreign ministry spokesman Geng Shuang told reporters “stay tuned.”
  • Boris Johnson told German Chancellor Angela Merkel a Brexit deal is “essentially impossible” if the EU demands Northern Ireland should stay in the bloc’s customs union. The call between the leaders, at 8 a.m. Tuesday, came after a text message from one of the prime minister’s officials, reported by the Spectator magazine, said his government is preparing for talks to collapse.
  • China’s state TV network CCTV said Tuesday that it would halt broadcasts of the National Basketball Association’s games as a backlash intensified against the U.S. league over a tweet that expressed support for Hong Kong’s pro-democracy protesters.
  • The U.K. government revamped the tariffs it will levy after a no-deal Brexit following warnings from industry that its earlier plans risked making domestic producers uncompetitive.
  • German industrial production unexpectedly improved in August after two months of decline, a development that will do little to alleviate concerns about intensifying trade tensions and waning business confidence.
  • Japanese investors sold a record amount of Spanish bonds in August, seeking to lock in profits from five months of purchases while pivoting more toward U.S. debt.

Asian equities traded higher across the board despite a lacklustre handover from Wall Street where stocks were choppy but ultimately closed in the red amid trade war jitters after the US blacklisted Chinese governmental and commercial organisations over treatment of the Muslim minority community. ASX 200 (+0.4%) was kept afloat by miners amid favourable price action in base metals, whilst Nikkei 225 (+1.0%) was bolstered on the back of a weaker Yen and after US and Japan signed a limited trade deal on agricultural and digital trade. Hang Seng (+0.2%) and Shanghai Comp (+0.3%) returned from a long weekend and played catchup to the NFP-induced upside in the prior session. The former was buoyed by heavyweights Geely Auto after dealers noted a pickup in sales during Golden Week, whilst HKEX shares rose in excess of 2% after it dropped its GBP 32bln bid for LSE, as the boards of the two companies were “unable to engage”. Meanwhile, Mainland China saw upside despite the Caixin Services metric falling short of forecasts, as an improvement in the Composite metric signalled the strongest rate of growth since April. Furthermore, South Korea’s KOSPI (+0.8%) showed a strong performance as the index was supported by tech giant Samsung Electronics, who’s shares spiked higher by 1% after its Q3 guidance topped analyst expectations, albeit it still noted that its profits will likely plunge 56% Y/Y. Finally, core fixed-income futures drifted lower and tracked the risk sentiment around the market with UST and Bund futures poised to close Asia trade near session lows.

Top Asian News

  • Hillhouse-Backed Genor Said to Seek Up to $1 Billion Valuation
  • Samsung Billionaire Heir to Cede Board Seat Before Legal Probe

Major European Bourses (Euro Stoxx 50 -0.9%) are lower, with the region shrugging off a positive AsiaPac hand over, as trade jitters return to the forefront following the flurry of headlines yesterday evening. This morning, China’s Ministry of Commerce said to stay tuned for a blacklist retaliation to the recent US decision to list 28 Chinese governmental and commercial organisations, including Hikvision, to the entity list over treatment of the Muslim Uighur community. Further contributing to the downbeat tone, SCMP reported that China is toning down expectations head of US/China trade talks, and even though the round of talks will take place this week, a source says that the Chinese delegation is already planning to cut short its stay in Washington by one night. Moreover, Chinese negotiator Liu He will not carry the title of “special envoy” for President Xi Jinping at the meeting, which the article speculated is an early indication that the vice-premier has not been given any particular instructions from China’s leader. Separately, but also contributing some downside to global equities, was a return of no deal Brexit fears, with UK/EU talks seemingly approaching collapse and the UK government vowed to pursue a no deal exit unless the EU compromises. The confluence of negatives saw DAX Dec’ 19 futures lose the 12000 handle. Moving forward, further impetus likely to come in the form of Fed speak (including Powell at 19.30 BST) and Minutes tomorrow and US/China trade talks, US CPI and ECB Minutes on Thursday. Sectors are lower apart from Telecoms (unch.). In terms of individual movers; Airbus (+0.7%) shares were supported by a strong delivery update. Wirecard (-2.8%) initially moved higher after the Co. announced an increase to its Vision 2025 targets, before paring gains alongside the market. EasyJet (-6.3%) shares fell after a trading update; on the face of it the update appeared strong, however investors noted that they had been expecting firmer guidance, while also suggesting that the co.’s decision to not to have a conference call was a mistake. London Stock Exchange (-4.8%) sunk on news that the Hong Kong Exchange and Clearing will no longer proceed with their offer for the Co. Uniper (-8.2%) shares fell and Fortum (-0.2%) initially rose after the former announced it had agreed to acquire a majority stake in the latter, before falling with the market.

Top European News

  • Fortum Gets Uniper Control in $2.5 Billion Deal With Funds
  • U.K. Tweaks No-Deal Brexit Tariffs for Trucks, Fuel and Clothing
  • Johnson Warned Against Big Tax Cuts as U.K. Faces No- Deal Shock
  • German Factories Feed Unexpected Rebound in Industrial Output

In FX, NZD/AUD/SEK/TRY – Not quite all change, but certainly some solace for the Kiwi, Aussie, Swedish Crown and Turkish Lira following a bad start to the week. Nzd/Usd has regained 0.6300+ status on the back of supportive fiscal impulses as the NZ Finance Minister flagged a 4 bn budget surplus overshoot against target overnight, while Aud/Usd is hovering above 0.6750 in wake of mixed Chinese Caixin PMIs and an uptick in NAB business conditions. Elsewhere, Eur/Sek has eased back from 10.8900+ peaks towards 10.8500 with the aid of some encouraging Swedish data (private/services production and Usd/Try retreated from around 5.8450 to sub-5.8000 at one stage after US President Trump threatened to decimate the Turkish economy if it crosses the line in Northern Syria.

  • GBP – In stark contrast to all the above, no deal Brexit risk has put the Pound back on the rack amidst reports that German Chancellor Merkel deems that a breakthrough on the Irish backstop is now highly unlikely, while other headlines contend that an agreement may be dead in the water full stop. In response, Cable lost grip of the 1.2300 handle and filled bids at 1.2275 before ploughing through more between 1.2260-50 on the way through 1.2230, while Eur/Gbp spiked to just over 0.8980 and beyond 500 mn option expiries at 0.8965.
  • CHF/EUR/JPY – All firmer against the Dollar even though the DXY nudged back over 99.000 ahead of US PPI and Fed Chair Powell, with an element of underlying safe-haven demand underpinning the Franc, Yen and Euro awaiting US-China trade talks alongside the aforementioned Brexit negotiations on the cusp of collapsing. Usd/Chf is closer to 0.9900, Eur/Usd near the top end of a 1.0965-95 band and Usd/Jpy eyeing 107.00 again from circa 107.45 earlier. Note, latest SCMP reports confirms earlier talk that Beijing is not looking for any major deal and propose to cut their stay short, with Liu He not attending in the guise of special envoy that would imply no remit or agenda to sign off on a full trade agreement.
  • NOK/CAD – The Norwegian Krona and Loonie are both holding relatively steady around 10.0400 vs the single currency and 1.3300 vs the Greenback respectively, with the former largely taking comments from Norges Bank Governor Olsen in stride as he underlined guidance for rates to remain on hold after September’s hike, barring the option to reverse the tightening move if economic developments deteriorated significantly. Meanwhile, Canadian housing starts and building permits are due and may provide the Cad with some independent direction or at least a distraction.

In commodities, the crude complex is lower on Tuesday, after negative news flow on the US/China trade and Brexit front spurring risk off. WTI Nov’19 futures broke below yesterday’s USD 52.60/bbl lows and technicians will now be eyeing support just ahead of the USD 52.00/bbl handle. Meanwhile, Brent Nov’ 19 futures are probing support at USD 58.00/bbl. In terms of geopolitical developments, news flow still appears focussed on the US’ recent decision to pull troops out of Northern Syria, which opens the door for a Turkish offensive against Kurdish forces in the area (reports allege the offensive had already begun), rather than on the US/Iran/Saudi picture; given Syria’s lack of oil it remains unlikely that these developments will have much of a baring on crude prices. In supply news, the North Sea’s Buzzard Oilfield remains closed, according to its operator, and there is still no timeline for its return to normal operations. Gold prices have reclaimed the USD 1500/oz mark assisted by the aforementioned trade and Brexit jitters, after reports that China is ready to do a deal on the parts of the negotiations both sides agree upon (and is prepared to set out a timetable for the harder issues to be worked out next year) triggered a lurch lower during US hours on Monday. Copper prices saw upside overnight on decent Chinese Caixin PMI data helped to moderate concerns about an economic slowdown in the country, but has since given up the majority of its overnight gains.

US Event Calendar

  • Oct. 8-Oct. 11: Monthly Budget Statement, est. $96.5b, prior $119.1b
  • 8:30am: PPI Final Demand MoM, est. 0.1%, prior 0.1%;
    • PPI Ex Food and Energy MoM, est. 0.2%, prior 0.3%
    • PPI Ex Food, Energy, Trade MoM, est. 0.2%, prior 0.4%
  • 8:30am: PPI Final Demand YoY, est. 1.8%, prior 1.8%
    • PPI Ex Food and Energy YoY, est. 2.3%, prior 2.3%
    • PPI Ex Food, Energy, Trade YoY, prior 1.9%

DB’s Jim Reid concludes the overnight wrap

I’m in need of motivational words from readers this morning. 5 months ago I set off on a journey of betterment and fulfilment but over the last few days I’ve had a wobble, become disillusioned and now need reassurance that I’ve picked the right path. Yes at 45, with three young kids, a full time (demanding) job and numerous other claims on my time I decided to completely remodel my 35 year old golf swing. After starting this process as a 5-handicapper back in early May, yet another poor round this past weekend has seen me move up to 7. Every time I tee the ball up at the moment I’ve got no idea how wild it’s going to be. Most evenings I stand in front of a mirror and do 30-40 minutes of practise swings before videoing it at the end to see the progress. My wife thinks I’m crazy. On camera it’s looking pretty good but on the course I’ve been struggling for months and have given myself tennis elbow for good measure with all the swinging. Oh and I’ve even moved to live opposite my golf course to try to find time to get better. So if you’ve made a big effort to try to get better at something and have experienced big lows before eventually seeing a euphoric payoff then I’ll be delighted to hear from you as I need it to motivate myself through the upcoming winter months.

US markets flipped between gains and losses yesterday with a level of direction normally reserved for my driver. We eventually closed in the light rough. In more detail the S&P 500 had initially opened -0.55% lower as investors first reacted to the Sunday night Bloomberg story that Chinese officials have become more reluctant to agree a broad trade deal. It then bounced back into the green to trade as high as +0.25% on comments from US official Larry Kudlow that we’ll discuss below. Ultimately the index fell back during afternoon trading to end -0.45% lower, though trading volumes were their thinnest in over a month. The NASDAQ (-0.33%) and the Dow Jones (-0.36%) performed similarly. While most of what Kudlow said was non-committal, saying that he didn’t want to predict the outcome of the trade talks, he did say that delisting Chinese companies “is not on the table”. We also got a White House statement yesterday that the US would be welcoming a Chinese delegation led by Vice Premier Liu He for further trade talks beginning on Thursday. The statement said that the topics of discussion include “forced technology transfer, intellectual property rights, services, non-tariff barriers, agriculture, and enforcement.” After markets had closed, news broke that the US is sanctioning eight additional technology companies over their involvement with China’s treatment and surveillance of the Uighur minority group. Coming just before the trade talks are set to begin, the announcement might lead to more tensions.

This morning in Asia markets have risen in spite of the above blacklisting news. The advances are across the board, with the Nikkei (+1.03%), the Hang Seng (+1.08%), and the Kospi (+0.97%) all trading higher, while the Shanghai Comp (+0.84%) also saw similar moves in spite of opening again after a seven-day public holiday. In corporate news overnight, Samsung’s results beat analysts’ estimates, even as operating profit fell 53% last quarter, and the company’s shares are up +1.36% this morning. We’ve also heard that Hong Kong Exchanges & Clearing are not going to go ahead with its attempt to take over the London Stock Exchange. Elsewhere 10yr JGBS are up +2.0bps this morning and S&P 500 futures are up +0.37%.

Back to trade, and in a special report yesterday (link here ), Peter Hooper and Michael Spencer looked at the current trade war with a historical perspective, as well as prospects for the future. They write that we’ve come to the end of a six-decade surge in global trade as a share of GDP, and that this growth led to a protectionist backlash because the benefits of trade were skewed increasingly away from lower and middle income households. Looking forward, they don’t expect the scope for trade conflict to change greatly after next year’s elections, regardless of the outcome, and either a Trump win or a progressive Democratic win could increase the intensity of the trade conflict in 2021.

Outside of trade, fiscal is another topical issue at the moment and there were interesting headlines on this yesterday from a European Commission document. It suggested that the “Euro-zone need pre-emptive fiscal stimulus to avoid protracted period of low growth” and that “more monetary easing now would be less effective than fiscal stimulus”. The Reuters article suggests that the document will be presented to the Eurogroup meeting of finance ministers next week. It’ll be interesting to see whether it gets traction but it’s important as it shows that the commission is starting to give Governments the green light to open the fiscal vaults. On page 44 of our long term study ( link ) we showed that monetary (QE especially) and fiscal policy have mostly gone in opposite directions since 2010. When central banks have been expanding their balance sheet, governments have been reducing their deficits and visa-versa. So the two moving in the same direction would be more powerful.

Back to markets yesterday and the other big move came from oil, which took a similar roundtrip move as stocks did. WTI and Brent had traded as much as +2.37% and +2.24%, which would’ve been the biggest move since the Saudi drone attack 3 weeks ago, but they retraced to end closer to flat as the risk-off mood reasserted during the afternoon. Nevertheless, energy stocks had led equity gains in Europe, with the STOXX Oil & Gas index up +0.99%, since they closed before the afternoon selloff. In the US, energy stocks lagged and the only group which advanced on the day was the safe-haven communications sector.

Unlike the US, European equities pared back losses to close higher yesterday, with the STOXX 600 up +0.71%, along with the DAX (+0.70%) and the CAC 40 (+0.61%). This was in spite of more negative data, once again from German manufacturing. Factory orders fell by -0.6% mom in August, (vs. -0.3% expected), bringing the yoy rate down to -6.7% (vs. -6.4% expected). This means that the yoy rate has been negative for 15 consecutive months, and comes at a tense time for the German economy, which stands on the brink of a technical recession after contracting by -0.1% in Q2. In the US, 10yr Treasuries ended the session +3.1bps, although the curve flattened with the 2s10s -2.7bps at 9.3bps.

It was the reverse picture in sovereign bond markets, which pared back gains to end the session lower, with ten-year bunds (+1.3bps), OATs (+1.0bps) and BTPs (+1.9bps) all seeing higher yields. The outperformance came from Portugal yesterday, where government bonds outperformed following the country’s election results, with ten-year yields down -0.4bps as investors looked for continuity as Prime Minister Costa increased his Socialist Party’s representation in parliament. Costa is still short of an overall majority however, so needs to work out an alliance with other parties, and has said he wanted to continue working with the Left Bloc and the Communists as he has for the last four years. Costa’s target is to bring public debt down from 122% at present to below 100% of GDP by the end of this four-year term in 2023. Portuguese 10yr yields fell below their Spanish equivalents for the first time since December 2009 with yields falling to 0.137% – impressive given that they were at 4.297% as recently as 2017, and as high as 17.393% in the sovereign crisis in 2012.

Elsewhere in the world of Sovereign risk, the Turkish lira fell -2.47% against the dollar yesterday, its worst session in over six months, extending losses after President Trump tweeted that “if Turkey does anything that I, in my great and unmatched wisdom, consider to be off limits, I will totally destroy and obliterate the Economy of Turkey”.

In terms of the latest on Brexit, Prime Minister Johnson won a Scottish legal challenge yesterday, where anti-Brexit campaigners had sought to force Johnson into sending the extension required under the Benn Act. The judge said that the “unequivocal assurances” that he would obey the law were sufficient. After today’s proceedings in Westminster, Parliament will be prorogued again later on today. However unlike the last prorogation, which ended up being ruled unlawful by the Supreme Court, this one is only until a Queen’s Speech on Monday, which is where the UK government outlines its legislative programme for the coming parliamentary session. Meanwhile, there seemed to be little progress towards a deal ahead of the crucial EU Council meeting on 17 October, and last night the Spectator magazine published what they claim was a message from someone in Prime Minister Johnson’s office that the government were preparing for the talks to collapse and that as a result they would be forced into fighting the next election explicitly on a no-deal platform to ensure they carried the leave vote with them.

Turning to the day ahead, we have a number of highlights, including remarks from Fed Chair Powell, who’s speaking at the annual meeting of the National Association for Business Economics. In terms of other central bank speakers we’ll hear from the BoE’s Haldane and Tenreyro, the ECB’s Lane and Hernandez de Cos, along with the Fed’s Evans and Kashkari. The data picks up a little as well this morning, with August releases for German industrial production, Italian retail sales and the French trade balance. From the US, there’ll be September’s PPI reading and the NFIB small business optimism index, while from Canada there’s September housing starts and August building permits.

 

3A/ASIAN AFFAIRS

I)WEDNESDAY MORNING/ TUESDAY NIGHT: 

SHANGHAI CLOSED DOWN 30.52 POINTS OR 1.04%  //Hang Sang CLOSED DOWN 131.51 POINTS OR 0.46%   /The Nikkei closed DOWN 422.94 POINTS OR 1.97%//Australia’s all ordinaires CLOSED DOWN .42%

/Chinese yuan (ONSHORE) closed DOWN  at 6.8807 /Oil UP TO 57.21 dollars per barrel for WTI and 64.13 for Brent. Stocks in Europe OPENED MIXED//  ONSHORE YUAN CLOSED DOWN // LAST AT 6.8807 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.8834 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY CLOSE TO 7:1//TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED  : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /TRADE DEAL NOW DEAD..TRUMP  RAISED RATES TO 25%

 

 

3 a./NORTH KOREA/ SOUTH KOREA

South Korea

 

b) REPORT ON JAPAN

 

3 C CHINA

Beijing pulls the plug on the uSA: cancels NBA broadcasts as they react with anger over Trump’s Hong Kong tweet
(zerohedge)

Beijing Pulls The Plug: China Cancels NBA Broadcasts Amid Outrage Over Hong Kong Tweet

Adding yet another layer of conflict to the US-China relationship (in addition to trade tensions, there’s also Hong Kong and Taiwan, the South China Sea, etc.), China’s state broadcaster, CCTV, said it would end broadcasts of NBA games in China, ensuring that the spat that exploded out of nowhere when Daryl Morey tweeted (then swiftly deleted) a message of support for the Hong Kong protesters. Despite the league’s insistence that Morey didn’t speak for either the Houston Rockets nor the NBA as a whole, Commissioner Adam Silver’s later defense of Morey (after coming under intense public and political pressure) and his right to freedom of expression inflamed tensions with Beijing.

And the Chinese state has decided to retaliate by effectively pulling the plug on the NBA in China, decimating viewership for one of the most popular leagues in the country. Every year, some 800 million Chinese watch NBA programming.

CCTV said in a Weibo post it won’t broadcast two NBA pre-season games, and is investigating “all cooperation and exchanges with the NBA,” which could lead to the cancellation of the entire 2019-2020 season, WSJ reports.

With the protests still raging in Hong Kong, the Chinese government is particularly vulnerable to offense right now. The issue is a “particularly sensitive” one, as a Bloomberg source pointed out.

The issue of foreign support for Hong Kong protesters is particularly sensitive for Chinese officials, who have previously accused demonstrators of advocating independence, as well as seeking support from external governments, said Shen Dingli, a Shanghai-based international relations professor.

After the announcement, one twitter user published a summary of users’ reactions on Weibo, China’s Twitter.

Frankie Huang 🌙@ourobororoboruo

After CCTV announced they are ceasing NBA broadcasts for threatening China’s sovereignty I poked around on Weibo for some reactions.

– Performative patriotism
– CBA still has no love 😆
– Showing off China’s spending power
– Whataboutism on US domestic issues

View image on TwitterView image on TwitterView image on TwitterView image on Twitter

As the international relations professor quoted above pointed out, Beijing’s mentality is effectively this: If you want to do business in China, and make money in China, then don’t go around disrespecting China.

“The Chinese government has difficulty seeing foreign businesses doing business and making money in China while disrespecting China’s legitimate interests,” Shen said. “You have the right not to respect us, but we also have the right not to do business with these people. We don’t think we’re demanding something unreasonable.”

During his regular press briefing on Tuesday, foreign ministry spokesman Geng Shuang said “it’s impossible to conduct exchanges and cooperation with China without knowing the public opinion of China.”

According to BBG, the fallout from the imbroglio has turned what was supposed to be a high-profile promotional week for the league in one of its biggest markets into a major PR disaster.

And the fallout is only getting worse: In China, celebrities and fans said they would skip exhibition games scheduled for this week featuring top stars like LeBron James, while an NBA charity event at a Shanghai school was cancelled. The event was set to feature the Brooklyn Nets, a team that’s majority owned by Taiwanese-Canadian billionaire Joe Tsai, but it was cancelled, marring the start of a one-week tour through China for the team, the New York Post reported. Several Chinese sponsors have already suspended ties with the rockets, including sportswear maker Li Ning Co.

CCTV is a monopoly, so the NBA doesn’t make as much money selling broadcasting rights in China since it doesn’t have much leverage (in the US, bidding wars between the networks push up the price). But China is seen as a major growth market for the NBA, which recently made $1.5 billion auctioning off the digital streaming rights for China to Tencent.

To be sure, the NBA isn’t the first corporation that Beijing has leaned on since the protests in Hong Kong began. Hong Kong-based companies like Cathay Pacific Airlines faced what employees called a “white terror” of firings tied to evidence of support for the protests.

As we pointed out yesterday (Bloomberg is highlighting it again on Tuesday), South Park’s criticism of the NBA and Hollywood is feeling incredibly prescient today.

Bloomberg TicToc

@tictoc

“Like the NBA, we welcome the Chinese censors into our homes and into our hearts.”

South Park is being censored in China because of an episode criticizing Hollywood for catering to Beijing

Embedded video

end
This will not end pretty as the Chinese army is ready to step in against the rioters.
(zerohedge)

Chinese Army Ready To Step In Against Rioters – HK’s Carrie Lam Warns For First Time

Following a renewed surge in protest unrest and violence in the wake of the controversial mask ban which went into effect on Saturday, Hong Kong leader Carrie Lam has for the first time issued public warning that the Chinese military could step insaying this drastic step would only happen if it “becomes so bad”.

Expressing hope it won’t come to that, and that the situation will resolve itself under local authorities, she noted that the four month-long raging protests were no longer “a peaceful movement for democracy” and urged outside critics to understand this.

 

Demonstrators in Hong Kong, via Axios/Getty Image

“I still strongly feel that we should find the solutions ourselves. That is also the position of the central government, that Hong Kong should tackle the problem on her own, but if the situation becomes so bad, then no options could be ruled out if we want Hong Kong to at least have another chance,” Lam said at a news conference on Tuesday.

Over the past month especially, demonstrations have increasingly involved a smaller but more hardline crowd of mostly face-masked youth relying on extreme tactics such as hurling molotov cocktails at police, and setting stores and infrastructure on fire, along with increased vandalism.

The anti-Beijingers have attempted to bring the city to a complete halt, using various tactics such as erecting barriers on busy roadways, occupying the international airport, and vandalizing train stations including attempting to disable trains. The protests seem to have entered a new, more dangerous phase, which further suggests the Chinese military could be inching closer to direct intervention.

Global Times

@globaltimesnews

From Friday night to Saturday, violence spread in , the way rioters attacked was shocking, causing unprecedented damage. They even attacked the city’s train system, including the cars and railway:

Embedded video

Chinese state media as it continues highlighting the dangerous vandalism, including an alleged attack on a cross-border train into China, seems to be making a case that only direct mainland intervention can remedy the situation and restore order.

Over the weekend the city’s MTR train network had to be closed for two days. As the AP reports, this was over fears of wide scale attacks and disablement of the public transit system which carries some 5 million passengers daily:

Videos on local media showed masked protesters smashing windows of a train heading to mainland China late Monday as passengers screamed — the first time a train carriage was attacked. Protesters also threw objects on the track as the train pulled away. An MTR spokesman, who identified himself only as Terry, confirmed the incident and said some cross-border services were suspended Tuesday.

Both police and random passersby suspected of harboring pro-mainland views have also been subject of attack by mobs of masked protesters. Police regional chief Kwok Yam-yung has slammed “Ruthless and reckless acts are pushing the rule of law to the brink of total collapse,” after in only four days he indicated 241 people were detained due to what he dubbed widespread “atrocities”.

Ramy Inocencio 英若明

@RamyInocencio

Fire burning on top of a train in Kowloon Tong, according to my local producer. Another video making social media rounds.

Embedded video

Only days in effect, the mask ban has resulted in 77 arrests, with 16 of those cases already prosecuted — a violation which can receive up to a year in jail and a fine, according to police numbers cited by the AP. Technically a formal charge of rioting, though perhaps harder to prove, can bring a penalty of up to ten years.

According to Hong Kong police figures, a total of 2,363 people have been arrested, and among those more than 200 have been charged with rioting.

Pro-Beijing social media has further begun to accuse to the HK protesters of beginning to deploy roadside bombs, upping their usual petrol bombs into something more deadly.

LFC@goldencaskcap

That’s not the sound of an explosion; it’s the sound of freedom. 🙄🙄 Maybe the first casualty would be a firefighter that gets killed by a roadside bomb, in Hong Kong

Embedded video

Given there’s no sign the ferocity of the unrest will stall or lessen, and given Carrie Lam’s first formal warning of the mainland’s People’s Liberation Army intervention, it appears Hong Kong authorities are prepping for a worst case scenario, which Beijing will only be too happy to oblige.

end

4/EUROPEAN AFFAIRS

 

 

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

Turkey/Syria/usa

Trump appears to back off from destroying Turkey’s economy with their threat to invade Syria. They are having talks

(zerohedge)

Turkish Lira Surges As Trump Appears To Back Off “Destroying And Obliterating” Economy

Appearing to back away from his threats to ‘obliterate’ Turkey’s economy, President Trump tweeted on Tuesday that Turkey has been “good to deal with” and that President Recep Tayyip Erdogan will travel to Washington “as my guest” on Nov. 13.

Donald J. Trump

@realDonaldTrump

So many people conveniently forget that Turkey is a big trading partner of the United States, in fact they make the structural steel frame for our F-35 Fighter Jet. They have also been good to deal with, helping me to save many lives at Idlib Province, and returning, in very…..

Donald J. Trump

@realDonaldTrump

…..good health, at my request, Pastor Brunson, who had many years of a long prison term remaining. Also remember, and importantly, that Turkey is an important member in good standing of NATO. He is coming to the U.S. as my guest on November 13th.

Trump’s sudden shift to using more congenial language triggered a rebound in Turkish assets, and the Turkish lira, which climbed to session highs.

Source: Bloomberg

A few minutes later, Trump offered what could be construed as a revision of his “threat” from yesterday. In another series of tweets, Trump said that although we “may be in the process of leaving Syria” we have “in no way Abandoned the Kurds, who are special people and wonderful fighters.”

According to Trump, Turkey understands that “any unforced or unnecessary fighting by Turkey will be devastating to their economy and to their very fragile currency.” And thus, Erdogan can be trusted not to massacre the Kurds who had been the US’s chief allies on the ground.

Donald J. Trump

@realDonaldTrump

We may be in the process of leaving Syria, but in no way have we Abandoned the Kurds, who are special people and wonderful fighters. Likewise our relationship with Turkey, a NATO and Trading partner, has been very good. Turkey already has a large Kurdish population and fully….

Donald J. Trump

@realDonaldTrump

….understands that while we only had 50 soldiers remaining in that section of Syria, and they have been removed, any unforced or unnecessary fighting by Turkey will be devastating to their economy and to their very fragile currency. We are helping the Kurds financially/weapons!

The return to coarse threats sent the Turkish lira moving lower, erasing some of its recent rally.

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 1.0968 DOWN .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 /ALL RED

 

 

USA/JAPAN YEN 106.93 DOWN 0.319 (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 1.2200   DOWN   0.00587 (Brexit March 29/ 2019/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED/BREXIT EXTENDED TO OCT 31/2019//

USA/CAN 1.3321 UP .0016 CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA/CANADA HAS A HUGE HOUSEHOLD DEBT/GDP PROBLEM)

Early THIS  TUESDAY morning in Europe, the Euro FELL BY 4 basis points, trading now ABOVE the important 1.08 level FALLING to 1.0968 Last night Shanghai COMPOSITE CLOSED UP 8.83 POINTS OR 0.29% 

 

//Hang Sang CLOSED UP 72.37 POINTS OR 0.99%

/AUSTRALIA CLOSED UP 0,40%// EUROPEAN BOURSES ALL RED

 

Trading from Europe and Asia

EUROPEAN BOURSES ALL RED

 

 

2/ CHINESE BOURSES / :Hang Sang CLOSED UP 72.37 POINTS OR 0.26%

 

 

/SHANGHAI CLOSED DOWN 8.83 POINTS OR 0.29%

 

Australia BOURSE CLOSED UP. 40% 

 

 

Nikkei (Japan) CLOSED UP 212.53   POINTS OR 0.99%

 

 

 

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1504,50

silver:$17.73

Early TUESDAY morning USA 10 year bond yield: 1.51 !!! DOWN 4 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 2.501 DOWN 4  IN BASIS POINTS from MONDAY night.

USA dollar index early TUESDAY morning: 98.99 UP 3 CENT(S) from  MONDAY’s close.

This ends early morning numbers TUESDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx6

And now your closing TUEDAY NUMBERS \1: 00 PM

Portuguese 10 year bond yield: 0.47% DOWN 4 in basis point(s) yield from YESTERDAY/

JAPANESE BOND YIELD: -.13%  DOWN 1   BASIS POINTS from YESTERDAY/JAPAN losing control of its yield curve/56

SPANISH 10 YR BOND YIELD: 0.41%//DOWN 3 in basis point yield from yesterday.

ITALIAN 10 YR BOND YIELD:1,56 DOWN 3 points in basis points yield from yesterday./

 

 

the Italian 10 yr bond yield is trading 111 points higher than Spain.

 

GERMAN 10 YR BOND YIELD: FALLS TO –.31% IN BASIS POINTS ON THE DAY//

THE IMPORTANT SPREAD BETWEEN ITALIAN 10 YR BOND AND GERMAN 10 YEAR BOND IS 1.87% AND NOW ABOVE THE  THE 3.00% LEVEL WHICH WILL IMPLODE THE ENTIRE ITALIAN BANKING SYSTEM. AT 4% SPREAD THERE WILL BE A HUGE BANK RUN…

 

END

IMPORTANT CURRENCY CLOSES FOR TUESDAY

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

Euro/USA 1.1276  DOWN     .0008 or 8 basis points

USA/Japan: 107.74 DOWN .199 OR YEN UP 20  basis points/

Great Britain/USA 1.2491 UP .0057 POUND UP 57  BASIS POINTS)

Canadian dollar DOWN 32 basis points to 1.3086

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

The USA/Yuan,CNY: AT 6.8800    ON SHORE  (DOWN)..GETTING DANGEROUS

THE USA/YUAN OFFSHORE:  6.8872  (YUAN DOWN)..GETTING REALLY DANGEROUS

TURKISH LIRA:  5.6842 EXTREMELY DANGEROUS LEVEL/DEATH WISH.

the 10 yr Japanese bond yield closed at -.13%

 

Your closing 10 yr US bond yield UP 1 IN basis points from MONDAY at 2.06 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.59 UP 3 in basis points on the day

Your closing USA dollar index, 97.15 UP 81  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 42.37  0.56%

German Dax :  CLOSED DOWN 113.18 POINTS OR .92%

 

Paris Cac CLOSED DOWN 21.16 POINTS 0.38%

Spain IBEX CLOSED DOWN 58.50 POINTS or 0.63%

Italian MIB: CLOSED UP 11.43 POINTS OR 0.05%

 

 

 

 

 

WTI Oil price; 54.92 12:00  PM  EST

Brent Oil: 61.83 12:00 EST

USA /RUSSIAN /   RUBLE RISES:    63.05  THE CROSS HIGHER BY 0.15 RUBLES/DOLLAR (RUBLE LOWER BY 15 BASIS PTS)

 

TODAY THE GERMAN YIELD FALLS  TO –.24 FOR THE 10 YR BOND 1.00 PM EST EST

END

 

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

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

WTI CRUDE OIL PRICE 4:30 PM :  55.66//

 

 

BRENT :  62.41

USA 10 YR BOND YIELD: … 2.03…

 

 

 

USA 30 YR BOND YIELD: 2.57..

 

 

 

 

 

EURO/USA 1.177 ( UP 49   BASIS POINTS)

USA/JAPANESE YEN:107.27 DOWN .667 (YEN UP 67 BASIS POINTS/..

 

 

USA DOLLAR INDEX: 97.69 DOWN 53 cent(s)/

The British pound at 4 pm   Britain Pound/USA:1.2554 UP 119  POINTS

 

the Turkish lira close: 5.6298

 

 

the Russian rouble 62.86   UP 0.03 Roubles against the uSA dollar.( UP 3 BASIS POINTS)

Canadian dollar:  1.3034 UP 21 BASIS pts

USA/CHINESE YUAN (CNY) :  6.8800  (ONSHORE)/we need to watch these levels/anything greater than 6.95 will be deadly./

 

USA/CHINESE YUAN(CNH): 6.8740 (OFFSHORE) we need to watch these levels/anything greater than 6.95 will be deadly/

German 10 yr bond yield at 5 pm: ,-0.32%

 

The Dow closed UP 2.65 POINTS OR 0.01%

 

NASDAQ closed UP 22.04 POINTS OR 0.27%

 


VOLATILITY INDEX:  13.53 CLOSED DOWN .44

LIBOR 3 MONTH DURATION: 2.302%//libor dropping like a stone

 

USA trading today in Graph Form

Stocks Drop, Gold Pops As Powell Promises (Not)QE & Trump Dumps On Xi

Fed Chair Powell promised moar (but with a caveat)…

“I want to emphasize that growth of our balance sheet for reserve management purposes should in no way be confused with the large-scale asset purchase programs that we deployed after the financial crisis.”

“…in no sense is this QE

“…it’s not QE, did i mention that?”

“Anyone who calls QE4, QE4, and not “not QE” is a Russian spy…”

OK, the last one was not true, but if Powell has to deny the obvious this much, does he really expect the market to buy the bullshit he is selling?

And so, because we do not want to argue with Fed Chair Powell, we will call it “NotQE.”

And the market utterly rejected Powell’s comments…

This came minutes after Chicago Fed’s Evans’ comments that “certainly, asset valuations are quite high,” and Powell claimed that he “doesn’t see any bubbles in housing or financial markets.”

The sun is setting on any semblance of credibility for The Fed as helicopter money comes closer to reality.

Unfortunately for Fed Chair Powell, President Trump stole the jam from his donut, announcing notable actions against human rights abusers in China – pouring cold water on any hopes of a trade deal and crushing the gains from Powell’s promised printfest.

Additionally, Powell said that “tariffs are a one-time increase in prices and is different from inflation,” therefore confirming (following the slide in PPI today) that Trump is right, and US consumers aren’t hurt by trade war.

*  *  *

China is back from Golden Week and after a weak PMI, tech stocks sank…

Source: Bloomberg

US futures show the chaos from headlines today…

And cash equities are all notably weaker on the day, ending ugly…

 

Which left all the US major equity markets at or near critical technical levels…

 

Gold was just as chaotic, but ended back above $1500…

 

And gold rose despite a surge in the dollar…

Source: Bloomberg

Treasury yields were all lower on the day with the short-end outperforming (2Y -4bps, 30Y -1.5bps), leaving the belly actually lower in yield on the week…

Source: Bloomberg

With 30Y testing back down towards 2.00%…

Source: Bloomberg

Fed Funds markets shifted dovishly, pricing in slightly more rate-cuts this year…

Source: Bloomberg

Cryptos lagged on the day…

Source: Bloomberg

Cable tumbled on Brexit headlines…

Source: Bloomberg

Yuan was ugly as Golden Week ended…

Source: Bloomberg

Silver outperformed on the day and crude lagged…

Source: Bloomberg

Silver was aggressively bid overnight and extended gains during the day…

And dramatically outperformed gold on the day…

Source: Bloomberg

WTI dropped back below $53 ahead of tonight’s API inventory data….

 

Finally, “You Are Here”…

Source: Bloomberg

And fun-durr-mentals aren’t helping anymore…

Source: Bloomberg

It would seem that President Trump is very confident that Jay Powell do anything to save the market.

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

MARKET TRADING//USA

a)Market trading/LAST NIGHT/USA

Futures, Yuan Tumble After China Balks At Pursuing “Broad Trade Deal”

Update (1800ET): As expected, markets are disappointed at this shift in the US-China trade negotiations with yuan tumbling (despite the seasonal upward bias of Golden Week)…

Source: Bloomberg

And US futures sliding (Dow -175)…

*  *  *

For the past month, both Trump and his hawkish China trade advisor, Peter Navarro, have been repeating that they would only consider a “great” deal with China and would not even entertain a “small deal” with Beijing. Last week, Peter Navarro appeared on CNBC and said that despite the recently launched impeachment inquiry into Trump, “the probability of a great deal has not changed.”

Squawk Box

@SquawkCNBC

. @realDonaldTrump “has steely resolve about standing up to China,” says W.H. trade advisor Peter Navarro on whether impeachment inquiry could impact trade negotiations. “The probability of a great deal has not changed.”

Embedded video

Then just last Friday, Trump told reporters that “we’ve had good moments with China. We’ve had bad moments with China. Right now, we’re in a very important stage in terms of possibly making a deal. But what we’re doing is we’re negotiating a very tough deal. If the deal is not going to be 100% for us, then we’re not going to make it.”

So unless something has drastically changed in the past day or two, the probability of a trade deal being announced next week when China’s high level delegation arrives in Washington has just collapsed following a Bloomberg report that China is balking at the “broad trade deal” pursued by President Trump.

In meetings with US visitors to Beijing in recent weeks, senior Chinese officials have indicated they are “increasingly reluctant” to pursue a “great deal” as the range of topics they’re willing to discuss has narrowed considerably, Bloomberg’s sources reported.

Specifically, Vice Premier Liu He, who is leading the Chinese delegation in high-level talks that begin Thursday, said “he would bring an offer to Washington that won’t include commitments on reforming Chinese industrial policy or the government subsidies that have been the target of longstanding U.S. complaints”, effectively eliminating the possibility of even a token deal being announced purely for optical purposes.

Why Beijing’s sudden change of track? Perhaps it is the result of China sensing blood now that Trump is embroiled in an impeachment inquiry; and with Trump eager to preserve his reelection changes, conventional wisdom has telegraphed that the US president would be willing to do anything to keep the US economy from sliding into recession, or a steep drop in the US stock market. Both of those would – in principle – require Trump to concede and end the trade war, or else risk a backlash at the ballot come next November.

As such, Beijing is now confident that it has all the leverage and can once again dictate the terms of a trade non-deal.It also explains why China’s latest “offer” would take one of the Trump administration’s core demands off the table.

As Bloomberg notes, “it’s emblematic of what analysts see as China’s strengthening hand as the Trump administration faces an impeachment crisis — which has recently drawn in China — and a slowing economy blamed by businesses on the disruption caused by the president’s trade wars.”

Of course, Trump remains stoic as people close to the Trump administration say the impeachment inquiry isn’t affecting trade talks with China, and “any attempt to portray anything different is an attempt to weaken the U.S. hand at the negotiating table and, they argue, would be a miscalculation by the Chinese.”

And yet, that’s precisely the attempt that China is about to make, indicating that this week’s negotiations will either result in no deal, or Trump caving to China’s revised demands.

Of course, it’s not that simple: on one hand, China has its hands full with the ongoing Hong Kong protests which despite Trump’s “soft touch” so far, have refused to go away, and with every passing day, they threaten Xi Jinping’s public perception as a quasi-despotic and undisputed ruler of China, thereby weakening his own administration. Then there is the extremely important topic that continues to get virtually no media coverage: the soaring price of Chinese pork as a restul of pig ebola, which has resulted in growing anger among hundreds of millions of protein-starved Chinese.

if that wasn’t enough, China was also recently drawn into the Washington drama after Trump last week called for a Chinese investigation into his Democratic rival Joe Biden and the former vice president’s son, moments after threatening another escalation in the trade spat. While Trump has insisted that there’s no linkage, the president’s latest comments suggest why Chinese leaders, already frustrated with what they see as the president’s impetuous conduct in the trade talks, may see room to take advantage.

China’s leadership “are interpreting the impeachment discussion as a weakening of Trump’s position, or certainly a distraction,” said Jude Blanchette, an expert on China’s elite politics at the Center for Strategic and International Studies.

“Their calculation is that Trump needs a win” and is willing to make compromises on substance as a result, he said.

Needless to say, a compromise for Trump at this point is a double-edged sword, as it would be seen as a major walk back after two years of increasingly escalating tariffs, leading to great losses for US farmers. Discussions have focused on what U.S. administration officials view as a three-phase process: the sequence would involve large-scale purchases of U.S. agricultural and energy exports by China, implementing intellectual-property commitments China made in a draft agreement this year and, finally, a partial rollback of U.S. tariffs.

It now appears that China wants to short-circuit the process, and – at best – will agree to some generic promise to boost token imports from the US (mostly of pigs) without committing to anything else.

To be sure, hopes have always been limited that China would agree to give up its economic model in a trade deal with the U.S., Bloomberg notes even though a draft agreement reached in April before talks broke down included several substantive commitments from China to abandon the sort of industrial policies the Trump administration and others before it have complained about.

That draft focused on securing more transparency from China on the extent of its subsidies. It included a commitment essentially to disavow Made in China 2025, Xi Jinping’s plan for Chinese domination of key 21st century industry such as artificial intelligence, robotics and electric vehicles, though it lacked a schedule for removing Chinese government subsidies that fueling the plan.

Commenting to Bloomberg, former U.S. Treasury representative in China, David Dollar, now at the Brookings Institution, said China’s push to narrow the discussions is “more evidence that both sides are hardening their positions on a broader deal.”

The U.S. and China increasingly have reasons to strike a “mini deal” and avoid an escalation, he said. China needs agricultural products such as pork that Trump wants it to buy so he can placate American farmers. And even people in the White House concede there’s a U.S. incentive to hold off on further tariffs to avoid a worsening economic slowdown going into 2020.

“It’s a funny kind of negotiation where both sides’ so-called concession is something that they need,” Dollar said.

At the end of the day, however, it’s all about reading – and misreading – one’s opponent, and if China is making a miscalculation in escalating its demands ahead of the week’s trade talks, and if Trump balks at China’s revised proposal, then not only are trade talks off indefinitely once again, but the bigger problem for Trump is that stocks will tumble, and unless the Fed promptly cuts rates or launches QE4, the president will find it increasingly difficult to boast of his “financial” accomplishments by telling his opponents to “look at the S&P500.”

Then again, a market crash is precisely what the Fed would need to launch QE4, which may suggest that whether it’s 4-D chess or not, Trump is just one step ahead of his Chinese opponents on this one.

end
QE4 will commence
(zerohedge)

Fed Announces QE4 One Day After BIS Warns QE Has Broken The Market

Following Fed Chair Powell’s surprising announcement today that the Fed was resuming Permanent Open Market Operations after a 5 year hiatus, just as we said last month that it would (see “The Fed Will Restart QE In November: This Is How It Will Do It“)…

…  there was a brief debate whether the Fed’s soon to be permanent expansion in its balance sheet is QE or not QE. The answer to this semantic debate simple: Powell defined Quantitative Tightening as removing reserves from the system. Thus, by that simple definition, adding reserves to the system on a permanent basis via permanent open market operations, i.e., bond purchases, is Quantitative Easing. Incidentally, the repo market fireworks were just a smokescreen: the real reason why the Fed is resuming QE is far simpler: the US has facing an avalanche of debt issuance and with China and Japan barely able to keep up, someone has to buy this debt. That someone: the Fed.

And just to shut up anyone who still wants to call the upcoming $400BN expansion in the Fed’s balance sheet, as represented in the following chart by Goldman…

… QE-Lite, here is JPMorgan comparing what is coming with what has been: at a $21BN in monthly 10Yr equivalent TSY purchases, the “upcoming” operation is the same size as QE1.

 

Yet semantic bullshit aside, what is most infuriating about Powell’s “shocking” announcement (which we previewed a few weeks ago) is that it took place just one day after the central banks’ central bank, the Bank of International Settlements, finally caught up with what we first said in 2009 – for economists being only 10 years behind the curve is actually not terrible – and wrote that “the unprecedented growth in central banks’ balance sheets since the financial crisis has had a negative impact on the way in which financial markets function.”

Ignoring the fact that central bank policies are responsible for such phenomena as Brexit and Trump, as it is the flawed monetary policy of the past decade that made the rich richer beyond their wildest dreams by expanding the biggest asset bubble in history, while destroying the middle class…

… it is disgusting that even as the Fed’s own supervisor admits that its balance sheet expanding policies have broken the market – something this “tinfoil” conspiracy blog has been saying since 2008 – the Fed is doing even more of the same, ensuring that the market will be more broken than ever!

So what was this startling epiphany? According to the BIS, while the immediate impact of this massive balance sheet expansion had eased the severe market strains created by the 2008 financial crisis, there had been several negative side-effects. These included a scarcity of bonds available for investors to purchase, squeezed liquidity in some markets, higher levels of bank reserves and fewer market operators actively trading in some areas.

In short: last month’s repo crisis is a direct consequence of central banks’ own actions. as Scott Skyrm explained earlier.

“Lower trading volumes and price volatility, compressed credit spreads and flatter term structures may reduce the attractiveness of investing and dealing in bond markets,” the BIS said in the Monday report. “Some players may leave the market altogether, resulting in a more concentrated and homogenous set of investors and fewer dealers.”

This “could result in market malfunctioning when large central bank balance sheets are eventually unwound”, the BIS warned, adding that “it could make it more difficult for reserves to be redistributed effectively between market participants.” Of course, the BIS was clearly joking because even five-year olds know balance sheets will never be unwound.

Additionally, the BIS went on to point out that negative impacts have been more prevalent when central banks hold a larger share of outstanding assets, as the FT reportedmajor central banks’ holdings of domestic sovereign bonds range from 20% of outstanding paper at the US Fed to over 40% in Japan.

But the BIS said these side-effects had so far only rarely affected financial conditions in such a way as to impede central banks’ monetary policymaking, though it added that the full consequences were unlikely to become clear until major central banks started to shrink their balance sheets.

Worse, the BIS noted that regulations demanding liquidity at large banks might discourage the banks from offering to lend out their reserves — a source of same-day liquidity — into overnight markets. This is similar to what the large banks themselves have said in the last month. But the BIS also noted that since the financial crisis, risk management practices might have changed within the banks themselves.

Sadly, the Fed – which is fully aware of all of this – decided to ignore everything the BIS warned about, and by launching more POMO/QE/”don’t call it QE”, just ensured that the next financial crisis will be the last one.

b)MARKET TRADING/USA/AFTERNOON

ii)Market data/USA

PPi unexpectedly plummets are as we are heading for zero bound

(zerohedge)

US Producer Prices Unexpectedly Plunge In September – Biggest Drop Since 2015

After falling (MoM) in July, US producer prices rebounded in August offering some hope, but September has now massively disappointed with a headline tumble of 0.3% MoM (+0.1% exp).

This is the biggest headline drop MoM since Sept 2015.

Source: Bloomberg

Excluding food and energy, producer prices decreased 0.3% in September from the prior month, compared with forecasts for a 0.2% increase.

Both headline and core PPI saw notable YoY slowdowns (although core PPI is at 2.0% or above for the 27th month in a row)…

Source: Bloomberg

Under the hood is a sea of deflation…

The cost of goods fell 0.4% after dropping 0.5% the previous month.

Nearly half of the September decline in prices for final demand services can be traced to the index for machinery and vehicle wholesaling, which fell 2.7 percent. The indexes for automotive fuels and lubricants retailing; apparel, jewelry, footwear, and accessories retailing; airline passenger services; gaming receipts (partial); and professional and commercial equipment wholesaling also moved lower. Conversely, prices for hospital outpatient care rose 1.1 percent.

Three-fourths of the September decrease in the index for final demand goods can be traced to prices for gasoline, which fell 7.2 percent. The indexes for electric power, iron and steel scrap, basic organic chemicals, fresh and dry vegetables, and light motor trucks also moved lower. Conversely, prices for meats rose 1.9 percent.

Theoretically, this provides Powell with some more ammo for cutting rates BUT we note that despite all the mainstream media screaming over tariff-driven price surges crushing the consumer – there is no evidence of it at all.

iii) Important USA Economic Stories

Not great and not terrible as we continue with 38 billion in repo money accepted.

Repos will continue until November when it will be replaced with permanent money operations otherwise known as QE 4

(zerohedge)

 

Fed Accepts $38BN In Both Overnight And Term Repos As Liquidity Stabilizes

Today’s overnight/term repo announcement by the Fed was “not great, not terrible.”

One day after the NY Fed accepted $47.05BN in securities for its latest overnight repo, demand for liquidity eased slightly, with the latest $75BN O/N repo operation seeing demand for exactly half of the maximum allotment, or $37.5BN, mostly in the form of TSYs, at $31.75BN.

It now appears that overnight repo usage has stabilized in the $30-$45BN range, with post-quarter end operations averaging around $40BN.

Separately, the Fed also announced the result of its first post-quarter end 14-day term repo operation which similar to the O/N repo, saw $38.85BN in submissions ($29.3BN in TSYs, $9.55BN in MBS), which while closer to the full allotment of $45BN still confirmed that there was some space for additional liquidity demand.

And with the repo market seemingly stabilizing, the question is what happens as we approach the coming year-end period when as we recall from last year, the demand for collateral exploded, and whether the Fed will be content to manage liquidity demands with repo or whether it will launch POMOs some time in November as most investment banks now believe.

end

The panic in the repo market explained

(skyrm/zerohedge)

 

“Panic At The Repo”: One Of The World’s Top Repo Experts Explains What Really Happened

Authored by Curvature Securities‘ Scott E.D. Skyrm, one of the world’s most-respected repo market participants and experts.

Panic At The Repo

As a professional trader, I keep an eye out for the next panic or market crisis. Since the beginning of my career, there was a crash or panic every few years in one market or another. You try to think about what market is overbought. What market is in a bubble. What market just appeared on the cover of Time Magazine! Little did I ever imagine the Repo market would experience the next big panic. This is a market consisting of AAA-rated risk-free securities backed by the United States of AmericaHow can there be a crisis in U.S. Treasury securities? We didn’t even make the cover of Time Magazine!

I write about the Repo market every day. As a service to our clients, I decided to put everything I know about the Repo market collapse down on paper. So here it is!

Modern Day Bank Run

We’ve seen the old pictures or films of people lining up outside of a bank to collect their deposits. Think of the Depression in the 1930s. Knowing that a bank can’t make good on all of their customers’ deposits means the first people to get their money are more likely to get their money. Period. Banks never keep all of their customers’ deposits as cash on hand. They invest those customers’ deposits by making loans – like a mortgage loan to a family to buy a home or loan to a business to help start a new venture. Banks invest in loans and borrow money through deposits. That also means they loan long-term and borrow short-term. Don’t worry, this is important later on.

Though banks still have the same problem today – lending long-term and borrowing short-term, increased regulation and stronger risk management has forced them to narrow the tenure mismatch. These days banks have a larger percentage of their funding borrowed in the term markets by issuing CDs, medium-term notes, and even bonds. Since banks manage their tenure mismatch much better, they are not as susceptible to the classic “run on the bank.” However, in recent years, new categories of financial institutions have popped-up that are more susceptible to “bank runs.”

Shadow Banking

The term “shadow banking” is often thrown around as the perennial risk to the financial system. There is no real definition of a “shadow bank,” but they are a key part of the Repo market and the Repo market made “shadow banking” possible. Basically, a “shadow bank” is a financial institution that performs banking functions. A “shadow bank” can be anything from a REIT (Real Estate Investment Trust), to a mortgage finance company, to a hedge fund, to a broker-dealer (like MF Global). The easiest example is a mortgage REIT. They buy mortgage-backed securities (MBS), basically mortgage loans that were packaged into securities, and borrow money to finance those securities in the Repo market. Comparing the REIT to a bank, the REIT’s “loans” are the mortgage-backed securities and the Repo transactions are the “deposits.”

Just like a bank, the REIT’s MBS portfolio might have an average weighted maturity of, say, 7 years. Their Repo transactions might be anywhere from overnight to three months. In this simple example, the REIT is lending 7 years and borrowing between overnight and three months. This maturity mismatch problem exists for “shadow banks” just like it  exists for regular banks. But there is no regulation that forces “shadow banks” to mind their mismatch. As I said, this is all important later on.

Crisis of Too Few Securities

Maybe the whole Repo crisis really began several years ago. Yes! Blame it on the Financial Crisis. Just a few years ago, the Fed was in Quantitative Easing mode and buying Treasury and agency MBS securities, thus removing them from the market. At the time, I called it a back-door method to finance the budget deficit; but it worked. The combination of bond purchases and a fed funds target range of 0.0% to .25% pushed GC Repo rates close to zero. With rates set so low and the Fed still buying $50 billion of securities every month, Treasury securities were becoming scarce in the Repo market. By July 2013 QE purchases had taken so many Treasurys out of the market that the Fed was left with a SOMA portfolio of over $4 trillion. At this point, GC Repo rates were close to zero. If overnight rates turned negative, there would be tremendous stress on the Repo market, money market funds, and the Treasury market overall.

In the blink of an eye, the Fed announced the Reverse-Repurchase Program as a facility to put securities back into the market. And they rolled out this program very quickly. Announcing it in August 2013 and beginning operations in September 2013. Approved participants (not just Primary Dealers) could submit their cash to the Fed and receive Treasury securities in exchange as collateral. The perfect solution to a shortage of collateral. Cash investors, like money market funds, immediately found a new counterparty to invest their cash. They could trade with the AAA-rated Federal Reserve and receive AAArated U.S. Treasury securities. Not a bad deal! You can’t get any more risk free than that!

Pressure Building

Between 2013 and the present day, a lot of things changed. The Treasury kept issuing more and more debt to fund the budget deficit, thus putting more and more Treasury securities into the market. The Federal Reserve began the QE “runoff,” where they stopped reinvesting the principal and interest of maturing SOMA portfolio securities. This put upward pressure on GC Repo rates and the spread between GC Repo and fed funds began to increase. Whereas GC Repo rates were averaging about 5 basis points below fed funds in July 2013, they now average about 10 bps above fed funds. That’s a large move!

Bank Reserves

While more and more collateral was accumulating in the Repo market, bank reserves were dwindling. Banks are required to hold a certain percentage of their liabilities in cash. This cash can be delivered to a special account at the Federal Reserve and the Fed will pay the banks an interest rate on their cash/reserves. What’s more, if banks have extra cash, they can deposit that cash at the Fed and the Fed will pay them interest on their “excess reserves.” That’s the Interest On Excess Reserves (IOER) rate. But the key point is that banks choose to leave excess reserves at the Fed. If there is a better short-term investment, they are allowed to remove that cash and invest it elsewhere.

Total bank reserve balances peaked at around $2.8 trillion in 2014 and have slowly declined since then. These days, those reserves are down to about $1.7 trillion. Yes, there’s been a significant decline, but nothing off trend in 2019, let alone no significant changes in

September 2019.

The Fed had been cut ting the IOER all year long. At the beginning of 2018, the IOER was set at the upper end of the fed funds target range. Since then, when the FOMC either raised or cut the fed funds target range, they often raised the IOER less than 25 basis points with a tightening or lowered the IOER more than 25 basis points with an ease. Since the September FOMC meeting, the fed funds target range was lowered to 1.75% to 2.00% and the IOER was set at 1.80%, or 5 basis points above the lower end of the target range. Basically, between 2018 and 2019, the Fed moved the IOER from the top of the target range to near the bottom of the range. Why?

If you’re a bank and you can invest your excess cash at the Fed at 1.80%, or with another bank in the fed funds market at 1.90%, or in Repo GC at 2.00%, which one do you choose? As the Fed moved the IOER lower and lower within the fed funds target range, it provided a greater economic incentive to get excess reserves out of Fed and into the overnight markets. No doubt moving the IOER relatively lower within the target range is one reason why bank reserves declined over the past two years.

Repo Market Participants: Cash Investors

For every Repo transaction, there is one counterparty that is a cash investor and one counterparty that is a cash borrow. The cash investor borrows the securities from their counterparty and receives securities as collateral. By far, money market funds (MMF) supply the largest amount of cash to the Repo market each day, estimated to be around $1.3 trillion. After the money funds, the bulk of the cash comes from several other kinds of investors including: insurance companies, municipalities, small banks, GSEs (like Fannie Mae, Freddie Mac, and the federal home loan banks), broker-dealer segregated funds, and central banks. But here’s the catch – most of these cash investors need a counterparty with a rating to trade Repo. The largest money-center banks are the ones with a rating, and a rating high enough to attract the cash coming into the Repo market. Thus, bulk of customer cash coming into the Repo market each day goes to the banks.

Repo Market Participants: Cash Borrowers

Remember the discussion about the “shadow banks”? REITs, hedge funds, broker-dealers, etc.? These are the large cash borrowers. These are the leveraged entities that own securities and need the Repo market to finance their positions. Like in our example above, they own longer-term securities and loan those securities into the Repo market for three months, one month, one week, and overnight. But here is what’s important – these entities don’t have any other financing mechanism outside of the Repo market.

Repo Market Participants: Banks

The banks bring everyone together. They intermediate between the two kinds of Repo market participants – the cash investors and the cash borrowers. That’s called a Repo matched-book. The Repo desk at a bank borrows securities from a REIT or hedge fund and loans those securities to a money fund. They profit by the spread where they borrow cash and where they loan cash. Years ago, banks ran massive matched books, borrowing securities from hundreds of counterparties each day and loaning securities to hundreds of other counterparties each day. Back then, no one could compete with the big banks in the Repo market. They had all the capital and massive balance sheets.

However, that all changed after the Financial Crisis. New bank regulation from Dodd-Frank and Basel III changed the Repo market. Banks still intermediate, even though bank balance sheets are restricted by regulation. Under Dodd-Frank and Basel III, there are leverage ratios and a capital charge on Repo transactions. Regulation that never existed before. As a result, banks cut down on size of their balance sheets and reallocated assets based on revenue. Many Repo clients were the first closed because of the low Return On Assets (ROA) for Repo.

Beginning in 2015, banks were no longer sufficiently intermediating the Repo market. Liquidity issues started to appear. Banks expanded their “window dressing” on statement periods to make their balance sheets appear smaller and reduce regulatory capital charges and leverage ratios. The result was noticeably less liquidity in the Repo market on year-end, quarter-end, and sometimes month-end. At these times, if a bank Repo desk had reached its asset limit, they couldn’t book any more trades with clients. No matter what the profit was.

Market participants realized they could no longer rely on banks for Repo financing, especially on quarter-end, and they searched for new counterparties. A whole new cottage industry sprang up of “balance sheet providers.” Broker-dealers like Curvature Securities started running independent Repo matched-books. However, even with the new market participants, the Repo market still relies on banks to intermediate cash investors into the overall Repo market – like the money market funds that need a rated counterparty. On days when banks limit their balance sheets, less cash flows into the market it and causes increased volatility and rate spikes.

Market Timing

The Repo market opens at 7:00 AM EST and closes at 3:00 PM. Repo transactions generally settle for “cash” settlement; meaning the cash and securities are exchange on the same day the trade is executed. The settlement mechanism is called the “Fed Wire,” which is the electronic payments system that moves cash and securities from one counterparty to another. The Fed Wire opens at 8:30 AM.

Cash comes in the Repo market throughout the day. Some cash investors are there when the market opens, some enter the market around 8:00 AM, some around 9:00 AM, and Westcoast funds might arrive in the early afternoon. Most sellers of collateral (hedge funds, REITs, broker-dealers, etc.) – the borrowers of cash – are rushing to sell by 8:30 AM when the Fed Wire opens. Due to recent market infrastructure changes like Triparty reform and increased Daylight Overdraft (DOD) charges, most collateral sellers have a deadline to finance their positions by 8:30 AM. Many Prime Brokers require their hedge fund clients to have their trades booked by then. The key point is that the cash investors enter the market throughout the morning and even in the afternoon and the bulk of the cash borrowers need to finance their positions by 8:30 AM.

As an example, picture someone commuting into New York City each morning by car. Suppose that the George Washington Bridge charged no toll before 8:30 AM and the toll was jacked-up to $50.00 after 8:30 AM. Most people would make damn sure they crossed the bridge before 8:30 AM! It’s the same in the Repo market. Charges increase at 8:30 AM, so there is a big rush to get securities processed and delivered by then.

Cracks In The System

Cracks in the system started to appear on December 31, 2018 year-end. GC Repo rates opened at 2.93% and a panic ensued. Rates backed-up all the way to 7.25% before finally closing at 4.00% at 3:00 PM. It was a real eye opener. The Repo market had not seen such rate volatility in years. It was a shock. And, it was even more of a shock that the Fed did  not intervene to pump cash into the market with rates so high on a year-end.

Over the next several months, the market continued to experience increased rate volatility and small rate spikes on January month-end, March quarter-end and June quarter-end. During this time, the Fed talked about a permanent RP Program, but nothing happened. The market was waving the white flag, but there was no response from the Fed.

Lehman Moment

That brings us to September and the collapse of the Repo market. Monday, September 16 was supposed to be a normal day. The market was expecting some funding pressure due to

  • $19 billion in net new Treasury issuance (more securities in the market)
  • Tax date (cash leaving the market for the Treasury)
  • Money Market Fund cash decreased the previous week by about $20 billion (less cash in the Repo market)
  • Bond market sell-off the previous week (generally adds collateral to the Repo market)
  • A holiday in Japan (?)

All of these factors are a normal part of the Repo market. Cash comes in and out of the market. Securities come in and out of the market. The market finds a clearing price. In fact, on September 16, the Repo GC rate opened at 2.33%. The market was expecting a little funding pressure. Nothing extraordinary. In reality, there was no Lehman moment. The only thing the Repo panic has in common with Lehman are the calendar dates.

Market Panic Dynamics

During the week of September 16, bids were thin. That is, when a bid was hit, the sellers had much more collateral to sell than the buyers (who were long cash) wanted to buy. Bids were hit and the market backed-up immediately. 3.00% traded, 3.50% traded, then 4.00%, then 4.50%, etc. The amount of securities hitting the market kept overwhelming the buyers. Everyone who was long collateral was in a rush to sell because rates were going higher. Everyone who was long cash   didn’t want to buy because rates were going higher. The market peaked at 9.25%.

During the morning, as cash came into the market, rates recovered slightly. Behind the scenes it meant a cash investor had just locked-in their cash investment at a bank. The Repo trader at the bank now had actual cash to invest and they rushed to lock-in their profit. However, once that cash investment was all filled, the bids were thin again until another chunk of cash came into the market.

Look at it this way. Suppose you are a Repo trader at a large bank and your cash client calls you at 8:00 AM every day to invest their cash and set a rate. Before 8:00 AM, why lock-in a Repo rate of 3.00% at 7:30 AM when rates are gaping higher. Between 7:30 AM and 8:00 AM, there are a whole 30 more minutes for rates to keep moving higher. And 30 minutes are a long time in the Repo market at 7:30 AM! And that’s exactly what happened.

Fed Operations

On Tuesday, September 17 at 9:15 AM, during the depth of the market panic, the Fed realized they needed to inject cash into the market and announced an overnight RP operation. This was the first time the Fed used this operation in years. The operation was successful. They pumped $53.15 billion into the market and Repo GC rates closed at 2.30%; within the realm of normal. Over the next two days the Fed continued overnight operations entering the market at 8:15 AM each day and rates stabilized. On Friday, September 20, the Fed announced a schedule for overnight and term operations that went through quarterend and into October. The three term operations eventually pumped $139 billion in the market over quarter-end. On the day of quarter-end, the Fed executed a $63.5 billion overnight operation in addition to the term operations. The timing of that operation was moved up to 7:45 AM on quarter-end.

Overall, the Fed got it right. They pumped a total of $202.5 billion into the Repo market through quarter-end and progressively moved the timing of the operations from 9:15 AM to 7:45 AM. The Repo market is now functioning smoothly.

Who Won And Who Lost?

The question of who won and who lost during the Repo panic will inevitably come up. To sum it up, bank repo desks won, cash investors won, and leveraged market participants lost. Here is a closer look:

1. Bank Repo Desks – It’s pretty hard to determine exactly how much money was made or lost that week, but we can generate some rough estimates. Note: please remember there are a lot of moving parts. This is a simple estimate. If we compare the FICC GCF Index to the Fed Tri-Party Index, we can gauge, on average, where banks borrowed securities (FICC GCF) and where banks borrowed cash (Tri-Party). If we use Thursday, September 19 as a “control” date where the Street makes 7.5 basis points, we estimate that the Street normally makes about $1 million a day on Tri-Party Repo transactions. On Monday, September 16, the FICC GCF Index was 2.876% and the Tri-Party Index was 2.42% for a 45.6 basis point spread. Using the Tri-Party volume of $498 billion, means, just for Tri-Party transactions, the Street made about $6.3 million that day. The spread was even wider on Tuesday at 75.7 basis points and the profit that day was at least $10.7 million, followed by another $7 million on Wednesday. Naturally the Street marks-up clients more than the interdealer average and there is an undetermined about of deliverable GC Repo transactions, and, of course, wider spreads in the Specials market.

2. Cash Investors – Let’s say, under normal circumstances, the Tri-Party Index would be around 2.15% before the ease and at 1.90% after the ease. That means cash investors took in an additional $3.7 million in interest on Monday, $43.8 million on Tuesday, and $4.9 million on Wednesday. Thursday was a scratch. Not a bad week for cash investors! And, just like the banks, there are still a large amount of deliverable Repo GC transactions that can’t be counted.

3. Leveraged Market Participants – These are the entities that paid the price of the panic. If you add up the additional income that the banks and cash investors made, most of this came from the leveraged market participants. Based on the Tri-Party transactions, leveraged players lost, at a minimum, of $73 million that week. Once again, that figure does not include a calculation for deliverable GC Repo transactions. So … the bottom line is … I am comfortable saying that banks and cash investors earned an extra $150 million at the expense of leveraged market participants that week.

Revelations

  • Bank Reserves – The decline in bank reserves didn’t cause the Repo panic, but the dwindling supply of reserves could have created a smaller cushion of extra liquidity ready to enter the Repo market. In other words, the amount of excess reserves coming out of the Fed account and into the Repo market is possibly maxed out. Perhaps the bank reserves that are rate sensitive already moved out of the Fed as the IOER rate was cut. What’s left are the reserves that are not rate sensitive and therefore a one-day Repo rate spike is not enough incentive to move that liquidity out
  • Declining excess bank reserves might be the result of Repo market funding pressure and not the cause. Over the past year as Repo rates moved relatively higher and the Fed lowered the IOER, perhaps funds moved out of reserves into Repo just for that reason
  • Modern Day Bank Run – The collateral sellers (shadow banks) need funding. And they need it between 7:00 AM and 8:30 AM. The panic was a classic “run on the bank.” Cash investors did not pull cash out of the market, but they made borrowing cash more expensive. The leverage market participants had no choice but to accept prevailing rates
  • Price Not Credit – At no point during the Repo market panic did credit break down. The market didn’t seize up. Counterparties continued to trade. Just interest rates went higher and higher. In other words, there was never a time when there was no bid for collateral. There was always a bid. The bids just kept moving higher
  • Though bank balance sheets are constrained by bank regulation, banks are still the main conduit for cash investors and the Federal Reserve to inject cash into the Repo market
  • Question: Did the Fed solve the Repo funding problem by the size of the operations or the timing? Naturally, most traders assume it’s the dollar amount that eased the Repo panic. Maybe it’s the fact that the Fed plugged the timing mismatch between the collateral sellers and cash providers?
  • One question that remains unanswered is what sparked the Repo panic? I still believe a block of cash left the market and has not yet returned

Recommendations

The market was spooked by the rate spike last year-end and was hoping for a structural change after every FOMC meeting this year. It all came to a head two weeks ago. Here are some things that the Fed should or should not do to fix the Repo liquidity problem:

1. RP Program

The program would be like the RRP Program, but in reverse. Instead of injecting securities into the market like the RRP Program, the RP Program would inject cash. Sounds like a good idea. A simple solution to eliminate funding spikes. However, the RP Program is a little more complicated. Such a program can come in two forms. Philosophically, is it a rate ceiling to eliminate rate spikes, like on year-end or quarter-end? Or is it a tool to better manage overnight rates, keeping them within the target range? There are pluses and minus for both.

  • Rate Ceiling Facility – If the goal to prevent rate spikes, the Fed can set the RP rate 25 or 50 basis points above the upper target rate. At the current target range, the RP rate would be set at 2.25% or 2.50%. Those rates are low enough to prevent rate spikes but high enough to avoid becoming an everyday funding tool for market participants
  • Better Manage Rates – If the Fed wants to fine tune Repo rates, keeping them within the target range, they can set the RP rate at the upper target rate. At the current range, that would be 2.00%. With the Fed willing to inject billions of dollars of cash in the market at 2.00%, Repo rates would rarely trade above 2.00%. The drawback is that it would appear the Fed is funding leveraged market participants. Lending cash to speculators (Gasp!). Such a tight spread is probably a no-go

2. More Quantitative Easing (QE)?

QE is a monetary policy and is not a tool to provide liquidity to the Repo market. It should not be a part of managing overnight interest rates.

3. Eliminate Interest On Excess Reserves (IOER)

The Fed should continue to pay interest to banks on required reserves but stop paying interest on excess reserves. That will get more cash out of the Fed and into the market. Why should private investors (banks) receive a market rate of interest investing with the government (the Fed)? Added bonus – the Fed will no longer need to keep tweaking the IOER rate.

4. Continue RP Operations

Back a few months ago, I recommended in my Repo Market Commentary that the Fed resume RP operations instead of initiating a permanent RP Program. “Bring back the System RP!” I wrote. My recommendation stands. I don’t believe a permanent facility is needed. RP operations give the Fed flexibility – they can choose overnight or term, choose the timing, and even enter the market twice in one day if necessary. The downside is that Fed overnight and term RP operations stress Primary Dealer bank balance sheets – balance sheets that are already restricted by bank regulation. Could the Fed open the RP operations to other financial institutions? Like the RRP Program?

iv) Swamp commentaries)

Giuliani coming to the Senate to explain the corruption of Biden and son

(zerohedge)

Graham Gives Giuliani Senate Platform To Lay Out Biden-Ukraine Corruption Case

While House Democrats gear up for kangaroo-court impeachment proceedings triggered by a whistleblower complaint over President Trump’s communications with Ukraine, Senate Judiciary Committee Chairman Lindsey Graham (R-SC) has invited Trump attorney Rudy Giuliani to explain allegations of rampant corruption against former Vice President Joe Biden and his son Hunter in Ukraine. 

Joe Biden infamously bragged on tape last year about abusing his position as Vice President to force Ukraine to fire a prosecutor investigating Burisma Holdings, a Ukrainian gas company which was paying Hunter Biden $600,000 to sit on its board.

Democrats have gone to great lengths to avoid addressing this – and have instead launched impeachment proceedings after a CIA employee approached the House Intelligence Committee chaired Adam Schiff (D-CA), lawyered up with Democrat operatives, and then filed a whistleblower complaint using second-hand information on a recently changed form – the previous version of which explicitly prohibited anything but first-hand info.

The whistleblower and concurrent media reports claimed that President Trump pressured Ukrainian President Volodomyr Zelensky to investigate the Bidens, however in a surprise move the White House released both a transcript of the call proving there was no pressure or quid pro quo. A release of the whistleblower complaint suggested it was written by a legal team, and several of its claims were proven false by the transcript.

On Tuesday, Graham tweeted: “Have heard on numerous occasions disturbing allegations by @RudyGiuliani about corruption in Ukraine and the many improprieties surrounding the firing of former Prosecutor General Viktor Shokin,” adding “Given the House of Representatives’ behavior, it is time for the Senate to inquire about corruption and other improprieties involving Ukraine.”

Lindsey Graham

@LindseyGrahamSC

Have heard on numerous occasions disturbing allegations by @RudyGiuliani about corruption in Ukraine and the many improprieties surrounding the firing of former Prosecutor General Viktor Shokin.

(1/3)

Lindsey Graham

@LindseyGrahamSC

Given the House of Representatives’ behavior, it is time for the Senate to inquire about corruption and other improprieties involving Ukraine.

(2/3)

“Therefore I will offer to Mr. Giuliani the opportunity to come before the Senate Judiciary Committee to inform the committee of his concerns,” Graham concluded.

Lindsey Graham

@LindseyGrahamSC

Therefore I will offer to Mr. Giuliani the opportunity to come before the Senate Judiciary Committee to inform the committee of his concerns.

(3/3)

In addition to allegations of malfeasance and profiteering by the Bidens, Giuliani is also looking into Democratic efforts to meddle in the 2016 US election in favor of Hillary Clinton.  In December of 2018, a Ukrainian court ruled thatUkraine’s Ukraine’s Director of the National Anti-Corruption Bureau of Ukraine (NABU), Artem Sytnyk “acted illegally” when he revealed the existence of Trump campaign manager Paul Manafort’s name in a “black ledger” containing off-book payments to Manafort by Ukraine’s previous administration.

While the ruling against Sytnyk and Leshchenko was later overturned on a technicality, The Blaze obtained and translated recording of Sytnyk bragging about helping Clinton in the 2016 US election.

BlazeTV

@BlazeTV

“I don’t know how, but the Americans got an audio recording of Mr. Sytnik’s conversation: He is resting with his family & friends & discussing how he would like to help Hillary.”@glennbeck reveals the Ukraine transcript the media isn’t talking about.https://youtube.com/watch?v=kuvfYE7ZdL0 

Embedded video

In response to Graham’s offer, Giuliani told CNN “Love Lindsey, but I am still a lawyer and I will have to deal with privilege,” although “Given the nature of his invitation about my concerns I might be able to do it without discussing privileged information.”

If and when Giuliani shows up, Kamala Harris appears ready to go full attack dog – with theatrics which haven’t been witnessed since last October’s anti-Kavanaugh performance.

Kamala Harris

@KamalaHarris

Good. I have questions. https://twitter.com/LindseyGrahamSC/status/1181573486164230144 

Lindsey Graham

@LindseyGrahamSC

Replying to @LindseyGrahamSC @RudyGiuliani

Therefore I will offer to Mr. Giuliani the opportunity to come before the Senate Judiciary Committee to inform the committee of his concerns.

(3/3)

 

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

Well that is all for today

I will see you Friday night.

 

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