GOLD:$1463.60 DOWN $0.40 (COMEX TO COMEX CLOSING)

Silver:$16.92 DOWN 9 CENTS (COMEX TO COMEX CLOSING) :

Closing access prices:

Gold : $1462.80

silver: $16.92

COMEX DATA

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

today RECEIVING: 306/4933

EXCHANGE: COMEX
CONTRACT: DECEMBER 2019 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,465.600000000 USD
INTENT DATE: 11/29/2019 DELIVERY DATE: 12/03/2019
FIRM ORG FIRM NAME ISSUED STOPPED
____________________________________________________________________________________________
072 C GOLDMAN 121 46
072 H GOLDMAN 910
118 H MACQUARIE FUT 244
132 C SG AMERICAS 128
152 C DORMAN TRADING 30
323 C HSBC 49
323 H HSBC 4095
355 C CREDIT SUISSE 24
357 C WEDBUSH 4 1
365 C ED&F MAN CAPITA 1 1
435 H SCOTIA CAPITAL 351
624 C BOFA SECURITIES 101 1000
657 C MORGAN STANLEY 202
661 C JP MORGAN 120 306
686 C INTL FCSTONE 6 74
690 C ABN AMRO 17 686
732 C RBC CAP MARKETS 43
737 C ADVANTAGE 13 49
773 C G.H. FINANCIALS 1
800 C MAREX SPEC 34 187
880 C CITIGROUP 156
880 H CITIGROUP 803
905 C ADM 48 15
____________________________________________________________________________________________

TOTAL: 4,933 4,933
MONTH TO DATE: 6,253

we are coming very close to a commercial failure!!

NUMBER OF NOTICES FILED TODAY FOR DEC CONTRACT: 4933 NOTICE(S) FOR 493,300 OZ (15.343 tonnes)

TOTAL NUMBER OF NOTICES FILED SO FAR: 6253 NOTICES FOR 625300 OZ (19.449 TONNES)

SILVER

FOR DEC

1026 NOTICE(S) FILED TODAY FOR 5,130,000 OZ/

total number of notices filed so far this month: 2111 for 10,555,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXX

Bitcoin: OPENING MORNING TRADE : $ 7257 DOWN 136

Bitcoin: FINAL EVENING TRADE: $ 7299 DOWN 93

Let us have a look at the data for today

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

IN SILVER THE COMEX OI FELL BY A HUGE SIZED 1880 CONTRACTS FROM 206,427 DOWN TO 204,547 DESPITE THE 4 CENT GAIN IN SILVER PRICING AT THE COMEX.

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

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

FOR DEC 0 ,; MARCH 2278 AND ZERO FOR ALL OTHER MONTHS AND THEREFORE TOTAL ISSUANCE 2278 CONTRACTS. WITH THE TRANSFER OF 2278 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 2278 EFP CONTRACTS TRANSLATES INTO 11.39 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 INITIALLY STANDING IN OCT

17.530 MILLION OZ INITIALLY STANDING IN DEC

FRIDAY, WAS THE LAST DAY FOR OTC/LBMA OPTIONS ON GOLD/SILVER..THE EXPIRY IS GENERALLY OVER BETWEEN 9 AM TO 11:30 PM DEPENDING ON THEIR AGREEMENTS. SILVER ROSE ONCE THOSE AGREEMENTS HAD EXPIRED. AGAIN OUR CROOKS USED COPIOUS PAPER IN ORDER TO CONTAIN SILVER’S PRICE TO NO AVAIL (IT ROSE BY 4 CENTS). ALSO OUR OFFICIAL SECTOR/BANKERS WERE SOMEWHAT UNSUCCESSFUL IN THEIR ATTEMPT TO FLEECE SOME SILVER LONGS AS THE TOTAL GAIN IN OI ON BOTH EXCHANGES TOTALED A GOOD 398 CONTRACTS. OR 3.815 MILLION OZ…..

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

2278 CONTRACTS (FOR 1 TRADING DAY TOTAL 2278 CONTRACTS) OR 11.39 MILLION OZ: (AVERAGE PER DAY: 2278 CONTRACTS OR 11.39 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER: SO FAR THIS MONTH OF DEC: 11.39 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 30.51% 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.

SPREADING LIQUIDATION HAS NOW STOPPED IN GOLD AND WILL MORPH INTO SILVER AS THE NEW FRONT MONTH WILL BE JANUARY.

FOR THOSE OF YOU WHO ARE NEW, HERE IS THE MODUS OPERANDI OF THE SPREADERS AND THE CRIMINAL ELEMENT BEHIND IT:

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 SILVER 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 ACTIVE DELIVERY MONTH OF DEC HEADING TOWARDS THE NON ACTIVE DELIVERY MONTH OF JANUARY FOR SILVER:

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 ACTIVE MONTH OF DEC 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 NON ACTIVE DELIVERY MONTH (JAN), 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 IN YEAR 2019 TO DATE SILVER EFP’S: 2,095.73 MILLION OZ.

JANUARY 2019 EFP TOTALS: 217.455. MILLION OZ

FEB 2019 TOTALS: 147.4 MILLION OZ/

MARCH 2019 TOTAL EFP ISSUANCE: 207.835 MILLION OZ

APRIL 2019 TOTAL EFP ISSUANCE: 182.87 MILLION OZ.

MAY 2019: TOTAL EFP ISSUANCE: 136.55 MILLION OZ

JUNE 2019 , TOTAL EFP ISSUANCE: 265.38 MILLION OZ

JULY 2019 TOTAL EFP ISSUANCE: 175.74 MILLION OZ

AUG. 2019 TOTAL EFP ISSUANCE; 216.47 MILLION OZ

SEPT 2019 TOTAL EFP ISSUANCE 174.900 MILLION OZ

OCT 2019 TOTAL EFP ISSUANCE: 146.14 MILLION OZ

NOV 2019 TOTAL EFP ISSUANCE: 213.60 MILLION OZ.

RESULT: WE HAD A CONSIDERABLE SIZED DECREASE IN COMEX OI SILVER COMEX CONTRACTS OF 1880, DESPITE THE 4 CENT GAIN IN SILVER PRICING AT THE COMEX /YESTERDAY... THE CME NOTIFIED US THAT WE HAD A HUGE SIZED EFP ISSUANCE OF 2278 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 GOOD SIZED: 398 TOTAL OI CONTRACTS ON THE TWO EXCHANGES:

i.e 2278 OPEN INTEREST CONTRACTS HEADED FOR LONDON (EFP’s) TOGETHER WITH DECREASE OF 1880 OI COMEX CONTRACTS. AND ALL OF THIS DEMAND HAPPENED WITH A 4 CENT GAIN IN PRICE OF SILVER AND A CLOSING PRICE OF $17.01 WITH RESPECT TO FRIDAY’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. 1.023 BILLION OZ TO BE EXACT or 146% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT DEC MONTH/ THEY FILED AT THE COMEX: 1026 NOTICE(S) FOR 5,130,000 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:

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// NOV: 2.630 MILLION OZ//DEC: 17.530 MILLION OZ
THE RECORD WAS SET IN AUGUST 22/2018: 244,196 CONTRACTS, WITH A SILVER PRICE OF $14.78//.
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 GOOD SIZED 5434 CONTRACTS, AND MOVING CLOSER TO THAT NEW ALL TIME RECORD OF 719,211 (SET NOV 20/2019). THE NEW OI RESTS AT 674,822. THE GOOD GAIN IN COMEX OI OCCURRED WITH A CONSIDERABLE $9.85 PRICING GAIN ACCOMPANYING COMEX GOLD TRADING// FRIDAY// /

THE CME RELEASED THE DATA FOR EFP ISSUANCE AND IT TOTALED A VERY STRONG SIZED 11,046 CONTRACTS:

DEC 2019: 0 CONTRACTS, FEB> 11,046 CONTRACTS AND ALL OTHER MONTHS ZERO. The NEW COMEX OI for the gold complex rests at 674,882,,. 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 AND CRIMINALLY SIZED GAIN IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 16,480 CONTRACTS: 5434 CONTRACTS INCREASED AT THE COMEX AND 11,046 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS TOTAL OI GAIN OF 16,480 CONTRACTS OR 1,648,000 OZ OR 51.26 TONNES. FRIDAY WE HAD A GAIN OF $9.85 IN GOLD TRADING….

AND WITH THAT GAIN IN PRICE, WE HAD A HUMONGOUS GAIN IN GOLD TONNAGE OF 51.26 TONNES!!!!!! THE BANKERS/OFFICIAL SECTOR WERE SUPPLYING INFINITE SUPPLIES OF SHORT GOLD COMEX PAPER WITH RECKLESS ABANDON AS OPTIONS EXPIRY HAS JUST CONCLUDED. THE BANKERS WERE UNSUCCESSFUL IN THEIR ATTEMPT TO LOWER GOLD’S PRICE (UP $9.85) .THEY WERE UNSUCCESSFUL IN FLEECING GOLD LONGS FROM THE GOLD ARENA AS WE HAD A HUGE GAIN IN OPEN INTEREST ON OUR TWO EXCHANGES (51.26 TONNES). THE SPREADING OPERATION WILL NOW SWITCH OVER TO SILVER.

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF DEC : 11,046 CONTRACTS OR 1,104,600 oz OR 34.35 TONNES (1 TRADING DAY AND THUS AVERAGING: 11,046 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE STRONG SIZE OF THESE EFP TRANSFERS : THIS MONTH IN 1 TRADING DAYS IN TONNES: 34.35 TONNES

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

THUS EFP TRANSFERS REPRESENTS 34.35/3550 x 100% TONNES =0.96% OF GLOBAL ANNUAL PRODUCTION

WE ARE WITNESSING AN INCREASING USE OF OUR EXCHANGE FOR PHYSICAL MECHANISM TO MOVE CONTRACTS OFF OF NY AND INTO LONDON. IT BEGAN IN JUNE 2019 AND CONTINUES TO THIS DAY.

ACCUMULATION OF GOLD EFP’S YEAR 2019 TO DATE: 5760.06 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 EFP ISSUANCE 509.57 TONNES

OCT 2019 EFP ISSUANCE 497.16 TONNES

NOV.2019 EFP ISSUANCE: 568.20 TONNES

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

Result: A GOOD SIZED INCREASE IN OI AT THE COMEX OF 5434 WITH THE CONSIDERABLE PRICING GAIN THAT GOLD UNDERTOOK FRIDAY($9.85)) //.WE ALSO HAD A VERY STRONG SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 11,046 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 11,046 EFP CONTRACTS ISSUED, WE HAD A HUMONGOUS AND CRIMINALLY SIZED GAIN OF 16,480 CONTRACTS IN TOTAL OPEN INTEREST ON THE TWO EXCHANGES:

11,046 CONTRACTS MOVE TO LONDON AND 5580 CONTRACTS INCREASED AT THE COMEX. (IN TONNES, THE GAIN IN TOTAL OI EQUATES TO 51.26 TONNES). ..AND THIS STRONG INCREASE OF DEMAND OCCURRED WITH THE CONSIDERABLE GAIN IN PRICE OF $9.85 WITH RESPECT TO FRIDAY’S TRADING AT THE COMEX.

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

we had: 4933 notice(s) filed upon for 493,300 oz of gold at the comex.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD...

WITH GOLD DOWN $0.40 TODAY//(COMEX-TO COMEX)

NO CHANGE IN GOLD INVENTORY AT THE GLD///

DEC 2/2019/Inventory rests tonight at 896.48 tonnes

SLV/

WITH SILVER DOWN 9 CENTS TODAY:

NO CHANGE IN SILVER INVENTORY AT THE SLV//

/INVENTORY RESTS AT 370.481 MILLION OZ

end

OUTLINE OF TOPICS TONIGHT

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

1. Today, we had the open interest in SILVER FELL BY A STRONG SIZED 1880 CONTRACTS from 206,427 DOWN TO 204,547 AND FURTHER FROM A NEW COMEX RECORD. THE LAST RECORDS WERE SET IN AUG.2018 AT 244,196 WITH A SILVER PRICE OF $14.78/(AUGUST 22/2018)..THE PREVIOUS RECORD TO THAT WAS SET ON APRIL 9/2018 AT 243,411 OPEN INTEREST CONTRACTS WITH THE SILVER PRICE AT THAT DAY: $16.53). AND PREVIOUS TO THAT, THE RECORD WAS ESTABLISHED AT: 234,787 CONTRACTS, SET ON APRIL 21.2017 OVER 2 YEARS AGO. THE PRICE OF SILVER ON THAT DAY: $17.89.

EFP ISSUANCE:

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

FOR DEC 00: FOR MAR.: 2278 AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 2278 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. IF WE TAKE THE OI LOSS AT THE COMEX OF 1880 CONTRACTS TO THE 2278 OI TRANSFERRED TO LONDON THROUGH EFP’S, WE OBTAIN AN GOOD AND CRIMINALLY SIZED GAIN OF 763 OPEN INTEREST CONTRACTS. THUS IN OUNCES, THE GAIN ON THE TWO EXCHANGES: 3.815 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//NOV 2.63 MILLION OZ//DEC: 17.530 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 2278 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)MONDAY MORNING/ SUNDAY NIGHT:

SHANGHAI CLOSED UP 3.83 POINTS OR 0.13% //Hang Sang CLOSED UP 98.20 POINTS OR 0.37% /The Nikkei closed DOWN 422.94 POINTS OR 1.97%//Australia’s all ordinaires CLOSED DOWN .42%

/Chinese yuan (ONSHORE) closed DOWN at 7.0421 /Oil DOWN TO 56.55 dollars per barrel for WTI and 61.80 for Brent. Stocks in Europe OPENED RED// ONSHORE YUAN CLOSED DOWN // LAST AT 7.0421 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 7.0411 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 BELOW 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

North Korea//Japan

North Korea threatens the imbecile Abe as they threaten their neighbour Japan

(zerohedge)

3b) REPORT ON JAPAN

3C CHINA

i)China

Surging PMI’s in China did nothing for the stock markets as they do not believe the data. Also crashing Korean exports weighing heavy on global markets

(zeorhedge)

ii)China/USA

The gloves are for sure coming off as China now insists that existing tariffs must be removed before a phase one deal is consummated

(zerohedge)

iii)Macau/China

A strong indicator of declining China’s GDP: Macau revenues are plunging. The Chinese love to gamble

(zerohedge)

iv)Hong Kong/China

Hong Kong plunges again in their post election chaos. Pro democracy protesters thank Trump for signing his billl
(zerohedge)

v)Hong Kong/Margin calls continue in Hong Kong as the Chairman of China’s first Capital offloads more of his shares. Prepare for a contagion effect

(zerohedge)

vi)CHINA/THIS AFTERNOON

Relations between China and the USA declining by the minute. After Wilbur Ross stated that the Dec 15 is fixed in stone, the Chinese immediate accelerated their release of an “unreliable USA entity list”

(zerohedge)

vii)Slowly but surely China no longer needs any USA parts to its phones

(Mish Shedlock/Mishtalk)

4/EUROPEAN AFFAIRS

i)UK

UK Conservatives set to win a large majority

(zerohedge/You Gov MRP)

ii)Germany

Merkel in trouble as Germany’s SPD elects leftist leaders and thus risking its coalition government. It may collapse

(zerohedge)

iii)

ECB

We brought you this story last week but I did not think that she was going to go through with this nonsense. I am wrong Lagarde vows to link QE to climate change. How on earth she will accomplish this is anybody’s guess…

(zerohedge)

7. OIL ISSUES

8 EMERGING MARKET ISSUES

India

We must pay attention to this. India is witnessing a huge “death of demand” according to its former Indian finance Minister Sinha

(zeorhedge)

9. PHYSICAL MARKETS

i)Cuba reintroduces the dollar as nobody wants the Cuban Peso..

London’s The Economist/GATA)

ii)Trust is being brought back to the gold jewellery business in India as the government is forcing mandatory hallmarking

(Reuters/GATA)

iii)We are hearing that eastern nations are buying gold and./or repatriated gold back to its home country. That is gold is and will always be a sign of economic sovereignty.

(Bloomberg/GATA)

iv)Iran must be offering huge discounts on its oil as 6 nations join instex to bar oil in exchange for currency other than dollars

(Agence Franc Presse/Yahoo/GATA)

v)Chris Powell writes that the New York continues to misrepresent disclosures to us but what else is new

(GATA/Chris Powell)

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

a)Again oversubscribed as we no doubt have a year end liquidity problem. On the paper side of things, it looks like Deutsche bank is the bank which has a huge hole and thus the need for constant repo money. On the commodity side of things (gold/silver) it looks like HSBC has some severe problems

(zerohedge)

b)Pay more attention to the ISM numbers as Markit is generally fudged. ISM’s poor manufacturing data , new orders and employment in that area caused the Dow to plummet

(zerohedge)

iii) Important USA Economic Stories

a)Black Friday is dying as the internet sales skyrocket

(zerohedge)

b)The Fed proposes to allow inflation to rise above 2% to make up for lost time. This guys are nothing but jokers

(zerohedge)

iv) Swamp commentaries)

PHASE TWO OF THE IMPEACHMENT CIRCUS BEGINS WITH THIS. HERE IS WHAT TO EXPECT

(COURTESY SARA CARTER)

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 GOOD SIZED 5434 CONTRACTS TO A LEVEL OF 674,822ACCOMPANYING THE GAIN OF $9.85 IN GOLD PRICING WITH RESPECT TO FRIDAY’S // COMEX TRADING)

WE ARE NOW IN THE ACTIVE DELIVERY MONTH OF DEC.. THE CME REPORTS THAT THE BANKERS ISSUED A VERY STRONG SIZED TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS., THAT IS 11,046 EFP CONTRACTS WERE ISSUED:

DEC: 0 ; FEB: 11,046 AND ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE: 11,046 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: 16,480 TOTAL CONTRACTS IN THAT 11,046 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE GAINED A GOOD SIZED 6012 COMEX CONTRACTS.

THE BANKERS SUPPLIED THE NECESSARY AND INFINITE AMOUNT OF SHORT PAPER IN GOLD. THE BANKERS WERE UNSUCCESSFUL IN LOWERING GOLD’S PRICE WITH THE CONSIDERABLE RAID INITIATED, AS IT ROSE BY $9.85. AND THEY WERE MOST DEFINITELY UNSUCCESSFUL IN FLEECING ANY LONGS AS WE GAINED 16.480 CONTRACTS ON OUR TWO EXCHANGES:

NET GAIN ON THE TWO EXCHANGES :: 16,480 CONTRACTS OR 1,648,000 OZ OR 51.26 TONNES.

We are now in the active contract month of DEC. This month is always the biggest delivery month of the year. Here we have a total of 8478 open interest stand for a loss of 3690 contracts. We had 1320 notices filed upon yesterday so we lost 2370 contracts or an additional 237,000 will not stand for delivery at the comex as they could not find any physical metal over on this side of the pond as they morphed into London forwards as well as receiving a fiat bonus for their hard work. Thus, the entire loss in December can be attributed to the morphing of contracts over to London. They were joined by an additional 7,356 contacts: thus total morphing over to London 11,046

The next non active contract month after Dec, is January and it saw its OI FALL by 87 contracts DOWN to 4094 which is extremely high for a January delivery month.. The next active delivery month after January is February and here we witnessed a huge 8475 gain in contracts up to 500,450.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And now for the wild silver comex results.

Total COMEX silver OI FELL BY A STRONG SIZED 1880 CONTRACTS FROM 206,427 DOWN TO 204,547 (AND FURTHER FROM THE NEW RECORD OI FOR SILVER SET ON AUGUST 22.2018. THE PREVIOUS RECORD WAS SET APRIL 9.2018/ 243,411 CONTRACTS) AND TODAY’S CONSIDERABLE OI COMEX LOSS OCCURRED WITH A 4 CENT GAIN IN PRICING./FRIDAY.

WE ARE NOW INTO THE ACTIVE DELIVERY MONTH OF DEC.

Here we have a loss of 2269 contracts down to 2421. We had 1085 notices served up on Friday, so we LOST 1342 contracts or an additional 6,710,000 oz will not stand in this active delivery month of December as they guys morphed into London based forwards and as well received a fiat bonus for their efforts. In silver the entire December loss of 2269contracts morphed to London forwards (exchange for physical issued: 2278)

After December we have the non active month of January and here we see that we gained 60 contracts up to 1046. MARCH saw an decrease of 157 contracts up to 161,354. March is a very active month for silver.

INITIAL standings for DEC/GOLD

DEC 2/2019

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*	nil oz
Deposits to the Customer* Inventory, in oz*	nil
No of oz served (contracts) today	4933 notice(s) 493,300 OZ (15.343 TONNES)
No of oz to be served (notices)	3545 contracts (354500 oz) 11.026 TONNES
Total monthly oz gold served (contracts) so far this month	6253 notices 625,300 OZ 19.449 TONNES
Total accumulative withdrawals of gold from the Dealers* inventory this month*	NIL oz
Total accumulative withdrawal of gold from the Customer* inventory this month*	xxx oz

we had 0 dealer entry:

We had 0 kilobar entries

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

To calculate the INITIAL total number of gold ounces standing for the DEC /2019. contract month, we take the total number of notices filed so far for the month (6233) x 100 oz , to which we add the difference between the open interest for the front month of DEC. (8478 contract) minus the number of notices served upon today (4933 x 100 oz per contract) equals 979,800 OZ OR 30.47 TONNES) the number of ounces standing in this active month of DEC

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

No of notices served (4933 x 100 oz) + (8478)OI for the front month minus the number of notices served upon today (4933 x 100 oz )which equals 979,800 oz standing OR 30.47 TONNES in this active delivery month of DEC.

We lost 2370 contracts or an additional 237,000 oz will not stand at the comex as they morphed into London based forwards.

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 DEC.

INITIAL standings/SILVER

IN TOTAL CONTRAST TO GOLD, HUGE ACTIVITY IN SILVER TODAY.

DEC 2 2019

Silver	Ounces
Withdrawals from Dealers* Inventory*	NIL oz
Withdrawals from Customer Inventory	nil oz
Deposits to the Dealer* Inventory*	nil oz
Deposits to the Customer Inventory	600,102.320 oz Scotia
No of oz served today (contracts)	1026 CONTRACT(S) (5,130,000 OZ)
No of oz to be served (notices)	1395 contracts 6,975,000 oz)
Total monthly oz silver served (contracts)	2111 contracts 10,555,000 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*

ii) Into SCOTIA: 600,102.300 oz

total dealer silver: 82.777 million

total dealer + customer silver: 314.007 million oz

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

The total number of notices filed today for the DEC 2019. contract month is represented by 1026 contract(s) FOR 5,130,000 oz

To calculate the number of silver ounces that will stand for delivery in DEC, we take the total number of notices filed for the month so far at 2111 x 5,000 oz = 10,555,000 oz to which we add the difference between the open interest for the front month of DEC. (2421) and the number of notices served upon today 1026 x (5000 oz) equals the number of ounces standing.

Thus the INITIAL standings for silver for the DEC/2019 contract month: 1085 (notices served so far) x 5000 oz + OI for front month of DEC (2421)- number of notices served upon today (1026) x 5000 oz equals 17,530,000 oz of silver standing for the DEC contract month.

We lost 1342 contracts or 6,710,000 oz will not stand at the comex as they morphed into London based forwards.

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 ESTIMATED SILVER VOLUME: 70,543 CONTRACTS //volume increases due to raid

CONFIRMED VOLUME FOR YESTERDAY: 73,174 CONTRACTS..

YESTERDAY’S CONFIRMED VOLUME OF 73,174 CONTRACTS EQUATES to 365 million OZ 52.2% 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

NPV for Sprott

1. Sprott silver fund (PSLV): NAV FALLS TO -1.66% ((DEC 2/2019)
2. Sprott gold fund (PHYS): premium to NAV FALLS TO -1.07% to NAV (DEC 2/2019 )
Note: Sprott silver trust back into NEGATIVE territory at +%-/Sprott physical gold trust is back into NEGATIVE/ -1.66%

(courtesy Sprott/GATA)

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

NAV 14.56 TRADING 14.02///DISCOUNT 3.71

END

And now the Gold inventory at the GLD/

DEC2 /WITH GOLD DOWN $.40 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 895.60 TONNES

NOV 29/WITH GOLD UP $9.85//A SMALL CHANGE IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL TO PAY FOR FEES ETC./INVENTORY RESTS AT 895.60 TONNES

NOV 27//WITH GOLD DOWN $6.10 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 896.48 TONNES//

NOV 26/WITH GOLD UP $3.10 TODAY:: A BIG CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER GOLD DEPOSIT OF 4.69 TONNES INTO THE GLD///INVENTORY RESTS AT 896.48 TONNES

NOV 25/WITH GOLD DOWN $6.45: NO CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 891.79 TONNES

NOV 22/WITH GOLD DOWN $1.00//NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 891.79 TONNES

NOV 21/ WITH GOLD DOWN $10.85 //NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 891.79 TONNES

NOV 20/WITH GOLD UP $.50 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 891.79 TONNES

NOV 19/WITH GOLD UP $2.40 TODAY: A HUGE CHANGE: A MASSIVE PAPER WITHDRAWAL OF 4.98 TONNES OF GOLD FROM THE GLD AND THIS WITH A GOLD PRICE RISE?/INVENTORY RESTS AT 891.79 TONNES

NOV 18/WITH GOLD UP $3.50 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 896.77 TONNES

NOV 15//WITH GOLD DOWN $4.70 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 896.77 TONNES

NOV 14/WITH GOLD UP $10.00: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 896.77 TONNES

NOV 13/WITH GOLD UP $9.50 : A SMALL CHANGE IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF .32 TONNES (PROBABLY TO PAY FOR FEES)/INVENTORY RESTS AT 896.77 TONNES

NOV 12: WITH GOLD DOWN $3.40 TODAY: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER GOLD WITHDRAWAL OF 4.10 TONNES///INVENTORY RESTS AT 897.09 TONES

NOV 11/WITH GOLD DOWN $5.70 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 901.19 TONNES

NOV 8/WITH GOLD DOWN $3.50 TODAY: A MASSIVE WITHDRAWAL OF 13.19 PAPER TONNES OF GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 901.19 TONNES

NOV 7/2019 WITH GOLD DOWN $35.55 TODAY: A PAPER WITHDRAWAL OF 1.47 TONNES FROM THE GLD/INVENTORY RESTS AT 914.38 TONNES

NOV 6/2019 WITH GOLD UP $8.70 TODAY: A BIG CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 1.18 TONNES INTO THE GLD//INVENTORY RESTS AT 915.85 TONNES

NOV 5/WITH GOLD DOWN $26.00//NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 914.67 TONNES

NOV 4/WITH GOLD DOWN $0.75 TODAY: A CONSIDERABLE WITHDRAWAL OF .88 TONNES FROM THE GLD//INVENTORY RESTS AT 914,67 TONNES

NOV 1/WITH GOLD DOWN $2.90 TODAY/NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 915.55 TONNES

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

DEC 2/2019/Inventory rests tonight at 895.60 tonnes

*IN LAST 715 TRADING DAYS: 40.77 NET TONNES HAVE BEEN REMOVED FROM THE GLD
*LAST 615 TRADING DAYS: A NET 126.28 TONNES HAVE NOW BEEN ADDED INTO THE GLD INVENTORY.

end

Now the SLV Inventory/

DEC 2/WITH SILVER DOWN 9 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 370.481

NOV 29/WITH SILVER UP 4 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER WITHDRAWAL OF 2.383 MILLION OZ FROM THE SLV//INVENTORY RESTS AT 370.481 MILLION OZ//

NOV 27/WITH SILVER DOWN 8 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER WITHDRAWAL OF 1.868 MILLION OZ OF SILVER FROM THE SLV///INVENTORY RESTS AT 372.864 MILLION OZ//

NOV 26//WITH SILVER UP 14 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY REST AT 374.732 MILLION OZ/

NOV 25/WITH SILVER DOWN 12 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV///INVENTORY RESTS AT 374.732 MILLION OZ//

NOV 22/WITH SILVER DOWN 3 CENTS TO DAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 374.732 MILLION OZ

NOV 21/ WITH SILVER DOWN 5 CENTS TODAY/a big CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 84,000 OZ/INVENTORY RESTS AT 374.732 MILLION OZ//

NOV 20/WITH SILVER UP 0 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 375.574 MILLION OZ//

NOV 19/WITH SILVER UP 11 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 375.574 MILLION OZ//

NOV 18/ WITH SILVER UP 3 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER WITHDRAWAL OF 1.074 MILLION OZ F FROM THE SLV///INVENTORY RESTS AT 375.574 MILLION OZ/

NOV 15//WITH SILVER DOWN 6 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 376.648 MILLION OZ//

NOV 14/ WITH SILVER UP 12 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 376.648 MILLION OZ/

NOV 13/WITH SILVER UP 20 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 2.524 MILLION /INVENTORY RESTS AT 376.648 MILLION OZ/

NOV 12/ WITH SILVER DOWN 10 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 379.172 MILLION OZ..

NOV 11/2019 WITH SILVER DOWN 3 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 379.172 MILLION OZ///

NOV 8/2019 WITH SILVER DOWN 19 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 379.172 MILLION OZ//

NOV 7/WITH SILVER DOWN 57 CENTS TODAY; NO CHANGES IN SILVER INVENTORY AT THE SLV// SLV INVENTORY RESTS AT 379.172

NOV 6/WITH SILVER UP ONE CENT TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV; A MASSIVE DEPOSIT OF 2.804 MILLION OZ///INVENTORY REST AT 379.172 MILLION OZ

NOV 5/WITH SILVER DOWN 44 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 376.368 MILLION OZ//

NOV 4/WITH SILVER UP ONE CENT TODAY: A SMALL CHANGE IN INVENTORY AT THE SLV A WITHDRAWAL OF 157,000 OZ TO PAY FOR FEES/INVENTORY RESTS AT 376.368 MILLION OZ//

NOV 1//WITH SILVER DOWN 3 CENTS TODAY: NO CHANGE IN INVENTORY AT THE SLV INVENTORY RESTS AT 376.525 MILLION OZ

LIBOR SCHEDULE AND GOFO RATES:

YOUR DATA…..

6 Month MM GOFO 1.94/ and libor 6 month duration 1.90

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

G0LD LENDING RATE: – .04

XXXXXXXX

12 Month MM GOFO
+ 1.91%

LIBOR FOR 12 MONTH DURATION: 1.95

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE = +.04

end

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

ii) Important gold commentaries courtesy of GATA/Chris Powell

Cuba reintroduces the dollar as nobody wants the Cuban Peso..

London’s The Economist/GATA)

Cuba reintroduces the dollar

Submitted by cpowell on Fri, 2019-11-29 15:43. Section: Daily Dispatches

From The Economist, London
Thursday, November 28, 2019

American saloons from the 1950s and Chinese-brand cars still fill Havana’s streets. Lately, though, they have shared the road with brand-new electric scooters. Once rarities — sourced in Panama, Mexico, or the Dominican Republic and sold at a big markup in the black market — scooters can now be purchased at home, and far more cheaply than before.

The catch: Cubans must pay in American dollars or another rich-country currency.

…

In October Cuba’s communist government said citizens could open bank accounts that receive dollars, yen, euros, and other European currencies. They will be able to use the money to buy imported goods from new state-owned shops, called Tiendas Moneda Libremente Convertible (or convertible-currency shops), where prices are given in dollars. More than 70 are planned. This ends a ban on dollar transactions introduced in 2004.

The Tiendas MLC are proving popular. Shoppers queue to buy refrigerators, air-conditioners, car parts, and television sets. Some items, including freezers and scooters, cannot be restocked quickly enough.

By reintroducing the greenback, Cuba has in effect added a third leg to its dual-currency system. The state pays its employees (that is, most workers) in Cuban pesos, the currency for buying necessities like electricity, water, and bus tickets. In 1994, during the “special period” that followed the collapse of the Soviet Union, the government introduced convertible pesos (CUC), which could be exchanged for dollars at a rate of one to one. This was an attempt to hoover up dollars from remittances and curb inflation by offering Cubans an alternative to dollars.

CUC’s are now the main way to pay for things like petrol, internet access, hotel stays, appliances, and restaurant meals.

The reintroduction of the dollar is a response to hardship. Sources of foreign currency needed to sustain the import-dependent economy are running dry. …

… For the remainder of the report:

https://www.economist.com/the-americas/2019/11/28/cuba-reintroduces-the-…

end

Trust is being brought back to the gold jewellery business in India as the government is forcing mandatory hallmarking

(Reuters/GATA)

India makes gold jewellery hallmarking mandatory from January 15

Submitted by cpowell on Fri, 2019-11-29 19:28. Section: Daily Dispatches

Amazing — the Indian government facilitates the monetizing of gold here, rather than the usual paperizing of it.

* * *

By Rajendra Jadhav
Reuters
Friday, November 29, 2019

MUMBAI — India will make hallmarking of gold jewellery and artefacts mandatory from mid-January, a senior government minister said today, a move that could boost demand in the world’s second-biggest gold market by tackling quality concerns.

Hallmarking will be mandatory from Jan. 15, but a period of one year will be allowed to set up new hallmarking centres and to clear jewellers’ existing stocks, Consumer Affairs Minister Ram Vilas Paswan told reporters.

…

Hallmarking jewellery is not yet mandatory in India, where jewellery quality is sometimes an issue, mainly with small jewellers, and customers face problems when selling old jewellery for cash or exchanging it for new.

“The move will bring trust back to the gold industry, benefiting consumers and trade alike,” said Somasundaram PR, managing director of the World Gold Council’s Indian operations. …

… For the remainder of the report:

https://in.reuters.com/article/india-gold/india-makes-gold-jewellery-hal…

* * *

Help keep GATA going:

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

http://www.gata.org

To contribute to GATA, please visit:

http://www.gata.org/node/16

end

We are hearing that eastern ations are buying gold and./or repatriated gold back to its home country. That is gold is and will always be a sign of economic sovereignty.

(Bloomberg/GATA)

Gold is ‘a symbol … a sign of economic sovereignty’

Submitted by cpowell on Fri, 2019-11-29 15:00. Section: Daily Dispatches

Gold Is New Obsession for East Europe’s Nationalist Leaders

By Andrea Dudik and Radoslav Tomek
Bloomberg News via Yahoo News
Friday, November 29, 2019

https://www.yahoo.com/finance/news/gold-obsession-east-europe-nationalis…

Gold is all that nationalist leaders in Europe’s east can talk about these days.

Just this week, Poland’s government touted its economic might after completing the repatriation of 100 tons of the metal. Over in Hungary, anti-immigrant Prime Minister Viktor Orban has been ramping up holdings of the safe-haven asset to boost the security of his reserves.

…

The gold rush mirrors steps by Russia and China to diversify reserves exceeding $3 trillion away from the dollar amid flaring geopolitical tensions with the U.S. Motivations in Europe’s ex-communist wing, however, can vary.

Take the latest example. Former Slovak Premier Robert Fico, who has a shot at returning to power, urges parliament to compel the central bank into bringing home gold stocks stored in the U.K.

The reason? Sometimes your international partners can betray you, Fico said, citing a 1938 pact by France, Britain, Italy and Germany allowing Adolf Hitler to annex a chunk what was then Czechoslovakia, and — more recently — the Bank of England’s refusal to return Venezuela’s gold stock over political differences.

“You can hardly trust even the closest allies after the Munich Agreement,” Fico told reporters. “I guarantee that if something happens, we won’t see a single gram of this gold. Let’s do it as quickly as possible.”

His comments came despite the U.K. being one of Slovakia’s closest allies after the Soviet empire crumbled, helping ease the path to European Union and NATO. Fico said Brexit and the risk of a global economic crisis put Slovak gold stored in Britain in a dangerous situation.

The gold Poland brought back also came from the U.K., though there was no questioning of Britain’s reliability by central bank Governor Adam Glapinski.

Instead, he said he wanted to demonstrate the strength of his nation’s $586 billion economy — the largest in the EU’s east. Poland has doubled its gold holdings in the past two years and now has the region’s biggest stockpile.

Hungary, though, has been an active buyer too. Gold reserves surged 10-fold last year, setting the clamor for the metal in the countries around it in motion.

Serbia’s strongman leader Aleksandar Vucic took note, ordering the central bank to boost reserves and prompting the purchase of nine tons in October. Vucic said last week that more should be bought because “we see in which direction the crisis in the world is moving.”

The biggest nation to emerge from the breakup of Yugoslavia still keeps some of its gold abroad, the central bank said by email. The region is buying more of the metal because of global uncertainty over trade and politics, Brexit and low interest rates, it said.

Romania had also sought to relocate some of its gold reserves from the U.K., but those plans were put on hold when the government behind them was ousted in October.

For the no-nonsense leaders that have come to dominate eastern Europe, the main benefit may be the message to voters that hefty holdings of the precious metal conveys.

“Gold is a symbol,” said Vuk Vukovic, a political economist in Zagreb. “When states purchase it, people everywhere see it as a sign of economic sovereignty.”

END

Iran must be offering huge discounts on its oil as 6 nations join instex to bar oil in exchange for currency other than dollars

(Agence Franc Presse/Yahoo/GATA)

Six European countries join barter system for Iran trade

Submitted by cpowell on Sun, 2019-12-01 03:09. Section: Daily Dispatches

From Agence France-Presse
via Yahoo News

END
Saturday, December 30, 2019

PARIS — Paris, London, and Berlin today welcomed six new European countries to the INSTEX barter mechanism, which is designed to circumvent US sanctions against trade with Iran by avoiding use of the dollar.

“As founding shareholders of the Instrument in Support of Trade Exchanges (INSTEX), France, Germany, and the United Kingdom warmly welcome the decision taken by the governments of Belgium, Denmark, Finland, the Netherlands, Norway, and Sweden to join INSTEX as shareholders,” the three said in a joint statement.

…

The Paris-based INSTEX functions as a clearinghouse allowing Iran to continue to sell oil and import other products or services in exchange.

The system has not yet enabled any transactions.

Washington in 2018 unilaterally withdrew from the international agreement governing Iran’s nuclear programme and reinstated heavy sanctions against Tehran.

The accession of the six new members “further strengthens INSTEX and demonstrates European efforts to facilitate legitimate trade between Europe and Iran,” France, Germany, and Britain said. …

…

For the remainder of the report:

https://www.yahoo.com/news/six-european-countries-join-barter-system-ira…

end

Chris Powell writes that tne New York continues to misrepresent disclosures to us but what else is new

(GATA/Chris Powell)

New York Fed misrepresented disclosure rules to GATA, but so what?

Submitted by cpowell on Mon, 2019-12-02 00:59. Section: Daily Dispatches

8:05p ET Sunday, December 1, 2019

Dear Friend of GATA and Gold:

Our friend J.D. writes today:

“I write regarding the interesting response you received from Shawn Elizabeth Phillips, corporate secretary at the Federal Reserve Bank of New York, by e-mail dated November 13, 2019:

http://www.gata.org/node/19583

“The New York Fed’s response points to purported Dodd-Frank law rules prohibiting disclosing for two years of the identities of banks that receive ‘loans made under discount window programs.’ I believe that the New York Fed’s response was a cute evasion that may be exposed by specifying the loan types about which GATA sought information

“It’s correct that you asked for access to ‘all records of the New York Fed’s loans made this year.’ It’s also correct that Dodd-Frank has the disclosure restriction cited by the New York Fed. But you did not distinguish among the types of loan records for which you sought access, thus allowing the New York Fed to assume that your request involved ‘discount window’ lending.

“Dodd-Frank’s disclosure restriction does not appear to encompass the New York Fed’s activities in the repo market, the activities most at issue lately.

“I would argue the ‘discount rate’ is wholly different and serves a different purpose than the repo market. So I would suggest asking the New York Fed specifically for access to records of ‘all repurchase and reverse repurchase transactions performed beginning September 17, 2019, to date.”

* * *

Your secretary/treasurer responded:

“Thanks much for your note, J.D.

“Pam Martens of Wall Street on Parade (https://wallstreetonparade.com/) made the same observation to me when I shared the New York Fed’s reply with her. One or two other people did as well. But GATA was satisfied just to have caused the New York Fed to embarrass itself with its unaccountability.

“Zero Hedge took note of the New York Fed’s reply to GATA —

https://www.zerohedge.com/markets/fed-will-not-disclose-which-banks-are-…

— and got 31,000 page views for doing so, and Wall Street on Parade and other internet sites mentioned it as well.

“While GATA could press the matter with the New York Fed, the bank would blow us off no matter what we argued unless GATA was prepared to hire a law firm and challenge the bank’s unaccountability in court. Then we’d be stuck with years of litigation and tens of thousands of dollars in legal expenses.

“We don’t have the money for that, and people who want to know which investment houses are getting the repo cash from the New York Fed and what they are doing with it can always urge their congressmen to ask the question GATA posed. Congress could get the answers if it wanted to.

“Of course most congressmen don’t want to touch this issue, and of course mainstream financial news organizations are useless here too. Despite their pompous posturing about freedom of the press, they are actually just tools of the government. They will never dare to put a critical question to a central bank.

“If somebody gives GATA a winning Powerball or Mega-Millions ticket, we may bring a federal lawsuit against the New York Fed and a few other market riggers. But for the time being GATA seems to have done some pretty good damage to the bad guys without incurring any expense at all — did it just by sending an e-mail, which was free.

“Thanks again for writing.”

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

* * *

Help keep GATA going:

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

http://www.gata.org

To contribute to GATA, please visit:

http://www.gata.org/node/16

end

iii) Other physical stories:

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

(courtesy zerohedge/Chris Powell)

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

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

Dawn Giel | Dan Mangan

Published 3:33 PM ET Tue, 20 Nov 2018 Updated 10:32 AM ET Wed, 21 Nov 2018CNBC.com

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.

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

Submitted by cpowell on Tue, 2019-03-05 14:40. Section: Daily Dispatches

9:47a ET Tuesday, March 5, 2019

Dear Friend of GATA and Gold:

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

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

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

…

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

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

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

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

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

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

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

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

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

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

* * *

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

i) Chinese yuan vs USA dollar/CLOSED / LAST AT: 7.0421/ GETTING VERY DANGEROUSLY CLOSE TO 7:1

//OFFSHORE YUAN: 7.0411 /shanghai bourse CLOSED UP 3.83 POINTS OR 0.13%

HANG SANG CLOSED UP 98.20 POINTS OR 0.37%

2. Nikkei closed UP 235.59 POINTS OR 1.01%

3. Europe stocks OPENED ALL RED/

USA dollar index UP TO 98.36/Euro FALLS TO 1.1008

3b Japan 10 year bond yield: RISES TO. –.05/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 109.53/ 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:: 56.55 and Brent: 61.80

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

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO -.30%/Italian 10 yr bond yield UP to 1.35% /SPAIN 10 YR BOND YIELD UP TO 0.48%…ITALIAN 10 YR BOND YIELD/GERMAN BUND: 1.65: DANGEROUS FOR THE ITALIAN BANKING SYSTEM

3j Greek 10 year bond yield RISES TO : 1.52

3k Gold at $1457.50 silver at: 16.88 7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 2/100 in roubles/dollar) 64.37

3m oil into the 56 dollar handle for WTI and 61 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 109.53 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 .9981 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0981 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 –0.30%

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 1.83% early this morning. Thirty year rate at 2.27%

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

6. TURKISH LIRA: UP TO 5.7586..

Futures Fade China PMI Euphoria After Trump Restarts Trade War With Brazil, Argentina

Markets started off the week in full-blown euphoria mode, despite another lukewarm Black Friday (as Amazon continues to cannibalizes the entire bricks and mortar retail industry) disappointing Korean exports, Japanese industrial data and a report out of China that only a full rollback on existing tariffs will lead to a “Phase 1” trade deal, with traders instead choosing to focus on this weekend’s NBS and Caixin manufacturing PMI data out of China, of which the former unexpectedly moved into expansion in November, while the latter jumped to a near three-year high, which reinforced market confidence that the worst may be over for China (of course, this is merely a soft survey; China’s actual hard data has been an absolute disaster) and the world economy.

Not even an Axios report late on Sunday that the US-China trade deal had stalled because of Hong Kong legislation and the the phase one deal would probably happen year-end at the earliest, managed to dent optimism.

However after rising as high as 3,158 shortly after the European open, S&P futures pared much of their gain and Europe stocks briefly turned lower after President Trump tweeted on Monday that he will immediately restore tariffs on U.S. steel and aluminum imports from Brazil and Argentina, in the process reminding investors of lingering trade risks and overshadowed solid factory data.

“Brazil and Argentina have been presiding over a massive devaluation of their currencies, which is not good for our farmers. Therefore, effective immediately, I will restore the Tariffs on all Steel & Aluminum that is shipped into the U.S. from those countries,” Trump said in a tweet.

Donald J. Trump

✔@realDonaldTrump

· 2h

Brazil and Argentina have been presiding over a massive devaluation of their currencies. which is not good for our farmers. Therefore, effective immediately, I will restore the Tariffs on all Steel & Aluminum that is shipped into the U.S. from those countries. The Federal….

Donald J. Trump

✔@realDonaldTrump

…..Reserve should likewise act so that countries, of which there are many, no longer take advantage of our strong dollar by further devaluing their currencies. This makes it very hard for our manufactures & farmers to fairly export their goods. Lower Rates & Loosen – Fed!

Trump also urged the Federal Reserve to prevent countries from gaining an economic advantage by devaluing their currencies: “The Federal Reserve should likewise act so that countries, of which there are many, no longer take advantage of our strong dollar,” Trump tweeted. “Lower Rates & Loosen – Fed!”, he said, perhaps unaware that the Fed did just that in three of the past five months.

The latest tariff twist threatened to overshadow promising data out of China and Europe along with a record $7.4 billion in U.S. online sales for Black Friday, if somewhat below expectations. Investors will also be looking for new reasons to be bullish in American factory and employment numbers due this week, although as we showed on Sunday, they may end up disappointed.

Despite the modest Trump tweet glitch, US futures remained solidly higher thanks to the Chinese PMI data, which coming from a country best known for fabricating all of its economic data, is certainly beyond reproach and is absolutely accurate.

In Europe, the Stoxx Europe 600 Index erased erases an early gain of as much as 0.6% and traded slightly lower as defensive bond proxies utilities, telecoms and real estate led declines. The STOXX 600 Utilities Index extends drop, down 1.4%, the most since Nov. 7. Markets were also keeping track of the latest Eurozone PMI reports which indicated manufacturing activity contracted for a 10th straight month in November although the bloc’s battered factories may have turned a corner as forward-looking indicators in Monday’s survey appear to have passed a nadir.

IHS Markit’s final manufacturing Purchasing Managers’ Index (PMI) has been below the 50 mark separating growth from contraction since February, but at 46.9 it was above October’s 45.9 and higher than a preliminary estimate of 46.6.

The index for output, which feeds into a composite PMI due on Wednesday that is seen as a good gauge of economic health, rose to 47.4 from 46.6. “Although still signaling a steep rate of decline, the manufacturing PMI nonetheless brings some encouraging signals which will fuel speculation that the worst is over for euro area producers,” said Chris Williamson, chief business economist at IHS Markit.

New orders, employment, raw materials purchases and backlogs of work all declined at a shallower rate, while optimism staged its biggest one-month bounce in over six years. The future output index leapt to 55.3 from 51.9.

“Perhaps most promising is a marked upturn in business sentiment, particularly in Germany,” Williamson said. Germany is going through a soft patch but is on track to grow 0.2% this quarter, the Ifo economic institute said last week.Its export-dependent manufacturing sector contracted at a slower pace for the second month in a row in November, the German factory PMI showed earlier.The country’s mfg PMI printed at 44.1, above the 43.8 expected.

In another key weekend development, Germany’s Finance Minister Scholtz lost his bid to become leader of the SPD after suffering defeat at the hands of the left-leaning Norbert Walter-Borjans and Saskia Esken, who have been highly critical of the coalition between their party and the CDU/CSU. The Chief economist at the Centre for European Reform noted that Walter-Borjans and Esken have been critical of the debt brake but accept that it probably cannot be changed, adding that it is unlikely the coalition will collapse but the SPD will likely make the GroKo more painful for the CDU.

Earlier, Japanese stocks led gains in Asia, while Hong Kong shares managed to climb even after clashes between protesters and police resumed over the weekend. Asian stocks advanced, led by health-care firms, after China posted stronger-than-expected manufacturing surveys. Most markets in the region were up, with Japan and the Philippines leading gains. The Topix climbed, driven by electronic companies and automakers, as the yen stabilized near a six-month low against the U.S. dollar. The Shanghai Composite Index edged higher, snapping a three-day losing streak, with Will Semiconductor and Foxconn Industrial Internet driving gains. India’s Sensex fluctuated after retreating from Thursday’s record-high close in the previous session. Reliance Industries climbed while Tata Consultancy Services, slid.

As a reminder, on Saturday China rpeorted that its official, NBS Manufacturing PMI rose to 50.2 vs. Exp. 49.5 (Prev. 49.3), its first expansion in 7 months, while the Chinese Non-Manufacturing PMI also rose to 54.4 vs. Exp. 52.0 (Prev. 52.8), resulting in a Composite PMI (Nov) 53.7 (Prev. 52.0) Chinese Caixin Manufacturing PMI (Nov) 51.8 vs. Exp. 51.4 (Prev. 51.7).

“This improvement in the manufacturing PMI is important because we can say with more certainty, than at the beginning of the year, that China’s macro outlook is indeed stabilizing,” said Aninda Mitra, senior sovereign analyst at BNY Mellon Investment Management.

Meanwhile, better-than-expected manufacturing data from China and the euro area failed to ignite demand for emerging-market assets as risks including a lack of progress in U.S.-Sino trade talks and protests in Hong Kong weighed on investor sentiment. While MSCI’s emerging-market stock index eked out a modest gain on Monday, the currency gauge extended a decline after posting its first down month in three in November. The Philippine peso led declines as the nation braces for Typhoon Kammuri, while Turkey’s lira edged lower amid concern soft economic growth will push the central bank to ease policy further. The zloty strengthened after the manufacturing PMI climbed. “Markets see the glass half full,” Guillaume Tresca, a Paris-based strategist for Credit Agricole, said in a client note. While the Chinese manufacturing data improve the outlook for global growth, “it could get more complicated to get a trade deal” as China’s government insists on a tariff rollback.

In FX, the U.S. dollar rose to a six-month high versus the Japanese yen and New Zealand’s currency jumped to near four-month peaks on Monday on a rebound in global economic optimism. The U.S. dollar rallied to 109.73 yen, the highest since May, and was last up a quarter of a percent against the safe-haven Japanese currency at 109.63 yen. The euro was steady ahead of a testimony by the European Central Bank’s new president, Christine Lagarde, to the European parliament later in the day. A tightening British election race knocked the pound lower. Riskier currencies also rallied after the Chinese data, with New Zealand’s dollar jumping to its highest in almost four months at $0.6475. It was up 0.75% on the day, while the Australian dollar rallied 0.4% at $0.6789.

In rates, global bonds retreated as equities traded in a sea of green and commodity currencies advanced. US 10Y Tsy yields jumped as high as 1.86% before fading half of their gains following the Trump tweet.

In commodities, oil rallied following its more than 5% sell-off on Friday, while gold retreated. Crude oil firmed on dual tailwinds in the form of better than expected PMIs out of China and talk of OPEC+ producers considering a 400k deepening of existing cuts acting as a tailwind for the complex. Front month WTI and Brent futures have managed to recover nearly half of Friday’s steep losses, the former eclipsing USD 56.50/bbl to the upside (vs. lows of USD 55.00/bbl), the latter briefly topping the USD 62.00/bbl mark (vs. USD 60.40/bbl lows). Weekend comments from Iraqi Oil Minister Ghadhba hinted the cartel will mull deepening existing oil output cuts by about 400k bpd to 1.6mln bpd, comments which further corroborated by sources this morning; the touted a cut of at least 400k BPD which could last until at least June.

Following a barrage of PMI reports from around the world, we also get PMIs and construction spending data from the US.

Market Snapshot

S&P 500 futures up 0.2% to 3,148.25
STOXX Europe 600 up 0.5% to 409.44
MXAP up 0.4% to 164.47
MXAPJ up 0.2% to 524.78
Nikkei up 1% to 23,529.50
Topix up 0.9% to 1,714.49
Hang Seng Index up 0.4% to 26,444.72
Shanghai Composite up 0.1% to 2,875.81
Sensex unchanged at 40,794.04
Australia S&P/ASX 200 up 0.2% to 6,862.27
Kospi up 0.2% to 2,091.92
German 10Y yield rose 7.9 bps to -0.281%
Euro down 0.01% to $1.1017
Italian 10Y yield fell 0.3 bps to 0.885%
Spanish 10Y yield rose 6.9 bps to 0.485%
Brent futures up 2.4% to $61.94/bbl
Gold spot down 0.5% to $1,456.67
U.S. Dollar Index little changed at 98.34

Top Overnight News from Bloomberg

The House this week begins the solemn task of deciding whether to bring impeachment articles against President Donald Trump, faced with a sharply divided American public, a compressed timetable and doubts about how and if the White House will participate
Peter Navarro, the self-described “bad cop” of Trump administration economic policy, wants to shake up the World Trade Organization
Chancellor Angela Merkel’s government was thrown into crisis after Germany’s Social Democrats redrew the country’s political map by electing a new leadership seen as a threat to the survival of their coalition; Chancellor Angela Merkel’s party told the new leadership that there will be no renegotiation of the terms of their alliance
The Labour Party gained on the ruling Conservatives in four of five polls with two weeks until the U.K. election, with one of them signaling a possible hung parliament
First it was India and South Korea. Now Japan and New Zealand are joining Asia Pacific’s fiscal stimulus bandwagon, raising concerns for bond investors who will be asked to fund the attempt to re-ignite growth
For years, OPEC ignored the rise of the U.S. shale industry and came to regret its mistake. Now, the group is making another bold gamble on America’s oil revolution: that its golden age is over

Asian equity markets kick-started December on the front-foot with risk appetite stimulated by a flurry of better than expected Chinese data including official Manufacturing PMI which expanded for the first time in 7-months. ASX 200 (+0.2%) and Nikkei 225 (+1.0%) were higher with Australia led by outperformance in the defensive and financial sectors but with upside capped by energy following the recent slump in oil prices after Russian Energy Minister Novak triggered doubts for a deal extension at this week’s OPEC+ meeting, while the advances in Tokyo were mainly fuelled by a weaker currency. Hang Seng (+0.4%) and Shanghai Comp. (+0.1%) welcomed the encouraging PMI data which aside from the headline beat, also showed Non-Manufacturing PMI and Caixin Manufacturing PMI topped estimates, although gains were limited by continued PBoC inaction, the resumption of violence in Hong Kong protests over the weekend and ongoing trade uncertainty with Beijing said to be insistent on a tariff rollback and as other reports suggested Hong Kong legislation may have stalled the US-China agreement but that a phase one deal would still probably occur by year-end at the soonest. Finally, JGBs were lower amid similar pressure in T-notes and with demand for bonds sapped by the mostly upbeat sentiment, while the BoJ’s presence for a respectable JPY 890bln of JGBs did little to help 10yr JGB prices after having slipped through prior support at the 153.00 level.

Top Asian News

PBOC Signals Policy to Stay Cautious Amid Uncertain Data
Slowdown Fuels Fears Turkey to Push Stimulus It Can’t Afford

Better than expected PMI data out of China overnight followed by slight revisions higher to manufacturing PMIs across Europe have somewhat spurred risk appetite; subsequently, major European bourses (Euro Stoxx 50 +0.1%), but has pared back a bulk of its gains in recent trade. Sectors are mostly in the green, led by Energy (+0.7%), in-line with rallying crude prices, while the defensive Utilities (-1.3%) sector is the laggard. In terms of individual mover, Tullow Oil (+4.3%) is the top Stoxx 600 gainer, as reports circulate alleging the Co. has agreed to sell a stake in its Ugandan oil fields. Lufthansa (+1.5%) received a boost on the news that Qatar Airways may be interested in taking a stake in the Co., which could lead to a partnership, although the Co. pushed back on the news stating that the Co. was not privatised in Germany to be nationalised in Qatar. Elsewhere, positive broker moves for Rio Tinto (+0.7%) and EDF (+2.4%) sees the Co.’s shares supported. In terms of the laggards, Hiscox (-3.4%) is set to receive the boot from the FTSE 100 in its quarterly reshuffle on Wednesday, while Fresnillo (-3.7%) and Kingfisher (+1.5%) are also reportedly at risk. easyJet (-0.1%), Just Eat (Unch) and GVC (+1.0%) could be promoted, according to Elsewhere, at the bottom of the FTSE 100 is Ocado (-8.6%), whose shares sunk on the news that the Co. is to issues GBP 500mln worth of bonds which will be convertible into shares as it seeks cash to fund its tech arm’s commitments.

Top European News

Johnson Bolsters Security Message After London Knife Attack
Euro- Area Manufacturing Slump Eases But Job Losses Continue
U.K. Factory Downturn Was Less Severe Than Feared in November
UniCredit Sells Stake in Turkey Unit as Mustier Readies Targets
Merkel’s Party Plays Hardball With Coalition Future in Doubt

In FX, the Kiwi has made a flying start to December on the back of significantly stronger than forecast NZ terms of trade for Q3 that has lifted Nzd/Usd over the 0.6450 mark to test early November resistance (around 0.6466) and nudged the Aud/Nzd cross down through 1.0500 to test Fib support even though the Aussie is also doing well in the G10 arena in wake of encouraging Chinese PMIs, with Aud/Usd climbing above 0.6775 and rebounding towards 0.6800.

EUR/CHF/CAD/GBP/JPY – All softer vs a generally solid Greenback, bar the aforementioned Antipodean Dollar outperformance, as the DXY meanders between 98.272-368 awaiting the full return of US markets/participants from Thanksgiving. Eur/Usd is just maintaining 1.1000+ status with the aid of better than flash or forecast Eurozone PMIs that have offset some of the investor qualms over German politics due to the failed attempt by Finance Minister Scholz to become SPD chief over the weekend. However, more hefty option expiry interest may keep the single currency supressed, as 1.2 bn runs off from 1.0995-1.1000 and a further 1.1 bn between 1.0005-20. Elsewhere, the Franc is pivoting parity after Swiss retail sales and the manufacturing PMI both beat consensus, but slowed from previous levels and the Loonie is hovering just above 1.3300 Canada’s manufacturing survey amidst a firm rebound in oil prices that is also helping the NOK pare some of its recent declines. Indeed, Eur/Nok has eased back from around 10.1600 vs a more elevated Eur/SEK following falls in Norwegian and Swedish manufacturing PMIs (albeit the former still growth vs the latter contracting faster). Meanwhile, Cable continues to labour on the 1.2900 handle, with weekend polls indicating a tighter UK election race and an upward revision to the manufacturing PMI not really providing the Pound with any momentum due to weak sub-components. Similarly, the Yen did not derive much impetus from Japan’s manufacturing headline rebounding closer to 50.0 as Usd/Jpy hovers near the middle of a 109.49-72 range and stays technically bullish after a 3rd close above a key chart level (109.37 Fib).
EM – Depreciation against the Buck almost across the board, with Usd/Cnh hovering around 7.0400 after China’s retaliatory moves in response to the US bill in favour of HK protestors and Usd/Try skirting 5.7600 following scant reaction to a rebound in Turkish GDP or upturn in manufacturing PMI.

In commodities, crude oil prices are firmer during Monday morning trade, with dual tailwinds in the form of better than expected PMIs out of China and talk of OPEC+ producers considering a 400k deepening of existing cuts acting as a tailwind for the complex. Front month WTI and Brent futures have managed to recover nearly half of Friday’s steep losses, the former eclipsing USD 56.50/bbl to the upside (vs. lows of USD 55.00/bbl), the latter briefly topping the USD 62.00/bbl mark (vs. USD 60.40/bbl lows). Weekend comments from Iraqi Oil Minister Ghadhba hinted the cartel will mull deepening existing oil output cuts by about 400k bpd to 1.6mln bpd, comments which further corroborated by sources this morning; the touted a cut of at least 400k BPD which could last until at least June. Moreover, the latest analysis from OPEC sees a significant oil glut and inventory build in H1 2020 in the absence of further cuts, said multiple sources. In terms of the metals; gold is well off last Friday’s highs of around USD 1467/oz, as lack of haven demand on better global PMI data puts the precious metal under pressure. Copper, meanwhile, received a fleeting overnight boost on better Chinese PMIs but has since retreated from highs and is fairly flat on the day as the red metal balances trade implications from China’s action against the Hong Kong bill which passed into law in Washington.

US Event Calendar

9:45am: Markit US Manufacturing PMI, est. 52.2, prior 52.2
- 10am: ISM Manufacturing, est. 49.2, prior 48.3
- ISM Employment, est. 48.3, prior 47.7
- ISM Prices Paid, est. 47, prior 45.5
- ISM New Orders, prior 49.1
10am: Construction Spending MoM, est. 0.3%, prior 0.5%

DB’s Jim Reid concludes the overnight wrap

As we welcome in December, Craig has already published our monthly performance review (link here ).The penultimate month of the year proved to be another good one for risk assets as tentative signs of progress towards a “Phase One” trade deal and slightly better data helped. As such of the 16 equity markets in our sample, 13 closed with a positive total return in local currency terms. That of course included fresh new highs for the major US equity markets. YTD, all 38 assets in our sample across all asset classes are now up. Impressive stuff. See the link for more.

It always feels that getting past Thanksgiving marks the start of the official Christmas season. The tree went up at home yesterday, Bronte has already eaten 5 tree decorations, the twins have pulled off several more and Maisie has demanded that she opens more than one advent calendar door each day. Meanwhile my wife drops more Xmas present hints than a taxi driver does passengers on New Year’s Eve. It’s going to be a long month.

This first week of December has a number of critical events that will set the agenda for markets running up to Christmas. Data releases include global PMIs (today and Wednesday), the US jobs report (Friday) and the US ISM figures (today and Wednesday). We’ll hear from ECB President Lagarde (today), and get policy decisions from central banks in Canada (Wednesday), Australia (Tuesday) and India (Thursday), while there’ll be another UK election debate between the two main party leaders (Friday) and a NATO leaders summit in London (Tuesday-Wednesday). With only just over a week to the U.K. election all eyes on whether Trump’s visit to London (starting today ahead of NATO) creates political capital for the opposition parties keen to link Mr Trump to Mr Johnson. Finally the German SPD 3-day party conference starting on Friday is now a must watch given the shock leadership results over the weekend that we’ll discuss below.

Today is global manufacturing PMI day before the services and composite PMIs come out on Wednesday. China has given the world a boost by seeing the official manufacturing gauge at 50.2 (49.5 expected), the first 50+ print since April and up from 49.3 in October. Non-manufacturing rose to 54.4 (consensus 53.1) from 52.8 last month. There is some chatter about strong seasonal helping but overall this will be seen as positive news. Meanwhile, China’s November Caixin manufacturing PMI also came in higher than consensus at 51.8 (vs. 51.5 expected). Asian equity markets have subsequently started the week on the front foot with the Nikkei (+0.99%), Hang Seng (+0.34%), Shanghai Comp (+0.30%) and Kospi (+0.13%) all up. Elsewhere, futures on the S&P 500 are up +0.28% while yields on 10y USTs are up +3.8bps. In other news, China’s Global Times tweeted yesterday that the Chinese government wants tariffs to be rolled back as part of the phase one trade deal with the US, citing unidentified people in Beijing. As for other overnight data releases Japan’s final November PMI came in 0.3pts above the preliminary read at 48.9.

As for the rest of the weekend news, the surprise SPD leadership victory for Norbert Walter-Borjans and Saskia Esken who are very much on the left wing of the party will likely have short and longer term implications. Walter-Borjans has already suggested that they don’t need to leave the coalition with Mrs Merkel’s CDU but that “we must improve the policies and perhaps loosen the black zero”. Whatever actually happens from here this news will likely get markets excited about an easier path to more German fiscal policy in the future. It makes the probability of the Groko breaking up higher and increases the chance of fresh elections in H1 next year. With the Greens riding high in the polls (Forsa) this hope of more fiscal will be further boosted by this. However their policies are not market friendly so what happens next in Germany is very complicated. It could well be that nothing actually happens and the Groko stays together. The SPD are low enough in the polls to make them vulnerable in early elections but staying in the coalition isn’t helping their polling. So a catch-22. Makes me happy I live in an easy to predict country in terms of politics (a joke by the way!). Maybe we’ll have a lot more to report this time next week after the 3-day SPD conference starting on Friday. The Euro is trading flattish this morning at 1.1020 after the news. See our FX strategist full round up of this German political earthquake and implications for the Euro here .

In terms of the U.K. election polls, the Tory lead over Labour in the weekend polls were 6, 10, 15, 9, 13 and 9 points with a bigger range than of late. This still averages 10 points but it’s clear that Labour are eroding the lead in enough polls to make this a little more “interesting” than a couple of weeks ago even if the aggregated lead isn’t that much different. A reminder that a lead of less than 6-7 points might start to push us towards hung parliament territory. Sterling is trading a shade weaker overnight at $1.2917 on the back of these polls.

Moving forward and as for the rest of the global PMIs, the flash numbers mean we do have some initial indications of how the global economy performed into November but if momentum is improving this can be picked up between the flash and final numbers. The flash Euro Area services PMI fell to 51.5 while the manufacturing reading rose to 46.6, and the consensus is expecting the final Euro Area PMI readings to remain in line with the flash ones.

In the US, we’ve also got the ISM releases, with the manufacturing report today before the non-manufacturing index comes out on Wednesday. The manufacturing reading has been below 50 since August (49.2 expected, 48.3 last month), although the non-manufacturing index has held up better, at 54.7 last month.

The other big highlight of the week comes with the US jobs report on Friday. In October, the +128k increase in nonfarm payrolls was the slowest pace of job growth since May but was better than expected with upward revisions to earlier months. The consensus is looking for a rebound to +190k in November. Meanwhile the unemployment rate and average hourly earnings yoy growth are expected to remain at 3.6% and +3.0% respectively. Other US data on factory orders, the trade balance and durable goods orders on Thursday will also help set the tone through December.

In Europe, slightly less is happening in terms of data aside from the PMIs, but we will see German factory orders and industrial production figures released for October on Thursday and Friday respectively. With the German economy having avoided a technical recession in Q3 with +0.1% qoq growth, attention will focus on whether the data heading into Q4 has shown further signs of stabilisation. Finally, for the Euro Area as a whole, Thursday sees the October retail sales figures coming out, along with the final reading for Q3 employment and GDP.

Turning to central banks, with the Fed in their blackout period, the main event this week is likely to be ECB President Lagarde’s appearance before the Economic and Monetary Affairs Committee of the European Parliament today. This is the first Monetary Dialogue with the committee since Lagarde became ECB President, and it’ll be worth keeping an eye on whether she talks about the upcoming strategic review of monetary policy.

Other political events to watch out for include the annual UN climate change conference in Madrid from today, which will be taking place over the next two weeks. Then here in London we have a summit of NATO leaders on Tuesday and Wednesday. And finally, ahead of the UK general election on December 12, there’ll be the second head-to-head debate between Prime Minister Johnson and Labour leader Corbyn on Friday.

A quick recap of last week and equity markets ended on a negative foot amid thin post-US holiday liquidity, but were still higher on the week thanks in large part to better US data from earlier in the week. The S&P 500 ended +0.99% on the week (-0.40% Friday), with the NASDAQ outperforming, up +1.71% (-0.46% Friday). The STOXX 600 moved a similar amount, up +0.85% (-0.44% Friday). Bank stocked lagged in both regions, with the S&P 500 banks index up +0.43% (-0.28% Friday) and the STOXX bank index -1.08% (-0.49% Friday). Fixed income markets were calm, with yields on treasuries up +0.5bps (+1.0bps Friday) and on bunds down -0.1bps (+0.1bps Friday). Gilts saw a relatively larger move on Friday, ending the week -0.8bps lower despite a +2.1bps selloff on Friday, as confidence increased that the Conservative party will win the upcoming election even with a slight narrowing in the polls.

3A/ASIAN AFFAIRS

I)MONDAY MORNING/ SUNDAY NIGHT:

SHANGHAI CLOSED UP 3.83 POINTS OR 0.13% //Hang Sang CLOSED UP 98.20 POINTS OR 0.37% /The Nikkei closed DOWN 422.94 POINTS OR 1.97%//Australia’s all ordinaires CLOSED DOWN .42%

3 a./NORTH KOREA/ SOUTH KOREA

North Korea//Japan

North Korea threatens the imbecile Abe as they threaten their neighbour Japan

(zerohedge)

NK Threatens ‘Imbecile’ Shinzo Abe With “Real Ballistic Missile” Over Japan

Amid stalled talks with the US we have the dangerous Thanksgiving specter of multiple North Korea ICBM launches in the past month — or were they?

Pyongyang has lashed out at Japanese Prime Minister Shinzo Abe, calling him a “political dwarf” for ‘misidentifying’ missiles used in the latest tests. In the fourth known recent test of a new “multiple launch rocket system,” two short-range projectiles were fired into waters off NK’s east coast on Thursday. It’s sparked an intense debate over the nature of the missiles, and whether they were banned ballistic missiles under United Nations Security Council resolutions,which would constitute a threat to the region and the world.

On Saturday a North Korean Foreign Ministry official called Abe “the most stupid person ever known in history” after the Japanese leader publicly characterized the latest rocket test as a likely ballistic missile launch.

*NK state news showcasing this week’s launch, via Sky News.*

“It can be said that Abe is the only one idiot in the world and the most stupid man ever known in history as he fails to distinguish a missile from multiple launch rocket system while seeing the photo-accompanied report,” NK’s Foreign Ministry’s Department of Japanese Affairs said on the North’s official Korean Central News Agency channel.

All of this has led an enraged Pyongyang to issue a more direct threat of “a real ballistic missile” which concluded the fiery and bizarre “political dwarf” comments:

“Abe may see what a real ballistic missile is in the not distant future and under his nose,” the statement said.

And followed with, “Abe is none other than a perfect imbecile and a political dwarf without parallel in the world.”

Of Thursday’s launch, Prime Minister Shinzo Abe told reporters that the missiles didn’t enter Japan’s airspace or “exclusive economic zone” at sea. The incident followed a series of short-range missile tests by North Korea in late October, which landed near Japan.

According to South Korea’s Joint Chiefs of Staff, the projectiles launched days ago flew about 380km (235 miles) at a maximum altitude of 97km (60 miles), leading to debate over their nature and classification in among western analysts as well.

“Some experts said the distance and trajectory of the projectiles showed they were virtually missiles or missile-classed weapons,” Sky News noted.

The South Korean army further assessed they were “presumed to be fired from a super-large caliber multiple rocket launcher,” according to an official statement .

Though the White House has in recent months downplayed the tests, Pyongyang’s new threat to launch “a real ballistic missile” over Japan is sure to provoke a reaction from Washington, also given that if confirmed to be a ballistic missile test, it would mark the 13th since May of this year.

end

b) REPORT ON JAPAN

3 C CHINA

China

Surging PMI’s in Chian did nothing for the stock markets as they do not believe the data. Also crashing Korean exports weighing heavy on global markets

(zeorhedge)

Surging China PMIs, Crashing Korea Exports Spark Even More Confusion About Global Economy

While markets and economists were quick to conclude the global economy had recovered from its post-2018 slump which had sent $17 trillion in bonds in negative yielding territory, some time in early September and that the widely anticipated recession of 2020 appears to now have been delayed amid growing speculation that the US and China appear to put the whole trade war nastiness behind us, the reality is that the global economic signs in the past three months have been mixed at best, with the Citi US eco surprise index sliding from a nearly two year high back to negative in mid-November, and now just barely peeking above the flatline.

Of course, any such downshift in the economy is news to stocks which have continued to surge to all time highs courtesy of the Fed’s QE4 (sorry, we won’t call it NOT QE anymore for reasons we explained yesterday), rising every single week the Fed’s balance sheet has been increasing since the resumption of POMO in mid-October, and falling the one week the balance sheet shrank…

… even as virtually all other risk assets have peaked amid a surge in growth “jitters“, with bond yields dropping…

… junk bond spreads widening…

… and commodities sliding.

What is surprising is just how immune stocks have been to any adverse news; and while the Fed’s QE and record stock buybacks are certainly helping preserve the market’s optimism, one could in theory make a fundamental case that stocks have no priced in a full-blown economic recovery as the following chart from Morgan Stanley shows.

Which brings us back to the original question: is the modest recovery that flourished in early September, then wilted in the next few weeks, still on track or is it time to start pricing in a 2020 recession all over again.

Over the weekend we got two data additional economic points that provided only added to the confusion.

First, on Saturday morning (local time), China reported that its official manufacturing and service PMIs had both escaped from the sub-50 “contractionary” zone, with both prints beating consensus expectations.

Specifically, the official NBS manufacturing PMI came in at 50.2 in November, up from 49.3 in October, beating consensus estimates of 49.6, and the highest print since March. Meanwhile, the non-manufacturing PMI rose sharply from 52.8 to 54.4 in November, and also the highest since March.

Adding to the good news, both production and new orders sub-indexes suggested stronger growth momentum, and trade indicators improved. The production index was 1.8pp higher at 52.6, and the new orders sub-index went up 1.7pp to 51.3. The employment sub-index was unchanged at 47.3. Trade indicators – the imports sub-index – climbed 2.9pp (the largest rebound among manufacturing PMI sub-indexes) to 49.8, back to the levels seen around mid 2018; and the new export order index was also 1.8pp higher at 48.8, the highest reading since April. By enterprise type, manufacturing PMIs for large, medium and small-sized enterprises all increased in November.

It’s almost as if China’s factories have already priced in the end of the trade war, and are stating to restock for a year free and clear of tariffs. In retrospect, this may prove overly optimistic…

The non-manufacturing PMI (comprised of the service and construction sectors at roughly 80%/20% weightings, based on our estimates) rebounded to 54.4 in November, the highest reading since March this year. Services PMI rose to 53.5, a five-month high. Among sub-sectors in services, property, railway transportation and catering saw weaker growth momentum while production related services, logistics, telecom, capital markets and insurance sub-sectors saw stronger growth momentum. The construction PMI fell by 0.8pp to 59.6, modestly below the average level of more than 60 over the past two years.

Putting the two together, China gave a clear sign that the economic storm clouds are dispersing, while the combination of better import sub-indexes and lower finished goods inventory pointed to stronger demand, and the NBS attributed the better new export orders to “more foreign demand ahead of the Christmas holiday”. Commenting on the data, Goldman said that the fading of payback effects after earlier export front-loading, as well as early signs of better global growth, likely contributed to the rebound in new export orders. The dissipation of potential drag on some activities around the October 1 celebration of the 70th anniversary of the PRC might have also added to the recovery in PMI indexes in November (average reading of October to November NBS manufacturing PMI is 49.8, slightly higher than the average reading in the first nine months of this year). The stronger manufacturing PMI also helped with a better services PMI – production related services and the logistics industry saw stronger growth momentum in November.

Still, one naturally needs to take the Chinese PMI surveys with a grain of salt: after all, there is no country on earth more prone to manipulating and goalseeking its “data” as the political narrative may fit, and of all the data, the PMI happens to be the most malleable. As such we would wait for separate confirmation that China is now in the clear, especially following the recent collapse in China Industrial Profits which plunged to an 8 year low. If the PMI data was indeed just a fabrication, expect no rebound in this far more important and tanbile data set.

Then again, one may not even have to wait that long, because in addition to China’s latest PMI prints, over the weekend we also got the latest South Korean export data, and it was a doozy.

The data, which is a closely watched bellwether for world trade and a leading indicator for global corporate profits, not only plunged again, but dropped far more than expected in November, dealing what Bloomberg dubbed “a blow to nascent optimism that a prolonged slump in global demand may be bottoming out”, the same optimism Bloomberg was cheering on just one day earlier with the Chinese data.

In November, trade ministry data showed that exports tumbled 14.3% from a year earlier for a sixth straight double-digit decline; the drop was about a third worse than the 9.7% slide consensus expected, and refuted preliminary figures which had also offered hope of some respite in the export slide. This was the second worst annual export drop in the past 4 years, and one of the worst months for Korean trade since the financial crisis. At the same time, imports decreased 13% y/y.

Exports to China dropped 12.2% in November from a year earlier, reflecting slowing growth in the world’s second largest economy and South Korea’s biggest export destination. Exports to Japan fell 10.9%, while imports declined by 18.5%, as the two neighboring countries go through their own trade dispute. Japan said in summer that it would impose tighter checks on its exports of gas and two other materials used in the tech industry, citing national security concerns. The ministry said the materials make up only 1.4% of Korea’s total imports from Japan and haven’t yet caused any disruption to production.

Meanwhile, imports stayed weak at -13.0% yoy, also moderating slightly from the previous month, and below the consensus of a -11.9% print. Consumer goods imports weakened slightly to -5.2% (vs. -3.2% in October) weighed by weak auto imports, and capital goods imports slightly to -7.5% (vs. -11.6% in October). The trade surplus moderated further to US$3.4bn, down from US$5.4bn in the previous month.

The export numbers confirm that the Asian country is on course for its weakest economic growth in a decade. The BOK on Friday slashed its growth projections for this year and next by 0.2% points to 2% and 2.3%, respectively. That according to Bloomberg would be the slowest pace since 2009 when the country suffered in the aftermath of the global financial crisis. Other key indicators like industrial output and consumer prices have also been pointing to deteriorating demand, but the government has few policy options left to support the economy, with rates already at all time lows, while expansionary fiscal and monetary policies are pushing household debt to all-time highs as people borrow more to invest in the domestic property market in search of higher yields. That in turn is jeopardizing President Moon Jae-in’s pledge to provide affordable homes.

“Korea is not the only casualty of the U.S.-China trade dispute, a slowdown in the global economy and no-deal Brexit,” the ministry said, noting that most of the world’s 10 biggest exporting countries had seen shipments decline as of September. “We’re particularly harder hit because of heavy reliance on China by region and semiconductor by sector.”

That said, Korea did everything it could to give the impression that its dismal data was also set to turn higher: Bank of Korea Governor Lee Ju-yeol insisted two days ago that the economy was passing through its most painful moment and talked of a gradual recovery next year. Still, the latest data suggests that any optimism may be premature.

As Bloomberg notes, South Korea’s trade figures have gained particularly close attention in recent months as markets try to infer whether the worst of a tech sector slump is over and how quickly it might recover. Korean companies such as Samsung Electronics are among the world’s biggest suppliers of semiconductors, smart-phones and other tech-related items. The November data showed that chip exports, the largest category in Korea’s overseas shipments, dropped 30.8%, compared with falls of more than 30% in recent months.

South Korea’s export-dependent economy has been one of the hardest-hit by the U.S.-China trade war and the disruptions it has caused in the global supply chain, with almost 40% of the nation’s shipments headed to the two countries. The government, just like the US stock market, has pinned its hopes on an export recovery next year as the U.S. and China move towards a preliminary trade deal.

That said, with just two weeks to go until Trump and Xi have to conclude a Phase 1 deal or else the US is set to trigger more tariffs, optimism of a deal may disappear quickly if no progress is made in the coming days.

end

China/USA

The glove are for sure coming off as China now insists that existing tariffs must be removed before a phase one deal is consummated

(zerohedge)

Gloves Come Off: China “Insists” Existing Tariffs Must Be Scrapped For “Phase 1” Trade Deal

Until now, China had largely kept the key hurdles in the ongoing US-China trade talks close to the vest, fearful that “breaking the embargo” so to speak on what have been confidential talks so far, could anger the US side. Now in a surprise diplomatic reversal, one which has the intent of signaling to the world that China will no longer play by Washington’s unspoken if assumed rules, overnight China’s nationalistic Global Times tabloid reported that Beijing now “insists” that existing tariffs must be removed as part of a “Phase 1” trade deal, well beyond the US “ask” of merely scrapping those tariffs which are set to kick in on December 15.

“Sources with direct knowledge of the trade talks told the Global Times on Saturday that the U.S. must remove existing tariffs, not planned tariffs, as part of the deal,”said the report.

Global Times, which is published by the official People’s Daily newspaper of China’s ruling Communist Party, also cited another unidentified source close to the talks as saying U.S. officials had been resisting such a demand because the tariffs were their only weapon in the trade war and giving up that weapon meant “surrender.”

Which is precisely what we said last night, when we noted that by going public with its demands, it would make Trump look even weaker, as the US president can no longer spin the outcome of negotiations as one where he proposed the removal of existing tariffs, but rather such an act would be seen as caving to China.

zerohedge@zerohedge

Here we go: China breaks the negotiation embargo and goes public with its deal demands, insisting rollback of existing tariffs. Trump now can’t concede or will be seen as caving to China https://twitter.com/GlobalTimesBiz/status/1200955364641869824 …

The Business Source@GlobalTimesBiz

Sources in Beijing informed the Global Times that China insists the tariffs must be rolled back as part of the first-phase trade deal. A US pledge to scrap tariffs scheduled for December 15 cannot replace the rollbacks of tariffs. #ChinaUSTrade #TheBusinessSource

Of course, by eliminating existing tariffs, the US would lose any leverage it currently has as it is only the current tariffs squeezing Chinese exporters that make the current situation unpalatable for Beijing, and any roll back to a status quo would mean that China can now indefinitely delay any further concessions toward a bigger trade deal.

Needless to say, should Trump agree, he would be squeezed by both parties as having capitulated to Beijing after a year and a half, with absolutely nothing to show for it besides the S&P at all time highs, of course, which however is not his but rather the Fed’s doing.

On Tuesday, Trump said Washington was in the “final throes” of a deal aimed at defusing a 16-month trade war with China, a few days after Chinese President Xi Jinping had expressed his desire for a trade agreement. Top trade negotiators for both countries also spoke again and agreed to continue working on the remaining issues.

Trade experts and people close to the White House told Reuters last month, however, that signing a phase one agreement may not take place until the new year as China pressed for more extensive rollbacks of tariffs, with US trade hawks led by Peter Navarro, refusing to concede realizing well that such an act would be a surrender by the US.

Last Tuesday, Senate Finance Committee Chairman Chuck Grassley told reporters that Beijing invited U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin for in-person talks in Beijing. Grassley said Lighthizer and Mnuchin were willing to go if they saw “a real chance of getting a final agreement.

A source familiar with the trade talks also told Reuters that U.S. officials could travel to China after Thursday’s Thanksgiving holiday in the United States.

end

It is unclear if Trump will comply with China’s demands and roll back all existing tariffs just to avoid any market turbulence in the critical, for his re-election, year 2020.

end

Macau/China

A strong indicator of declining China’s GDP: Macau revenues are plunging. The Chinese love to gamble

(zerohedge)

Macau Casino Revenue Plunges Amid Chinese Slowdown

When the Chinese economy is booming, Mainlanders head to Macau to wager some of their disposable income at casinos. When the economy decelerates, sort of like what’s happening at the moment, gamblers stay home because of economic pessimism.

New data from the Gaming Inspection & Coordination Bureau, first reported by Bloomberg, shows gross gaming revenue for Nov. was $2.8 billion, down 8.5% YoY.

Year to date, gross gaming revenue sagged 2.4%, comes at a time when the Chinese government has told its citizens to embrace lower-economic growth.

Macau’s gross gaming revenue is expected to record its first yearly decline since 2016, as several headwinds have developed.

Several months ago, JP Morgan analyst DS Kim told Reuters that the casino slump in Macau is due to “social unrest in Hong Kong, tough year-on-year comparison, negative headlines around junkets, and macro headwinds.”

Credit Suisse Group analyst Kenneth Fong said Visa policies to Macau had been tightened ahead of President Xi Jinping’s visit this month. These restrictions, Fong said, are hurting visitation numbers into the late year.

The Bloomberg Intelligence index of Macau casino operators slipped 3.4% in November. Though the index is still up for the year, it has dropped 20% from a peak in Apr.

Wynn Macau Ltd.HK is down more than 42% since 2Q18 highs.

With no turn up in the China Momentum Indicator, there’s a high probability that Macau’s gaming industry will continue decelerating into 2020.

World stocks are ignoring the slowdown in China and in the Macau gaming industry.

Gaming industries in Macau and the US appear to exhibit signs of weakness.

The global gaming industry appears weak, as well. Maybe highlights how consumers across the world are pulling back on casino spending as the global trade recession is imminent.

end

CHINA/THIS AFTERNOON

(zerohedge)

China To Accelerate Release Of “Unreliable Entity List” In Response To Xinjiang Bill, Stocks Swoon

In a day when weeks of “trade deal” optimism are being systematically unwound by the hour, if not minute, moments ago the Global Times’ Business Source group said that that China will release an “unreliable entity list” soon, which includes relevant US entities. The move is being accelerated up in response to the expected passage of a Xinjiang-related bill by US Congress, that will harm Chinese firms’ interests, “prompting China to speed up the move.”

While the existence of a “unreliable entities list” is nothing new, and was first reported back in May, the fact that suddenly various adverse developments related to the trade deal appear to be hitting at the same time is spooking markets, with futures slumping back to session lows following the Chinese news.

The Chinese threat comes about two hours after Wilbur Ross said that absent a deal by Dec 15, the US fully expects to hike tariffs on Dec 15, which in turn appears to have prompted a rapid deterioration in diplomacy among the two sides, and judging by the market, it now appears that a tariff delay in two weeks is becoming increasingly improbable.

END

Slowly but surely China no longer needs any USA parts to its phones

(Mish Shedlock/Mishtalk)

China No Longer Needs US Parts In Its Phones

Authored by Mike Shedlock via MishTalk,

China was once very dependent on US chips for its phones. The latest Chinese phones have no US parts.

The Wall Street Journal reports Huawei Manages to Make Smartphones Without American Chips.

American tech companies are getting the go-ahead to resume business with Chinese smartphone giant Huawei Technologies Co., but it may be too late: It is now building smartphones without U.S. chips.

Huawei’s latest phone, which it unveiled in September—the Mate 30 with a curved display and wide-angle cameras that competes with Apple Inc.’s iPhone 11—contained no U.S. parts, according to an analysis by UBS and Fomalhaut Techno Solutions, a Japanese technology lab that took the device apart to inspect its insides.

In May, the Trump administration banned U.S. shipments to Huawei as trade tensions with Beijing escalated. That move stopped companies like Qualcomm Inc. and Intel Corp. from exporting chips to the company, though some shipments of parts resumed over the summer after companies determined they weren’t affected by the ban.

Meanwhile, Huawei has made significant strides in shedding its dependence on parts from U.S. companies. (At issue are chips from U.S.-based companies, not those necessarily made in America; many U.S. chip companies make their semiconductors abroad.)

Huawei long relied on suppliers like Qorvo Inc., the North Carolina maker of chips that are used to connect smartphones with cell towers, and Skyworks Solutions Inc., a Woburn, Mass.-based company that makes similar chips. It also used parts from Broadcom Inc., the San Jose-based maker of Bluetooth and Wi-Fi chips, and Cirrus Logic Inc., an Austin, Texas-based company that makes chips for producing sound.

Yet Another Trump Trade Win

Trump cut off supplies so China looked elsewhere.
Trump changed his mind.
This is what constitutes a win.

“When Huawei came out with this high-end phone—and this is its flagship—with no U.S. content, that made a pretty big statement,” said Christopher Rolland, a semiconductor analyst at Susquehanna International Group.

Huawei executives told Rolland that the company was moving away from American parts, but it was still surprising how quickly it happened.

This was likely going to happen anyway, but Trump escalated the speed at which it happened.

Trade Deal?

Reuters reports U.S.-China Trade Deal ‘Stalled Because of Hong Kong Legislation’
MarketWatch reports China ‘Insists’ on Tariff Rollbacks as Part of ‘Phase One’ Trade Deal

Standard Assumption for 17 Months

Assuming there is a deal, the standard assumption for 17 months, Trump will announce two key elements.

Greatest Deal in History

China will resume buying the same amount of soybeans as before.
China will resume buying the same amount of chips as before.

The longer this takes the more wins there will be.

With that in mind, please recall Another Trump Tariff Success Story: Vietnam.

And despite the fact that Trump’s China Tariffs Made Matters Made the Global Manufacturing Recession Worse and has killed US farmers, It’s important to remember, Trump is collecting “huge tariffs”.

So please brush aside this recession warning: Freight Volumes Negative YoY for 11th Straight Month.

Hong Kong/China

Hong Kong plunges again in their post election chaos. Pro democracy protesters thank Trump for signing his billl
(zerohedge)

Hong Kong Plunges Into Post-Election Chaos; Pro-Democracy Protesters Thank Trump For Signing Bill

After nearly two weeks of relative calm in Hong Kong surrounding the pro-democracy camp’s landslide victory in last week’s elections, tens of thousands of protesters took to the streets in renewed anti-government demonstrations on Sunday.

Protesters spilled out of railway stations – some waving American flags, as they began chanting “Hongkongers, take revenge!”

As the day turned to evening, things rapidly devolved into all too familiar stand-offs with the police amid rioting and vandalism, resulting in the deployment of tear gas, rubber bullets and other crowd-control measures, according to SCMP.

And while the protests have been largely peaceful – with many families bringing children as they marched down the waterfront promenade, packs of radicals began hurling smoke bombs and bricks at police, smashing restaurants and shops in Whampoa, and vandalizing the local railway station. A gasoline bomb was thrown at a police van at one point.

Defiant demonstrators said the massive turnout for the Sunday procession – titled “Do not forget why we started” – demonstrated their determination not just to savour the electoral victory, but also to keep up the protests, which will enter their seventh month next week, until all their demands were met.

“We want to let the younger protesters know that they are not alone,” said KC, a 35-year old man who joined the demonstration with his son, who is in Primary Six.

“We cannot pretend and act as if everything is normal just because the pro-democracy camp has scored a victory in the district council elections.” –SCMP

Protesters have maintained five demands – the first one of which has been satisfied after Hong Kong leadership withdrew a controversial extradition bill that sparked the protests. The other demands have not been satisfied; an independent inquiry into police’s use of force, retracting the riot label for the events of June 12, amnesty for arrested protesters and implementation of universal suffrage (via SCMP).

At the Tsim Sha Tsui march, tensions soon flared when crowds deviated from the approved 1.2km route and flooded the streets.

Police raised the blue flag warning protesters they were taking part in an illegal assembly by doing so.

Rounds of tear gas and other projectiles, including pepper balls, were fired at the packed crowd, whose number included the elderly and young people. The crowd control measures were targeted at both ends of Salisbury Road shortly before 5pm. –SCMP

Meanwhile, hundreds of protesters marched to the US consulate waving American flags to show ‘gratitude’ for US support, after President Trump signed a Human Rights bill into law designed to show solidarity with the pro-democracy movement.

At one point they sang the US National Anthem while waving signs that read “Make Hong Kong Great Again.” Another shows Trump standing atop a tank with ‘Trump’ stamped on the front and side.

“The Hong Kong Human Rights and Democracy Act of 2019 reaffirms and amends the U.S.-Hong Kong Policy Act of 1992, detailing U.S. policy toward Hong Kong and ordering an assessment of the political developments there, among other things,” according to the WSJ.

Obviously the CIA sent in their shortest operative, as Beijing continues to accuse the West of stoking discord.

end

Hong Kong/

Margin calls continue in Hong Kong as the Chairman of China’s first Capital offloads more of his shares. Prepare for a contagion effect

(zerohedge)

China First Capital Continues Epic Crash In Hong Kong As Chairman Offloads More Shares

Last week we reported how China First Capital Group, an investment holding company, saw its equity trading on the Hong Kong exchange crash in minutes.

The epic implosion continued into the new week, shares are down -23% on Monday as a new report from Bloomberg specifies the chairman of the company unloaded half his stake.

Exchange filing published Saturday show Wealth Max Holdings Ltd. dumped 326.57 million shares of China First Capital on Nov. 28, one day after the stock plummeted 78%.

Wealth Max is controlled by chairman Wilson Sea, who held a 16.1% stake in China First Capital as of last December.

We noted that the abrupt stock slump, wiping out billions of dollars in shareholder value, has once again put the spotlight on corporate governance of Hong Kong stocks.

The forced selling by the chairman was likely due to a margin call on a loan that had collateral as stock. This dangerous business practice can act as a domino effect when companies are connected by investors or business lines.

The next significant risk for investors in Hong Kong and or Chinese stocks are sliding prices because of a decelerating regional economy. As a result, this would lead to additional margin calls and force a vicious circle of panic selling.

4/EUROPEAN AFFAIRS

UK Conservatives set to win a large majority

(zerohedge/You Gov MRP)

UK Conservatives Set To Win A Large Majority

In the lead up to the 2017 general election, YouGov’s MRP projection model accurately predicted a hung parliament at a time when many other pollsters were indicating a Conservative majority. As Statista’s Martin Armstrong details, the MRP technique (Multilevel Regression and Post-stratification) is used to make estimates for small geographies for which only small sample sizes are available. Anthony Wells, Director of Political and Social Research at YouGov, explains:

“It works by using an extremely large number of interviews to model people’s voting preferences based upon their demographics and the local political circumstances. Once this model has been developed it is applied to the demographic make-up and political circumstances of each of the 632 constituencies in Great Britain, providing projected vote shares for each and every seat”.

As the infographic below shows, the projections for 2019 are a far cry from the hung parliament predicted for 2017.

You will find more infographics at Statista

According to this year’s calculations, Boris Johnson’s Conservative party is set for a large parliamentary majority, taking 359 seats to Labour’s 211. That would represent an increase of 42 seats for the tories and a devastating decrease of 51 for Labour – surely prompting a change in party leadership.

In Scotland, the SNP is forecast to gain eight seats, taking five from Labour, two from the Conservatives and one from the Lib Dems. Speaking of the Liberal Democrats, Jo Swinson’s party is apparently also due for a disappointing election night, taking just 13 seats, representing a measly gain of one.

end

Germany

Merkel in trouble as Germany’s SPD elects leftist leaders and thus risking its coalition government. It may collapse

(zerohedge)

In Shocking Blow To Merkel, Germany’s SPD Elects Leftist Leaders, Risking Coalition Government Collapse

Merkel’s last term as German chancellor has been a series of relentless blows to her reputation and legacy, as the former leader of Europe finds herself trapped and increasingly powerless in a world that has grown hostile to her style of governing.

The latest shock came on Saturday, when the German Social Democratic Party (SPD) announced the winner of its leadership contest as both coalition partners of Germany’s Grand Coalition were transitioning their party leaderships after disappointing results in opinion polls and at regional elections.

Whereas consensus had widely expected finance minister Olaf Scholz and regional politician Klara Geywitz to preserve their control over the SPD after topping the first round of voting, the result announced just after 6pm CET showed that with a vote of 53% to 45%, SPD members elected Norbert Walter-Borjans, a former minister in the regional state of North Rhine-Westphalia, and Saskia Esken, an MP from Baden-Württemberg, as their new leaders.

The outcome was a blow to Merkel and her coalition government, as the duo of Walter-Borjans and Esken represent the left-leaning segment of the SPD and have been highly skeptical of the SPD’s role in the Grand Coalition government.

*SPD’s new leaders, Norbert Walter-Borjans and Saskia Esken*

The surprising swing to the left for Germany’s (formerly) centrist and fiscally prudent Grand coalition threatens to trigger a prolonged phase of political uncertainty in Germany, because as Bloomberg notes, “the victory of Walter-Borjans and Esken, who favor taxing the rich, boosting welfare spending and abandoning Germany’s long-standing policy of a balanced budget, will certainly weaken pro-government forces.”

Goldman Sachs agrees: in a Thursday note by the bank’s European strategist Sven Jari Stehn, he wrote that a victory by Walter-Borjans and Esken increases the risk that the SPD pulls out the coalition because under a left-leaning SPD “there would be a diminished consensus within the coalition” as the newly elected duo is demanding a re-negotiation of parts of the coalition agreement, and seeking to increase federal fiscal spending and investment.

Whereas this would be a virtually impossible concession for the CDU to make during its own leadership transition, Goldman does not expect “an immediate dissolution of the coalition”, even though the collapse of Germany’s current coalition is now just a matter of time.

“I never said we need to leave,” Walter-Borjans said after the results of the election were announced on Saturday evening. “We must improve the policies and perhaps loosen the black zero,” he said in reference to Merkel’s balanced budget policy, news that would be met over champagne and caviar everywhere from the ECB to Brussels, to the IMF, all of whom have been demanding that Germany boost its fiscal stimulus.

Ironically, it’s now only Angela Merkel who stands in the way of Germany doing away with its “black zero” balanced budget policy, and any deviation would almost surely mean the end of the Chancellor’s political career.

The fate of Germany’s fiscal stimulus has emerged as arguably the most important topic for Europe’s economic future.

While Germany avoided a technical recession by the narrowest of margins, growth continues to slow and will drop to an estimated 0.5% this year, one-fifth the rate of what it was in 2017, largely as a result of the global trade war and China’s collapsing credit impulse, although the ECB’s recent monetary boost has certainly helped delay the day of reckoning.

Ironically, after a tumultuous year in which the SPD and Merkel’s Christian Democrats both faced intense power struggles, Germany’s political and business elites had hoped for a period of calm and continuity; instead they are now looking at what appears to be an almost certain collapse of the ruling coalition.

As Bloomberg notes, in hopes of delaying political chaos, Merkel this week had made an unusual plea to see the alliance through to 2021, saying there was still much to be done. Finmin Scholz also argued that his party is achieving more of its objectives in government than it ever could in opposition, even if it needed to compromise. But Walter-Borjans managed to tap the dissatisfaction of many Social Democrats who feel their party has abandoned its working-class origins and should abandon an alliance with conservatives.

Meanwhile, as Goldman points out, the CDU/CSU coalition is not immune to internal tensions either. Since Annegret Kramp-Karrenbauer (AKK) took over the CDU leadership last year, both European and regional elections failed to show a turnaround in voter support that would have cemented her leadership of the party. While AKK’s critics refrained from a rival leadership bid at last week’s CDU party convention, her position remains uncertain. Absent a substantial improvement in her approval ratings, there will be an aggressive race for the CDU’s lead candidate for the next general election scheduled for the fall of 2021, with candidates from both the centre and the right of the party likely throwing their hats in the ring when the nomination process begins in late 2020. A more right-leaning candidate could also raise questions about the viability of the current coalition, especially with the SPD now turning a sharp left turn.

To be sure, Merkel may still fight to preserve the coalition, but that would come at a major cost: during the campaign Esken and Walter-Borjans said their price for staying includes billions of euros of government investment in climate and education, a 12 euro per hour minimum wage, and wage negotiations that should be made obligatory for employers. While such demands were seen as unacceptable by Merkel’s CDU and its leader, AKK, told delegates at a convention in Leipzig last week that she would refuse to renegotiate the coalition agreement that the two factions completed in March 2018, now that the numbers are in, Merkel may have no choice but to bend the knee.

In other words, while today was another major loss for Merkel, fans of MMT around the world are rejoicing as Germany is now one step closer to launching an ECB-monetized fiscal stimulus.

What happens next?

According to Goldman, notwithstanding the risks involved in the leadership transitions, the bank still expects the Grand Coalition to last through 2020 and, even in the event the coalition is dissolved, snap elections would not be triggered automatically as the hurdles to dissolving parliament are high. Neither coalition partner currently has a strong incentive to seek fresh elections as both are polling well below their 2017 election results, and the Greens continue to poll ahead of the SPD.

A CDU/CSU minority government is therefore the more likely option in the event of a breakup of the Grand Coalition, providing relative stability during Germany’s European Council Presidency in the second half of 2020.

As for Germany’s economy, Goldman expects the Esken/Walter-Borjans leadership to increase the chance that the fiscal space made available in the 2020 budget is fully exploited rather than under-delivering on the planned easing as in previous years seeing they have indicated to favor a looser fiscal stance. This could add stimulus worth 0.2% of GDP in 2020, but it would still fall significantly short of the easing space afforded by both national and EU rules. Should the Grand Coalition
break up, a CDU-led minority government would imply downside risks to Goldman’s ur baseline.

So while today’s result was a clear sign that at least one German party is turning sharply left, and thus more likely to endorse fiscal stimulus, Germany still faces an uphill climb before it concedes, a climb that may last well into 2021 by which point the global economic recession would make a German stimulus a moot point.

end

ECB

(zerohedge)

In Stuttering, Stumbling Address Christine Lagarde Vows To Link QE To Climate Change

In her much anticipated first appearance as president of the ECB before at the European Parliament, Christine Lagarde asked EU lawmakers on Monday to give her time to “learn the ropes” of her new job and to reshape the ECB’s monetary policy in what is likely to be a lengthy policy review, and said the ECB will be “resolute” in restoring euro-zone price stability, while stressing that an upcoming strategy review will be wide-ranging, including climate change as well as inflation.

“The ECB’s accommodative policy stance has been a key driver of domestic demand during the recovery, and that stance remains in place,” she said ahead of her first monetary policy meeting at the ECB on Dec. 12.

*Christine Lagarde arrives to testify before the European Parliament’s Economic and Monetary Affairs Committee; December 2, 2019. Photos: Reuters.*

Similar to the Fed, the former convicted criminal and IMF chief who left Argentina near bankruptcy, has promised an overarching review of ECB business ranging from how it defines its inflation objective to whether it includes a fight against climate change among its responsibilities.

“I’m indeed trying to learn German but I’m also trying to learn central bank language,” Lagarde, a former lawyer told the European Parliament’s Committee on Economic and Monetary Affairs in a regular hearing. “So bear with me, show a little bit of patience, don’t over-interpret, if I may say,” said a seemingly nervous Lagarde, who often diverged from the text of her prepared speech and stumbled at times, leaving out phrases or repeating herself.

Lagarde said that a key focus of the review would be to determine whether its objective of keeping inflation at close to but below 2% was still valid, given changes in the global economy.

Speaking a day after it was unveiled that the Fed – which is also in the process of reviewing its policies – was considered launching a new rule that would let inflation run above its 2% target to make up for lost inflation, Lagarde also said the review would look at whether the target should by symmetric, meaning it should be used to tackle both low and high inflation and not just the latter, if the ECB should have leeway in reaching that target, or whether there should be a tolerance band around it.

Of course, just like the Fed, the issue for the ECB is two-fold:

i) ignoring soaring asset price inflation which is where central banks have blown the biggest asset bubble in history, and

ii) failing to properly measure consumer price inflation, instead applying a spate of adjustments that make it seem inflation is subdued when in reality for many prices are rising so high, the cost of living is no longer bearable.

Then there is the question of whether targeting higher prices is sensible at a time when the middle class is shrinking across the developed world. As a reminder, back in June, a Bloomberg report looked at the stark disconnect between Fed policy and well, everybody else but banks and the 1%.

While the Fed sees low inflation as “one of the major challenges of our time,” Shawn Smith, who trains some of the nation’s most vulnerable, low-income workers stated the obvious: people don’t want higher prices. Smith is the director of workforce development at Goodwill of Central and Coastal Virginia.

In fact, he said that “even slight increases make a huge difference to someone who is living on a limited income. Whether it is a 50 cents here or 10 cents there, they are managing their dollars day to day and trying to figure out how to make it all work.’’ Indeed, as we discussed in “How The Fed’s New Monetary Policy Will Crush America’s Poorest“, it is the low-income workers – not the “1%”ers, who are most impacted by rising prices, as such all attempts by the Fed to “help” just make life even more unaffordable for millions of Americans.

None of this was a concern to Lagarde, however, who said taht the ECB’s “strategy review will be guided by two principles: thorough analysis and an open mind,” Lagarde told lawmakers. “This will require time for reflection and for wide consultation.”

In a recent note, HSBC discussed several options in terms of changing the mandate, from small tweaks to more fundamental changes, which the ECB may pursue. The problem, however, as HSBC noted is that the success of some of these options depends on the degree of confidence in the ECB’s ability to meet it. As a result, the risk of creating a new mandate, only to fail to achieve it as soon as it is implemented, is significant, particularly with policy already so loose and little left in the tank. This was a risk already flagged by Mario Draghi at the September meeting.

These risks, alongside seemingly inevitable compromises in the Governing Council – hawks will likely be averse to any option that risks persistently elevated inflation – lead HSBC to believe that if there will be changes in the ECB mandate as a result of the strategic review, they are likely to be fairly minor. Even moving to a 2% inflation target – removing the uncertainty created by the “below, but close to” – might be too contentious for some.

None of this prevented Lagarde from thinking big. As in climate change big. Because what was more shocking for a central bank which admits it has failed dismally in hitting its price inflation, was its mission creep into seeking to “tame” climate change as well.

Many of the questions at the parliament hearing focused on climate change, an area where the central bank has come under increasing pressure to play a bigger role. In response, Lagarde said that while inflation is the bank’s primary objective, the fight against climate change should be a central part of policy. She said that the ECB’s economic analysis should include the impact of climate change and that its bank supervision arm should also be asking lenders for transparency disclosures and climate risk assessments.

And the punchline: while the ECB’s private sector bond purchases have been market neutral, Lagarde said it was also worth discussing whether climate concerns should impact the ECB’s QE.

How would that work we wonder: “It’s hot outside, so let’s print more money?”

So far the ecofascists have not completely taken over yet, and as we reported previously, German Bundesbank President Jens Weidmann warned against heavy-handed steps such as barring the bonds of polluters from QE, as proposed recently by a group of activists and academics in an open letter to Lagarde. Lagarde said she agreed with Weidmann, but that it doesn’t stop the ECB looking into incorporating climate change into its operations, economic analysis and bank supervision.

To be sure, any mission creep in the ECB’s mandate will only serve to make future monetary easing, well, easier and what better virtue-signaling smokescreen than to use “global warming” as an excuse to print an extra trillion here and there.

Ironically, her linking of QE to climate change took place even as she acknowledged the adverse side effects of the ECB’s ultra-loose policy, and said the review will try to gain a better understanding of how longer-term trends affect what the central bank can control.

One wonders: perhaps the ECB should have conducted such reviews before it bought nearly €3 trillion in assets starting in 2015, long after the European sovereign debt crisis was over, and was merely meant to stabilize risk prices and avoid a market crash.

The take home message however was clear: it is now only a matter of time before the ECB becomes the EcoCB and is “tasked” with a loose, vague and intangible climate change mandate, one which gives the central bank a carte blanche to do virtually anything “in the name of the environment.” Sure enough, at the Parliament hearing, Lagarde said that while the ECB’s primary mandate is price stability, the secondary mandate – to support the general economic policies of the European Union – can cover climate change. European Commission President Ursula von der Leyen has pledged to turn Europe into the first climate-neutral continent in the world by 2050, and green parties made significant gains in recent parliamentary elections.

Finally, reaffirming the ECB’s most recent assessment of the economy, Lagarde added that growth looks weak but that the ECB was determined to use all it available tools to reach its mandate. Asked to predict what the inflation rate will be in eight year’s time when her term ends, Lagarde refused.

“I don’t think that anybody in their right mind would venture to forecast any number, be it growth or inflation, eight years from today,” she said, yet clearly confident it is her job to predict how the climate will do over the same time period.

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

IRAN/SCANDINAVIAN COUNTRIES/EU/USA

The USA is enraged after 6 more countries join the INSTEX movement to bypass SWIFT and Iranian sanctions. Trump was winning prior to this as Iran, financially just blew itself up.

(zerohedge)

US Enraged After 6 More EU Nations Join INSTEX To Bypass Iran Sanctions

On Friday six European countries issued a bombshell joint statement declaring their intent to join INSTEX, or the Instrument in Support of Trade Exchanges, a European special-purpose vehicle serving as a ‘SWIFT alternative’ to bypass US sanctions on Iran.

Finland, Belgium, Denmark, Netherlands, Norway, and Sweden released a joint statement asserting it’s of “the utmost importance to the preservation and full implementation of the Joint Comprehensive Plan of Action (JCPoA) on Iran’s nuclear program by all parties involved.”

“In light of the continuous European support for the agreement and the ongoing efforts to implement the economic part of it and to facilitate legitimate trade between Europe and Iran, we are now in the process of becoming shareholders of the Instrument in Support of Trade Exchanges (Instex) subject to completion of national procedures,” the statement reads.

*The Foreign Minister of Finland Pekka Haavisto alongside Foreign Minister of Iran Mohammed Javad Zarif. AP Photo*

Instex is an initiative set up by France, Germany and the UK in January 2019 to provide humanitarian and sanctions relief to Iran after in November 2018 the SWIFT network suspended Iranian banks under Washington pressure, months after Trump pulled the US out of the nuclear deal.

Though the new alternative financial device had shaky beginnings amid further aggressive threats from the US administration, it continued through a trial phase even though Tehran officials had complained it appeared ‘too little, too late’.

But now as this latest six country statement announces, it will serve as the European vehicle to “facilitate legitimate trade between Europe and Iran,” while also providing incentive for Tehran to return to its commitments under the JCPOA, specifically to recently breached uranium enrichment limits. Upon the announcement, US Ambassador to Germany Richard Grenell lambasted the move, saying:

Terrible timing – why fund the Iranian regime while its killing the Iranian people and shutting off the internet? You should be standing for human rights not funding the abusers.

Richard Grenell

✔@RichardGrenell

Terrible timing – why fund the Iranian regime while its killing the Iranian people and shutting off the internet? You should be standing for human rights not funding the abusers. https://twitter.com/nordrumlars/status/1200373049247379456 …

Lars Nordrum@NordrumLars

Today announced that we are joining INSTEX together with the #E3 to facilitate trade with #Iran and help preserve the #JCPOA. https://www.regjeringen.no/no/aktuelt/join_instex/id2680468/ …

Specifically he called out a tweet by Norway’s ambassador to Iran hailing the news of multiple Scandinavian countries joining the nuclear deal-saving initiative.

As the US official’s tweet reveals, the White House is using the latest weeks-long protests and government-ordered internet blockage inside Iran to keep up the pressure and focus on a ‘human rights’ narrative amid the security forces crackdown.

Despite the criticism and what will no doubt be a continued flood of US official anger in response to the news, France said it asserts European autonomy amid an over-reaching Washington administration. French Foreign Minister Jean-Yves le Drian called it an “important decision” that will show “Europe’s autonomy of action”.

end

6.Global Issues

The global scene as seen through the eyes of Michael Every of Rabobank

(courtesy Every/Rabobank

Rabobank: “The Global Institutional Architecture Is Collapsing”

Submitted by Michael Every of Rabobank

It’s December, and the start of the season of good will to all and peace on earth. Not much of that about, of course.

In the UK, the election has been interrupted by the terrorist attack at London Bridge, which both sides are naturally playing politics with in different ways (The Left is soft on terrorists vs. police underfunding and foreign policy, etc.); the latest opinion polls suggest Labour continues to make up some ground but remains well behind, but London Bridge may perhaps see that impetus stalled. Let’s see if the imminent arrival of US President Trump tips the scales, as President Obama did on Brexit, or if he can hold off on commenting as protocol dictates.

In Germany, Angela Merkel’s coalition partners the SPD have just elected new leadership, and they have veered to the left, hardly a surprise against this global backdrop, but likely accelerating the eventual collapse of the current government and opening up questions about what any new one could look like. Instability, or at least uncertainty, at the heart of the Eurozone is certainly not going to be welcome to investors – yet could it herald an imminent fiscal shift?

Tomorrow and Wednesday will also see the 2019 NATO summit, again in London, where the world’s largest military alliance will get together and try to decide what it is for and if it still has a purpose. Trump continues to put pressure on all members to spend the pledged 2% of GDP to keep it a fighting force vs. Russia, and perhaps China(?): relatively few do or show they even want to (e.g., Germany). He’s is also going to bring up Huawei and 5G to discuss. President Macron of France has called NATO “Brain dead” due to the absence of US leadership–I thought it was leading?–and has suggested it should shift from seeing Russia or China as potential enemies and refocus on terrorism: does France keep its nuclear deterrent to deal with events like London Bridge? President Erdogan of Turkey, the second-largest contributor militarily after the US, has no problems making friends with Russia and China–he is buying Russian weapons now–but has publicly called Macron “Brain dead” too. And Jeremy Corbyn, who would of course be the UK PM in under two weeks if the polls are wrong or misleading, has stated that NATO should be used to fight inequality: bomb the rich? Or spend as much on defence as he is pledging on everything else to rebuild British (defence) industry and provide quality jobs? It should make for a remarkable meeting one way or another: at the very least, it will be a world-class exercise in papering-over-cracks.

Does this actually matter for markets? Well, it depends. If the markets in question are only looking at things like the bounce in Chinese PMI data (the headline PMI rose to 50.2 from 49.3 in October, and the private Caixin index edged up to 51.8 from 51.7), or at US Black Friday spending (brick and mortar sales were up 4.2% y/y according to First Data, and on-line shopping pulled in USD7.2bn, up 14% y/y), then perhaps not – all is well with the world! Or the same markets might instead focus on China’s Global Times reporting that Beijing is insisting on the US rolling back tariffs for a trade deal, NOT just the delay of the looming 15 December tariffs, as the price of any ‘phase one’ – in which case all is decidedly not well. Expect USD/CNY and USD/CNH to continue to hover around the Lucky Seven level until this is resolved, of course. (But underlying our CNY bearishness, the data the market isn’t talking about this morning is that China is apparently set to see just 11m births in 2019 in a population of 1.4 billion. That’s down from 15.2m in 2018 and 17.2m in 2017. If true, its demographics are vastly worse than the already-poor projections: it is going to be very old long before it is rich enough to retire, and growth will suffer without automation, innovation, or immigration.)

Yet from data to the bigger picture: consider it was the likes of NATO that built the post-Cold War (1?) world within which these global markets now operate. As Polanyi pointed out back in The Great Transformation, though not in so many words, ‘free markets aren’t free’ – they are carved out of the political jungle with force, and require constant tending to stop them from being over-run. In that respect, we can posit that the problems in NATO are symptomatic of a broader collapse of the global institutional architecture in the face of populism.

But does that matter in a world which, as Branko Milanovic argues in his new book, and as markets continue to price for, capitalism is actually triumphant and there is no genuine alternative being offered by NATO’s enemies? Perhaps not, which of course fully supports our house view that on rates, “lower for longer” is now “lower forever”. China’s (and Russia’s) state-capitalist models certainly imply lower forever as the cost of capital is suppressed for national/geostrategic goals; in the West, markets are as utterly reliant on central-bank largesse, which hasn’t had any geostrategic goals up to now, but which may be about to get some.

Yet this does not mean there won’t be major financial market volatility if the architecture crumbles. You cannot think of a world dominated by multi-polar state-capitalism vs. a retreating more-free-market US-dominated system without seeing: 1) huge shifts in the USD and all resultant markets – either up, as its rivals falter, or down as its rivals combine to topple it (with what exactly?!); and 2) uncomfortable parallels with the pre-WW1 period. Like I said, not much peace on earth, sadly.

Another sign of the end of institutional architecture. The Apostrophe Society has closed down after admitting defeat in its quest to get Brits to understand when and how this simple but crucial grammar point is used (where tired eyes mean even The Global Daily occasionally falls short). So thats it for its members hopes for its vs. its; and a full societal circle from cave painting to Renaissance men-of-letters back to emojis beckons with a thumbs up. Perhaps current fuzzy market pricing fits perfectly in age where nobody can communicate properly anymore.

And another sign of crumbling related to architecture: Aussie building approvals slumped 8.1% in October, more than reversing the surprise 7.2% surge seen in September and vs. a consensus -1.0% figure. That puts them down -23.6% y/y. Likewise, Q3 Aussie company operating profits were -0.8% q/q vs. an expected 1.0% gain, and inventories -0.4% not the -0.2% consensus. Somehow Aussie yields are still up on the day despite those clear recession warnings: perhaps the apostrophe was in the wrong place.

7. OIL ISSUES

8 EMERGING MARKET ISSUES

India

We must pay attention to this. India is witnessing a huge “death of demand” according to its former Indian finance Minister Sinha

(zeorhedge)

India In “Very Deep Crisis,” Witnessing “Death Of Demand,” Warns Former Indian FM

Former Indian Finance Minister Yashwant Sinha said India’s economy is in a “very deep crisis,” witnessing “death of demand,” and the government is “befooling people” with its economic distortions of how growth is around the corner, reported India Today.

“No matter what the powers that be say, the fact is that we are in a very deep crisis,” warned Sinha.

India’s GDP has been rapidly slowing since peaking in 2016. Official data shows Q3 growth slumped to 4.5%, the lowest since 1Q13.

Sinha was speaking to an audience at the Times Litfest 2019 conference, located at Habitat World Center in Delhi, India, on Sunday.

He warned that President Narendra Modi’s government is attempting to deceive everyone about how growth is coming in the next quarter or the quarter after but cautioned there’s only a crisis ahead.

“They (the government) are trying to fool the people by saying the next quarter will be better…This type of crisis takes a long time like three to four or even five years (to subside). It cannot be resolved at the drop of a hat or by wielding a magic stick,” he said.

He said the economy is experiencing what is called the “death of demand,” and the epicenter of it is the agriculture and rural sector.

“There is no demand in the economy, and that is the starting point of the crisis. They (government of the day) are least bothered about what is happening to our farmers, people living in rural areas, now that is where the death of demand started. The demand first dried up in agriculture and rural sector, then it dried up in the informal or unorganized sector, and ultimately it traveled to the corporate sector,” he said.

Sinha said he’s been warning the government of the crisis that is coming down the pipe.

“In fact, this was something I had done after already warning them (people in the government) personally through letters, personal meetings… it is only when the party’s doors were closed on me that I had to start speaking publicly,” he added.

Though there’s no recession in India at the moment, the warning signs are showing up. Private consumption has plunged, both public and private investments have fallen, exports have dropped in the past quarter, the economy has been decelerating for several years, and there’s zero evidence that the economy has bottomed out.

end

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

Euro/USA 1.1008 DOWN .0006 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 109.53 UP 0.061 (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 1.2921 UP 0.0010 (Brexit March 29/ 2019/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED/BREXIT EXTENDED TO DEC 12/2019 ELECTION//JAN 31/2020

USA/CAN 1.3299 UP .0035 CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA/CANADA HAS A HUGE HOUSEHOLD DEBT/GDP PROBLEM)

Early THIS MONDAY morning in Europe, the Euro FELL BY 6 basis points, trading now ABOVE the important 1.08 level FALLING to 1.1219 Last night Shanghai COMPOSITE CLOSED UP 3.83 POINTS OR 0.12%

//Hang Sang CLOSED UP 98.23 POINTS OR 0.37%

/AUSTRALIA CLOSED UP .25%// EUROPEAN BOURSES ALL RED

Trading from Europe and Asia

EUROPEAN BOURSES ALL RED

2/ CHINESE BOURSES / :Hang Sang CLOSED UP 98.23 POINTS OR 0.37%

/SHANGHAI CLOSED UP 3.83 POINTS OR 0.13%

Australia BOURSE CLOSED UP. 25%

Nikkei (Japan) CLOSED UP 235.59 POINTS OR 1.01%

INDIA’S SENSEX IN THE RED

Gold very early morning trading: 1457.80

silver:$16.88-

Early MONDAY morning USA 10 year bond yield: 1.83% !!! UP 6 IN POINTS from FRIDAY’S night in basis points and it is trading WELL BELOW resistance at 2.27-2.32%.

The 30 yr bond yield 2.27 UP 7 IN BASIS POINTS from FRIDAY night.

USA dollar index early MONDAY morning: 98.36 UP 9 CENT(S) from FRIDAY’s close.

This ends early morning numbers MONDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx6

And now your closing MONDAY NUMBERS \1: 00 PM

Portuguese 10 year bond yield: 0.46% UP 6 in basis point(s) yield from YESTERDAY/

JAPANESE BOND YIELD: -.05% UP 3 BASIS POINTS from YESTERDAY/JAPAN losing control of its yield curve/56

SPANISH 10 YR BOND YIELD: 0.49%//UP 7 in basis point yield from yesterday.

ITALIAN 10 YR BOND YIELD:1,35 UP 12 points in basis points yield from yesterday./

the Italian 10 yr bond yield is trading 86 points higher than Spain.

GERMAN 10 YR BOND YIELD: FALLS TO –.28% IN BASIS POINTS ON THE DAY//

THE IMPORTANT SPREAD BETWEEN ITALIAN 10 YR BOND AND GERMAN 10 YEAR BOND IS 1.63% 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 MONDAY

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

Euro/USA 1.1078 UP .0065 or 865basis points

USA/Japan: 109.08 DOWN .398 OR YEN UP 40 basis points/

Great Britain/USA 1.2935 UP .0024 POUND UP 24 BASIS POINTS)

Canadian dollar DOWN 29 basis points to 1.3298

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The USA/Yuan,CNY: AT 67.0393 ON SHORE (DOWN)..GETTING DANGEROUS

THE USA/YUAN OFFSHORE: 67.0435 (YUAN DOWN)..GETTING REALLY DANGEROUS

TURKISH LIRA: 5.7435 EXTREMELY DANGEROUS LEVEL/DEATH WISH.

the 10 yr Japanese bond yield closed at -.05%

Your closing 10 yr US bond yield UP 5 IN basis points from FRIDAY at 1.82 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.27 UP 7 in basis points on the day

Your closing USA dollar index, 97.05 DOWN 42 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 MONDAY: 12:00 PM

London: CLOSED DOWN 60.59 0.82%

German Dax : CLOSED DOWN 271.70 POINTS OR 2.05%

Paris Cac CLOSED DOWN 118.43 POINTS 2.01%

Spain IBEX CLOSED DOWN 195.70 POINTS or 2.09%

Italian MIB: CLOSED DOWN 530.74 POINTS OR 2.28%

WTI Oil price; 56.04 12:00 PM EST

Brent Oil: 61.25 12:00 EST

USA /RUSSIAN / RUBLE RISES: 64.20 THE CROSS LOWER BY 0.15 RUBLES/DOLLAR (RUBLE HIGHER BY 15 BASIS PTS)

TODAY THE GERMAN YIELD FALLS TO –.28 FOR THE 10 YR BOND 1.00 PM EST EST

END

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

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

WTI CRUDE OIL PRICE 4:30 PM : 55.93//

BRENT : 60.91

USA 10 YR BOND YIELD: … 1.83….UP 5 BASIS PTS

USA 30 YR BOND YIELD: 2.27..plus 5 basis pts.

EURO/USA 1.1082 ( UP 69 BASIS POINTS)

USA/JAPANESE YEN:1098.96 DOWN .519 (YEN UP 52 BASIS POINTS/..

USA DOLLAR INDEX: 97.83 DOWN 44 cent(s)/

The British pound at 4 pm Britain Pound/USA:1.2946 UP 35 POINTS

the Turkish lira close: 5.7415

the Russian rouble 64.19 UP 0.16 Roubles against the uSA dollar.( UP 16 BASIS POINTS)

Canadian dollar: 1.3299 UP 35 BASIS pts

USA/CHINESE YUAN (CNY) : 7.0393 (ONSHORE)/

USA/CHINESE YUAN(CNH): 7.0436 (OFFSHORE)

German 10 yr bond yield at 5 pm: ,-0.28%

The Dow closed DOWN 268.37 POINTS OR 0.96%

NASDAQ closed DOWN 97.48 POINTS OR 1.13%

VOLATILITY INDEX: 14.93 CLOSED DOWN 1.91

LIBOR 3 MONTH DURATION: 1.905%//libor dropping like a stone

USA trading today in Graph Form

Stocks, Bonds, & The Dollar Dumped On Dismal-Data & Trade-Tensions

A quadruple-whammy of not-awesome trade-related comments today spoiled the party…

0602ET *TRUMP TO RESTORE TARIFF ON STEEL SHIPPED FROM BRAZIL, ARGENTINA
1035ET *TRUMP WILL INCREASE TARIFFS IF NO CHINA DEAL, ROSS TELLS FOX
1200ET *TRUMP AIDE SAYS IT’S UP TO CHINA IF DEAL WILL BE MADE THIS YR
1230ET *CHINA TO RELEASE ‘UNRELIABLE ENTITY LIST’: GLOBAL TIMES

And then US Macro data poured cold water on China and EU economic hope as construction spending plunged and manufacturing ISM disappointed significantly.

Source: Bloomberg

But that ‘surprising’ surge in a government-provided survey of manufacturers in China was offered up as evidence that (despite US weakness) everything will be ok and the trough is in…

Chinese stocks clung to very modest gains overnight (trade headlines hit after the China close)…

Source: Bloomberg

European stocks were hammered on trade turmoil (despite PMIs beating expectations)…

Source: Bloomberg

And European bonds were also down (in price) along with stocks (10Y Bunds +8bps)…

Source: Bloomberg

US equities suffered their biggest daily drop in 6 weeks…

Dow futures were down over 400 points from the overnight highs…

Momo was dumped at the open but the trend in value/momo reversed around the European close…

Source: Bloomberg

VIX spiked above 15 intraday but once again vol-sellers returned after Europe’s close…

Source: Bloomberg

Credit was smashed today (after last week’s insane surge)…

Source: Bloomberg

Treasury yields surged on the day, led by the long-end (2Y was marginally lower in yield)…

Source: Bloomberg

Most notably, the ultra-bond futures collapsed overnight (hitting a 3-point limit circuit breaker)…

Source: Bloomberg

And today saw a major steepening of the yield curve… (the yield curve move has the smell of rate-locks given the underlying macro data, but we will have to wait and see what the calendar looks like – high-grade dealers expect this week to bring $15b-$20b in supply. This is likely to be December’s busiest week, with just about $25b for the full-month in store, according to estimates — that’s $8b more than last year and in line with the $23b that priced in December 2017)

Source: Bloomberg

The dollar was dumped today (biggest daily drop in 6 weeks)…

Source: Bloomberg

…breaking down through its 50- and 100-day moving-averages…

Source: Bloomberg

Yuan also lost ground as trade-deal hope faded…

Source: Bloomberg

Cryptos extended losses over the weekend and pushed lower still today…

Source: Bloomberg

Bitcoin has been unable to get back above $7400…

Source: Bloomberg

Gold, Copper, and Silver ended the day lower (despite a tumbling dollar) but oil popped on Saudi calls for more production cuts/extensions at OPEC (as its Aramco IPO looms)…

Source: Bloomberg

But, with regard to oil, it is still a lot lower than before Friday’s plunge…

“This whole week is going to be based on OPEC speculations,” said James Williams, president of London, Arkansas-based WTRG Economics.

All the precious metals are green for 2019, but palladium is by far the biggest winner…

Source: Bloomberg

Finally, today was the worst day for a balanced portfolio of stocks and bonds since mid-August…

Source: Bloomberg

Additionally, as Bloomberg’s Garfield Reynolds notes, global equities are gliding serenely into the end of 2019, even in the face of a dire economic landscape. To justify an exuberance that looks anything but rational, global activity will need to turn around dramatically.

Source: Bloomberg

The 2019 FOMO rally’s resilience has taken it far enough in the face of a cloudy forecast. Any declines from here could get very steep indeed.

And then there’s this…

Source: Bloomberg

And the US is just as bad (if not worse)…

Source: Bloomberg

And this…

Source: Bloomberg

END

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

MARKET TRADING//USA

a)Market trading/this morning/USA

Market Spooked After Trump Threatens To Restore Steel And Aluminum Tariffs On South American Countries

Not surprising whatsoever that President Trump is starting the new week by threatening several South American countries with a return of steel and aluminum tariffs. Trump alleged that Brazil and Argentina have been conducting “massive devaluation of their currencies,” which are harming US farmers.

Trump then scapegoats Powell for this mess and demands “Lower Rates & Loosen – Fed!”

Donald J. Trump

✔@realDonaldTrump

· 2h

Brazil and Argentina have been presiding over a massive devaluation of their currencies. which is not good for our farmers. Therefore, effective immediately, I will restore the Tariffs on all Steel & Aluminum that is shipped into the U.S. from those countries. The Federal….

Donald J. Trump

✔@realDonaldTrump

…..Reserve should likewise act so that countries, of which there are many, no longer take advantage of our strong dollar by further devaluing their currencies. This makes it very hard for our manufactures & farmers to fairly export their goods. Lower Rates & Loosen – Fed!

China is signing trade deals with Brazil and Argentina for agriculture products. We’ve noted this on several occasions. Trump is troubled with these developments and is willing to deepen the trade war as China is buying agriculture products elsewhere.

Nevertheless, overnight, AXIOS reported that the US-China trade deal was now “stalled because of the Hong Kong legislation.” Likely, a phase one deal might not be seen until next year.

E-mini S&P500, Nasdaq, and Rusell 2000 futures are sliding on Trump’s tweets.

b)MARKET TRADING/USA/AFTERNOON

Stocks & Dollar Plunge After Dismal US Data

US equity markets surged overnight on China and European PMIs but have accelerated losses this morning after US Manufacturing ISM (and construction spending) disappoints.

Dow futures are down over 300 points from overnight highs…

The dollar is also being dumped…

Source: Bloomberg

For now, bonds refuse to move much after their ugly selloff overnight, but the short-end is outperforming...

Source: Bloomberg

Seems like we are going to need a “China deal is close” tweet to save the market.

end

Stocks Tumble After Ross Says Trump Will Hike Tariffs If No China Deal By Dec 15

Following the latest dismal ISM data which sent US equity markets tumbling, traders were on the prowl for any hints what the US may do over the next major catalyst in the US trade war: the December 15 deadline for more tariffs.

An answer came moments ago when Commerce Secretary Wilbur Ross told Fox Business Network that President Trump will increase tariffs on China if Washington and Beijing can’t reach a trade agreement by the December 15 deadline.

“Well you have a logical deadline Dec. 15,” Ross told FOX Business’ Stuart Varney in an exclusive interview. “If nothing happens between now and then, the president has made quite clear he’ll put the tariffs in – the increased tariffs.”

Confirming that this is not just a hollow threat, Ross also explained that raising tariffs on Dec 15. won’t “interfere with this year’s Christmas” as retailers have already stocked up, adding that it’s a “really good time if we have to put more tariffs on.”

The fact that with exactly two weeks left until the tariff deadline the US is once again warning China that a deal has to be reached is hardly supportive of “optimism”, especially one day after China made it clear that it would only agree to a Phase 1 deal if the US agreed to roll back tariffs, something which Navarro would never agree as it would both destroy any leverage the US has over China and would crippled Trump’s negotiating credibility.

As a result, stocks which were already near session lows, took another leg lower..

… as did the Chinese yuan which continues to drift ever further away from the “lucky” 7 level.

ii)Market data/USA

Again oversubscribed as we no doubt have a year end liquidity problem. On the paper side of things, it looks like Deutsche bank is the bank which has a huge hole and thus the need for constant repo money. On the commodity side of things (gold/silver) it looks like HSBC has some severe problems

(zerohedge)

Fed’s Second 42-Day Repo Oversubscribed As Rising Repo Rate Confirms Year End Liquidity Rush

One week after the Fed’s first 42-day term repo which for the first time allowed dealers to lock in funding into the new year and which was 2x oversubscribed, confirming a growing scramble for year-end funding, traders were keenly looking ahead to the result from today’s second 42-day repo which matured on January 13. And, as we noted last week, year-end liquidity fears remain front and center as the $25 billion operation proved to be roughly 40% below the required size to satisfy all liquidity demands.

Dealers submitted $42.550BN in bids for the 42-day op ($29.750BN in Treasurys, $1BN in Agency, $11.8BN in MBS paper), resulting in an oversubscription of the $25BN in available repo.

This was modestly below the $49.050 billion submitted in the first 42-day repo operation conducted on November 25:

It remains a key question for funding markets why, even with QE4 in place and now daily overnight and short-term repo operations in place, banks continue to rush to lock in year-end liquidity, where some fear a similar explosion in overnight repo rates as was observed on Dec 31, 2018 when General Collateral soared amid a widespread liquidity shortage. Indeed, as Bloomberg put it, “even with the Fed’s commitment to continue providing liquidity to the financial system around year-end, the market is still showing concerns. This is due to banks’ year-end balance-sheet constraints related to capital surcharges and other regulatory requirements.”

The clearest indication that despite the massive liquidity injections that have taken place since mid-September liquidity remains scarce was today’s initial print in the overnight General Collateral rate, which rose from 1.60% to 1.68%, the highest since the Fed cut rates on Oct 31.

So what is it about quarter and year-end that is forcing banks to shore up their balance sheets with liquidity? As a reminder, while most US bank have a GSIB surcharge of around 2%-3%, JPMorgan remains an outlier – and is perceived as the “riskiest” bank – with its 4.0% surcharge. It’s also the reason why the bank has been quietly pulling liquidity away from funding markets ahead of quarter-end periods.

For those curious how the Fed calculates the GSIB surcharge, Bank of America provided the following handy schematic:

Two weeks ago, when commenting on why it expects to see sharp year-end liquidity pressures, BofA said that funding markets are currently very stable but the bank sees risks of repo pressure into year-end, as the Fed faces two funding issues into Y/E:

a low level of reserves requiring ongoing large Fed repo injections
dealer repo intermediation constraints stemming from the GSIB surcharge.

The way these issues are linked is through the Fed’s short-term repos; Fed repos pressure dealer balance sheets larger while GSIB constraints encourage dealers to shrink the overall size of their market making activities.

Separately, and in keeping with the recent tradition, the Fed also completed an overnight repo operation, which however showed less funding demand, as “only” $72.9 billion in securities were pledged in exchange for overnight liquidity with the Fed, well below the limit of $120 billion. Yet another troubling observation: while many have expected the total notional on overnight repos to decline over time, the daily use of the overnight repo has stabilized in the $60-$80 billion range and has failed to decline over the past month.

end

Pay more attention to the ISM numbers as Markit is generally fudged. ISM’s poor manufacturing data , new orders and employment in that area caused the Dow to plummet

(zerohedge)

US Manufacturing Survey Disappoints, New Orders/Employment Plunge

After China’s “surprise” PMI beat…

…and Europe’s ‘bottoming’…

…the world seems convinced that everything is awesome again (despite China Industrial Profits collapsing at a record pace) and expectations were for US Manufacturing surveys to extend their rebound in November.

Markit’s final Manufacturing PMI for November beat expectations, printing 52.6 (from 52.2 flash and 51.3 in October)
ISM’s Manufacturing survey for November missed expectations, printing 48.1 (from 49.2 exp and 48.3 prior)

This was the highest PMI since Feb 2019.

Source: Bloomberg

According to Markit, manufacturing output and new order growth rates improve to 10-month highs with the fastest rise in employment since March, but business confidence remains subdued.

And, according to ISM, new orders and employment both contracted further…

Source: Bloomberg

The data was ugly across the board:

According to the ISM, there was just one series that printed in expansion, or above 50 – supplier deliveries – as almost every other series sank deeper into contraction.

As ISM notes, “Consumption contracted, due primarily to lack of demand, but contributed positively (a combined 1.8-percentage point increase) to the calculation.”

The respondents were rather gloomy:

“Slowdown in business has us revising our 2020-21 capital spend.” (Petroleum & Coal Products)
“The order book continues to shrink below our forecast levels. We’re unsure at this point how much of the slowdown is tied to certain events [like the General Motors strike], year-end inventory reductions by customers, or a worsening economy. We don’t expect clarity on this until early 2020, when we expect to either see restocking orders [a good sign] or not [a bad sign].” (Fabricated Metal Products)
“Heading into the holiday season, we are seeing the backlog decrease as new orders for 2020 seem lighter than in past years.” (Plastics & Rubber Products)
“Markets have downshifted further. The continued confusion surrounding China trade has kept export markets on edge. Profits are elusive. Cash-flow planning is paramount. The general economy is slowing down.” (Wood Products)

Chris Williamson, Chief Business Economist at IHS Markit said:

“A third consecutive monthly rise in the PMI indicates that US manufacturing continues to pull out of its soft patch. New orders and production are rising at the fastest rates since January, encouraging increasing numbers of firms to take on more workers. Exports are also back on a rising trend, firms are buying more inputs and re-building inventories, adding to the signs of improvement.

“Some caution is needed, as these improved survey numbers merely translate into very subdued growth in comparable official gauges of manufacturing production and factory payrolls. Business sentiment also remains worryingly subdued, with expectations about future output growth well down on earlier in the year and running at one of the lowest levels seen since comparable data were first available in 2012.

“Firms remain very concerned about the disruptive effects of tariffs and trade wars in particular, both in terms of rising prices and weakened demand, though the survey also saw further worries among manufacturers that the economy could slow in the upcoming presidential election year as customers delay spending and investment decisions.”

So one is left wondering, given this global rebound in ‘soft’ survey data, whether the terrifying global depression that was forecast due to Trump’s unilateral trade war was just more “Project Fear”-driven propaganda… or is this the eye of the global trade hurricane?

iii) Important USA Economic Stories

Black Friday is dying as the internet sales skyrocket

(zerohedge)

“Black Friday Is Dying” – Shopping Malls Turn To “Ghost Towns” Amid Online Shift

Black Friday is undergoing a transformative period where consumers are ditching brick-and-mortar stores for online shopping.

Reuters noted Friday, that traffic volumes at stores across the country on Thanksgiving eve were soft — and it’s likely the trend will continue through the weekend.

Another report via KeyBanc Capital Markets found traffic “somewhat muted at malls” during Thanksgiving and Black Friday.

KeyBanc’s analyst Edward Yruma attributed the decline to more online sales.

KeyBanc’s note said Gap, Banana Republic, Express and Zara offered 50% discounts, but that still wasn’t enough to attract shoppers.

Though traffic was steady at Walmart, Target, and Lululemon.

As of noon, Salesforce.com observed online sales of $7.4 billion on Black Friday, 16% higher than a year ago.

“It speaks to the fact that we’re amidst this digital transformation that’s happening for both the consumers and the retailers,” Rob Garf, vice president of industry strategy and insights at Salesforce, told Bloomberg.

Some other possible reasons behind the weak turn out could be due retailers already offered an entire month of aggressive sales leading up to Black Friday. There are often limitations of how much a consumer can purchase as credit card rates soar to 25-year highs.

The National Retail Federation (NRF) polled consumers earlier this month who said most of their shopping has already been done, many of whom took advantage of the deals leading up to Black Friday.

NRF said retail sales for November through December are expected to increase by 3.8% to 4.2% YoY, for a total of around $730 billion, but a larger portion could be coming from e-commerce.

Another reason for the softer turn out could be generational trends. As millennials take over the workforce, they don’t want to follow in the footsteps of their ‘Ok Boomer’ parents who have been herded like sheep into stores for decades. Millennials would rather “Netflix and chill” while surfing for deals on their mobile devices.

There’s also evidence that the US economy is rapidly slowing and the US consumer is pulling back on spending as a recession could be nearing. The chart below shows the industrial recession has likely transmitted weakness into the consumer, which could produce a rather weak holiday spending period.

As for some evidence of consumers ditching brick-and-mortar stores this Black Friday, we turn to Twitter:

Jeff Macke

✔@JeffMacke

· 8h

Replying to @JeffMacke

I have no idea what multiple to put on $LULU. That said, and I realize it’s only 6:54am on Black Friday, I’m declaring Lulu the winner of Christmas. This is what crushing looks like.

The clearance is ~10-40% full retail. It’s barely a sale.

How are Fanny pack sales? “Great!”

Jeff Macke

✔@JeffMacke

Other Black Friday halftime news:

No Baby Yoda until January. “to keep it a secret”. Plenty of secrets from Frozen II are available. $LB is a ghost town. Specifically the bordello in a ghost town. $M wasn’t terrible(!).

Most traffic at Lulu or coffee. Black Friday is dying.

And to get an idea of what Black Friday used to look like before the consumer went broke and the internet came around. Here are a few short minutes of fights, stampedes, riots, and utter chaos, all over cheap plastic junk that was mostly made in China.

END

The Fed proposes to allow inflation to rise above 2% to make up for lost time. This guys are nothing but jokers

(zerohedge)

Federal Reserve Proposes New Rule To Let Inflation Run Hot Ahead Of Next Recession

As the Federal Reserve remains unable to stoke inflation and refuses to factor in asset price inflation, it has now considered launching a new rule that would let inflation run above its 2% target to make up for lost inflation, reported the Financial Times.

Though the Fed’s policies are to protect big Wall Street banks and keep liquidity ample in the financial system, their policies have overwhelmingly created deflation through supporting zombie companies and blowing financial bubbles.

To make up for lost inflation, the Fed will temporarily increase the target range above 2%. The policy would require “making it clear that it’s acceptable that to average 2 percent, you can’t have only observations that are below 2 percent,” said Eric Rosengren, president of the Federal Reserve Bank of Boston, who recently spoke with FT.

Fed members have expressed concerns that reverting the federal funds rate to the zero lower bound will drive inflation expectations lower, a real risk of Japanification.

Officials have remarked that the fed funds rate is so low compared to historical standards, that any given recession could make monetary policy ineffective, though there’s a real threat negative interest could be seen.

Fed members have been experimenting with new monetary tools ahead of the next downturn.

Janet Yellen, former chair of the Fed, said the new rule could be like “forward guidance,” which enabled the Fed to pressure short-term interest rates lower. This eventually allowed longer-term rates to fall as well.

Rosengren said, “future committees might not be as comfortable with that formulaic approach. This is why I prefer something that is a little bit more flexible, maybe not as constraining, but makes it a little clearer that we should be having [some inflation readings] over 2 percent.”

Fed governor Lael Brainard, spoke with reporters last week, said the new rule is to complex to elaborate on with the public. She said if inflation drops, the Fed should allow inflation to run hot, perhaps in a range of 2 to 2.5%.

In plain English, the Fed is afraid that its policies are Japanifying the US economy and are willing to let inflation run above target. The strategy clearly shows the Fed is making up policy as it goes ahead of the next recession, where monetary policy will be less effective than ever before.

iv) Swamp commentaries)

PHASE TWO OF THE IMPEACHMENT CIRCUS BEGINS WITH THIS. hERE IS WHAT TO EXPECT

(COURTESY SARA CARTER)

Nunes: “Phase Two” Of The Impeachment Circus Begins This Week

Via SaraACarter.com,

House Intelligence Committee ranking member Rep. Devin Nunes told Fox News host Judge Jeanine Pirro Saturday, that phase two of the impeachment hearings will start this week with Chairman Jerrold Nadler who will deliberate on the constitutionality of impeachment.

Nunes said he doesn’t expect anything new from the House Judiciary Committee’s Democrat led investigation.

“Well we now know that this coming week Jerry Nadler is gonna start phase two of the circus,” said Rep. Devin Nunes, on Justice with Judge Jeanine.

“Jerry Nadler has been in the witness protection program for several months after he botched the (Robert) Mueller probe. We’re going to see how this goes supposedly they’re going to talk about the constitutionality of impeachment,” said Nunes.

So far the Democrats have not been able to show any evidence that President Donald Trump withheld any aid from Ukraine in exchange for an investigation into former Vice President Joe Biden’s son, Hunter Biden. In fact, Office of Management and Budget Mark Sandy told lawmakers during Schiff’s hearing that the only reason the money was held up for a short period of time was Trump’s concern that other “countries were not contributing more to Ukraine.

The controversy surrounds questionable actions around Hunter Biden’s paid position on the board of Ukrainian energy company Burisma Holdings. His firm Rosemont Seneca Partners LLC, “received regular transfers into one of its accounts — usually more than $166,000 a month — from Burisma from spring 2014 through fall 2015, during a period when Vice President Biden was the main U.S. official dealing with Ukraine and its tense relations with Russia,” according to reports.

No Evidence For Trump Impeachment

Nunes added, “during the (President Richard) Nixon impeachment hearings you had an actual break in – you knew what the crime was. During the (President Bill) Clinton impeachment you knew that he had lied to a grand jury. I think for two weeks one of the things we were able to expose is that not only did they not have a quid pro quo, they actually had to change quid pro quo to bribery until John Ratcliff had to pointed out that the only person ever accused of bribery in Adam Schiff’s star basement down in the capital is Hunter Biden.”

The White House until Dec. 6, to decide whether to participate in the House Judiciary Committee’s impeachment proceedings, Nadler said. The committee will hold it’s first hearing Wednesday, and offered President Donald Trump the option to send someone to represent him.

It is highly unlikely that the White House will send anyone to represent the president at the Wednesday hearing, according to reports.

Four Key Pieces of Evidence Against Democratic Narrative (Republican Memo)

The July 25 call summary – the best evidence of the conversation – shows no conditionality or evidence of pressure;
President Zelensky and President Trump have both said there was no pressure on the call;
The Ukrainian government was not aware of a hold on U.S. Security assistance at the time of the July 25 call; and
President Trump met Ukrainian President and assistance flowed to Ukraine in September 2019. These occurred without Ukraine investigating President Trump’s political rivals.

END

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

Well that is all for today

I will see you TUESDAY night.

One comment

steve maxwell · December 3, 2019 - 8:26 pm · Reply→

Hi Harvey, Love reading your daily notes on the precious metals . Where does one go to hear or read your “more swamp stories tonight “as mentioned at the end of your daily comments ?

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NUMBER OF NOTICES FILED TODAY FOR DEC CONTRACT: 4933 NOTICE(S) FOR 493,300 OZ (15.343 tonnes)

1026 NOTICE(S) FILED TODAY FOR 5,130,000 OZ/

Bitcoin: OPENING MORNING TRADE : $ 7257 DOWN 136

Bitcoin: FINAL EVENING TRADE: $ 7299 DOWN 93

3. ASIAN AFFAIRS

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

Let us head over to the comex:

Trading Volumes on the COMEX TODAY: 313,115 CONTRACTS

CONFIRMED COMEX VOL. FOR YESTERDAY: 290,042 contracts

INITIAL standings for DEC/GOLD

And now for silver

AND NOW THE DELIVERY MONTH OF DEC.

INITIAL standings/SILVER

ii) Important gold commentaries courtesy of GATA/Chris Powell

Cuba reintroduces the dollar

India makes gold jewellery hallmarking mandatory from January 15

Gold is ‘a symbol … a sign of economic sovereignty’

Six European countries join barter system for Iran trade

New York Fed misrepresented disclosure rules to GATA, but so what?

iii) Other physical stories:

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

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

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

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

Futures Fade China PMI Euphoria After Trump Restarts Trade War With Brazil, Argentina

3A/ASIAN AFFAIRS

3 a./NORTH KOREA/ SOUTH KOREA

NK Threatens ‘Imbecile’ Shinzo Abe With “Real Ballistic Missile” Over Japan

b) REPORT ON JAPAN

3 C CHINA

Surging China PMIs, Crashing Korea Exports Spark Even More Confusion About Global Economy

Gloves Come Off: China “Insists” Existing Tariffs Must Be Scrapped For “Phase 1” Trade Deal

Macau Casino Revenue Plunges Amid Chinese Slowdown

China To Accelerate Release Of “Unreliable Entity List” In Response To Xinjiang Bill, Stocks Swoon

China No Longer Needs US Parts In Its Phones

Yet Another Trump Trade Win

Trade Deal?

Standard Assumption for 17 Months

Greatest Deal in History

Hong Kong Plunges Into Post-Election Chaos; Pro-Democracy Protesters Thank Trump For Signing Bill

China First Capital Continues Epic Crash In Hong Kong As Chairman Offloads More Shares

4/EUROPEAN AFFAIRS

UK Conservatives Set To Win A Large Majority

In Shocking Blow To Merkel, Germany’s SPD Elects Leftist Leaders, Risking Coalition Government Collapse

In Stuttering, Stumbling Address Christine Lagarde Vows To Link QE To Climate Change

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

US Enraged After 6 More EU Nations Join INSTEX To Bypass Iran Sanctions

6.Global Issues

Rabobank: “The Global Institutional Architecture Is Collapsing”

7. OIL ISSUES

8 EMERGING MARKET ISSUES

India In “Very Deep Crisis,” Witnessing “Death Of Demand,” Warns Former Indian FM

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

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

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

USA trading today in Graph Form

Stocks, Bonds, & The Dollar Dumped On Dismal-Data & Trade-Tensions

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

Market Spooked After Trump Threatens To Restore Steel And Aluminum Tariffs On South American Countries

Stocks & Dollar Plunge After Dismal US Data

Stocks Tumble After Ross Says Trump Will Hike Tariffs If No China Deal By Dec 15

Fed’s Second 42-Day Repo Oversubscribed As Rising Repo Rate Confirms Year End Liquidity Rush

US Manufacturing Survey Disappoints, New Orders/Employment Plunge

“Black Friday Is Dying” – Shopping Malls Turn To “Ghost Towns” Amid Online Shift

Federal Reserve Proposes New Rule To Let Inflation Run Hot Ahead Of Next Recession

Nunes: “Phase Two” Of The Impeachment Circus Begins This Week

No Evidence For Trump Impeachment

Four Key Pieces of Evidence Against Democratic Narrative (Republican Memo)

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