OCT 31/COMEX DATA FINAL/INITIAL AMOUNT OF GOLD AND SILVER STANDING//NOON DATA//MAJOR STORIES THIS MORNING//

GOLD:$1512.50 UP $18.20

 

 

 

 

 

 

 

 

 

 

Silver:18.08 UP 22 CENTS

 

access market prices

 

GOLD:$1512.20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Silver:$18.11

 

 

we are now entering options expiry week
comex options on gold/silver expire on:  Monday Oct 28//  expired YESTERDAY
LBMA options expire on Thursday Oct 31 as does the OTC options. expired today
first time in a long time that gold and silver rose during the final days of the month
despite LBMA/OTC options expiry.

 

COMEX DATA

 

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

today RECEIVING 401

DLV615-T CME CLEARING
BUSINESS DATE: 10/30/2019 DAILY DELIVERY NOTICES RUN DATE: 10/30/2019
PRODUCT GROUP: METALS RUN TIME: 20:21:34
EXCHANGE: COMEX
CONTRACT: NOVEMBER 2019 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,493.200000000 USD
INTENT DATE: 10/30/2019 DELIVERY DATE: 11/01/2019
FIRM ORG FIRM NAME ISSUED STOPPED
____________________________________________________________________________________________
118 H MACQUARIE FUT 60
152 C DORMAN TRADING 5 8
657 C MORGAN STANLEY 37
657 H MORGAN STANLEY 299
661 C JP MORGAN 10
690 C ABN AMRO 34
737 C ADVANTAGE 148 72
800 C MAREX SPEC 22
905 C ADM 107
____________________________________________________________________________________________

TOTAL: 401 401
MONTH TO DATE: 401

we are coming very close to a commercial failure!!

 

 

NUMBER OF NOTICES FILED TODAY FOR  NOV CONTRACT: 401 NOTICE(S) FOR 40100 OZ (0.1247 tonnes)

TOTAL NUMBER OF NOTICES FILED SO FAR:  401 NOTICES FOR 40100 OZ  (.1247 TONNES)

 

 

 

SILVER

 

FOR NOV

 

 

302 NOTICE(S) FILED TODAY FOR 1,510,000  OZ/

 

total number of notices filed so far this month: 302 for 1,510,000 oz

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Bitcoin: OPENING MORNING TRADE :  $ 9053 DOWN 350 

 

 

 

Bitcoin: FINAL EVENING TRADE: $ 9352 UP 140

 

 

 

 

 

 

Let us have a look at the data for today

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IN SILVER THE COMEX OI ROSE BY A LARGE SIZED 1012 CONTRACTS FROM 221,384 UP TO 222,396 DESPITE THE TINY 4 CENT GAIN IN SILVER PRICING AT THE COMEX.

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

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

FOR SEPT 0,; DEC  1495 AND ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE  1495 CONTRACTS. WITH THE TRANSFER OF 1495 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 1495 EFP CONTRACTS TRANSLATES INTO 7.475 MILLION OZ  ACCOMPANYING:

1.THE 4 CENT GAIN IN SILVER PRICE AT THE COMEX AND

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

JUNE/2018. (5.420 MILLION OZ);

FOR JULY: 30.370 MILLION OZ

FOR AUG., 6.065 MILLION OZ

FOR SEPT. 39.505 MILLION  OZ S

FOR OCT.2.525 MILLION OZ.

FOR NOV:  A HUGE 7.440 MILLION OZ STANDING  AND

21.925 MILLION OZ FINALLY STAND FOR DECEMBER.

5.845 MILLION OZ STAND IN JANUARY.

2.955 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)

7.665     MILLION OZ FINALLY STANDING IN OCT

YESTERDAY,WE HAD A STRONG ADVANCE EARLY WHICH FORCED OUR THE BANKERS/OFFICIAL SECTOR INTO ACTION TRYING TO CONTAIN SILVER’S PRICE, THEY TRIED TO COVER THEIR MASSIVE SHORTFALL  AS THEY AGAIN USED HUGE COPIOUS NON BACKED PAPER IN THEIR UNSUCCESSFUL ENDEAVOUR TO WHACK SILVER’S PRICE ( IT ROSE 4 CENTS ). OUR OFFICIAL SECTOR/BANKERS HOWEVER WERE  UNSUCCESSFUL IN THEIR ATTEMPT TO FLEECE SOME SILVER LONGS AS THE TOTAL GAIN IN OI ON BOTH EXCHANGES TOTALED A STRONG 2507 CONTRACTS. OR 12.535 MILLION OZ

 

 

 

 

 

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

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

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

 

 

AS I HAVE MENTIONED IN PREVIOUS COMMENTARIES:

 

 

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

HERE IS HOW THE CROOKS USED SPREADING AS WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF OCT HEADING TOWARDS THE  ACTIVE DELIVERY MONTH OF OCTOBER FOR GOLD.

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

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

 

 

 

 

 

 

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

29,228 CONTRACTS (FOR 23 TRADING DAYS TOTAL 29,228 CONTRACTS) OR 146.14 MILLION OZ: (AVERAGE PER DAY: 1270 CONTRACTS OR 6.35 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH OF OCT:  146.14 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 20.87% 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:          1870.74   MILLION OZ.

JANUARY 2019 EFP TOTALS:                                                      217.455. MILLION OZ

FEB 2019 TOTALS:                                                                       147.4     MILLION OZ/

MARCH 2019 TOTAL EFP ISSUANCE:                                          207.835 MILLION OZ

APRIL 2019 TOTAL EFP ISSUANCE:                                              182.87  MILLION OZ.

MAY 2019: TOTAL EFP ISSUANCE:                                                136.55 MILLION OZ

JUNE 2019 , TOTAL EFP ISSUANCE:                                               265.38 MILLION OZ

JULY 2019   TOTAL EFP ISSUANCE:                                                175.74 MILLION OZ

AUG. 2019  TOTAL EFP ISSUANCE;                                                 216.47 MILLION OZ

SEPT 2019 TOTAL EFP ISSUANCE                                                  174.900 MILLION OZ

OCT.  2019 TOTAL EFP ISSUANCE                                                  146.14 MILLION OZ

RESULT: WE HAD A CONSIDERABLE SIZED INCREASE IN COMEX OI SILVER COMEX CONTRACTS OF 1012, WITH THE 4 CENT GAIN IN SILVER PRICING AT THE COMEX /YESTERDAY... THE CME NOTIFIED US THAT WE HAD A  STRONG SIZED EFP ISSUANCE OF 1465 CONTRACTS WHICH EXITED OUT OF THE SILVER COMEX AND TRANSFERRED THEIR OI TO LONDON AS FORWARDS. SPECULATORS CONTINUED THEIR INTEREST IN ATTACKING THE SILVER COMEX FOR PHYSICAL SILVER (SEE COMEX DATA) .

 

TODAY WE GAINED A STRONG SIZED: 2507 TOTAL OI CONTRACTS ON THE TWO EXCHANGES: 

i.e 1495 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH INCREASE OF 1057 OI COMEX CONTRACTS. AND ALL OF THIS  DEMAND HAPPENED WITH A 4 CENT GAIN IN PRICE OF SILVER AND A CLOSING PRICE OF $17.86 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. 1.112 BILLION OZ TO BE EXACT or 159% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT NOV MONTH/ THEY FILED AT THE COMEX: 302 NOTICE(S) FOR 1,510,000 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: 7.665 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 ROSE BY A CONSIDERABLE SIZED 4096 CONTRACTS TO 647,538, MOVING CLOSER TO THE NEW ALL TIME RECORD OF 659,371 SET THREE DAYS AGO. 

THE  GAIN IN OI ACCOMPANIED THE CONSIDERABLE  $5.55 PRICING GAIN WITH RESPECT TO COMEX GOLD PRICING // YESTERDAY// / (THE PREVIOUS RECORD WAS SET ON OCT 28/2016 AT 659,371)

 

 

THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A STRONG SIZED 5817 CONTRACTS:

OCT 2019: 0 CONTRACTS, DEC>  5817 CONTRACTS AND ALL OTHER MONTHS ZERO.  The NEW COMEX OI for the gold complex rests at 647,538,,.  ALSO REMEMBER THAT THERE WILL BE A DELAY IN THE ISSUANCE OF EFP’S.  THE BANKERS REMOVE LONG POSITIONS OF COMEX GOLD IMMEDIATELY.  THEN THEY ORCHESTRATE THEIR PRIVATE EFP DEAL WITH THE LONGS AND THAT COULD TAKE AN ADDITIONAL, 48 HRS SO WE GENERALLY DO NOT GET A MATCH WITH RESPECT TO DEPARTING COMEX LONGS AND NEW EFP LONG TRANSFERS. . EVEN THOUGH THE BANKERS ISSUED THESE MONSTROUS EFPS, THE OBLIGATION STILL RESTS WITH THE BANKERS TO SUPPLY METAL BUT IT TRANSFERS THE RISK TO A LONDON BANKER OBLIGATION AND NOT A NEW YORK COMEX OBLIGATION. LONGS RECEIVE A FIAT BONUS TOGETHER WITH A LONG LONDON FORWARD. THUS, BY THESE ACTIONS, THE BANKERS AT THE COMEX HAVE JUST STATED THAT THEY HAVE NO APPRECIABLE METAL!! THIS IS A MASSIVE FRAUD: THEY CANNOT SUPPLY ANY METAL TO OUR COMEX LONGS BUT THEY ARE QUITE WILLING TO SUPPLY MASSIVE NON BACKED GOLD (AND SILVER) PAPER KNOWING THAT THEY HAVE NO METAL TO SATISFY OUR LONGS. LONDON IS NOW SEVERELY BACKWARD IN BOTH GOLD AND SILVER  AND WE ARE WITNESSING DELAYS IN ACTUAL DELIVERIES.

IN ESSENCE WE HAVE A STRONG GAIN IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 9913 CONTRACTS: 4096 CONTRACTS INCREASED AT THE COMEX  AND 5817 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI GAIN OF 9913 CONTRACTS OR 991,300 OZ OR 30.83 TONNES.  YESTERDAY WE HAD A GAIN OF $5.55 IN GOLD TRADING….

AND WITH THAT GAIN IN  PRICE, WE  HAD A GAIN IN GOLD TONNAGE OF 30.83  TONNES!!!!!! THE BANKERS/OFFICIAL SECTOR WERE SUPPLYING INFINITE SUPPLIES OF SHORT GOLD COMEX PAPER WITH RECKLESS ABANDON. THE BANKERS WERE  UNSUCCESSFUL IN THEIR ATTEMPT TO LOWER GOLD’S PRICE (UP $5.55) .THEY WERE UNSUCCESSFUL IN FLEECING  GOLD LONGS FROM THE GOLD ARENA AS WE GAINED ON BOTH EXCHANGES 9913 CONTRACTS OR A GAIN OF 991,300 OZ 

 

 

 

 

 

 

 

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF OCT : 158,253 CONTRACTS OR 15,825,300 oz OR 497.16 TONNES (23 TRADING DAY AND THUS AVERAGING: 6928 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE STRONG SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 23 TRADING DAYS IN  TONNES: 497.16 TONNES

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

THUS EFP TRANSFERS REPRESENTS 497.16/3550 x 100% TONNES =14.00% OF GLOBAL ANNUAL PRODUCTION

 

ACCUMULATION OF GOLD EFP’S YEAR 2019 TO DATE:     5158.05  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

OCT 2019 EFP ISSUANCE                           497.16 TONNES

 

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

 

Result: A STRONG SIZED INCREASE IN OI AT THE COMEX OF 4096 WITH THE  PRICING GAIN THAT GOLD UNDERTOOK YESTERDAY($5.55)) //.WE ALSO HAD  A HUGE SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 5817 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 5817 EFP CONTRACTS ISSUED, WE  HAD A STRONG SIZED GAIN OF 9913 CONTRACTS IN TOTAL OPEN INTEREST  ON THE TWO EXCHANGES:

5817 CONTRACTS MOVE TO LONDON AND 4096 CONTRACTS INCREASED AT THE COMEX. (IN TONNES, THE GAIN IN TOTAL OI EQUATES TO 30.83 TONNES). ..AND THIS HUGE INCREASE OF  DEMAND OCCURRED DESPITE THE SMALL GAIN IN PRICE OF $5.55 WITH RESPECT TO YESTERDAY’S TRADING AT THE COMEX.

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

 

 

 

 

 

 

 

 

we had:  401 notice(s) filed upon for 40,100 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 UP $5.55 TODAY//(COMEX-TO COMEX)

NO CHANGE IN GOLD INVENTORY AT THE GLD//

 

INVENTORY RESTS AT 915.55  TONNES

 

 

 

SLV/

 

WITH SILVER UP 4 CENTS TODAY: 

 

 

 

 

/INVENTORY RESTS AT 376.525 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 ROSE BY A STRONG SIZED 1012 CONTRACTS from 221,384 UP TO 222,396 AND CLOSER TO 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  1495  AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 1495 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON.  IF WE TAKE THE OI GAIN AT THE COMEX OF 1012  CONTRACTS TO THE 1495 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN A VERY STRONG SIZED GAIN OF 2507 OPEN INTEREST CONTRACTS. THUS IN OUNCES, THE GAIN ON THE TWO EXCHANGES: 12.535 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: 7.665 MILLION OZ//

 

 

RESULT: A STRONG SIZED INCREASE IN SILVER OI AT THE COMEX WITH THE 4 CENT GAIN IN PRICING THAT SILVER UNDERTOOK IN PRICING// YESTERDAY. WE ALSO HAD A STRONG SIZED 1495 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))THURSDAY MORNING/ WEDNESDAY NIGHT: 

SHANGHAI CLOSED DOWN 10.26 POINTS OR 0.35%  //Hang Sang CLOSED UP 239.01 POINTS OR 0.90%   /The Nikkei closed UP 83.92 POINTS OR 0.37%//Australia’s all ordinaires CLOSED DOWN .32%

/Chinese yuan (ONSHORE) closed UP  at 7.0439 /Oil UP TO 54.96 dollars per barrel for WTI and 60.16 for Brent. Stocks in Europe OPENED RED//  ONSHORE YUAN CLOSED UP // LAST AT 7.0439 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED UP ON THE DOLLAR AT 7.0497 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY PAST 7:1//TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED  : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /TRADE DEAL NOW DEAD..TRUMP  RAISED RATES TO 25%

 

3A//NORTH KOREA/ SOUTH KOREA

 

3b) REPORT ON JAPAN

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 ROSE BY A STRONG SIZED 4096 CONTRACTS TO A LEVEL OF 647,538 ACCOMPANYING THE GAIN OF $5.55 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 STRONG SIZED  TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS., THAT IS 5817 EFP CONTRACTS WERE ISSUED:

 FOR OCT; 0 CONTRACTS: DEC: 5817   AND  ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE:  5817 CONTRACTS.

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

ON A NET BASIS IN OPEN INTEREST WE GAINED THE FOLLOWING TODAY ON OUR TWO EXCHANGES: 9913 TOTAL CONTRACTS IN THAT 5817 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE GAINED A STRONG SIZED 4096 COMEX CONTRACTS. 

THE BANKERS SUPPLIED THE NECESSARY AND INFINITE AMOUNT OF SHORT PAPER IN GOLD.  THE BANKERS WERE UNSUCCESSFUL IN LOWERING GOLD’S PRICE AS IT ROSE BY $5.55. JUDGING BY THE STRENGTH IN GAIN OF OUR TWO TOTAL OI FROM OUR TWO EXCHANGES, THEY WERE UNSUCCESSFUL IN THE ENDEAVOUR TO FLEECE ANY UNSUSPECTING LONGS. 

 

NET GAIN ON THE TWO EXCHANGES ::  9913 CONTRACTS OR 991300 OZ OR 30.83 TONNES.

We are now in the active contract month of NOVEMBER.  This month is generally a very poor month of the year as must players prefer to go straight to DECEMBER. Today we have 732 contracts  standing for a GAIN of 23 contracts.  thus by definition, the total amount of gold oz standing in this non active delivery month of November:

732 contracts x 100 oz  =  73200 oz or 2.280 tonnes

 

 

The next active delivery month after November is December.  Here this big December contract month saw its oi FALL by 1049 contracts DOWN to 477,447.

 

 

 

 

TODAY’S NOTICES FILED:

WE HAD 401 NOTICES FILED TODAY AT THE COMEX FOR  40,100 OZ. (0.1247 TONNES)

 

 

 

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And now for the wild silver comex results.

Total COMEX silver OI ROSE BY A STRONG SIZED 1012 CONTRACTS FROM 221,384 UP TO 222,396 (AND CLOSER TO THE NEW RECORD OI FOR SILVER SET ON AUGUST 22.2018.  THE PREVIOUS RECORD WAS SET APRIL 9.2018/ 243,411 CONTRACTS) AND TODAY’S CONSIDERABLE  OI COMEX GAIN OCCURRED WITH A 4 CENT GAIN IN PRICING.//YESTERDAY.

WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF NOVEMBER.  WE HAD 302 NOTICES FILED AND THUS BY DEFINITION, THE TOTAL NUMBER OF SILVER OZ STANDING FOR DELIVERY IS AS FOLLOWS:

304 CONTRACTS X 5000 OZ PER CONTRACT  =  1,520,000 OZ STANDING FOR DELIVERY

 

AFTER NOVEMBER WE HAVE THE VERY STRONG ACTIVE DELIVERY MONTH OF DECEMBER.  HERE THE OI GAINED 294 CONTRACTS UP TO 159,927 CONTRACTS.

 

TODAY’S NUMBER OF NOTICES FILED:

 

We, today, had 302 notice(s) filed for 1,510,000, OZ for the NOV, 2019 COMEX contract for silver

Trading Volumes on the COMEX TODAY: 423,426  CONTRACTS 

 

 

 

CONFIRMED COMEX VOL. FOR YESTERDAY:  393,964  contracts

 

 

 

 

 

INITIAL standings for  NOV/GOLD

OCT 31/2019

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 XX oz

 

 

 

 

Deposits to the Customer Inventory, in oz  

nil

 

No of oz served (contracts) today
401 notice(s)
 40100 OZ
(0.1247 TONNES)
No of oz to be served (notices)
326 contracts
32,600 oz)
1.013 TONNES
Total monthly oz gold served (contracts) so far this month
401 notices
40100 OZ
.1247 TONNES
Total accumulative withdrawals of gold from the Dealers inventory this month NIL oz
Total accumulative withdrawal of gold from the Customer inventory this month xxx oz

 

we had X dealer entry:

We had X kilobar entries

 

 

 

 

total dealer deposits: XXX oz

total dealer withdrawals: XXX oz

 

we had 0 deposit into the customer account

i) Into JPMorgan:  nil oz

 

ii) Into everybody else: XX  oz

 

 

 

total gold deposits: XX  oz

 

 

we had X gold withdrawal from the customer account:

i

 

total gold withdrawals; XX  oz

We had XX adjustment

 

 

FOR THE NOV 2019 CONTRACT MONTH)Today, 0 notice(s) were issued from JPMorgan dealer account and 10 notices were issued from their client or customer account. The total of all issuance by all participants equates to 20 contract(s) of which 401 notices were stopped (received) by j.P. Morgan dealer and 0 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account and 0 notices by the squid  (Goldman Sachs)

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

To calculate the INITIAL total number of gold ounces standing for the NOV /2019. contract month, we take the total number of notices filed so far for the month (401) x 100 oz , to which we add the difference between the open interest for the front month of  NOV. (732 contract) minus the number of notices served upon today (401 x 100 oz per contract) equals 73200 OZ OR 2.277 TONNES) the number of ounces standing in this NON  active month of NOV

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

No of notices served (401x 100 oz)  + (727)OI for the front month minus the number of notices served upon today (401 x 100 oz )which equals 73200 oz standing OR 2.277 TONNES in this NON  active delivery month of OCT.

 

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

HERE IS WHAT STOOD DURING THESE PAST 4 MONTHS:  AUGUST 27.153 TONNES

SEPT:      5.4525 TONNES

 

OCT……………………………………………………………………………     OCT…..   38.09 TONNES

NOV:…………………………………………………………………………………………….. 2.277 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 3 TRANSACTIONS FOR 2.60155 TONNES.

IF WE ADD THE 4 DELIVERY MONTHS: 72.9565 TONNES- 2.60155 TONNES DEEMED SETTLEMENT = 70.35 TONNES STANDING FOR METAL AGAINST 35.773 TONNES OF REGISTERED OR FOR SALE COMEX GOLD! THIS IS WHY GOLD IS SCARCE AT THE COMEX.

 

total registered or dealer gold:  1,150,133.586 oz or  35.773 tonnes 
total registered and eligible (customer) gold;   8,284,498.599 oz 257.68 tonnes
WHY ARE THEY NOT SETTLING?
THE COMEX IS AN ABSOLUTE FRAUD..WE HAVE ZERO SETTLEMENTS.

IN THE LAST 37 MONTHS 104 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.

WHY ARE THEY NOT SETTLING?

 

THE COMEX IS AN ABSOLUTE FRAUD..WE HAVE ZERO SETTLEMENTS.

end

And now for silver

AND NOW THE  DELIVERY MONTH OF NOV.

INITIAL  standings/SILVER

IN TOTAL CONTRAST TO GOLD, HUGE ACTIVITY IN SILVER TODAY.
OCT 31 2019
Silver Ounces
Withdrawals from Dealers Inventory NIL oz
Withdrawals from Customer Inventory
XXX

 

 

Deposits to the Dealer Inventory
nil oz

 

Deposits to the Customer Inventory
XX oz
No of oz served today (contracts)
302
CONTRACT(S)
(1,510,000 OZ)
No of oz to be served (notices)
2 contracts
 10,000 oz)
Total monthly oz silver served (contracts)  302 contracts

1,510,000 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 X inventory movement at the dealer side of things

 

 

 

 

total dealer deposits: X  oz

total dealer withdrawals: XX oz

i)we had XX deposits into the customer account

into JPMorgan:   XX

 

 

 

 

 

 

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

JPMorgan now has 161.1 million oz of  total silver inventory or 51.10% of all official comex silver. (161.1 million/315.22 million

 

 

 

 

total customer deposits today:  XXXX  oz

 

we had XX withdrawals out of the customer account:

 

 

 

 

total withdrawals; XX  oz

We had XX adjustment:

 

 

 

total dealer silver:  77.271 million

total dealer + customer silver:  315.083 million oz

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

The total number of notices filed today for the NOV 2019. contract month is represented by 302 contract(s) FOR 1,510,000 oz

To calculate the number of silver ounces that will stand for delivery in NOV, we take the total number of notices filed for the month so far at 302 x 5,000 oz = XX oz to which we add the difference between the open interest for the front month of NOV. (304) and the number of notices served upon today 302 x (5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the NOV/2019 contract month: 302 (notices served so far) x 5000 oz + OI for front month of NOV (304)- number of notices served upon today 302) x 5000 oz equals 1,520,000 oz of silver standing for the NON contract month. 

 

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 302 notice(s) filed for 1,510,000 OZ for the NOV, 2019 COMEX contract for silver

 

TODAY’S ESTIMATED SILVER VOLUME:  134,555 CONTRACTS (we had considerable spreading activity..accumulation

 

CONFIRMED VOLUME FOR YESTERDAY: 118,180 CONTRACTS..

 

 

 

 

 

YESTERDAY’S CONFIRMED VOLUME OF 118,180 CONTRACTS EQUATES to 590 million  OZ 84.4% OF ANNUAL GLOBAL PRODUCTION OF SILVER..makes sense!!

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

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

 

end

 

 

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NPV for Sprott

 

1. Sprott silver fund (PSLV): NAV FALLS TO -2.19% ((OCT 29/2019)
2. Sprott gold fund (PHYS): premium to NAV RISES TO -0.95% to NAV (OCT 29/2019 )
Note: Sprott silver trust back into NEGATIVE territory at +%-/Sprott physical gold trust is back into NEGATIVE/ -2.19%

(courtesy Sprott/GATA)

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

NAV 15.04 TRADING 14.59///DISCOUNT 3.10

 

 

 

END

 

And now the Gold inventory at the GLD

OCT 31

OCT.30 WITH GOLD UP 5.50 TODAY: A WITHDRAWAL OF 2.93 TONNES FROM THE GLD/INVENTORY RESTS AT 915,55 TONNES

OCT 29/WITH GOLD DOWN $5.00 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 918.48 TONNES

OCT 28/WITH GOLD DOWN $9.70 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 918.48 TONNES

OCT 25/WITH GOLD UP $1.40 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 918.48 TONNES

OCT 24/WITH GOLD UP $8.75 TODAY: A BIG CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER GOLD WITHDRAWAL OF 1.18 TONNES FROM THE GLD//INVENTORY RESTS AT 918.48 TONNES

OCT 23/2016′ WITH GOLD UP $8.40 TODAY: A HUGE PAPER WITHDRAWAL OF 4.98 TONNES  IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 919.66 TONNES

OCT 22.WITH GOLD DOWN $0.15: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 924.64 TONNES

OCT 21/WITH GOLD DOWN $6.25//A HUGE CHANGE IN GOLD INVENTORY AT THE : A MONSTROUS PAPER DEPOSIT OF 6.45 TONNES//GLD/INVENTORY RESTS AT 924.64 TONNES

OCT 18/WITH GOLD DOWN $3.25 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 918.19 TONNES

OCT 17/WITH GOLD UP $4.00 TODAY: A BIG CHANGE IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.47 TONNES OF GOLD FROM THE GLD////INVENTORY RESTS AT 918.19 TONNES

OCT 16/WITH GOLD UP $10.25 TODAY//A BIG CHANGE IN GOLD INVENTORY AT THE GLD; A PAPER WITHDRAWAL OF 2.05 TONNES/INVENTORY RESTS AT 919.66 TONNES

OCT 15//WITH GOLD DOWN$13.25 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 921.71 TONNES

OCT 14/2019: WITH GOLD UP $8.25 TODAY//NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 921.71 TONNES

OCT 11/WITH GOLD DOWN $12.90 TODAY NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 921.71 TONNES

OCT 10/WITH GOLD DOWN $10.00 TODAY, A SMALL CHANGE IN GOLD INVENTORY AT THE GLD A WITHDRAWAL OF 2.05 TONNES OF GOLD FROM THE GLD//INVENTORY RESTS AT 921,71 TONNES

OCT.9//WITH GOLD UP $8.90//NO CHANGE IN GOLD INVENTORY AT THE GLD

OCT 8\WITH GOLD DOWN 35 CENTS //NO CHANGE IN GOLD INVENTORY AT THE GLD

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

 

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OCT 31/2019/ Inventory rests tonight at 915.55 tonnes

 

 

*IN LAST 694 TRADING DAYS: 34.10 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 594 TRADING DAYS: A NET 133.04 TONNES HAVE NOW BEEN ADDED INTO  THE GLD INVENTORY.

 

end

 

Now the SLV Inventory

OCT 31

OCT 30.//WITH SILVER DOWN 6 CENTS TODAY NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 376.525 MILLION OZ

OCT 29/WITH SILVER DOWN 6 CENTS TODAY: A SMALL  CHANGE IN SILVER INVENTORY AT THE SLV” A WITHDRAWAL OF 400,000 OZ TO PAY FOR FEES/INVENTORY REMAINS AT 376.525 MILLION OZ//

OCT 28/WITH SILVER DOWN 6 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 909,000 OZ FROM THE SLV INVENTORY/INVENTORY RESTS AT 376.925 MILLION OZ/

OCT 25/2019: WITH SILVER UP 16 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 377.834 MILLION OZ//

OCT 24/2019: WITH SILVER UP 22 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 377.834 MILLION OZ/

OCT 23/2019: WITH SILVER UP 9 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 377.834 MILLION OZ//

OCT 22/WITH SILVER DOWN 9 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER WITHDRAWAL OF 1.963 MILLION OZ//INVENTORY RESTS AT 377.834 MILLION OZ.

OCT 21/WITH SILVER UP ONE CENT TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER WITHDRAWAL OF 1.222 MILLION OZ FROM THE SLV../INVENTORY RESTS AT 379.797 MILLION OZ//

OCT 18/WITH SILVER DOWN 3 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 380.919 MILLION O

OCT 17./WITH SILVER UP 17 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER WITHDRAWAL OF 1.87 MILLION OZ FROM THE SLV.//INVENTORY RESTS AT 380.919 MILLION OZ//

OCT 16/WITH SILVER UP 4 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 382.789 MILLION OZ//

OCT 15/WITH SILVER DOWN 30 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER WITHDRAWAL OF 2.15 MILLION OZ//. INVENTORY RESTS AT 382.789 MILLION OZ

OCT 14/WITH SILVER UP 18 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 384.939 MILLION OZ

OCT 11/WITH SILVER DOWN 6 CENTS NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 384.939 MILLION OZ//

OCT 10/2016//WITH SILVER DOWN 22 CENTS: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER DEPOSIT OF 1.443 MILLION OZ INTO THE SLV/INVENTORY RESTS AT 384.939 MILLION OZ

OCT 8/WITH SILVER UP 15 CENTS //NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 383.496 MILLION OZ

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//

OCT 31/2019:

 

 

Inventory 376.525 MILLION OZ

 

 

LIBOR SCHEDULE AND GOFO RATES:

 

 

YOUR DATA…..

6 Month MM GOFO 1.95/ and libor 6 month duration 1.92

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

G0LD LENDING RATE: – .03

 

XXXXXXXX

12 Month MM GOFO
+ 21.90%

LIBOR FOR 12 MONTH DURATION: 1.98

 

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.08

end

 

 

end

 

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

Time To Replace Bonds With Gold

Source: World Gold Council

“It may be time to replace bonds with gold”according to the just released excellent new Investment Update by the World Gold Council.

◆ Central banks have shifted to a new regime of easy monetary policy, thus reducing expected bond returns.

◆ As negative yielding debt increases alongside stock-to-yield valuations to all-time highs, gold may become an attractive and more effective diversifier than bonds, justifying a higher portfolio allocation than historical performance suggests.

◆ Re-optimising portfolio structures for lower future expected bond returns suggests investors should consider an additional 1%-1.5% gold exposure in diversified portfolios.

Access the just released excellent report from the WGC here

 

NEWS & COMMENTARY

Gold gains as dollar weakens after Fed’s interest rate cut

Gold settles higher after back-to-back declines, then falls after Fed decision

BOJ sends clearer signal of rate cut chance; keeps policy steady

Dented dollar on Fed outlook buoys EM currencies

Hong Kong falls into recession after a decade

Fed Chair Jerome Powell says current monetary policy stance ‘likely to remain appropriate’

Here’s what changed in the new Fed statement

Understand the Real Causes of the Coming Collapse
Listen to Goldnomics Podcast Here

GOLD PRICES (LBMA – USD, GBP & EUR – AM/ PM Fix)

30-Oct-19 1490.15 1492.10, 1156.65 1159.81 & 1340.39 1342.74
29-Oct-19 1492.75 1486.75, 1164.79 1155.20 & 1347.80 1338.37
28-Oct-19 1505.05 1492.40, 1172.89 1160.94 & 1356.95 1345.55
25-Oct-19 1504.65 1513.45, 1171.82 1180.79 & 1353.28 1364.22
24-Oct-19 1488.85 1496.55, 1154.75 1163.12 & 1338.03 1346.45
23-Oct-19 1494.25 1494.45, 1162.53 1159.84 & 1343.78 1343.66
22-Oct-19 1487.45 1485.35, 1149.50 1149.66 & 1335.28 1334.14
21-Oct-19 1490.85 1491.65, 1147.81 1148.27 & 1334.91 1337.12

SIGN UP FOR OUR AWARD WINNING MARKET UPDATES HERE

Mark O’Byrne
Executive Director

 

ii) Important gold commentaries courtesy of GATA/Chris Powell

Derivatives’ danger may have gotten too big for central banks, Rickards says

 Section: 

5p CT Wednesday, October 30, 2019

Dear Friend of GATA and Gold:

For some big-picture financial and geopolitical commentary it might be hard to do better than the interview conducted a few days ago by comedians Konstantin Kisin and Francis Foster with author, economist, consultant, and gold advocate James G. Rickards.

Rickards explains how the derivatives held by the late hedge fund Long-Term Capital Management, for which he was legal counsel, threatened to drag down many too-big-to-fail investment banks and, with them, major financial exchanges. He adds that the threat posed by derivatives to the world financial system is even bigger now, possibly too big for central banks to address effectively.

… 

They also discuss Modern Monetary Theory, the subservience of the U.S. government to the big investment banks, the monstrous totalitarianism and human rights violations of China’s government, and the U.S. dollar’s vulnerability to substitution by the Special Drawing Rights of the International Monetary Fund.

The interview is an hour long and can be viewed at YouTube here:

https://www.youtube.com/watch?v=S_UhqAkG-KI

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

end

iii) Other physical stories:

Gold Jumps Back Above $1500 As The Dollar Dives To 3-Month Lows

The yield curve is flattening, gold is spiking, and the dollar is puking… all has the smell of ‘policy error’?

The dollar is down hard since Powell’s comments on inflation…

Source: Bloomberg

And as the dollar dived, gold surged…

And the yield curve continues to flatten…

Source: Bloomberg

We’re gonna need a Trump trade tweet.

 

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.

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

i) Chinese yuan vs USA dollar/CLOSED / LAST AT: 7.0439/ GETTING VERY DANGEROUSLY PAST 7:1

//OFFSHORE YUAN:  7.0497   /shanghai bourse CLOSED DOWN 10.26 POINTS OR 0.35%

HANG SANG CLOSED UP 239.01 POINTS OR 0.90%

 

2. Nikkei closed UP 83.92 POINTS OR 0.37%

 

 

 

 

3. Europe stocks OPENED ALL RED

 

 

 

USA dollar index DOWN TO 97.27/Euro RISES TO 1.1614

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:: 54.96 and Brent: 60.16

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

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund FALLS TO -.41%/Italian 10 yr bond yield DOWN to 0.92% /SPAIN 10 YR BOND YIELD DOWN TO 0.23%…ITALIAN 10 YR BOND YIELD/GERMAN BUND: 1.33: DANGEROUS FOR THE ITALIAN BANKING SYSTEM

3j Greek 10 year bond yield FALLS TO : 1.16

3k Gold at $1507.00 silver at: 18.07   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 22/100 in roubles/dollar) 63.99

3m oil into the 54 dollar handle for WTI and 60 handle for Brent/

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

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

30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF. It is not working: USA/SF this morning .9877 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.1025 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 0.41%

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

4. USA 10 year treasury bond at 1.74% early this morning. Thirty year rate at 2.21%

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

6.  TURKISH LIRA:  UP  TO 5.7152..

Markets Spooked By Report China Doubts Trade Deal Is Ever Possible

S&P futures reversed overnight gains, and European stocks slumped on Thursday after a Bloomberg report that China doubts the possibility of a long-term trade deal with President Donald Trump. And one day after they all slumped following the Fed’s latest rate cut which pushed stocks to all time highs, safe haven assets including bonds, gold and the yen all advanced.

US index futures all reversed sharply, wiping out most of the post-FOMC gains, and Europe’s Stoxx 600 turned lower, with basic resources, energy and autos leading European indices into the red after Bloomberg reported Chinese officials have warned they won’t budge on the thorniest trade issues and remain concerned about “Trump’s impulsive nature and the risk he may back out of even the limited deal both sides say they want to sign in the coming weeks”, a report which frankly said nothing new, but seemed almost a hit piece designed to kill any upward algo momentum.

Amusingly, just an hour earlier, Reuters reported that Beijing could remove extra tariffs imposed since last year on U.S. farm products to ease the way for importers to buy up to $50 billion worth, rather than direct them to buy specific amounts, the head of a government-backed trade association said, in what appeared to be dueling narratives between Reuters and Bloomberg.  Also prior to the Bloomberg report, China’s MOFCOM said trade negotiations are progressing well and that the teams maintain close communication, while the sides will proceed according to previous plan and lead US and China negotiators are to hold a phone call on Friday

Of course, all it takes is one optimistic tweet from Trump to reverse the dour early mood.

Earlier, world stocks edged to their highest in 20 months on Thursday after the Federal Reserve cut rates even as it signaled it would hold back from further reductions, sending bond yields and the dollar down, while solid earnings results from Facebook and Apple helped boost tech stocks.

Asian stocks outside Japan had earlier forged ahead on the cuts, following Wall Street’s advance to fresh record highs, climbing 0.3% to touch their highest since Jul. 30. Asian stocks advanced, led by communications firms, after the Federal Reserve cut interest rates for the third time this year and the dollar weakened. Fed officials signaled a pause in further rate cuts unless the economic outlook changes materially. Hong Kong led gains in the region, while Indonesia retreated. Japan’s Topix edged up 0.1%, supported by Sony and SoftBank Group, after the Bank of Japan strengthened the wording on its policy pledge, flagging the possibility that interest rates could go lower. The Shanghai Composite Index fell 0.4%, with Industrial & Commercial Bank of China and PetroChina among the biggest drags.

Early on Thursday, China’s National Bureau of Statistics reported that in October, China’s manufacturing PMI slumped deeper into contraction, dropping from 49.8 to 49.3, not only below the 49.8 consensus estimate, but also below the lowest sellside estimate (the range was 49.5-50.5). Worse, the Non-manufacturing PMI, which many had ignored for months because it was so deeply into expansionary territory, tumbled sharply, and after its biggest drop in almost a year, dipped to 52.8 from 53.6, and is now just shy of the lowest print since the financial crisis.

Emerging stocks rose 0.2% to their highest in three months, and were on course for a second straight month of healthy gains. India’s Sensex climbed 0.7%, as Infosys and State Bank of India offered strong support. Yes Bank soared as much as 39% after saying it got a $1.2 billion binding offer from a global investor for its share sale.

On Wednesday, Fed Chair Jerome Powell gave an upbeat assessment of the U.S. economy and geopolitical risks from Washington’s trade war with China to Brexit had eased. Yet many investors held on to expectations that further rate cuts could come should the U.S. economy turn sour next year, and on Thursday money moved to riskier assets.

“Markets are discounting some more easing, but not very aggressively at this stage,” said Klaus Baader, chief global economist at Societe Generale. “We think the U.S. is going slide into recession, and that is likely some time around the middle of 2020. If the economy slides into recession, we think the Fed will continue to cut interest rates aggressively – even though this isn’t mainstream thinking.”

The Fed dropped a previous reference in its policy statement that it “will act as appropriate” to sustain the economic expansion – language that was considered a sign for future cuts. Even so, market players said they thought the Fed could act should geopolitical risks flare up.

After the Fed cuts, the S&P 500 index closed at another record high on Wednesday, though some in the market voiced concern that central banks across the world lack room to respond to any economic downturn. “I’d be worried that there isn’t enough in the tool box,” said Neil Wilson, chief market analyst at Markets.com. “The Fed is in a better state than most, but I’m not sure what Europe and Japan can do.”

Just a few hours after the Fed cut, the Bank of Japan kept policy steady on Thursday, but introduced new forward guidance – a pledge central banks make on future policy – that commits more strongly to perpetuating ultra-low interest rates. The BoJ noted that this is to pay close attention to chance momentum for hitting price target will be lost although it added there has been no further increase in chance of momentum for hitting price target will be lost but must continue to pay attention to the possibility. Furthermore, BoJ stated Japan’s economy is likely to grow below potential temporarily but will likely continue expanding as a trend, while it noted that risks are skewed to the downside for the economy and it lowered all growth and inflation forecasts in its Outlook Report.

In geopolitics, North Korea has reportedly fired two projectiles, according to the South Korean Military and the Japanese Coast Guard note that the missile appers to have landed outside of their EEZ. The projectiles flew 370km with a maximum altitude 90km before sinking into the sea.

The dollar slipped against a basket of six major currencies slipped 0.4% to 97.29, its lowest in a week, after rising a day earlier. The Bloomberg Dollar Spot Index was set to lose 1.9% this month – its worst performance in 21 months – and fell a fourth day after Fed Chairman Powell said the bar to raising interest rates remained high. The greenback stayed lower on news of China’s skepticism to reach a longer-term trade deal with the U.S. while Treasuries advanced. The yen saw the biggest gains against the dollar on haven demand as risk sentiment soured; the Swiss franc also climbed. The pound rose a second day as the Dec. 12 election campaign began.

In rates, as investors switched to a risk-off mood, the yield on 10-year U.S. bonds fell four basis points to 1.74%.  Euro zone bond yields also fell: German government bond yields, seen as a benchmark, were set for their biggest fall this month.

In commodity markets, oil prices rose as investors banked on further economic stimulus by China after weak PMI data. Brent crude futures were last up 0.6%, or 39 cents, at $60.99 a barrel.

To the day ahead, focus will be on the September PCE report along with personal income and spending readings. The Q3 ECI, latest jobless claims data and Chicago PMI are also due. Elsewhere, the ECB’s Guindos is due to speak while earnings releases include Royal Dutch Shell, Sanofi, BNP Paribas and Kraft Heinz.

Top Overnight News from Bloomberg:

  • Chinese officials are casting doubts about reaching a comprehensive long-term trade deal with the U.S. even as the two sides get close to signing a “phase one” agreement. In private conversations, Chinese officials have warned they won’t budge on the thorniest issues, according to people familiar with the matter. They remain concerned Trump could back out of even a limited deal
  • In a press conference after the Fed cut interest rates for the third time in 2019, Federal Reserve Chairman Jerome Powell repeatedly said that the stance of policy was now “appropriate” to keep the economy growing moderately, the jobs market strong and inflation near the central bank’s 2% goal. Bond market signals doubt Fed has shut door on further rate cuts
  • Jeremy Corbyn will blast what he calls the U.K.’s “corrupt system” as he kick-starts Labour’s campaign to overthrow Prime Minister Boris Johnson’s Conservatives in the Dec. 12 general election. The opposition Labour Party leader will deliver his first speech of the campaign with an attack on billionaires. He’ll also reiterate Labour’s plans to nationalize rail, mail and water companies
  • A gauge of the outlook for China’s manufacturing sector dropped to the lowest level since February, underlining the weakness of an economy buffeted by weak domestic demand, shrinking profits, and the trade war with the U.S.
  • Japanese industrial output rebounded more than expected in September from a drop the previous month, though factory production still fell over the third quarter
  • Reserve Bank of Australia board member Ian Harper said his nation’s economy does “not need” a stronger currency — but worries that’s exactly what it could end up with if the U.S. Federal Reserve keeps easing
  • President Donald Trump’s plan to ink the first installment of a trade accord with Xi Jinping next month was thrown into question Wednesday after Chile canceled an upcoming summit where the two leaders had planned to meet
  • House Democrats hold a historic vote on Thursday to affirm an impeachment inquiry of President Trump that also will starkly illustrate the country’s political divisions
  • Pound traders eyeing December’s snap U.K. election are more worried about Brexit champion Nigel Farage than the socialist agenda of Labour leader Jeremy Corbyn. Faced with a vote as much about Brexit as the contenders, making it more difficult to predict, Goldman Sachs Group Inc. and BlueBay Asset Management have backed away from bets on pound strength
  • Hong Kong’s economy contracted sharply in the third quarter as it entered a recession, exceeding economists’ worst estimates of the damage from nearly five months of protests. Third-quarter gross domestic product retreated 3.2% from the previous three months, after a 0.4% contraction in the second quarter. That’s the worst slump since 2009

Asian equity markets traded mostly positive after the mild post-FOMC tailwinds, with participants also reflecting on a slew of blue-chip earnings and disappointing Chinese PMI data. ASX 200 (-0.4%) was among the few laggards, pressured by underperformance in its largest weighted financials sector after Big 4 lender ANZ Bank reported flat profits amid challenging conditions, while Nikkei 225 (+0.4%) just about kept afloat amid a mixed currency and with a deluge of earnings including Sony which raised its FY net forecasts. Elsewhere, KOSPI (+0.2%) was boosted by index heavyweight Samsung Electronics which surpassed its profit guidance and Apple suppliers in Taiwan saw mixed fortunes despite a strong Q4 result from the US tech giant which beat on top and bottom lines, as well as iPhone revenue but missed on iPad and Mac sales. Hang Seng (+0.9%) outperformed overnight after the HKMA lowered rates in lockstep with the Fed and Shanghai Comp. (-0.4%) was less decisive after another PBoC liquidity drain, weaker than expected Chinese Manufacturing and Non-Manufacturing PMI data, as well as some uncertainty after Chile cancelled the APEC summit next month. Finally, 10yr JGBs rallied from the open ahead of the BoJ announcement after source reports suggested that the BoJ is considering modifying its forward guidance to more clearly signal the chance of a future rate cut, although JGB prices pulled back aggressively following the BoJ announcement which was met with disappointment given that the bank’s new guidance for “short and long-term rates to stay at current or lower levels as long as needed“ didn’t provide anything ground-breaking, as the bank have previously reiterated the possibility for further negative rates.

Top Asian News:

  • BOJ Deploys Words Instead of New Policy Action to Fight Slowdown
  • Alibaba Is Said to Eye November Window for $10 Billion Listing
  • Taiwan Bucks Asia Slowdown With Fastest GDP Growth in 5 Quarters
  • Record Singapore Deposits May Show Hong Kong Funds Shift

Major European Bourses (Euro Stoxx 50 -0.6%) are mostly lower, after reports that China is doubtful about the possibility of a long-term trade deal with US President Trump and unwilling to budge regarding key structural issues; news which triggered a bout of risk off sentiment. Underperformance is being seen in the FTSE 100 (-1.07%) – weighed on by index heavy weight Royal Dutch Shell (-3.6%) after it reported disappointing earnings, in which the Co. noted risks to the completion of its share repurchase programme (Note: Shell A and B shares account for 11% of the FTSE 100). Meanwhile, the FTSE MIB (-0.1%) fares slightly better, with decent gains in Fiat Chrysler (+8.7%) on the terms of its merger with Peugeot (-12.3%) and with each to own 50% share in the merged entity. Prior to the US/China trade headlines, global equities had been holding on to yesterday’s post FOMC gains; in which the Fed cut rates by 25bps but indicated it would likely be on hold going forward. The sectors meanwhile are relatively defensive; Utilities (+0.7%), Health Care (-0.3%) and Consumer Staples (+0.1%) outperform while Energy (-2.4%) is the laggard on Shell. Prior to the risk off move, Tech (-0.7%) had been leading the pack higher, following strong earnings from strong earnings from Apple and Facebook (4.8% and 1.8% higher respectively in premarket trade). In terms of other individual movers; decent earnings saw Sanofi (-0.2%) bid at the open, albeit the Co. reversed gains amid the aforementioned US-China trade news. Conversely, weaker than expected earnings from Air France (-3.8%), Lloyds (-2.7%), BT (+0.5%) and Swiss RE (-1.9%) saw their respective shares under pressure.

Top European News:

  • BNP Paribas Fixed-Income Trading Outperforms European Rivals
  • Pound Investors’ Biggest Fear on Snap U.K. Election Isn’t Corbyn
  • British Airways Owner Posts Earnings Drop After Pilot Strike
  • Shell Warns of Weak Economic Outlook Despite Bumper Profit

In FX, the Greenback remains under pressure in the FOMC aftermath as some month end rebalancing models are negative in contrast to neutral signals flagged earlier in October, while the latest comments from China on the US trade front have been net bearish for the Buck with Beijing apparently raising doubts about the prospect of a long term accord given a reluctance to make major structural reforms and demands that Washington removes all tariffs before moving forward to Phase 2 talks. The DXY is holding just off 97.216 lows compared to 97.449 at one stage and considerably higher in knee-jerk Fed rate cut and shift to pause mode trade.

  • JPY/CHF/GBP/EUR – Risk-off sentiment prompted by the aforementioned Chinese concerns and conditions regarding trade negotiations with the US and more NK missile tests has (naturally) boosted the likes of the Yen and Franc (while Gold has also benefited and reclaimed Usd1500+/oz status), with Usd/Jpy retreating sharply through the 21 DMA (108.59), 108.50 and now testing 108.25 that would expose hefty option expiries between 108.00-10 (2.5 bn) if breached. Meanwhile, Usd/Chf is hovering close to the base of a 0.9895-60 range and Sterling is muscling in, albeit with bullish UK election momentum also underpinning the Pound amidst reports that the Brexit party may pull candidates and boost Tory votes in the process. Cable is holding near 1.2950, while Eur/Gbp is having another look at support ahead of 0.8600 even though the single currency is outpacing the Dollar with Eur/Usd firm within a 1.1150.75 band.
  • NZD/AUD/CAD – Somewhat contrasting fortunes down under, as the Kiwi clings to 0.6400 vs its US counterpart and stays above 1.0800 against the Aussie despite the latest China-US headlines and downbeat Chinese PMIs overnight with the aid of Westpac rolling its RBNZ ease forecast to February 2020 from next month and an improvement in the NBNZ business outlook. Conversely, Aud/Usd is losing grip of 0.6900 and Usd/Cad remains elevated between 1.3148-78 parameters following yesterday’s cautious BoC outlook and eyeing Canadian data in the form of GDP, PPI and AWE.
  • EM – A steeper retreat from recent peaks by the Rand as the risk aversion noted above merely adds to weakness stoked by SA’s MTBS and investor angst that Eskom aid is not as comprehensive as anticipated or hoped. Usd/Zar has been above 5.1800, but now paring back a tad.

In commodities, crude markets have eroded earlier gains after US/China trade related risk off saw this morning’s tentative gains quickly given back. WTI Dec’ 19 futures topped out around USD 55.60/bbl and Brent Jan’ 20 at USD 60.80/bbl, before a souring of sentiment saw the contracts fall as low as USD 54.85/bbl and USD 60.05/bbl respectively. In terms of crude specific news; the 590mln bpd Keystone pipeline, which carries crude oil from Alberta, Canada to refineries in the US, was shut yesterday after a spill, with little clarity on how long the disruption will last. Separate reports alleged that TC Energy has declared a ‘force majeure’ on the pipeline. “These developments will not be welcome news for Canadian producers” notes ING “with it likely to weigh on the WCS-WTI differential”. Meanwhile, source reports last night that US plans to allow Russian, Chinese and European companies to continue non-proliferation work with Iran by renewing sanctions waivers, although the news appears to have done little to change the dial. In terms of Metals; Gold is bid on 1) a weaker buck post-FOMC, 2) weak overnight Chinese PMI data 3) jitters regarding North Korean missile tests and, most recently, 4) negative US/China trade headlines. Meanwhile Copper prices saw renewed pressure amid the overall risk sentiment coupled with the dismal China data, with the red metal now below earlier reported resistance at USD 2.660/lbs to make fresh weekly lows.

US Event Calendar

  • 8:30am: PCE Deflator YoY, est. 1.4%, prior 1.4%; 8:30am: PCE Deflator MoM, est. 0.0%, prior 0.0%
  • 8:30am: Personal Income, est. 0.3%, prior 0.4%
  • 8:30am: Personal Spending, est. 0.3%, prior 0.1%
  • 8:30am: Real Personal Spending, est. 0.2%, prior 0.1%
  • 8:30am: Employment Cost Index, est. 0.7%, prior 0.6%
  • 8:30am: Initial Jobless Claims, est. 215,000, prior 212,000; Continuing Claims, est. 1.68m, prior 1.68m
  • 9:45am: MNI Chicago PMI, est. 48, prior 47.1

DB’s Jim Reid concludes the overnight wrap

Welcome to Hallowe’en – a day that was pretty meaningless to me until I had my first child. Since then each year I’ve come home on this day to pumpkins, witches hats, broomsticks and old bedsheets with eye holes cut out. I’m a bit nervous about tonight as trick or treaters at my house might get a nasty shock as we are half way through the process of getting a new set of gates at the top of our drive. We are at the stage where we have a massive drainage trench exposed but with no surrounding lights. So any attempt to come seeking sweets at our house tonight might end up being swallowed up by a three foot ditch.

The trick for markets last night was that the Fed offered very little to those hoping for more cuts with the treat being that the bar to hiking rates seemed to also get higher. So this was a Fed that seemingly wants to hold steady here for a long period of time. Whether the data lets them is another matter but both bonds and equities rallied once this message got across in the press conference, especially the one regarding the hurdle to future hikes.

They did cut 25bps as expected but the tone of the conference has meant that our US economists have adjusted their Fed call. They continue to expect another rate cut in December, even though the probability of this has been reduced by yesterday’s FOMC. Their outlook for the US economy anticipates a further weakening of the data, particularly related to the labour market. In addition, significant event risks remain related to trade policy and geopolitics before the December meeting. They have removed the rate cut they expected in January 2020 though. This cut was in part predicated on the Fed credibly committing to a shift to an inflation makeup strategy at that meeting. Chair Powell, however, sent a clear signal that the outcome of the Fed’s policy review is likely to be announced around the middle of next year. At that point, with growth having rebounded and inflation near target, they expect the Committee to compromise by committing to this change in inflation target by promising to keep rates lower for longer. They have therefore removed the rate hike they had built into late-2021. See their note here for more.

So whether you believe the Fed or whether you believe our economists the key take home that the market took away last night was that the Fed aren’t going to be very active over the next few years. I suspect that this view is wishful thinking but that’s the narrative for now.

The reaction in Treasuries was for 10y yields to fall -6.7bps, 4bps of which occurred after Powell answered a question about how far they were away from rate hikes. At the short end 2y yields fell -4.4bps, but 6bps from the peak in the press conference. Those moves meant the 2s10s curve flattened a couple of bps. Meanwhile the S&P closed +0.44% having been slightly lower for the first part of the press conference. US equity futures are broadly flat this morning even with earnings beats out of Apple and Facebook post the closing bell last night. They were up +1.94% and +4.46% respectively in after hours trading. Apple also projected fiscal first-quarter revenue that beat analysts’ estimates

Jumping to Asia now where following the Fed, the BoJ kept its policy settings unchanged but strengthened forward guidance. The BOJ now says that it expects short- and long-term interest rates to remain at current or lower levels as long as it is necessary to pay attention to the possibility of losing price momentum. They dropped a time frame of keeping rates extremely low until at least around spring 2020. On the review of prices that the BoJ had called for at its September meeting, the central bank said the possibility of losing momentum toward its price target had not increased any further, though it was necessary to keep closely watching the situation. Meanwhile, the BOJ revised down its CPI forecasts for 2019, 2020 and 2021 to +0.7% (vs. +1.0% previously), +1.1% (vs. +1.3%) and +1.5% (vs. +1.6%). GDP forecasts were also revised down too. Yields on 10y JGBs are down -1.4bps to -0.144%.

Also out this morning were the October PMIs in China where manufacturing PMI printed at 49.3 (vs. 49.8 expected), the lowest reading since February while the non-manufacturing PMI came in at 52.8 (vs. 53.6 expected) thereby bringing the composite PMI to 52.0 (vs. 53.1 last month). In details, the sub index of new export orders fell by -1.2pts from last month to 47.0 while the new orders sub index dipped back into contractionary territory (49.6 vs. 50.5 last month). Elsewhere, Japan’s preliminary September industrial production printed at +1.4% mom (vs. +0.4% mom expected).

Markets in Asia are largely trading higher with the Nikkei (+0.35% ), Hang Seng (+1.05% ), CSI (+0.10% ) and Kospi (+0.81%) all up. The Kospi’s performance is also being helped by the earnings beat from Samsung electronics (up +1.19%) as the company posted better-than-expected earnings and projected a gradual recovery in the memory chip market in 2020 as fifth-generation wireless technology rolls out globally. Elsewhere the US dollar index is down -0.31% and yields on 10y USTs are up +1.3bps.

In other news, Xinhua reported overnight that the top negotiators from the US and China will have a phone call tomorrow while China’s commerce ministry said that China – US trade negotiations are progressing well.

On Brexit the first national opinion poll that has come out since the election seemed a formality. Canvasing Tuesday and Wednesday the Survation results showed an 8 pc lead for the Conservatives – the same as two weeks ago for this agency. There was news last night that the Brexit Party might only contest around 20 seats and allow the Conservative Party free reign elsewhere. They had previously said they would contest all 650. We’re expected to know their plan by the end of the week. If true this would take some of tail risk out of the election and reduce the no-deal risk. Sterling has edged back above $1.292 this morning but much of that has been due to a weaker dollar after the FOMC.

Unsurprisingly there wasn’t much going on in markets prior to the Fed decision yesterday – the biggest news being the decision by Chile to cancel the APEC summit. President Trump had previously flagged this as the location for a likely signing of the preliminary trade accord with Xi but the cancelled summit presumably shouldn’t be a hurdle for that assuming they can find a new location. Indeed a spokesman for the White House said that the time frame for a deal is still the same despite the cancellation. Away from that, the slate of earnings that were released were a bit more mixed. The DOW got a lift from Johnson & Johnson while GE shares also jumped after painting a more optimistic cash flow picture for the rest of this year. Molson Coors, Yum Brands and CH Brands were among those to disappoint.

Coming back to the Fed, the committee also had the benefit of some slightly stronger than expected Q3 GDP data just prior to their decision yesterday. Indeed the +1.9% annualized reading bettered expectations for +1.6% and was down only one-tenth from Q2 as a result. Consumption was a driver (+2.9% vs. +2.6% expected) while the quarterly figure is also not far from the Fed’s second half forecast built into their September SEP projections. The one disappointing aspect of the report was capex, while elsewhere core PCE was in line at +2.2%.

Also out yesterday and as a precursor to tomorrow’s payrolls was the October ADP employment change print. The 125k reading bettered expectations for 110k however it did come about in the context of 42k of downward revisions to the September data. It’s worth noting that there was no mention of the GM strike in the press release which had been flagged as a factor potentially negatively impacting payrolls tomorrow.

The data in Europe included a +0.1% mom CPI reading in Germany which was slightly ahead of expectations for no change, and left the annual rate at +0.9% yoy. Away from that Q3 GDP was better than expected in France (+0.3% qoq vs. +0.2% expected) while the unemployment rate held steady at 5.0% in Germany. Finally confidence indicators were broadly weaker than expected for the Euro Area in October with the exception of the business climate indicator. For completeness European equity markets were little changed yesterday.

In other news, the Bank of Canada held rates steady at 1.75% yesterday however the message was interpreted as fairly dovish including references like “the resilience of Canada’s economy will be increasingly tested as trade conflicts and uncertainty persist”, as well lowering projections for 2020 and 2021. The Canadian Dollar immediately weakened following the statement release and closed down -0.55% while 10y yields were down -15.1bps.

To the day ahead, which this morning includes September retail sales data in Germany, preliminary October CPI in France and Italy, and the advance Q3 GDP reading for the Euro Area. In the US the focus will be on the September PCE report along with personal income and spending readings. The Q3 ECI, latest jobless claims data and Chicago PMI are also due. Elsewhere, the ECB’s Guindos is due to speak while earnings releases include Royal Dutch Shell, Sanofi, BNP Paribas and Kraft Heinz.

 

3A/ASIAN AFFAIRS

I)THURSDAY MORNING/ WEDNESDAY NIGHT: 

SHANGHAI CLOSED DOWN 10.26 POINTS OR 0.35%  //Hang Sang CLOSED UP 239.01 POINTS OR 0.90%   /The Nikkei closed UP 83.92 POINTS OR 0.37%//Australia’s all ordinaires CLOSED DOWN .32%

/Chinese yuan (ONSHORE) closed UP  at 7.0439 /Oil UP TO 54.96 dollars per barrel for WTI and 60.16 for Brent. Stocks in Europe OPENED RED//  ONSHORE YUAN CLOSED UP // LAST AT 7.0439 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED UP ON THE DOLLAR AT 7.0497 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY PAST 7:1//TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED  : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /TRADE DEAL NOW DEAD..TRUMP  RAISED RATES TO 25%

 

 

3 a./NORTH KOREA/ SOUTH KOREA

North Korea

North Korea Fires Two Projectiles Towards Japan, Official Reports Say 

North Korea has fired at least one “unidentified projectile” towards the sea of Japan on Thursday, read a statement from South Korea’s Joint Chiefs of Staff (JSC).

“North Korea fired two unidentified projectiles toward the East Sea (the Sea of Japan),” the JSC statement read.

JSC said the “projectiles were fired from areas in South Pyongan Province in the afternoon,” adding that, “Our military is monitoring the situation in case of additional launches and maintaining a readiness posture.”

Intelligence Fusion -Asia@IF_Asia_

🇰🇵: North Korea fired two suspected ballistic missiles into the Sea of Japan this morning. The launches are the second North Korean missile test this month.

View image on Twitter

No details were given on the projectiles’ type and or flight range.

The Japan Coast Guard has requested all vessels operating in the Sea of Japan to remain alert and monitor news channels.

Reuters

@Reuters

BREAKING: North Korea fires projectile – South Korea military

Embedded video

Reuters

@Reuters

MORE: Missile from North Korea appears to have landed outside Japan’s exclusive economic zone – Japanese coast guard

Embedded video

end

b) REPORT ON JAPAN

 

3 C CHINA

China,s manufacturing PMI unexpectedly slides further into contraction and this is deadly as China is the engine for global growth

(zerohedge)

Chinese PMIs Unexpectedly Slide Further Into Contraction, Just Shy Of Post-Crisis Lows

If there was some hope that that today’s Fed rate cut would mark the bottom of the global economic slowdown and serve as the basis for even a modest recovery – after all, even Powell admitted that after this, nothing less than a full blown economic shitstorm would force the Fed to cut more – then Beijing promptly crapped all over any such optimism, when it reported that its latest official PMIs for the month of October not only missed by a mile, but were two of the worst prints since the financial crisis.

Early on Thursday, China’s National Bureau of Statistics reported that in October, China’s manufacturing PMI slumped deeper into contraction, dropping from 49.8 to 49.3, not only below the 49.8 consensus estimate, but also below the lowest sellside estimate (the range was 49.5-50.5). Worse, the Non-manufacturing PMI, which many had ignored for months because it was so deeply into expansionary territory, tumbled sharply, and after its biggest drop in almost a year, dipped to 52.8 from 53.6, and is now just shy of the lowest print since the financial crisis.

 

It gets even worse: whereas the contraction for large cap companies was modest, at just 49.9, down from 50.8, mid cap companies were worse, at 49.0, while small caps were dismal, at a paltry 47.9, down from 48.8.

Broken down by components, almost every index posted a decline, with the exception of the worst one, employment, which posted a modest increase:

  • Production  50.8, down from 52.3
  • New Orders 49.6, down from 50.5
  • Employment 47.3, up from 47.0

The above means that not only is the trade war with the US continuing to take its toll on China, but as long as Beijing refuses to spark a massive credit injection spree, which rebooted the global economy after the financial crisis, after the European sovereign debt crisis, and again after the Shanghai Accord…

 

… then the Fed’s hopes that its “insurance cuts” will amount to anything, will soon be drowned in the chaos of another global recession, but not before the Fed first cuts rates back to zero first, and then negative.

 END
China’s bond market faces turmoil amid a maturity deluge
(zerohedge)

China’s Bond Market Faces Turmoil Amid Maturity Deluge

While the US bond market has had its share of harrowing slumps and vomit-inducing short squeezes in the past year as consensus shifted from one of “the neutral rate is far away” to “here comes NIRP”, China’s bonds have been a bastion of stability, trading in a tight range between 3% and 3.50% for the past year.

That may be about to change.

The reason: a wall of bond maturities is about to flood across China’s sovereign-bond market, which in the past three months has already been reeling from a global sell-off and rising inflation.

According to Bloomberg, more than 2 trillion yuan ($283 billion) of local-government notes will mature in 2020, a record and 58% more than this year’s level. This means fresh debt to refinance upcoming maturities will start hitting the market soon, with a the southern province of Guangdong expected to sell notes as early as November.

This is happening as China’s 10-year yield rose 3 basis points to 3.31%. the highest since late May, while the cost on 12-month interest rate swaps jumped 5 basis points to 2.92%. The yield on China Development Bank’s 3-year bonds due January 2022 rose 10 basis points to 3.25%.

Despite trading in a narrow range, China’s government bonds have been sliding for nearly two months, starting around the time a “growth shock” hit US rates and sparked the infamous quantastrophe, with the 10-year yield hitting the highest since May as selling momentum accelerated. Naturally, a flood of new supply will only exacerbate the weakness, especially as real, inflation-adjusted yields are barely above zero, a rarity for emerging markets.

“The large amount of supply that will be rolled over will weigh on China’s sovereign bonds,” Ken Cheung, chief Asia FX strategist at Mizuho Bank, told Bloomberg. The risk only grows when one considers the recent surge in food inflation as a result of “pig Ebola”, coupled with lower expectations of central bank stimulus.

To avoid a panic issuance scramble, Deputy Finance Minister Xu Hongcai said in September that China will grant part of a special bonds quota in advance to ensure that the funds raised can be used early in the year, Bloomberg reported, noting that so-called “special bonds have mostly been used for infrastructure spending, and the national limit could be raised from 2.15 trillion yuan.”

Earlier, in June, the State Council expanded the sectors that funds raised via the special bonds can be put toward. For 2020, they will include transport, energy, agriculture and forestry, vocational education and medical care. Overall fixed-asset investment has slowed this year amid pressure from the U.S. trade war.

Of course, there is only so much selling that the PBOC can take before it has to intervene, which is why so many China watchers have been stumped by the central bank’s lack of willingness to intervene so far.

Beijing’s decision to avoid conducting aggressive stimulus measures – even as China’s growth engine sputters, and the economy grows at the slowest pace since the early 1990s – has spooked bond investors. The central bank has held off from adding liquidity this week, instead allowing large short-term cash injections to mature. That’s effectively drained 500 billion yuan from the financial system. Meanwhile, China’s credit impulse which previously pulled the entire world out of a recessionary ditch, has barely pushed off the cycle lows.

Some analysts said the central bank could instead use a targeted tool to inject one-year cash, which it refrained from doing Wednesday. That said, there is also a limit how aggressive the PBOC can get: soaring consumer prices, fueled by the surging cost of pork, are seen capping how much liquidity Beijing can provide without further stoking inflation.

Which means that very soon, the PBOC will be forced to choose: risk runaway bond yields, tumbling risk prices and an even faster slowdown in the economy, or stimulate the economy, and watch as the yuan tumbles as inflation surges even more. The only question is whether this terminal dilemma will come before or after the US is faced with a roughly similar choice.

END
Hong Kong plunges into recession after months of violent protests
two commentaries…
(zerohedge)

Hong Kong Plunges Into Recession After Months Of Violent Protests Take Toll

Hong Kong has finally entered a recession after more than half a year of violent anti-government protests, the city’s Financial Secretary wrote in a blog post over the weekend, reported Reuters.

“The blow to our economy is comprehensive,” Paul Chan wrote, adding that upcoming economic data later this week will trigger a technical recession.

“The government will be announcing its advance estimates for the third quarter on Thursday. After seeing negative growth in the second quarter, the situation continued in the third quarter, meaning our economy has entered technical recession,” Chan wrote.

“It seems it will be extremely difficult for us to reach full-year economic growth of 0 to 1%. I would not rule out the possibility that the full-year economic growth will be negative.”

Protesters have frequently shut down popular shopping districts, something that we outlined last week, warning that the retail industry in Hong Kong is on the brink of collapse.

Tourism plunged 37% Y/Y in 3Q19, and the trend for 4Q19 is likely not to improve. The number of tourists for the first two weeks of October was down 50% on a Y/Y basis.

Rooms at the most high-end hotels, like Marco Polo Hongkong in Tsim Sha Tsui, are going for $72 per night, a 75% discount versus last year.

Anyone who wants to travel to Hong Kong this week, departing from New York City airports, can easily get roundtrip plane tickets for 50% off because air travel to Hong Kong remains depressed.

Local businesses are cutting back on their workforce as approximately 77% of all hotel workers have just been asked to go on leave without pay.

Chan said government officials had announced stimulative measures to support local small and medium-sized businesses as the recession is expected to deepen into 1H20.

Hong Kong billionaire Li Ka-shing pledged to give local businesses $128 million in support following the protests that have presented the city with “unprecedented challenges.”

In a series of charts below, the city’s economic decline suggests a crisis has arrived:

In a 12-month and 3-month change, Hong Kong retail sales have absolutely crashed over the last half-year.

Hong Kong GDP is expected to print negative this Thursday for the first time since the financial crisis a decade ago.

Property prices in the city have stalled out in 2019.

The Hang Seng stock index is in a consolidation pattern. If economic deterioration continues, and or the recession worsens through 2020. Then it’s likely the stock index will break lower from the triangle.

Hong Kong is the first domino to drop. More emerging growth countries will fall under economic stress as the global recession is imminent, if not already arrived.

end

Hong Kong Crashed Into First Recession Since 2009

The first domino in the next global economic crisis has fallen this morning, when Hong Kong crashed into a technical recession, the first time since the 2008/09 financial crisis. Hong Kong’s economy plunged 3.2% in 3Q19, government data showed on Thursday, exceeding economists’ lowest estimates and confirming a technical recession has begun.

Earlier this week, we reported that Hong Kong Financial Secretary Paul Chan warned after more than half a year of violent anti-government demonstrations, the end of October will likely mark the start of a recession.

“After seeing negative growth in the second quarter, the situation continued in the third quarter, meaning our economy has entered technical recession,” Chan wrote in a blog post.

“It seems it will be extremely difficult for us to reach full-year economic growth of 0 to 1%. I would not rule out the possibility that the full-year economic growth will be negative.”

With two consecutive quarters of negative growth and no end to the protests in sight, Bloomberg has noted in a series of graphs that a full-year economic contraction is likely for 2020.

Raymond Yeung, the chief Greater China economist with Australia & New Zealand Banking Group Ltd., told Bloomberg that social chaos in the city is driving the economy into the ground. Protesters have frequently shut down popular shopping districts, something that we outlined several weeks ago, warning that the retail industry in Hong Kong is on the brink of collapse.

Yeung warned: “It’s obviously comparable to the global financial crisis. We have a very similar situation that we don’t know when it’s going to end.”

Meanwhile, tourism has plunged 37% Y/Y in 3Q19, and the trend for 4Q19 is likely not to improve. The number of tourists for the first two weeks of October was down 50% on a Y/Y basis. Rooms at the most high-end hotels, like Marco Polo Hongkong in Tsim Sha Tsui, are going for $72 per night, a 75% discount versus last year.

Anyone who wants to travel to Hong Kong this month, departing from New York City airports, can easily get roundtrip plane tickets for 50% off because air travel to Hong Kong remains depressed.

Local businesses are cutting back on their workforce as approximately 77% of all hotel workers have just been asked to go on leave without pay.  Iris Pang, an economist at ING,  told the Financial Times that Hong Kong’s economy would be in a full-blown recession in 2020.

The Hong Kong government has rolled out countercyclical measures to buffer the economy and avoid a flat out depression. Some of these measures include tax cuts and increases to social security, along with housing perks for first-time homebuyers. But with an economic crisis expected to deepen, the government has held back on fully deploying its tools — would likely wait for a trough in the economy before large stimulative measures are seen.

Pang, on the other hand, said, “interest rates don’t matter for this economy anymore. When there’s violence in the streets, people don’t want to go out shopping or go out for dinner.”

In a series of charts below, the great collapse of Hong Kong can be visualized:

Mainland Chinese tourists to Hong Kong volumes are plunging.

In a 12-month and 3-month change, Hong Kong retail sales have absolutely collapsed over the last half-year.

Hong Kong is the first domino to fall. More emerging growth countries will slip into technical recession as a global financial crisis could arrive as soon as 2020.

END

We now have another Chinese bank on the verge of collapse after a sudden bank run

the bank is: Henan Yichuan Rural Commercial Bank,

(zerohedge)

 

Chinese Bank On Verge Of Collapse After Sudden Bank Run

First it was Baoshang Bank , then it was Bank of Jinzhou, then, two months ago, China’s Heng Feng Bank with 1.4 trillion yuan in assets, quietly failed and was just as quietly nationalized. Today, a fourth prominent Chinese bank was on the verge of collapse under the weight of its bad loans, only this time the failure was far less quiet, as depositors of the rural lender swarmed the bank’s retail outlets, demanding their money in an angry demonstration of what Beijing is terrified of the most: a bank run.

Local business leaders, political cadres and banking executives rallied Thursday at the main branch of Henan Yichuan Rural Commercial Bank, just outside the central Chinese city of Luoyang, where they stood one by one before a microphone to pledge their backing for the bank, as smiling employees brandished wads of cash before television cameras to demonstrate just how much cash, literally, the bank had.

It was China’s latest, and most desperate attempt yet to project stability and reassure the public that all is well after rumors spread that the bank’s chairman was in trouble and the bank was on the brink of insolvency. However, as the WSJ reports, it wasn’t enough for 31-year-old Li Xue, who showed up for the third day Thursday to withdraw thousands of yuan of her mother’s life savings after hearing from fellow villagers that Yichuan Bank – which is the largest lender in Yichuan county by the number of branches and capital, and it is also a member of PBOC’s deposit insurance system, according to the local government – was going under.

 

Customers form lines in front of Yichuan bank; photo: WSJ

Just like any self-respecting Ponzi scheme, the bank’s branch managers tried to persuade her to keep her money with them until March, when her mother’s three-year deposits would mature, yielding more than 10,000 yuan in interest. And then, just like any Ponzi scheme, to sweeten the offer, the bank managers also offered her even higher-yielding products, plus supermarket gift cards, just to keep her money there..

“Our bank is state-backed, and your money is insured by deposit insurance,” one female manager told her, but Ms. Li refused, her confidence in the state’s lies crushed.

“We really can’t afford to lose the money,” she said.

The bank run at Yichuan Bank, located in China’s landlocked province of Henan, makes it at least the fourth bank that authorities have rushed to rescue this year. It won’t be the last.

As we have documented previously, in recent month China’s banking sector has been dogged by a sudden surge in liquidity concerns, particularly among smaller regional banks that had expanded aggressively in recent years, and were now suffering a surge in bad loans, threatening their viability.

In May, regulators bailed out Baoshang Bank, in the country’s first bank bailout since the 1990s. That move led to widespread concerns about the health of other small lenders and financial institutions, squeezing liquidity in China’s interbank market. It also led to similar failures – and rescues – of Bank of Jinzhou and Heng Feng Bank, both smallish regional banks, yet big enough to convince the local population that something was very rotten with China’s financial system.

Prudently, Beijing has been careful not to announce any takeovers, although it has quietly brought in state-owned banks and asset management firms, as well as an arm of the nation’s sovereign-wealth fund, to inject fresh capital and stabilize wobbly banks, as it did most recently in the case of Heng Feng.

Try as Beijing might, however, the bailouts have not gone unnoticed, and culminated in what today has been a three-day bank run at Yichuan Bank.

Like with everything else in China, there is good and bad news.

The good news is that troubled banks accounted for just 4% of total assets in China’s banking system, according to a recent estimate by S&P Global that included poor quality rural institutions flagged by the Chinese central bank. An analysis by Barclays listed those banks that had delayed to disclose their 2018 annual reports: a clear indicator of imminent collapse. Three of the top four banks have already been nationalized or bailed out.

However, in this case size really does not matter, and the aggressive response from regulators to the developments at Yichuan Bank, a small lender with just 62.65 billion yuan ($8.9 billion) in assets, underscores the heightened concerns of contagion and social instability amid the loss of confidence in bank deposits, as the WSJ notes.

The bad news is that small banks are just the start of a wave that could eventually topple some of China’s biggest SOEs. Yichuan Bank is emblematic of the thousands of banks and cooperatives in China’s countryside that in recent years had scaled up its ambitions. In 2009, the rural cooperative became a commercial lender, attracting deposits primarily from farmers and county locals, according to the bank. It then kept growing at a tremendous pace, raking up billions in bad loans, until one day – like all Ponzi schemes – the new money stopped trickling in and the bank’s day of reckoning had arrived.

While Yichuan Bank has plenty of competition, including large state-owned banks in nearby Luoyang, an ancient capital of China known, Yichuan Bank accounted for 71% of deposits and 82% of loans in its county as of September 2018, according to China Chengxin International Rating Agency.

The problem, as hinted above, is that like most other small Chinese banks, Yichuan Bank suffered from a buildup of bad loans as the economy slowed in recent years, and struggled to retain deposits amid intensified competition from its peers.

That was the proverbial Minsky moment when every Ponzi scheme ends.

Then the warnings came: in July, analysts at China Chengxin flagged the bank for its lack of stable deposits and a rapid buildup of overdue and bad loans. Bad loans ballooned to 1 billion yuan at the end of 2018, a 10-fold increase in just three years, according to its financial statements. Overdue loans, meantime, grew to 28% of its total credit at the end of September 2018, the credit rating agency said.

That number, incidentally, is orders of magnitude higher than what the PBOC discloses as China’s average bad loan percentage, which in the past decade has stubbornly, and erroneously, been stuck in the mid-1% range. The true number is far, far higher, but Beijing guards it with its life, as the alternative is a bank run on the world’s largest bank system, which with $40 trillion in assets, is roughly double that of the US.

So far Beijing has been lucky, in that people tend to be notoriously bad with numbers. Ironically, what brought the bank down was news of trouble with Yichuan’s senior management that initially caught locals’ attention. Immediately thereafter, depositors started demanding their money back earlier this month; as speculation circulated on social media that the bank was on the verge of insolvency, the crowds at bank branches grew thicker, and so the bank run began.

By Wednesday, the problem – and its media coverage – was too big to avoid, and local authorities moved swiftly to stabilize the situation. In typical Chinese fashion, however, instead of fixing the underlying problem, they blamed the messenger and announced they had detained two women whom they accused of spreading false rumors; they also brought in the county’s deputy party secretary to take charge.

And since explaining to the people that China’s entire financial system is one giant house of cards, the authorities needed a scapegoat. They got it when they announced an investigation into the bank’s former chairman, citing a violation of discipline, a charge commonly used in corruption cases.

Meanwhile, having received a few truckloads full of cash, county authorities tried to ease depositor panic saying they had tens of billions of yuan in funds available, which the bank had already begun tapping, according to the bank.

So far this approach has failed to restore confidence, and bank officers, overwhelmed with withdrawal requests, put stacks of cash on display behind bank windows. They dangled various inducements, “including boxes of tissue, plastic chairs, tea thermoses and loose leaf tea” according to the WSJ, to persuade customers to keep their deposits with Yichuan.

And why not: cheap bribes almost worked in Spain in 2012, when the then-insolvent Bankia handed out Spiderman towels in exchange for a €300 deposit.

Surprisingly, it did not work in China, as people continued to show up, adamant about withdrawing their funds; the bank run was accelerating, and nothing officials did could halt, or reverse it.

Zhang Yanting, a 51-year-old farmer, decided after several days of trying to pull his money out of the bank that he would keep his account open to collect the few dollars in grain subsidies he receives each year from the government. But Zhang still wanted most of his 13,000 yuan in deposits back.

After hours in line Thursday, the bank cashier handed him a wad of cash, which he happily stuffed into his bag. Zhang was unmoved by the promise of gifts, save for a bottle of water that he sipped from while waiting.

“I’ve been with the bank for 10 years and have never seen service this good,” he said.

 

Zhang Yanting, a 51-year-old farmer, walked away with a wad of cash from his savings account at Yichuan Bank

Zhang was a happy customer: he learned that when dealing with a collapsing Ponzi scheme, only those who pull their money first stand to recover anything. It’s those who foolishly believed the government’s propaganda that all is well, who will be far, far angrier when they realize that it’s gone… it’s all gone.

END

4/EUROPEAN AFFAIRS

“Our Country Must Act:” Germany Exports To Shrink For The First Time Since 2008 Financial Crisis

The German economy could be headed for economic disaster, the German Chamber of Industry and Commerce (DIHK) warned in a new report Wednesday.

According to DIHK’s survey of 28,000 companies, German exports will shrink next year for the first time since the global financial crisis ten years ago.

DIHK@DIHK_News

Die DIHK- zeigt: Deutlicher Einbruch bei den Geschäftserwartungen der Unternehmen. Betroffen ist nicht nur die exportorientierte Industrie, auch Handel und Dienstleister blicken sorgenvoll in die Zukunft.

View image on Twitter

DIHK’s economic outlook is more pessimistic than the Federal Government. It said Germany’s annual export growth would decline to .30% in 2019 from 2.1% in 2018. And for 2020, exports are to shrink by .50%, which would then tip it into contraction.

The “green shoots” economic rebound narrative for Europe’s largest manufacturing hub is likely dead in the water for next year.

“For our economy, with its strong industrial core, this is a huge challenge,” DIHK President Eric Schweitzer said.

“Since the financial crisis of 2008/2009, DIHK has not received such pessimistic replies from the companies,” Schweitzer said. He pointed out that Germany’s average export growth rate was usually around 5.5%.

DIHK has cut its 2019 GDP forecast to .40% from .60% previously. It estimates GDP growth of .50% for 2020, but the number will likely be revised lower in the coming months.

Commenting on Germany’s frightening export deterioration is Joerg Buck, the CEO & President of the German-Italian Chamber of Commerce, who said: “The DIHK Business Survey shows: Significant slump in business expectations. Not only the export-oriented industry is affected, but also trade and service providers are worried about the future.”

Last week, the Deutsche Bundesbank said the German economy might have entered a technical recession in September.

Schweitzer called on the Federal Government to take immediate action on the “worrying” economic development. The federal government should “act urgently.”

“Our country must take action” before the crisis arrives, he warned.

No matter how much the Bundesbank and ECB attempt to stimulate the Germany economy with countless rounds of monetary policy, the business cycle has overpowered monetary authorities. Germans must prepare for the worst in 2020, as the economy is expected to continue decelerating to crisis levels.

end

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

 

6.Global Issues

Global Carmageddon Continues: Pirelli And VW Warn About “Worsening Market Scenario”

The automotive industry has been mired in recession for the better part of the last 18 months and still shows no signs of stopping. On Tuesday, comments from both VW’s CEO and from tire maker Pirelli, who cut its guidance for 2020, continue to exemplify an industry where the very worst of a recession may still be yet to come.

VW’s CEO said in an interview with Bloomberg early this week that he was cautious about “all regions except South America”, including major car markets like North America, Europe and China.

“We know what needs to be done – get our act together on vehicle launches and be very cautious on costs and expenses,” he commented. He also stated that he wasn’t surprised that PSA and Fiat Chrysler are in merger talks, given speculation about industry consolidation.

Volkswagen is expected to present a new five-year plan to its board in mid-November.

The shift to electric vehicles, more stringent emissions standards and a slowing global economy all continue to weigh on many auto manufacturers. 

Tire maker Pirelli also warned about its operating profit margin and cash flow on Tuesday, saying it would delay the presentation of a new business plan while it works out scenarios for what it sees as a “worsening market scenario”, according to Reuters.

The company forecasted full year margin on adjusted EBIT of between 17% and 17.5%, much lower than already-lowered expectations of 18% to 19%. The company’s adjusted EBIT fell to 685 million euros for the nine months ended September 30, 2019. Pirelli also lowered its full year cash flow expectations to between 330 and 350 million euros, down from expectations of between 350 million and 380 million euros.

The company said that greater fixed costs and lowered production to reduce inventories both stung its guidance.

The company is set to present its industrial plans to 2022 in the first quarter of next year. This presentation was previously supposed to occur on December 11 of this year. Pirelli said the setback was due to the market being “more challenging compared with the forecasts of recent months”.

Chief Executive Marco Tronchetti Porvera said: “In this context, to protect our profitability we have to act deeper to reduce the cost of our products.”

7. OIL ISSUES

Trump Loses More Than Just The Battle Over Nordstream 2

Authored by Tom Luongo via Gold, Goats, ‘n Guns blog,

For the past three years the U.S. has fought the construction of the Nordstream 2 pipeline from Russia to Germany every inch of the way.

The battle came down to the last few miles, literally, as Denmark has been withholding the final environmental permit on Nordstream 2 for months.

The U.S., especially under Trump, have committed themselves to a ‘whole of government approach‘ to stop the 55 bcm natural gas pipeline from making landfall in Germany.

I’ve literally documented every twist and turn of Nordstream 2 over the past few years here (check the archives), at Seeking Alpha and my former Newsletter at Newsmax.

Never once did I think the day wouldn’t come where the U.S. would eventually shut the pipeline down. The reason is simple. Europe, and specifically Germany, need the gas and there is no compelling reason for Germany to cave in the end if it wants to survive the 21st century a first world economy.

Russian piped gas is simply too cheap for any LNG to compete with.

In a sense, this pipeline is Germany’s declaration of independence from seventy-plus years of U.S. policy setting. Never forget that Germany is occupied territory with more than 50,000 U.S. troops stationed there.

So it is supremely rich of President Trump to call Nordstream 2 something that could make Germany a “hostage of Russia” when it’s been a hostage of the U.S. since 1945.

Then again, history isn’t one of Trump’s strong suits.

Poland had been the tip of the U.S. spear in this battle, first declaring the joint venture between Russian gas giant Gazprom and five European oil and gas majors — Wintershall, Uniper, Royal Dutch Shell, ENGIE and OMV — illegal and then forcing through changes to the European gas transit rules.

Today Nordstream 2 is wholly-owned by Gazprom where the five companies listed above are investors as creditors in the pipeline, having put up €9.4 billion as loans versus as partners, thanks to Polish intransigence.

And even if they had backed out, Russian President Vladimir Putin was always clear that the money for Nordstream 2 was available. You have to realize that this pipeline cost roughly three weeks of Russia’s trade surplus.

Poland wants to virtue signal about buying gas from the U.S. to spite Russia. That’s their business. They have other reasons for opposing Nordstream 2, their names are Angela and Merkel.

Because Merkel will be happy to replace gas going through Ukraine with gas coming through Germany to keep the Poles in line on EU integration policy. Germany will control the quotas from Nordstream 2. This is part of the reason why the Poles are so adamantly against it and why they are so set on having their own supplies.

So, they worked with Trump and others to secure their energy future, paying higher prices for the leverage to keep Merkel out of their domestic policy. It’s smart. I get that angle. But they could have gotten a better deal from Putin if they’d been willing to bury the hatchet.

In the end, the Trump administration likely spent more money opposing this project than it cost Gazprom to build it, when you factor in all the other moves made to counter Russia in Ukraine, Afghanistan, Syria and across Europe.

And the goal here was always to stop Nordstream 2 to retain some leverage over Russia by Ukraine in their negotiations of a new gas transit contract which expires at the end of 2019.

The same time that Nordstream 2 was supposed to be completed. U.S. pressure delayed this by a couple of months here as the pipeline won’t be ready on January 1st, but now that the permit has been granted there is no real leverage to play against Russia in Ukraine talks.

The gambit was to stop Nordstream 2 and then lambaste publicly, if not sue, Gazprom for not meeting its contracted volumes for delivery. This would bind the company down for years in more frivolous lawsuits within the EU while the U.S. stepped in, like the white knight, to keep Europeans from freezing to death.

Fortunately, for the world, that plan failed.

Because starving Russia of gas revenues and sending them to the U.S. is not the only goal of opposing Nordstream 2. Europe’s gas needs are so acute that there is plenty of market share to go around.

Bulgaria and other eastern European states are negotiating with Gazprom right now for new trains following path of the Turkstream pipeline across the Black Sea. Serbia is already getting theirs because they are an important bulwark against NATO for Putin.

Putin is in Hungary today talking with Prime Minister Viktor Orban who is also keenly interested in gas from Turkstream.

By the time Gazprom and Putin are done not only will Nordstream 2 be bringing in 55bcm, but Turkstream will have all four projected trains operating bringing in another 68 bcm.

So, which one of these is the real prize?

In the end the story of Nordstream 2 has a happy ending. Because despite the ridiculous rhetoric about European energy security, nothing secures the long-term peace in Europe than stitching the continent together with Asia with energy pipelines.

If Nordstream 2 wasn’t the optimal solution to Europe’s needs blame the U.S. and the EU itself for forcing Russia to scuttle South Stream in 2014 and fomenting a coup and the subsequent failed state known today as Ukraine then as well.

We broke what didn’t need fixing. But the U.S./U.K. obsessions with blunting the rise of China and enacting revenge on Russia for not becoming a vassal state to Wall St. and City of London under Putin wouldn’t be appeased.

There had to be one last major push for central Asian chaos and Nordstream 2 was only of those major offensives, like Syria, the war against the Donbass, the invasion of Yemen and the isolation of Iran.

All of those projects are coming to their very rapid conclusion now. And the geopolitical map will be forever changed.

Nordstream 2 going forward means now that Ukrainian President Zelensky will come to a quick decision on a transit contract with Gazprom. He’s already accepted the ‘Steinmeyer Formula’ for settling the conflict in the Donbass.

He’ll meet with Putin and risk a coup by the Banderists to get this done. He has to or Ukraine will not survive.

After four plus years of stalemate on these issues, like Brexit, when crunch time happens, everyone folds their hands and cuts a deal.

Had somehow Poroshenko remained in power Ukraine would continue to sink into irrelevance as the U.S. would keep them on the same ruinous path out of spite and the vain hope of success in the future.

So the future of Nordstream 2 was written in stone years ago, as Poroshenko’s approval sank into the abyss.

Moreover, Trump has lost the whip hand over Merkel on energy which means a quick reversal of foreign policy positions with respect to Russia. Once the Donbass is solved and a gas transit contract signed/extended and Nordstream 2 completed, expect the EU to lift sanctions on Russia and resume normal trade relations.

The first two things will likely happen now before the end of the year. Sanctions will be lifted in 2020.

Had Nordstream 2 failed, none of these outstanding issues would resolve themselves in the next five years.

This is how important Nordstream 2 was to the future of Europe and it proves that a pipeline and mutually beneficial trade, more so any political union, is a more powerful weapon than all the tanks in the world.

This is one fight I’m glad Trump lost.

*  *  *

Join My Patreon if you want to understand how to profit from these tectonic shifts in the geopolitical landscape. Install the Brave Browser if you think Google shouldn’t decide whether we should talk about them.

8 EMERGING MARKET ISSUES

 

 

 

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

Euro/USA 1.1614 UP .0009 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 /RED

 

 

USA/JAPAN YEN 108.27 DOWN 0.525 (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 1.2950   UP   0.0050  (Brexit March 29/ 2019/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED/BREXIT EXTENDED TO OCT 31/2019//

USA/CAN 1.3168 UP .0003 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  THURSDAY morning in Europe, the Euro ROSE BY 9 basis points, trading now ABOVE the important 1.08 level FALLING to 1.1219 Last night Shanghai COMPOSITE CLOSED DOWN 10.26 POINTS OR 0.35% 

 

//Hang Sang CLOSED UP 239.01 POINTS OR 0.90%

/AUSTRALIA CLOSED DOWN 0,32%// EUROPEAN BOURSES ALL RED

 

Trading from Europe and Asia

EUROPEAN BOURSES ALL RED 

 

 

2/ CHINESE BOURSES / :Hang Sang CLOSED UP 239.01 POINTS OR 0.90%

 

 

/SHANGHAI CLOSED DOWN 10.26 POINTS OR 0.35%

 

Australia BOURSE CLOSED DOWN. 32% 

 

 

Nikkei (Japan) CLOSED UP 83.92  POINTS OR 0.37%

 

 

 

INDIA’S SENSEX  IN THE GREEN

Gold very early morning trading: 1505.52

silver:$18.06-

Early THURSDAY morning USA 10 year bond yield: 1.74% !!! DOWN 3 IN POINTS from WEDNESDAY’S night in basis points and it is trading WELL BELOW resistance at 2.27-2.32%.

 

The 30 yr bond yield 2.21 DOWN 3  IN BASIS POINTS from WEDNESDAY night.

USA dollar index early WEDNESDAY morning: 97.27 DOWN 37 CENT(S) from  WEDNESDAY’s close.

This ends early morning numbers THURSDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx6

And now your closing THURSDAY NUMBERS \1: 00 PM

Portuguese 10 year bond yield: 0.17% DOWN 5 in basis point(s) yield from YESTERDAY/

JAPANESE BOND YIELD: -.13%  DOWN 0   BASIS POINTS from YESTERDAY/JAPAN losing control of its yield curve/56

SPANISH 10 YR BOND YIELD: 0.24%//DOWN 4 in basis point yield from yesterday.

ITALIAN 10 YR BOND YIELD:0.92 DOWN 8 points in basis points yield from yesterday./

 

 

the Italian 10 yr bond yield is trading 68 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 1.33% 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 THURSDAY

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

Euro/USA 1.1149  DOWN     .0003 or 3 basis points

USA/Japan: 108.05 DOWN .737 OR YEN UP 74  basis points/

Great Britain/USA 1.2941 UP .0078 POUND UP 78  BASIS POINTS)

Canadian dollar up 9 basis points to 1.3151

 

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The USA/Yuan,CNY: AT 7.0391    ON SHORE  (DOWN)..GETTING DANGEROUS

THE USA/YUAN OFFSHORE:  7.0497  (YUAN DOWN)..GETTING REALLY DANGEROUS

TURKISH LIRA:  5.7219 EXTREMELY DANGEROUS LEVEL/DEATH WISH.

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

 

Your closing 10 yr US bond yield DOWN 7 IN basis points from WEDNESDAY at 1.70 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.19 DOWN 6 in basis points on the day

Your closing USA dollar index, 97.35 DOWN 29  CENT(S) ON THE DAY/1.00 PM/

 

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

London: CLOSED DOWN 72.96  1.00%

German Dax :  CLOSED DOWN 21.86 POINTS OR .17%

 

Paris Cac CLOSED DOWN 19.87 POINTS 0.34%

Spain IBEX CLOSED DOWN 8.60 POINTS or 0.09%

Italian MIB: CLOSED UP 86.88 POINTS OR 0.38%

 

 

 

 

 

WTI Oil price; 54.07 12:00  PM  EST

Brent Oil: 59.46 12:00 EST

USA /RUSSIAN /   RUBLE FALLS:    64.10  THE CROSS HIGHER BY 0.33 RUBLES/DOLLAR (RUBLE LOWER BY 33 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 :  XX//

 

 

BRENT :  XX

USA 10 YR BOND YIELD: … 1.68 DOWN 9 BASIS PTS…

 

 

 

USA 30 YR BOND YIELD: 2.18 BASIS PTS7  OR DOWN ..

 

 

 

 

 

EURO/USA 1XXX ( UP XX   BASIS POINTS)

USA/JAPANESE YEN:XX DOWN . (YEN UP XX BASIS POINTS/..

 

 

USA DOLLAR INDEX: XX DOWN XX cent(s)/

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

 

the Turkish lira close: XX

 

 

the Russian rouble XX   UP 0.XX Roubles against the uSA dollar.( UP 3 BASIS POINTS)

Canadian dollar:  XX UP XX BASIS pts

 

German 10 yr bond yield at 5 pm: ,-0.41%

 

The Dow closed DOWN 140.46 OR .52%

 

 

NASDAQ closed DOWN 11.62 OR .14%

 

 


VOLATILITY INDEX:  13.27 CLOSED UP .94

LIBOR 3 MONTH DURATION: 1.909%//libor dropping like a stone

 

USA trading today in Graph Form

Stocks Slump, Gold Jumps On Powell-Pause, Trade-Turmoil, & Dismal-Data

October ended with the most disappointing macro-economic data since April 2017…

Source: Bloomberg

But stocks were holding up well until China blew it…

China chundered in the trade-deal punchbowl overnight, claiming that a deal was unlikely and despite Kudlow and Trump’s best efforts, the odds of a trade deal tumbled (but remain up on the month)…

Source: Bloomberg

And that crushed the gains in stocks that Powell had created…

Source: Bloomberg

Chinese stocks managed to hold on to gains from post-Golden-Week buying but faded the last few days as reality of the non-deal trade-deal hit investors…

Source: Bloomberg

European Stocks ended October higher with UK’s FTSE lagging and Germany’s DAX leading…

Source: Bloomberg

All major US Stock indices were higher in October, led by Nasdaq (Dow was a laggard) but the last few days has seen selling…

Source: Bloomberg

NOTE that US, Europe, and China all saw stocks rise once China returned from Golden Week

A daft end to the day…

 

US equity gains came on the back of an almost non-stop short-squeeze…

Source: Bloomberg

Momo ended October just in the red, after a big slide intramonth…

Source: Bloomberg

Defensives and Cyclicals were practically unchanged on the month, thanks to a surge in cyclical risk-taking mid-month…

Source: Bloomberg

Financials outperformed on the month but started to fall back in line with the yield curve in the last few days…

Source: Bloomberg

Smart Money has started to decouple from stocks…

 

Source: Bloomberg

Equity and credit protection costs collapsed in October…

 

Source: Bloomberg

Treasury yields were mixed on the month with the short-end lower and 10Y/30Y higher by the end (despite a collapse in yields the last few days)…

Source: Bloomberg

This divergence meant that the yield curve (2s10s) soared in October – its biggest steepening since Dec 2016 (right after Trump elected)…

Source: Bloomberg

The Dollar Index dived in October (after 3 straight months higher), the worst month since Jan 2018, and back in the red for 2019 (back below 200DMA)…

Source: Bloomberg

While the rest of the world appears to be weakening vs the dollar, the dollar itself is losing notable ground against ‘money’…

 

Source: Bloomberg

Cable soared over 5% in October, the biggest gain since May 2009 (back above 200DMA)…

Source: Bloomberg

Offshore Yuan surged in October, its best gain since January 2019…

Source: Bloomberg

Despite an ugly puke late in the month, Cryptos ended October higher (after 3 down months), led by Bitcoin Cash…

Source: Bloomberg

Bitcoin bounced perfectly off its 200DMA during the month, roaring back above a key trendline…

Source: Bloomberg

Silver soared in October and while the dollar dived, crude ended lower…

Source: Bloomberg

This is silver’s 4th month higher in the last 5, ending back above $18…

Gold managed to end October higher (up 5 of the last 6 months) and back above $1500…

Silver’s outperformance of gold erased September’s relative gains…

Source: Bloomberg

WTI ended back below $55 after three big legs down this week…

Finally, we note that the Fed’s liquidity spigot is wide open and shows no signs of being “fixed”…

Source: Bloomberg

Additionally, after today’s vote to formalize the public phase of the House’s impeachment inquiry, odds of Trump being impeached by the House have risen to 79% BUT the odds of him completing his first term (i.e. a bet that the Senate will reject the impeachment) is at 70%…

Source: Bloomberg

And for those claim that global economic data is bottoming… it’s not!! (October was the worst month since May 2018)…

Source: Bloomberg

And what happens next, now that The Fed has shown their cards…

Source: @StockCats

Could happen, especially given the stock market’s decoupling from Fed expectations…

 

Source: Bloomberg

end

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

MARKET TRADING//USA

a)Market trading/LAST NIGHT/USA

Futures Slide On Reports Top Chinese Officials Doubt Trade Deal Will Ever Happen

Contradicting a Reuters report published just a few hours prior, Bloomberg dropped one of the most discouraging scoops about the US-China trade talks that we’ve seen in months, sending stock futures lower around the world.

BBG reported Thursday morning that many senior Chinese officials quietly suspect that the “Phase 1” partial trade deal purportedly reached earlier this month in Washington will soon fall apart, and that the odds of the two sides reaching a more comprehensive final deal are effectively zero.

The report reads like a bad WaPo hit piece on Trump, accusing him of being unrealistic about Beijing’s willingness to compromise.

As it stands – or at least as it stood during President Trump’s most recent press conference with Vice Premier Liu He – the first phase of the trade deal is essentially this: Chinese purchases of US farm goods and other products such as aircraft. It’s also expected to include Chinese commitments to protect American intellectual property and an agreement by both sides not to manipulate their currencies. In return, Trump agreed to drop the planned October tariff hikes, while remaining open to dropping the December hike as well.

Earlier on Thursday, reports speculated that the cancellation of the upcoming APEC conference in Santiago, where the US and Chinese delegations were supposed to finalize the “Phase One” deal, might give the two sides to work out a broader deal.

According to BBG’s sources, this is the bare minimum that Beijing would accept to move ahead with Phase 1: a commitment from the Americans to removing tariffs in Phase 2, and agreeing to cancel the next round of tariffs, set to take effect in December.

The people familiar with China’s position said the tariffs don’t all have to be removed immediately, but they must be part of the next stage. China also wants Trump to cancel a new wave of import taxes due to take effect Dec. 15 on American consumer favorites such as smartphones and toys as part of the phase one deal, the people said.

The drop in eminis after the report wiped out half of yesterday’s post-Fed gains.

And offshore yuan, the most closely watched indicator of trade-deal sentiment, also dropped on the news.

While Beijing remains “open” to more talks, senior officials privately don’t see much of a point. Many of the big structural changes that Washington is demanding are simply unacceptable to Beijing, and have been since the beginning. With Washington refusing to budge on lifting all the new trade war tariffs, any big “asks” will likely be off the table, seeing as Beijing insists that removing all of the new tariffs be part of any final deal. Doing otherwise would simply be “politically unfeasible” for Xi.

Then again, it’s also possible that the story could be a plant by the White House. With two FOMC voters opposing yesterday’s rate-cut, and the central bank signalling that it’s done with its ‘mid-cycle adjustment’, after yesterday, perhaps the only way for President Trump to browbeat the central bank into more easing would be to come out and declare that the trade talks have failed.

zerohedge@zerohedge

Fed won’t cut again until Trump tweets that trade talks have collapsed

Hey @realDonaldTrump you know what to do

END
THEN…
MARKETS JUST NOT BUYING IT..

Kudlow Tries To Rescue Markets After China Spoiled The Party

Dow futures were down a horrifying 90 points this morning, erasing all of Powell’s pumpathon after China poured cold water on US-China trade talks. So what does the administration do – to rescue stocks from a terrifying 0.3$ drop?

Unleashes The Kudlow:

  • *KUDLOW SAYS U.S.-CHINA TALKS GOING SMOOTHLY: WHITE HOUSE AIDE

And the result, reflexive buying by algos…

But it seems like the White House’s jawboning is losing its mojo.

 

b)MARKET TRADING/USA/AFTERNOON

Stocks Slammed As Trump Rages “China’s Not Our Problem, The Fed Is!”

One day after the Fed cut rates, Trump wants more.

In a bizarre tirade aimed at the US central bank, the president who three years ago accused Yellen of creating a “big, fat, ugly bubble” when the S&P was 30% lower), appears to have taken a look at today’s stock market slide, and predictably, is is very angry

People are VERY disappointed in Jay Powell and the Federal Reserve. The Fed has called it wrong from the beginning, too fast, too slow. They even tightened in the beginning. Others are running circles around them and laughing all the way to the bank. Dollar & Rates are hurting our manufacturers.

We should have lower interest rates than Germany, Japan and all others. We are now, by far, the biggest and strongest Country, but the Fed puts us at a competitive disadvantage. China is not our problem, the Federal Reserve is! We will win anyway.

Here’s what prompted Trump’s ire: the Dow is down over 350 points from post-Powell highs.

So to summarize:

Powell says “We won’t cut any more unless there is a crisis”

Trump says “Our enemies at the Fed must cut more”

What happens next?

Spoiler alert: Trump is about to realize that the only way to maintain the market rally is to talk down trade and force The Fed to keep cutting til Nov 2020, just as we observed yesterday:

zerohedge@zerohedge

Fed won’t cut again until Trump tweets that trade talks have collapsed

Hey @realDonaldTrump you know what to do

One thing is for sure, the stock market is not drinking from the same bucket of hawkish slop that Fed Funds futures are…

Source: Bloomberg

ii)Market data/USA

US Incomes, Spending Accelerated In September As Fed’s Favorite Inflation Signal Slowed

After August’s slowdown in annual growth for spending and income, analysts forecast a modest rebound in September but the data disappointed with personal income up 0.3% MoM (in line with expectations) but spending rose just 0.2% MoM (below the +0.3% MoM expected).

Source: Bloomberg

On a Year-over-year basis, both incomes and spending growth accelerated…

Source: Bloomberg

The divergence between spending and income has sent the savings rate up to 6-month highs…

Source: Bloomberg

And one of The Fed’s most-watched inflation signals – core PCE deflator – slowed YoY, as real personal spending began to re-accelerate…

Source: Bloomberg

Get back to work, Mr.Powell!

END

iii) Important USA Economic Stories

Yes, Virginia, There Is A Deep State And It’s Feeding The Anti-POTUS Mob

Authored by David Stockman via TargetLiberty.com,

The prepared statement of the latest UkraineGate whistle-blower is well worth the read. It tells you all you need to know about why the Deep State apparatchiks are coming out of the woodwork in a massive assault on America’s duly elected president.

  • They are deathly afraid Trump will begin to dismantle a far-flung Empire which has
  • …wreaked havoc around the world,
  • …bled America’s fiscal accounts dry, and
  • …fostered unspeakable prosperity among the beltway’s legions of empire-supporting agencies, contractors, think tanks, foreign lobbies, NGO’s and K-street racketeers.

Whether out of common sense, naiveté or just contrariness, the Donald has dared to question and disrupt the Empire’s core policy on the Ukraine/Russia file. And that’s apparently exactly why the whistleblower de jour, Lt. Col. Alexander Vindman, wrote his now ballyhooed memos.

He feared that Trump’s appropriate desire to get to the bottom of the well-documented Ukrainian involvement in the Obama Administration’s illegal spying on his 2016 presidential campaign would undermine the bipartisan consensus on Capitol Hill for Washington’s utterly wrong-headed Ukraine policy.

Stated more crudely, Washington overthrew the duly elected government of Ukraine in early 2014 because its leader was deemed too cozy with Moscow. And in the vanguard of that illegal meddling in the governance of a sovereign foreign state was Obama’s state department led by neocon Assistant Secretary Victoria Nuland, Washington’s self-appointed roving proconsul John McCain and at length Vice-President Joe Biden.

After aiding a motley phalanx of ultra-nationalists, crypto-Nazi and political fortune seekers in overthrowing President Viktor Yanukovych, Washington has stood-up what are essentially puppet governments. The purpose has been to cause maximum abrasion with Putin and Russia; and at a cost of billions in aid from the US and other western agencies designed to prop up the economic basket case and cease pool of corruption which passes for the Ukrainian economy.

The Deep State narrative turns these realities on their head, of course, claiming that the mess in Ukraine is all the doing of the demonic Vladimir Putin. Accordingly, the very safety and security of the citizens of Lincoln NE and Springfield MA is allegedly on the line in a territory on Russia’s doorstep, which has historically been a meandering set of borders in search of a country when it was not otherwise a willing vassal and economic adjunct of Mother Russia.

As it happens, Lt. Colonel Vindman is a vociferous partisan of Washington’s Big Lie about the Russian ogre, and was virtually a fifth column operative in the viper’s nest of neocons at the Donald’s national security council. In fact, Vindman reported to Russophobe Fiona Hill, who reported to the Walrus of Forever War himself, John Bolton.

So despite all the Democrats’ crocodile tears for the constitution and rule of law, Vindman’s beef wasn’t really about their whole abuse of power canard. Nor did it touch upon the risible Dem/MSM nonsense that in asking a foreign government to undertake a legitimate action (an investigation of the corrupt use of taxpayers money by the former Vice President) Trump was committing a violation of U.S. election laws.

To the contrary, the gravamen of the colonel’s concern was domestic politics and the possibility that in withholding the $380 million of pending Ukrainian aid (which should have been zero in the first place) and pressing the Biden investigation, Trump would alienate Capitol Hill Democrats and leave the Deep State’s policy of using the Ukraine as an anti-Putin battering ram high and dry.

“…. I was worried about the implications for the U.S. government’s support of Ukraine…. “I realized that if Ukraine pursued an investigation into the Bidens and Burisma, it would likely be interpreted as a partisan play which would undoubtedly result in Ukraine losing the bipartisan support it has thus far maintained.”

“This would all undermine U.S. national security. Following the call, I again reported my concerns to NSC’s lead counsel.”

Folks, Lt. Col. Vindman was not elected to nothin’. If he’s a proud 20-year veteran of the US Army and diplomatic service as he claims, fine. But his job is to implement policy as decided by the elected representatives of the people, not to free lance in the cause of the Empire group-think in which he is obviously and hopelessly steeped.

So let’s cut to the chase: The policy he feared the Donald might be jeopardizing by his pressure tactics with President Zelensky has been a travesty from start to finish. The Ukraine has no bearing on America’s homeland security whatsoever, and the policies of its government vis a vis Russia or any of its other neighbors are none of Washington’s cotton picking business.

You can’t be more emphatic about the utter irrelevancy of Ukraine to America’s homeland security. Even at the pre-coup peak in 2013 it had a miniscule GDP of $185 billion, which has since plunged by 30% to $130 billion. Even if Putin were foolish enough to annex the approximate 30 million Russian-hating Ukrainians outside of the Russian-speaking eastern Donbas region, which he surely is not, it wouldn’t amount to a hill of beans in the strategic equation.

Ukraine amounts to just 8% of Russia’s pint-sized GDP and is actually worthless to the Kremlin. That’s because the cost of occupation and pacification of the non-Russian speaking majority of the country would vastly outweigh whatever industrial and material output it might steal from the Ukrainians.

Besides, what in the hell is wrong with Washington when it gets all hot and bothered about a no-count territory plagued with economic failure and which generates annually about two days worth of US output?

Moreover, even if you have warm and fuzzy regard for the rights and liberties of the Ukrainian “nation”, which has existed only infrequently as an independent state with wildly variant borders during the last 800 years, the question remains. Namely, how in the world can it be argued that its people were not better off in 2013 under an elected government of the Regions party that tilted toward Russia compared to the economic calamity which exits today and is only saved from complete collapse by US and European subventions?

So here’s where the Deep State’s hegemonic “sole super-power” world view comes in. Washington’s Ukraine policy has nothing to do with homeland security or prevention of military attack on American shores.

Instead, it is based on policing the world and demonizing the rump-state of Russia which emerged after the Soviet Union slithered off the pages of history in 1991. What was left was a decimated economy with half the former population and a current day GDP of $1.6 trillion, which is actually less than the GDP of the New York metro area. Still, the Warfare State needs palpable “enemies” and adversaries—no matter how tendentious the case— to justify its massive fiscal drain ($1.1 trillion counting everything) on US taxpayers, both current and unborn; and it also needs expansive missions like spreading the blessings of democracy, prosperity and western culture to the far corners of the earth.

And that’s not our hyperbole in the slightest; it’s essentially the content of Vindman’s whistleblower testimony to Shifty Schiff’s Star Chamber proceedings today.

Thus, when it comes to the blatant lie that Russia is an expansionist power, Vindman’s purple prose would make even the late war-mongering Senator from Arizona proud:

Since 2008, Russia has manifested an overtly aggressive foreign policy, leveraging military power and employing hybrid warfare to achieve its objectives of regional hegemony and global influence. Absent a deterrent to dissuade Russia from such aggression, there is an increased risk of further confrontations with the West. In this situation, a strong and independent Ukraine is critical to U.S. national security interests because Ukraine is a frontline state and a bulwark against Russian aggression.

Wow! That’s just bellicose rubbish. A “frontline state and bulwark”my eye. In fact, during the years since 1991 when Washington has invaded and virtually destroyed upwards of a dozen sovereign countries, Russia hasn’t invaded anyone! But the reference to 2008 does tell you exactly where Vindman is coming from. He’s obviously referring to Russia’s thwarting of Georgia’s invasion of South Ossetia in August 2008.

That incident has been spun by the Deep State ever since as Russian aggression when it was just the opposite.

To wit, it was an aggressive military invasion by Georgia designed to reclaim the break-away republic of South Ossetia. The real culprit was its mercurial leader and Washington tool, Mikheil Saakashvili, who had been egged on by Senator McCain and the usual cast of neocons with the promise of Washington military help, which fortunately did not happen.

But a subsequent 1,000 page report by an independent EU fact-finding mission led by a renown Swiss diplomat makes clear that the Georgian accusations of Russian aggression were completely fabricated.

“It was Georgia which triggered off the war when it attacked (South Ossetian capital) Tskhinvali” said Heidi Tagliavini, the mission head, in a statement. Although the EU commission tactfully avoided using the word “lie,” the report implies that Saakashvili did not tell the truth about how the war started.

The same is true of the so-called annexation of Crimea and the Kremlin’s support for the breakaway republics in eastern Ukraine.

As to the former, the population of Crimea is overwhelmingly Russian, and for 171-years from 1783 to 1954 it was an integral province of Czarist Russia. It got arbitrarily assigned to the Ukraine Soviet Socialist Republic by Khrushchev after he won the post-Stalin power struggle in 1954 as a reward to his compatriots in Kiev—even though less than 15% of the population was Ukrainian.

After the US funded, supported and instantly recognized coup in Kiev in February 2014 and the immediate passage of virulent anti-Russian legislation by the putsch, the Russian-speaking population of Crimea voted overwhelmingly (87%) to return to Mother Russia. The so-called coercive annexation by Russia is a figment of War Party propaganda, and implies a willingness to use American money and arms to enforce the dead hand of the Soviet Presidium.

And the same story goes for the Donbas. The largely Russian speaking population of this industrial region, which is highly integrated with the Russian economy, wants to be separated from the Ukrainian nationalists in Kiev who have launched a vicious war to subdue them.

But if the Donbas were to be partitioned or even if it voted to join the Russian Federation, so what?

The honest truth of the matter is that Europe is flush with partitioned states. These include Slovakia and the Czech Republic as well as the manifold offspring of Yugoslavia including North Macedonia, Slovenia, Croatia, Bosnia, Montenegro and Serbia, which, at the insistence of Washington, got further carved up by the partition of Kosovo.

That is to say, once Washington upended the tenuous political/ethnic balance of post- Soviet Ukraine by supporting the nationalist coup, there was still no reason that the Yugoslav model of partition could not have settled the matter.

In fact, the 5-year war on the Donbas—which has killed upwards of 20,000 and brought economic and fiscal ruin to both the region and Ukraine as a whole—wouldn’t have lasted more than a few weeks without the promise of western economic and military aid and political support.

The needless tragedy there is not the fruit of Russian aggression. It’s the consequence of Washington meddling, including all the corruption which has flowered after Ukraine was turned into a Washington vassal and found it necessary to hire Washington lobbyists and racketeers like Hunter Biden and Devon Archer (then Secretary of State John Kerry’s former campaign bundler) to keep the cash flowing.

Needless to say, the Deep State slathers this toxic reality in a narrative that is pure hogwash. And Colonel Vindman has it down pat: Namely, under the tutelage, money and political and military cover of the Washington Imperium, Ukraine is to be brought into the “Euro-Atlantic community” as a splendid new democracy.

The bolded term, of course, is an undisguised euphemism for NATO:

In spite of being under assault from Russia for more than five years, Ukraine has taken major steps towards integrating with the West. The U.S. government policy community’s view is that the election of President Volodymyr Zelensky and the promise of reforms to eliminate corruption will lock in Ukraine’s Western-leaning trajectory, and allow Ukraine to realize its dream of a vibrant democracy and economic prosperity.

The United States and Ukraine are and must remain strategic partners, working together to realize the shared vision of a stable, prosperous, and democratic Ukraine that is integrated into the Euro-Atlantic community.

Here’s the thing. The expansion of NATO to the very doorstep of Russia was the most colossal mistake of the post-cold war period. And the War Party’s insistence that this should to taken all the way to the incorporation of Ukraine and Georgia—-historic vassals of Russia—actually trespasses upon the very border of insanity.

Indeed, the father of containment and the intellectual architect of NATO in the late 1940s, the great George F. Kennan, hit the nail on the head when lightweight Clintonistas like Strobe Talbot and Madeleine Albright launched the NATO expansion process in the 1990s:

”I think it is the beginning of a new cold war,” said Mr. Kennan from his Princeton home. ”I think the Russians will gradually react quite adversely and it will affect their policies. I think it is a tragic mistake. There was no reason for this whatsoever. No one was threatening anybody else. This expansion would make the Founding Fathers of this country turn over in their graves. We have signed up to protect a whole series of countries, even though we have neither the resources nor the intention to do so in any serious way. [NATO expansion] was simply a light-hearted action by a Senate that has no real interest in foreign affairs.”

“What bothers me is how superficial and ill informed the whole Senate debate was,” added Mr. Kennan, who was present at the creation of NATO and whose anonymous 1947 article in the journal Foreign Affairs, signed ”X,” defined America’s cold-war containment policy for 40 years. ”I was particularly bothered by the references to Russia as a country dying to attack Western Europe. Don’t people understand? Our differences in the cold war were with the Soviet Communist regime. And now we are turning our backs on the very people who mounted the greatest bloodless revolution in history to remove that Soviet regime.

”And Russia’s democracy is as far advanced, if not farther, as any of these countries we’ve just signed up to defend from Russia,” said Mr. Kennan, who joined the State Department in 1926 and was U.S. Ambassador to Moscow in 1952. ”It shows so little understanding of Russian history and Soviet history. Of course there is going to be a bad reaction from Russia, and then [the NATO expanders] will say that we always told you that is how the Russians are — but this is just wrong.”

He couldn’t have been more right about the substance of what would happen. But little did even Kennan realize that once in motion any even tepid effort to question or stop it–per the Donald’s campaign rhetoric about the obsolescence of NATO–would actually provoke a Deep State assault on American democracy itself

So there’s your Deep State at work. It isn’t some kind of sinister conspiracy lurking deep in the shadows of the national security machinery.

To the contrary, it’s right there in the broad daylight of the Imperial City. It is populated by hundreds of thousands of foot soldiers like Colonel Vindman who make a career of drinking the Cool Aid, collecting a pay check from the state and propagating the policies of Empire First—policies which are immoral, illegal, unaffordable and have absolutely nothing to do with protecting America’s liberty, prosperity and security inside the great ocean moats, which once upon a time birthed a peace-loving Republic.

We have no illusions, of course, that the Donald is a peace-lover. He’s self-evidently first and foremost a Donald-lover.

Still, what is underway in Washington—first with the RussiaGate hoax and now with UkraineGate and impeachment—is an extra-constitutional political lynching, and one that has turned Washington’s desperate, mendacious Dem pols into complaisant handmaids of the Deep State.

So Lt. Colonel Alexander Vindman isn’t some kind of whistle-blowing hero. He’s just another mindless cog in the wheel of Empire talking his own book and thereby abetting the political mob that is now threatening the very constitution he was sworn to uphold.

*  *  *

The above originally appeared at David Stockman’s Contra Corner.

END

Repo-calypse: No, Jamie, It Wasn’t The SLR!

Authored by Jeffrey Snider via Alhambra Investment Partners,

JP Morgan’s CEO Jamie Dimon has been running around Washington claiming that mid-September’s repo rumble was the result of the post-crisis regulatory environment. He now says that his bank had the spare cash and was willing to cash in on double digit repo rates but it was government rules which prevented that from happening. It’s unclear (but we can, and I will, guess) why he didn’t make the same claim and warn everyone on Friday, September 13, before the seasonal low point in liquidity that everyone knew was there.

It wasn’t until quite a while afterward during that period when a stunned financial world was still trying (and failing) to make sense of what had happened.

You probably won’t be surprised to learn that this isn’t the first time Wall Street has complained about these very same regulations. They’ve been against them from the very beginning. What’s different now is that they have a very public event about which nobody has any real answers to rally support. It all sounds pretty plausible (it always sounds plausible, yet never explains most of the facts).

Suddenly, Treasury Secretary Mnuchin seems to be siding with the banks. Having spoken directly with Mr. Dimon recently, Secretary Mnuchin today says:

The banks have raised an issue around intra-day liquidity, and that is something that makes sense for regulators to look at.

That issue they’ve raised is something called the Supplemental Leverage Ratio, or SLR. It was created and applied to Global Systemically Important Bank organizations, or G-SIB. The FDIC, in particular, had pushed for the SLR because quite rightly the agency wasn’t very thrilled about the prospects for having to absorb potential deposit liabilities of huge banks sporting enormous leverage getting shut out of wholesale funding markets.

The Global Financial Crisis of 2008 demonstrated conclusively this wasn’t a trivial possibility.

To put it simply, regulators would require designated G-SIB’s (there are 8 in the US) to hold an additional liquidity buffer (SLR) based upon their reported leverage (one lesson authorities did learn from Bear, Lehman, and the rest). It would be a liquidity surcharge which would have to be met by a set percentage of holdings in unencumbered cash and highly liquid assets like UST’s over and above other regulatory (like Basel 3’s LCR) and good standing requirements.

If any G-SIB bank wanted to employ more leverage, more power to them. The regulation was an attempt to recognize partly the risks to others beyond the one bank involved in doing so. Regardless of capital ratios, worthless capital ratios, beyond a preset threshold the more leverage the greater the SLR; more liquid assets including cash and Treasuries need to be held as further liquidity reserves.

So, again, blaming the SLR along with Basel 3’s Liquidity Coverage Ratio sounds like a plausible excuse for September’s repo malfunction. JP Morgan, as its CEO now says, wanted to act but couldn’t because his bank’s SLR surcharge was the primary impediment.

We also know this because they said essentially the same thing in September…2018. Again, you probably won’t be surprised to learn that early on last year the banks were supporting regulatory efforts to make changes to what is now the e-SLR (the “e” stands for “enhanced” while there is room for debate about whether that’s the proper use of that particular word in this context). Martin J. Gruenberg, an FDIC board member, spoke in Washington last September to that effect:

On April 11 of this year [2018], the Federal Reserve Board and the OCC released a joint notice of proposed rulemaking, or NPR, to make changes to the enhanced supplementary leverage ratio capital requirement applied to the eight U.S. G-SIBs and their federally insured bank subsidiaries. The changes would have the effect of reducing the capital requirement. They are not technical fixes. They would significantly weaken constraints on financial leverage in systemically important banks put in place in response to the crisis.

And where did that “e” come from in the first place? Way back in July 2017, Wall Street was lobbying for changes to the same regulatory paradigm back then, too. What I wrote at the time was:

Released on June 12 [2017], it suggested that the SLR might be reformulated to make it less imposing. The SLR was initially proposed so that the risk-weighting shenanigans (regulatory capital relief) would at least be exposed by this measure of true(r) leverage. It takes Tier 1 capital divided by the sum of on-balance sheet assets plus off-balance sheet exposures. There is still a large gray area in that latter variable.

Banks want now to deduct certain cash and liquid assets (including UST’s) from it. The result of which is supposed to, in Treasury’s estimation, unlock significant liquidity potential of the global banking system from just American operations. It is, in other words, the official acceptance of at least part of the idea that one big problem in the economy is insufficient liquidity (no sh@#).

The banks succeeded and Secretary Mnuchin’s Treasury Department issued its favorable report that very JuneMost attention was focused on what it said about the so-called Volcker Rule while the more complex (and more relevant) SLR, e-SLR, and G-SIB designations remained, pardon me, in the shadows.

To sum upWall Street has hated almost every single post-crisis regulation that has been implemented, though in some cases they’ve been right to do so. However, there is absolutely no reason to believe that the e-SLR or G-SIB rules had anything to do with the repo market outbreak in September 2019.

What’s been constant is the banking system’s ongoing efforts to remove these kinds of regulations. At the same time, problems in the repo market have been nearly as constant. Yet , you didn’t hear a single thing about the SLR during any of the other outbreaks simply because no one paid any attention to those prior bouts of repo market illiquidity.

There was no opportunity, therefore, to pin the regulation on something bad.

The only thing that changed, in its aftermath, was that the public for once had no choice but to look at the repo market and the funding environment. With attention now fixed and no plausible answers being offered, all of a sudden it’s now evidence against a regulation banks have been actively opposing for years.

Shocking, I know.

As is the fact that May 29, 2018, had more to do with these repo market woes than anything about the SLR and the like. If that particular constraint was such a major issue in September, why wasn’t it in May 29 the prior year when the Treasury market began to embarrass Mr. Dimon and his prediction of 4% and even 5% 10-year UST yields? Repo rates were elevated at that time, too.

Obviously, in the middle of 2018, the head of JP Morgan, the bank allegedly suffering under the unfair imposition of out-of-touch regulators, saw no reason why the US and global economy wouldn’t soar in an all-but-guaranteed inflationary breakout (interest rates had nowhere to go but up). Implicit in that view was a resilient and robust global financial system flourishing without the hint of liquidity issues.

Dimon opposed the SLR (and LCR) when he fully believed things were really good, and he opposes the SLR now that he’s not so sure and he has something bad with which to blame. And he will oppose the SLR tomorrow if things really do turn around, and especially if they don’t.

So, is it that Dimon had no idea what was really going on during 2018 at his own bank, and has therefore come around to thinking some version of the SLR is to blame for getting 2019 all wrong? Or, is it because he had and has no real idea of the liquidity system that after being caught totally off-guard by pretty much everything he is cynically seeking to settle a longstanding score about the one thing he does know well?

When I came up with the zoo analogy to try to describe what’s going on, I didn’t realize just how well it would fit the times. What’s worse, the financial media will now be filled with stories about how it must be that Dimon is right! A real zoo.

Therefore, nothing will change even if the SLR does get changed.

end

Snyder: What In The World Is The Federal Reserve Thinking???

Authored by Michael Snyder via The Economic Collapse blog,

You don’t use up all of your ammunition before the battle even begins. 

The U.S. economy has not even officially entered recession territory yet, although many experts are definitely anticipating one in 2020.  When that recession arrives, the Federal Reserve is going to want as much ammunition to fight it as possible.  So I was horrified to learn that the Federal Reserve announced on Wednesday that interest rates are being slashed once again.  We have now had three interest rate cuts in 2019 as the Federal Reserve desperately attempts to revive the stalling U.S. economy.  But what are they going to do during the next recession when they have already pushed interest rates all the way to the floor and they can’t push them any lower? 

In addition, in recent days the Federal Reserve has decided to absolutely flood the financial system with new money in a desperate attempt to stabilize the repo market.  In essence, the Federal Reserve has launched a massive new round of quantitative easing even before a major crisis has erupted on Wall Street.  I can understand trying to be proactive, but in reality quantitative easing is an extreme emergency measure that should only be used in the most desperate of situations.  If the Fed is creating this much new money now, what are they going to do once things really get bad?  Are we destined to become the next Venezuela?

For a long time, the Federal Reserve has insisted that the U.S. economy is in good shape.  If that is true, there is no way in the world that the Fed should be cutting interest rates.  But that is exactly what happened on Wednesday

In a vote widely anticipated by financial markets, the central bank’s Federal Open Market Committee lowered its benchmark funds rate by 25 basis points to a range of 1.5% to 1.75%. The rate sets what banks charge each other for overnight lending but is also tied to most forms of revolving consumer debt.

It was the third cut this year as part of what Fed Chairman Jerome Powell has characterized as a “midcycle adjustment” in a maturing economic expansion.

With rates now so close to zero, there isn’t going to be much that the Fed can do in that regard once the next recession strikes.

According to Fed Chair Jerome Powell, this latest rate cut was done for “insurance” purposes

Powell said lowering the rate again was ‘insurance’, or protection needed because ‘weakness in global growth and trade developments have weighed on the economy and posed ongoing risks’.

If the U.S. economy doesn’t plunge into a deep recession next year, Powell and the other bureaucrats at the Fed will probably be applauded for these moves.

But if we do experience a significant economic downturn, they will be caught with their pants down.

Yes, the U.S. economy is definitely slowing down, but this week we learned that it still grew at an annual rate of 1.9 percent last quarter.

1.9 percent is not good at all, and if honest numbers were being used it would show that our economy is actually contracting.  But at least things are relatively stable for the moment, and as long as things are relatively stable the Federal Reserve should not be resorting to emergency measures.

Of course Wall Street was absolutely thrilled that the Fed cut rates again, and news of the rate cut pushed the S&P 500 to yet another all-time record high

Stocks advanced Wednesday after the Federal Reserve cut interest rates for the third time this year, propelling the Standard & Poor’s 500 to a fresh record.

The S&P 500 index added 9.88 points, or 0.3%, to close at 3046.77. The Dow Jones industrial average climbed 115.27 points, or 0.4%, to end at 27,186.69. The Nasdaq added 27.12 points, or 0.3%, at 8,303.98.

And without a doubt, this rate cut is good for consumers.  Rates on mortgages, auto loans and credit cards will go down, and that will save average Americans a lot of money

These Fed interest rate cuts are starting to add up, lowering costs for many Americans who use credit cards or take out loans while squeezing savers.

The Federal Reserve lowered its benchmark interest rate Wednesday by a quarter percentage point for the third time in the past three months. The move is likely to further trim borrowing costs on credit cards, home equity lines, adjustable-rate mortgages and auto loans.

But this is yet another example of the short-term thinking that is plaguing our society.

When the next recession arrives, the Fed will be able to cut rates a handful of times, and then that will be the end of it.

The Fed should have also held off on buying more bonds until we really needed it as well.  Even though a new financial crisis has not even started yet, the Fed has been creating money like crazy and their balance sheet has ballooned “by about $100 billion over the past month”

The Fed has been buying bonds again, but officials insist it is an effort to stabilize the funds rate within the target range rather than a resurrection of QE. Still, the central bank balance sheet has expanded by about $100 billion over the past month and is back above the $4 trillion mark, $3.6 trillion of which is in Treasurys and mortage-backed securities.

So if the Fed is being this crazy now, what are they going to do when a real financial crisis erupts?

Perhaps they should just get it over with and create trillions of dollars right now and turn us into the Weimar Republic already.

Because that is where all of this craziness is eventually going to take us.  Our dollar is eventually going to be absolutely worthless and we will become the next Venezuela.

I have always been highly critical of the Federal Reserve, but at least in other eras those running the Fed were at least mildly competent.

But now it appears that incompetence is running wild over at the Federal Reserve, and we will all pay a great price for their mistakes in the not too distant future.

iv) Swamp commentaries)

McConnell Decries ‘Bizarre’ Impeachment Process; Calls Schiff ‘De Facto Special Prosecutor’

Senate Majority Leader Mitch McConnell (R-KY) on Wednesday slammed an impeachment resolution brought by House Democrats the day before – using a floor speech to go after House Speaker Nancy Pelosi and House Intelligence Committee Chairman Adam Schiff.

McConnell said that the resolution would deprive President Trump of the “most basic rights of due process.”

“It falls way short, way short…Instead of setting a high bar House Democrats seem determined to set a new low,” he said, before accusing Pelosi of endorsing a “bizarre” process which makes Schiff “a defacto special prosecutor.”

Lindsay Wise@lindsaywise

McConnell on Pelosi’s impeachment resolution: “It falls way short, way short…Instead of setting a high bar House Democrats seem determined to set a new low.”

Accuses Pelosi of endorsing a “bizarre” process that treats Schiff “as if he were a defacto special prosecutor”

The resolution, set for a Thursday vote, gives Schiff’s committee more power than it has ever had in the past – as prior impeachments have been conducted through the House Judiciary Committee. The new resolution engages the House’s Intelligence, Foreign Affairs, Oversight and Ways and Means Committees to independently conduct their own impeachment inquiries in a full court press.

The resolution also allows Republicans to subpoena witnesses and documents subject to Democrats’ approval. It will also allow Schiff to control the release of transcripts, including ones that have been edited.

McConnell on Wednesday said that the resolution denies Trump “basic due process rights,” such as having his attorney participate in closed-door depositions.

end

NSC Official Who Quit Ahead Of Today’s Impeachment Testimony Reportedly Witnessed Quid Pro Quo

A senior National Security Council (NSC) official and John Bolton ally who resigned ahead of today’s testimony with House impeachment investigators reportedly witnessed Trump ally Gordon Sondland convey a quid pro quo arrangement whereby nearly $400 million in US military aid to Ukraine in exchange hinged upon investigations into former Vice President Joe Biden and his son Hunter.

 

Tim Morrison, who resigned on Wednesday ahead of Thursday testimony

The former official, Tim Morrison, was named during testimony earlier this month by William Taylor, Trump’s top envoy to Ukraine, according to Politico.  He was on the July 25 phone call during which President Trump requested that Ukrainian President Volodymyr Zelensky to investigate the Bidens, and is the second person who was on that call to testify in front of House Democrats.

Taylor also testified that following the call, Morrison informed him it “could have gone better,” and that Trump suggested Zelensky and his staff meet with Trump’s personal attorney Rudy Giuliani and Attorney General William Barr.

Morrison’s hawkish views align with those of Bolton and he has been described as a creature of process by some close to him.

Bolton always told those who worked for him that process was their protector and sometimes you have to listen to the person elected — advice Morrison adopted, sources said.

Morrison is a lifelong Republican described as a Reaganite and is referred to as “‘Bolton’s Bolton,’ he is really hard right,” according to one source familiar with Morrison. –CNN

According to CNN, “Morrison is expected to corroborate key elements of a top US diplomat’s [Taylor’s] account that Trump pressed for Ukraine to publicly announce investigations into former Vice President Joe Biden and his son, Hunter, using military aid the country sought to fight back against Russian aggression as leverage.”

 

William Taylor, President Donald Trump’s top envoy to Ukraine. | Andrew Harnik/AP Photo

It is unknown whether Morrison will say if there was a quid pro quo if asked by congressional investigators during today’s testimony.

But Morrison will be asked to detail what he meant when he told Taylor, according to Taylor’s testimony, that he had a “sinking feeling” after learning about a conversation between Trump and Sondland. During that conversation Trump said he was not asking for a “quid pro quo” but he still “insisted” that Zelensky “go to a microphone” to announce investigations into Biden and 2016 election interference. –CNN

According to CNNMorrison is also expected to “paint a picture of the NSC keeping the train on the tracks and not carrying out any illegal actions.”

“The NSC process does not allow anything that isn’t legal. It just, it would never get to the President. Certainly not any process that Tim was ever a part of,” said one source close to Morrison. “A piece of paper does not get to the national security adviser without first going through the lawyers, much less to the President.”

Taylor also described a conversation in which Morrison relayed word from Sondland that Trump had told Sondland directly that Ukraine President Volodymyr Zelensky should publicly announce the investigations.

House impeachment investigators are exploring whether Trump conditioned nearly $400 million in military aid to Ukraine — and a White House visit for Zelensky — on Ukraine’s willingness to investigate former Vice President Joe Biden, as well as a debunked theory that Ukraine, not Russia, interfered in the 2016 U.S. elections.

Taylor told lawmakers that Morrison relayed concerns about Trump’s posture toward Ukraine to then-national security adviser John Bolton and to NSC lawyers. –Politico

“After more than a year of service at the National Security Council, Mr. Morrison has decided to pursue other opportunities — and has been considering doing so for some time. We wish him well,” said a senior administration official of Morrison – who had been expected to leave the NSC for some time to pursue work in the private sector.That said, the timing of his departure so close to his testimony was notable according to two people familiar with his plans.

end
wow!! Their key witness states nothing illegal in Trump //Zelensky call
(zerohedge)

‘Nothing Illegal In Trump-Zelensky Call’: NSC Official Tells Impeachment Inquiry

A top National Security Council official who was present on a July 25 phone call between President Trump and Volodomyr Zelensky, Tim Morrison, told House investigators on Thursday that he does not believe anything illegal was discussed, according to The Federalist.

 

Tim Morrison

I want to be clear, I was not concerned that anything illegal was discussed,” said Tim Morrison, former NSC Senior Director for European Affairs who was on the July 25 call between the two leaders.

Morrison also testified that the transcript of the phone call which was declassified and released by the White House “accurately and completely reflects the substance of the call.”

Morrison testified that Ukrainian officials were not even aware that certain military funding had been delayed by the Trump administration until late August 2019, more than a month after the Trump-Zelensky call, casting doubt on allegations that Trump somehow conveyed an illegal quid pro quo demand during the July 25 call.

I have no reason to believe the Ukrainians had any knowledge of the [military funding] review until August 28, 2019,” Morrison said. That is the same day that Rep. Adam Schiff, D-Calif., the chief anti-Trump inquisitor in the U.S. House of Representatives, disclosed on Twitter that funding had been held up. Politico also published a story that day, sourced to anonymous leaks, that military funding had been temporarily held up. –The Federalist

Notably, Morrison quit the day before his testimony.

Last week, Morrison was named during testimony earlier this month by William Taylor, Trump’s top envoy to Ukraine, according to Politico.

 

William Taylor

As we reported earlier today of Morrison, following the call, Morrison informed Taylor that it “could have gone better,” and that Trump suggested Zelensky and his staff meet with Trump’s personal attorney Rudy Giuliani and Attorney General William Barr.

Morrison’s hawkish views align with those of Bolton and he has been described as a creature of process by some close to him.

Bolton always told those who worked for him that process was their protector and sometimes you have to listen to the person elected — advice Morrison adopted, sources said.

Morrison is a lifelong Republican described as a Reaganite and is referred to as “‘Bolton’s Bolton, he is really hard right,” according to one source familiar with Morrison. –CNN

“The NSC process does not allow anything that isn’t legal. It just, it would never get to the President. Certainly not any process that Tim was ever a part of,” said one source close to Morrison. “A piece of paper does not get to the national security adviser without first going through the lawyers, much less to the President.”

Taylor also said that Morrison witnessed Trump Ally Gordon Sondland convey a quid pro quo arrangement;

Taylor also described a conversation in which Morrison relayed word from Sondland that Trump had told Sondland directly that Ukraine President Volodymyr Zelensky should publicly announce the investigations.

House impeachment investigators are exploring whether Trump conditioned nearly $400 million in military aid to Ukraine — and a White House visit for Zelensky — on Ukraine’s willingness to investigate former Vice President Joe Biden, as well as a debunked theory that Ukraine, not Russia, interfered in the 2016 U.S. elections.

Taylor told lawmakers that Morrison relayed concerns about Trump’s posture toward Ukraine to then-national security adviser John Bolton and to NSC lawyers. –Politico

According to Morrison, the national security process worked as designed.

“I am pleased our process gave the president the confidence he needed to approve the release of the security sector assistance,” he said, adding “I am proud of what I have been able, in some small way, to help the Trump administration accomplish.”

Earlier Thursday, House Democrats (all but two) approved impeachment procedures against President Trump. No Republicans voted for the measure.

end
We now know who is the whistleblower: Eric Ciaramella. He can now be subpoena
(zerohedge)

Anti-Trump CIA Whistleblower Invited ‘Meddling’ DNC Operative To Obama White House In 2015

 

A partisan CIA officer who secretly worked with Rep. Adam Schiff’s Democratic staff before submitting a second-hand whistleblower complaint has been revealed as Eric Ciaramella – who previously worked in the Obama administration with former VP Joe Biden and former CIA Director John Brennan.

Eric Ciaramella as a Connecticut prep student in 2004

While his attorneys have declined to confirm that the 33-year-old Ciaramella (pronounced char-a-MEL-ah) is the whistleblower, RealClearInvestigations Paul Sperry on Wednesday reported that his name has been “raised privately in impeachment depositions,” and is an “open secret inside the Beltway.”

“Everyone knows who he is. CNN knows. The Washington Post knows. The New York Times knows. Congress knows. The White House knows. Even the president knows who he is,” said former CIA analyst and Trump national security adviser Fred Fleitz, who added “They’re hiding him because of his political bias.”

Sean Davis

@seanmdav

Sure is weird how the anti-Trump whistleblower was all jonesing to testify until everyone learned he was a Democrat operative who colluded with Adam Schiff before filing his bogus complaint and lying to the IG about his Schiff contacts. What’s he hiding? https://thefederalist.com/2019/10/18/adam-schiff-flip-flopped-on-whistleblower-testimony-after-reports-of-coordination/ 

Schiff Flipped On Whistleblower Testimony After Reports Of Coordination

House Democrats’ top impeachment inquisitor changed from repeatedly insisting on the testimony of a whistleblower against Trump to working to prevent it.

thefederalist.com

1,019 people are talking about this

He was accused of working against Trump and leaking against Trump,” said one former NSC official on condition of anonymity.

Sperry’s revelations:

  • Ciaramella, a registered Democrat and Obama White House holdover, helped initiate the Russia “collusion” investigation of the Trump campaign during the 2016 election.”
  • Ciaramella was detailed over to the National Security Council from the agency in the summer of 2015, working under Susan Rice, President Obama’s national security adviser. He also worked closely with the former vice president.
  • He worked with DNC operative Alexandra Chalupa – inviting her to the White House. Chalupa, “a Ukrainian-American who supported Hillary Clinton, led an effort to link the Republican campaign to the Russian government,” writes Sperry (which has been documented by Politico and journalist Lee Stranahan). “He knows her. He had her in the White House,” said one former co-worker, who requested anonymity to discuss the sensitive matter.

 

Michael Avenatti, Alexandra Chalupa
  • Documents confirm the DNC opposition researcher attended at least one White House meeting with Ciaramella in November 2015.  She visited the White House with a number of Ukrainian officials lobbying the Obama administration for aid for Ukraine.
  • Biden’s office invited Ciaramella to an October, 2016 state luncheon hosted for Italian Prime Minister Matteo Renzi. “Other invited guests included Brennan, as well as then-FBI Director James Comey and then-National Intelligence Director James Clapper.

The Federalist‘s Sean Davis adds: “Eric Ciaramella also needs to testify under oath why he invited a rep for Ukrainian oligarch and Clinton Foundation donor Victor Pinchuk to the White House the same day that oligarch’s representative met with Steele dossier leaker David Kramer.”

In October, the Washington Post gave House Intelligence Committee Chairman Adam Schiff (D-CA) four Pinocchios for lying when he said “We have not spoken directly with the whistleblower,” when in fact Ciaramella consulted with Schiff’s panel – which directed him to a Democrat attorney to file a second-hand complaint that President Trump had pressured Ukrainian President Volodomyr Zelensky into investigating former Vice President Joe Biden and other matters.

Notably, Schiff hired two of Ciaramella’s closest allies at the NSC – also Obama holdovers.

Tim Young

@TimRunsHisMouth

Doug Collins says he’s ready to call Adam Schiff as a witness in a real impeachment hearing and make him answer every question about his involvement with the ‘whistleblower.’

Get your popcorn ready.

1,210 people are talking about this

Ciaramella, held over into the Trump administration, headed the Ukraine desk at the NSC – transferring into the West Wing in June 2017.

He hired one, Sean Misko, in August — the same month the whistleblower complaint was filed.

During closed-door depositions taken in the impeachment inquiry, Misko has been observed handing notes to the lead counsel for the impeachment inquiry, Daniel Goldman, as he asks questions of Trump administration witnesses, officials with direct knowledge of the proceedings told RealClearInvestigations.

“He was moved over to the front office” to temporarily fill a vacancy, said a former White House official, where he “saw everything, read everything,” according to Sperry’s report.

The official added that it soon became clear among NSC staff that Ciaramella opposed the new Republican president’s foreign policies. “My recollection of Eric is that he was very smart and very passionate, particularly about Ukraine and Russia. That was his thing – Ukraine,” he said. “He didn’t exactly hide his passion with respect to what he thought was the right thing to do with Ukraine and Russia, and his views were at odds with the president’s policies.”

So I wouldn’t be surprised if he was the whistleblower,” the official said.

In May 2017, Ciaramella went “outside his chain of command,” according to a former NSC co-worker, to send an email alerting another agency that Trump happened to hold a meeting with Russian diplomats in the Oval Office the day after firing Comey, who led the Trump-Russia investigation. The email also noted that Russian President Vladimir Putin had phoned the president a week earlier. –RealClearInvestigations

No wonder Democrats are holding their impeachment proceedings in secret!

Read the rest of Sperry’s report here.

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

As expected, the Fed cut its target rate 25bps to an upper bound of 1.75%.  The Fed said the cut was motivated by global uncertainties.  George and Rosengren dissented with the cut.  The Fed lowered the IOER rate to 1.55% from 1.8%.

The Fed removed the phrase “act as appropriate to sustain the expansion” from its communiqué and replaced it with, “The Committee will continue to monitor the implications of incoming information for the economic outlook as it assesses the appropriate path of the target range for the federal funds rate.”

CNBC: Fed cutes rates but indicates a pause is ahead

The FOMC removed a key clause that had appeared in post-meeting statements since June saying that it was committed to “act as appropriate to sustain the expansion.” Powell had used the phase in early June to tee up the July rate cut, and it has been incorporate into the official language since.

    In its place was more tempered language.  “The Committee will continue to monitor the implications of incoming information for the economic outlook as it assesses the appropriate path of the target range for the federal funds rate,”…  https://www.cnbc.com/2019/10/30/fed-decision-interest-rates-cut.ht

Powell Presser Highlights [Note: his prepared remarks were brief]

  • Fed committed to make best decisions based on facts
  • Monetary policy is in a good place
  • Sluggish growth abroad and trade uncertainties are risks
  • Business investments, exports and manufacturing are weak
  • Inflation pressure remains muted
  • Expect inflation, as measured by PCE, will rise to 2%
  • Don’t confuse current T-Bill purchases (QE 4) with past Large Scale Asset Purchases (

Powell Q&A Highlights

  • Risks to the outlook have ‘perhaps moved in a positive direction’ since the last meeting
  • Consumer companies report to the Fed that “consumers are doing well
  • “I think we would need to see a really significant move up in inflation that’s persistent before we even consider raising rates to address inflation concerns.”
  • Fed is weighing whether regulatory adjustments could improve funding market liquidity
  • Repo liquidity didn’t flow as expected; banks had ample funds didn’t lend them out
  • Fed won’t lower capital or liquidity requirements
  • Low initial jobless claims are a positive sign for the economy
  • Fiscal policy is the paramount determinant of inclusive economic growth
  • World has significant disinflationary pressures
  • Fed sees no financial imbalances, AKA bubbles

Deutsche Bank shares plunged as much as 8.4% on an earnings loss of .41.  Revenue declined to €5.26B from €6.18B.   This is the bank to vigilantly monitor.

@RepMGriffith: I am in the Rules Committee room where Democrats are marking up their impeachment resolution. @RepDLesko offered an amendment requiring any evidence which is exculpatory regarding the President to be given to the Judiciary Committee.  Democrats rejected it. [You can’t make this up!]

 

‘Whistleblower’ Exposed: Close to Biden, Brennan, Schiff’s Staff, and DNC Operative

33-year-old Ciaramella, a registered Democrat held over from the Obama White House, previously worked with former Vice President Joe Biden and former CIA Director John Brennan

    In May 2017, Ciaramella went “outside his chain of command,” according to a former NSC co-worker, to send an email alerting another agency that Trump happened to hold a meeting with Russian diplomats in the Oval Office the day after firing Comey, who led the Trump-Russia investigation. The email also noted that Russian President Vladimir Putin had phoned the president a week earlier…

    Earlier this year, Schiff recruited two of Ciaramella’s closest allies at the NSC — both whom were also Obama holdovers — to join his committee staff. He hired one, Sean Misko, in August — the same month the whistleblower complaint was filed…

https://www.realclearinvestigations.com/articles/2019/10/30/whistleblower_exposed_close_to_biden_brennan_dnc_oppo_researcher_120996.html

 

Ex-intel officer @JackPosobiec: If this is truly the whistleblower, this is a guy who has been accused in the past of leaking presidential phone calls with world leaders, notoriously anti-Trump, and was fired from the NSC by Trump.  Definitely someone with an ax to grind rather than an objective analyst

 

Nunes: Adam Schiff was coaching Alexander Vindman throughout his testimony

“I have never in my life seen anything like what happened today, during the testimony of Lt. Col. Alexander Vindman… It was unprecedented… to interrupt us continually to coach the witness, to decide… what we’re going to be able to ask the witness”… 

https://saraacarter.com/nunes-adam-schiff-was-coaching-alexander-vindman-throughout-his-testimony/

 

Fox’s Catherine Herridge reported that when Vindman was asked to point to the specific language in the transcript that indicated any “demand” from Trump, he struggled for a few minutes and then said “hefeltthe whole phone call equated to a demand” because it was Trump on the call.

https://twitter.com/RoscoeBDavis1/status/1189558289534771200

 

The NYT with an unintentionally incriminating story: White House Ukraine Expert Sought to Correct Transcript of Trump Call – Lt. Col. Alexander S. Vindman, who heard President Trump’s July phone call with Ukraine’s president and was alarmed, testified that he tried and failed to add key details to the rough transcript… https://www.nytimes.com/2019/10/29/us/politics/alexander-vindman-trump-ukraine.html

 

Lt. Col. Alexander Vindman testified that one example of his attempts to change the transcript was to include Trump telling Ukraine President Volodymyr Zelensky there were tapes of Biden… Vindman also said that he would have edited the transcript to specifically show that Zelensky mentioned Burisma — the company that hired Hunter Biden — rather than just “the company,” according to sources.

https://www.cnn.com/2019/10/30/politics/alexander-vindman-testimony-white-house-transcript/index.html

 

What else did Vindman intent to alter?  Now we know why the MSM and Dems voiced outrage that the WH put the phone call tape and its transcript in the top secret file.  All you need to know about Vindman’s potential legal liabilities, particularly under the Uniform Code of Military Justice, is that Sen. Schumer sent a letter to the US Army asking them to protect Vindman.

 

On Tuesday, Senator Chuck Grassley criticized Comey for overlooking key evidence in the investigation into Hillary and promised to reopen the investigation.  Chuck could have made these claims years ago.  Perhaps Grassley has gotten bold now because of what Horowitz and Durham have uncovered.

https://www.dailywire.com/news/chuck-grassley-rips-comey-you-missed-key-evidence-in-clinton-investigation-im-going-to-find-it

 

Rumor has ‘career’, AKA Deep State, elements in the DoJ trying to delay Horowitz’s report.  The assumption is that they don’t want to hinder Schiff’s impeachment scheme.

Attachments area

Well that is all for today

I will see you Friday night.

 

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