MARCH 16 A/PHYSICAL GOLD AND SILVER DECOUPLE FROM PAPER GOLD/SILVER//PAPER GOLD DOWN $30.00//PAPER SILVER DOWN $1.77//DOWN DECIMATES: DOWN 2997 POINTS/NASDAQ DOWN 970.28 POINTS//FED LOWERS INTEREST RATE TO ZERO//REPO MESS REAPPEARS AS THE FED RUNS OUT OF AMMUNITION//CORONAVIRUS UPDATE THROUGHOUT THE GLOBE//

GOLD::$1487.60  DOWN $30.00

 

 

Silver:$12.69//DOWN 179 CENTS

 

(COMEX TO COMEX CLOSING)

Closing access prices:

 

 

 

Gold : $1513.80

 

SILVER:  $12.92

 

 

 

 

COMEX DATA

 

 

 

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

today RECEIVING: 0/43

EXCHANGE: COMEX
CONTRACT: MARCH 2020 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,515.700000000 USD
INTENT DATE: 03/13/2020 DELIVERY DATE: 03/17/2020
FIRM ORG FIRM NAME ISSUED STOPPED
____________________________________________________________________________________________
657 C MORGAN STANLEY 14
686 C INTL FCSTONE 1
737 C ADVANTAGE 14 13
800 C MAREX SPEC 9 6
880 C CITIGROUP 19
905 C ADM 10
____________________________________________________________________________________________

TOTAL: 43 43
MONTH TO DATE: 1,725

NUMBER OF NOTICES FILED TODAY FOR  MAR CONTRACT: 43 NOTICE(S) FOR 4300 OZ (0.1337 tonnes)

TOTAL NUMBER OF NOTICES FILED SO FAR:  1725 NOTICES FOR 172500 OZ  (5.3254 TONNES)

 

 

 

 

SILVER

 

FOR MARCH

 

 

303 NOTICE(S) FILED TODAY FOR 1,515,000  OZ/

total number of notices filed so far this month: 3971 for 19,855,000 oz

 

BITCOIN MORNING QUOTE  $4559 DOWN $783 

 

BITCOIN AFTERNOON QUOTE.:$4997 DOWN 503

GLD AND SLV INVENTORIES:

 

GLD: 944.18 TONNES OF GOLD//A BIG  CHANGE: DOWN 12.59 TONNES

 

SLV: 356.935 MILLION OZ.//LOSS OF 2.893 MILLION OZ//

 

 

XXXXXXXXXXXXXXXXXXXXXXXXX

Let us have a look at the data for today

 

 

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IN SILVER THE COMEX OI FELL BY A HUMONGOUS SIZED 9244 CONTRACTS FROM 180,832 DOWN TO 171,588 AND FURTHER FROM OUR NEW RECORD OF 244,710, (FEB 25/2020.  THE LOSS IN OI OCCURRED WITH OUR $1.55 LOSS IN SILVER PRICING AT THE COMEX. WE HAD SOME LONG LIQUIDATION,  AS MOST OF THE LOSS IN OI IS DUE TO  BANKER SHORT COVERING PLUS A STRONG EXCHANGE FOR PHYSICAL ISSUANCE AND A STRONG INCREASE IN AMOUNT STANDING AT THE COMEX. WE HAD A SMALL NET LOSS IN OUR TWO EXCHANGES OF 2518 CONTRACTS  (SEE CALCULATIONS BELOW)

 

 

 

 

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

; MARCH:  00 AND MAY: 5655 AND JULY: 0 ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE  8591 CONTRACTS. WITH THE TRANSFER OF 5655 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 5655 EFP CONTRACTS TRANSLATES INTO 28.25 MILLION OZ  ACCOMPANYING:

1.THE $1.55 CENT LOSS IN SILVER PRICE AT THE COMEX AND

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

JUNE/2018. (5.420 MILLION OZ);

FOR JULY: 30.370 MILLION OZ

FOR AUG., 6.065 MILLION OZ

FOR SEPT. 39.505 MILLION  OZ S

FOR OCT.2.525 MILLION OZ.

FOR NOV:  A HUGE 7.440 MILLION OZ STANDING  AND

21.925 MILLION OZ FINALLY STAND FOR DECEMBER.

5.845 MILLION OZ STAND IN JANUARY.

2.955 MILLION OZ STANDING FOR FEBRUARY.:

27.120 MILLION OZ STANDING IN MARCH.

3.875 MILLION OZ STANDING FOR SILVER IN APRIL.

18.845 MILLION OZ STANDING FOR SILVER IN MAY.

2.660 MILLION OZ STANDING FOR SILVER IN JUNE//

22.605 MILLION OZ  STANDING FOR JULY

10.025   MILLION OZ INITIAL STANDING IN AUGUST.

43.030   MILLION OZ INITIALLY STANDING IN SEPT. (HUGE)

7.32     MILLION OZ INITIALLY STANDING IN OCT

2.630     MILLION OZ STANDING FOR NOV.

20.970   MILLION OZ  FINAL STANDING IN DEC

5.075     MILLION OZ FINAL STANDING IN JAN

1.480    MILLION OZ FINAL STANDING IN FEB

21.01  MILLION OZ INITIALLY STANDING FOR MAR

 

FRIDAY, AGAIN OUR CROOKS USED COPIOUS PAPER IN ORDER TO LIQUIDATE SILVER’S PRICE…AND THEY WERE SUCCESSFUL IN KNOCKING THE PRICE OF SILVER DOWN (IT FELL $1.55).. AND, OUR OFFICIAL SECTOR/BANKERS  WERE  SOMEWHAT SUCCESSFUL IN THEIR ATTEMPT TO FLEECE  SILVER LONGS FROM THEIR POSITIONS. AS WE DID HAVE A SMALL NET LOSS OF 2518 CONTRACTS OR 12.59 MILLION OZ ON THE TWO EXCHANGES!

 

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

33,429 CONTRACTS (FOR 11 TRADING DAYS TOTAL 33,429 CONTRACTS) OR 167.145 MILLION OZ: (AVERAGE PER DAY: 3039 CONTRACTS OR 15.195 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH OF MAR: 167.145 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 23.87% OF ANNUAL GLOBAL PRODUCTION (EX CHINA EX RUSSIA)*  JUNE’S 345.43 MILLION OZ IS THE SECOND HIGHEST RECORDED ISSUANCE OF EFP’S AND IT FOLLOWED THE RECORD SET IN APRIL 2018 OF 385.75 MILLION OZ.

 

ACCUMULATION IN YEAR 2020 TO DATE SILVER EFP’S:          580.08 MILLION OZ.

JANUARY 2020 EFP TOTALS SO FAR: 181.61 MILLION OZ

FEB 2020 EFP’S TOTAL :  ……     259.600 MILLION OZ

MARCH EFP’S SO FAR…..          167.145 MILLION OZ

 

 

RESULT: WE HAD A HUMONGOUS SIZED DECREASE IN COMEX OI SILVER COMEX CONTRACTS OF 9244,  WITH THE $1.55 LOSS IN SILVER PRICING AT THE COMEX /FRIDAY… THE CME NOTIFIED US THAT WE HAD AN ATMOSPHERIC SIZED EFP ISSUANCE OF 5655 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

 

TODAY WE LOST A CONSIDERABLE :  3589 TOTAL OI CONTRACTS ON THE TWO EXCHANGES: (WITH THE 155 CENT FALL IN PRICE

 

THE TALLY//EXCHANGE FOR PHYSICALS

i.e 5655 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH DECREASE OF 9244 OI COMEX CONTRACTS.AND ALL OF THIS DEMAND HAPPENED WITH A  $1.55 LOSS IN PRICE OF SILVER/ AND A CLOSING PRICE OF $14.88 // FRIDAY’S TRADING. YET WE STILL HAVE A STRONG AMOUNT OF SILVER STANDING AT THE COMEX FOR DELIVERY AS WELL AS A HUGE INCREASE IN QUEUE JUMPING!! 

 

In ounces AT THE COMEX, the OI is still represented by JUST UNDER 1 BILLION oz i.e. 0.8632 BILLION OZ TO BE EXACT or 123% of annual global silver production (ex Russia & ex China).

FOR THE NEW  MAR DELIVERY MONTH/ THEY FILED AT THE COMEX: 303 NOTICE(S) FOR  1,515,000 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 $14.70//TODAY’S RECORD OF 244,705 IS SET WITH A PRICE OF: 18.91 (FEB 25/2020)

 

.

 

ON THE DEMAND SIDE WE HAVE THE FOLLOWING:

  1. HUGE AMOUNTS OF SILVER STANDING FOR DELIVERY  (MARCH/2018: 27 MILLION OZ , APRIL/2018 : 2.485 MILLION OZ  MAY: 36.285 MILLION OZ ; JUNE/2018  (5.420 MILLION OZ) , JULY 2018 FINAL AMOUNT STANDING: 30.370 MILLION OZ   )  FOR AUGUST 6.065 MILLION OZ. , SEPT:  A HUGE 39.505 MILLION OZ./ OCTOBER: 2,520,000 oz  NOV AT 7.440 MILLION OZ./ DEC. AT 21.925 MILLION OZ   JANUARY AT  5.825 MILLION OZ.AND FEB 2019:  2.955 MILLION OZ/ MARCH: 27.120 MILLION OZ/  APRIL AT 3.875 MILLION OZ/ A MAY:  18.845 MILLION OZ ..JUNE 2.660 MILLION OZ//JULY 22.605 MILLION OZ; AUGUST 10.025 MILLION OZ/ SEPT 43.030 MILLION OZ//OCT: 7.665 MILLION OZ//   NOV: 2.630 MILLION OZ//DEC:  20.970 MILLION OZ; JAN:  5.075 MILLION OZ.//FEB 1.480 MILLION OZ//MAR: 21.01 MILLION OZ
  2. THE  RECORD PRIOR TO TODAY WAS SET IN FEB 25/2018:  244,710 CONTRACTS,  WITH A SILVER PRICE OF $18.90//.
  3. HUGE ANNUAL EFP’S ISSUANCE EQUAL TO 2.9 BILLION OZ OR 400% OF SILVER ANNUAL PRODUCTION/2017 RECORD SETTING EFP ISSUANCE FOR ANY MONTH IN SILVER; APRIL/2018/ 385.75 MILLION OZ/  AND THE SECOND HIGHEST RECORDED EFP ISSUANCE JUNE 2018 345.43 MILLION OZ

 

AND YET, WITH THE EXTREMELY HIGH EFP ISSUANCE, WE HAVE A CONTINUAL LOW PRICE OF SILVER DESPITE THE ABOVE HUGE DEMAND.  TO ME THE ONLY ANSWER IS THAT WE HAVE SOVEREIGN  (CHINA) WHO IS ENDEAVOURING TO GOBBLE UP ALL AVAILABLE PHYSICAL SILVER NO MATTER WHERE, EXACTLY WHAT J.P.MORGAN IS DOING. AND IT IS MY BELIEF THAT J.P.MORGAN IS HOLDING ITS SILVER FOR ITS BENEFICIAL OWNER..THE USA GOVERNMENT WHO IN TURN IS HOLDING THAT SILVER FOR CHINA.(FOR A SILVER LOAN REPAYMENT)

 

GOLD

 

IN GOLD, THE COMEX OPEN INTEREST FELL BY A SMALLER THAN EXPECTED 14,240 CONTRACTS TO 582,100 AND MOVING FURTHER FROM OUR NEW RECORD (SET JAN 24/2020) AT 799,541 AND  PREVIOUS TO THAT: (SET JAN 6/2020) AT 797,110.

THE HUGE LOSS OF COMEX OI OCCURRED WITH OUR STRONG LOSS IN PRICE OF $73.60 /// COMEX GOLD TRADING// FRIDAY// WE,  HAD CONSIDERABLE BANKER SHORT COVERING ALONG WITH ZERO LONG LIQUIDATION ACCOMPANYING AN ATMOSPHERIC  EX. FOR PHYSICAL ISSUED AND YET THIS WAS COUPLED WITH THAT STRONG FALL IN PRICE.  ON THE TWO EXCHANGES DESPITE THE HUGE FALL IN PRICE, WE GAINED A HUMONGOUS 8,369 CONTRACTS  (26.03 TONNES)

 

E.F.P. ISSUANCE

 

 

 

THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A HUMONGOUS AND CRIMINALLY SIZED 22,595 CONTRACTS:

CONTRACTS, FEB>  CONTRACTS; MARCH 00 APRIL: 22,595. MAY: 0, AND JUNE. 0 AND ALL OTHER MONTHS ZERO//TOTAL: 22,595.  The NEW COMEX OI for the gold complex rests at 582,100. 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 INCREASE IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 8369 CONTRACTS: 14,240 CONTRACTS DECREASED AT THE COMEX  AND 22,595 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI GAIN OF 8,369 CONTRACTS OR 26.03 TONNES. FRIDAY, WE HAD A HUGE LOSS OF $73.60 IN GOLD TRADING.…..

AND WITH THAT HUMONGOUS LOSS IN  PRICE, SURPRISINGLY WE STILL HAD A HUGE SIZED GAIN IN  TOTAL/TWO EXCHANGES GOLD TONNAGE OF 26.03  TONNES!!!!!! THE BANKERS/OFFICIAL SECTOR WERE SUPPLYING INFINITE SUPPLIES OF SHORT GOLD COMEX PAPER WITH RECKLESS ABANDON. THE BANKERS WERE SUCCESSFUL IN THEIR ATTEMPT TO LOWER GOLD’S PRICE (LOSS $73.60). AND IT SEEMS THAT THEIR ATTEMPT TO FLEECE ANY GOLD LONGS FROM THE GOLD ARENA WERE UNSUCCESSFUL AS WE HAD A STRONG GAIN IN OUR TWO EXCHANGES:

SEE BELOW:

 WE HAD  A HUMONGOUS INCREASE IN EXCHANGE FOR PHYSICALS  (22,595) ACCOMPANYING THE SMALLER THAN EXPECTED LOSS IN COMEX OI.(14,240 OI):  TOTAL GAIN IN THE TWO EXCHANGES:  8,369 CONTRACTS.  WE NO DOUBT HAD HUGE BANKER SHORT COVERING AND NO LONG LIQUIDATION…..COUPLED WITH THAT HUGE COMEX OI FALL

 

 

SPREADING OPERATION FOR OUR NEWCOMERS:

WE HAVE NOW COMMENCED IN GOLD THE ILLEGAL SPREADING OPERATION \ FOR NEWCOMERS, HERE ARE THE DETAILS:

 

SPREADING LIQUIDATION HAS NOW STOPPED IN GOLD AS THEY NOW BEGIN TO MORPH INTO SILVER AS WE HEAD TOWARDS THE NEW FRONT MONTH WILL BE APRIL.

 

 

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 SILVER..AND WE WILL NOW MORPH INTO AN ACCUMULATION PHASE OF SPREADING CONTRACTS FOR GOLD.  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 GOLD 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 NON ACTIVE DELIVERY MONTH OF FEB HEADING TOWARDS THE  ACTIVE DELIVERY MONTH OF MARCH 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 NON  ACTIVE MONTH OF MAR.BUT SO IS THE OPEN INTEREST OF SPREADERS. THE OPEN INTEREST IN GOLD WILL CONTINUE TO RISE UNTIL ONE WEEK BEFORE FIRST DAY NOTICE OF AN UPCOMING  ACTIVE DELIVERY MONTH (APRIL), 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.”

 

HISTORICAL ACCUMULATION OF EXCHANGE FOR PHYSICALS IN 2020 INCLUDING TODAY

 

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF MAR : 202,845 CONTRACTS OR 20,284,500 oz OR 630.933 TONNES (11 TRADING DAYS AND THUS AVERAGING: 18,440 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE STRONG SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 11 TRADING DAY(S) IN  TONNES: 630.933 TONNES

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

THUS EFP TRANSFERS REPRESENTS 630.933/3550 x 100% TONNES =17.78% OF GLOBAL ANNUAL PRODUCTION

ISSUANCE OF EXCHANGE FOR PHYSICAL GOLD HAS EXPLODED THIS MONTH.

 

 

ACCUMULATION OF GOLD EFP’S YEAR 2020 TO DATE   1854,90  TONNES

JANUARY 2220 TOTAL EFP ISSUANCE; : 570.19 TONNES

FEB 2020 TOTAL EFP ISSUANCE :            653.78 TONNES

MARCH TOTAL EFP ISSUANCE SO FAR   630.933  TONNES  (11 TRADING DAYS)

 

 

 

 

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

 

 

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

1.Today, we had the open interest in SILVER FELL BY A HUMONGOUS SIZED 9,244 CONTRACTS FROM 180,832 DOWN TO 171,588 AND FURTHER FROM OUR COMEX RECORD //244,710(SET FEB 25/2020).  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 3/4 YEARS AGO.  THE PRICE OF SILVER ON THAT DAY: $17.89.

ALL OF THE LOSS IN COMEX OI WAS DUE TO 1) BANKER SHORT COVERING , 2) THE ISSUANCE OF AN ATMOSPHERIC NUMBER OF EXCHANGE FOR PHYSICALS (SEE BELOW), 3) A HUGE INCREASE IN SILVER OZ STANDING AT THE COMEX WITH SOME AMOUNT OF LONG LIQUIDATION

 

EFP ISSUANCE 5655

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

 FOR FEB. 0; FOR MAR  0:  AND MAY: 5655; JULY: 0 CONTRACTS   AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 5655 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 8173 CONTRACTS TO THE 5655 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN A CONSIDERABLE LOSS OF 2518 OPEN INTEREST CONTRACTS. THUS IN OUNCES, THE LOSS ON THE TWO EXCHANGES  12.59 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: 7.32 MILLION OZ//NOV 2.63 MILLION OZ//DEC: 20.970 MILLION OZ//JAN: 5.075 MILLION OZ//FEB: 1.480 MILLION OZ//MAR: 21.01 MILLION OZ

 

 

RESULT: A LARGE SIZED DECREASE IN SILVER OI AT THE COMEX WITH THE 155 CENT FALL IN PRICING THAT SILVER UNDERTOOK IN PRICING// FRIDAY. WE ALSO HAD A HUMONGOUS SIZED 5655 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. THE ENTIRE LOSS OF COMEX OI WAS DUE TO SPREADER LIQUIDATION AND THAT HUGE ISSUANCE OF EX. FOR PHYSICALS.

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 DOWN 98.17 POINTS OR 3.40%  //Hang Sang CLOSED DOWN 969.34 POINTS OR 4.03%   /The Nikkei closed DOWN 429.08 POINTS OR 2.46%//Australia’s all ordinaires CLOSED DOWN 9.52%

/Chinese yuan (ONSHORE) closed DOWN  at 7.0109 /Oil UP TO 57.21 dollars per barrel for WTI and 64.13 for Brent. Stocks in Europe OPENED RED//  ONSHORE YUAN CLOSED DOWN // LAST AT 7.0214 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 7.0109 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY CLOSE TO 7:1//TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED/CORONAVIRUS  : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /TRADE DEAL NOW DEAD..TRUMP  RAISED RATES TO 25%

 

3A//NORTH KOREA/ SOUTH KOREA

 

3b) REPORT ON JAPAN

3C  CHINA

 

4/EUROPEAN AFFAIRS

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

 

6.Global Issues

 

7. OIL ISSUES

 

8 EMERGING MARKET ISSUES

 

9. PHYSICAL MARKETS

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

MARKET TRADING//USA

a)Market trading/LAST NIGHT/USA

 

b)MARKET TRADING/USA/AFTERNOON

ii)Market data/USA

iii) Important USA Economic Stories

iv) Swamp commentaries)

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

 

LET US BEGIN:

 

 

Let us head over to the comex:

THE TOTAL COMEX GOLD OPEN INTEREST FELL BY A SMALLER THAN EXPECTED 14,240 CONTRACTS TO 582,100 MOVING FURTHER FROM OUR  RECORD THAT WAS SET IN JANUARY/2020: {799,541  OI(SET JAN 16/2020)} AND  PREVIOUS TO THAT: 797,110 (SET JAN 7/2020).  AND THIS FALL IN OI WAS SET WITH A STRONG LOSS OF $73.60 IN GOLD PRICING //FRIDAY’S  COMEX TRADING//). HOWEVER WE ALSO HAD AN ATMOSPHERIC EFP ISSUANCE (22,595 CONTRACTS),.  THUS WE HAD 1) HUGE BANKER SHORT COVERING AT THE COMEX AND 2) ZERO LONG LIQUIDATION ……AS OUR TWO EXCHANGES ROSE HUGELY IN TOTAL OPEN INTEREST..DESPITE THE HUGE LOSS  IN PRICE….  BASICALLY LONGS JUST TRANSFERRED OVER TO LONDON COUPLED WITH CONSIDERABLE BANKER SHORT COVERING

 

EXCHANGE FOR PHYSICAL ISSUANCE

WE ARE NOW IN THE  NON ACTIVE DELIVERY MONTH OF MARCH..  THE CME REPORTS THAT THE BANKERS ISSUED AN ATMOSPHERIC SIZED  TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS., THAT IS 22,595 EFP CONTRACTS WERE ISSUED:

 FEB: 0; MARCH 00 AND APRIL: 22,595, MAY: 0  JUNE : 0 AND  ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE: 22,595 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:  8,369 TOTAL CONTRACTS IN THAT 22,595 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON BUT WE LOST A SMALL SIZED 14,240 COMEX CONTRACTS.  THE BANKERS PROVIDED ALL THE NECESSARY SHORT PAPER TO WHICH OUR LONGS DUTIFULLY ACCEPTED AS THEY GOBBLED UP ATMOSPHERIC AMOUNTS OF EXCHANGE FOR PHYSICALS COUPLED WITH A HUGE BANKER SHORT COVERING.(FOLLOWING THE  COMEX OI DECLINE)

 

 

THE BANKERS WERE  SUCCESSFUL IN LOWERING GOLD’S PRICE DRAMATICALLY //// (IT FELL BY $73.60). THEY WERE MOST DEFINITELY  UNSUCCESSFUL IN FLEECING ANY LONGS, AS THE TOTAL GAIN ON THE TWO EXCHANGES 37.77 TONNES WAS MAINLY DUE TO BANKER SHORT COVERING AND EXCHANGE FOR PHYSICAL ISSUANCE. 

 

 

NET GAIN ON THE TWO EXCHANGES ::  8369 CONTRACTS OR 836,900 OZ OR  26.03 TONNES. 

 

COMMODITY LAW SUGGESTS THAT COMMODITY FUTURES OPEN INTEREST SHOULD APPROXIMATE 3% OF TOTAL PRODUCTION.  IN GOLD THE WORLD PRODUCES AROUND 3500 TONNES PER YEAR BUT ONLY 2200 TONNES ARE AVAILABLE FROM THE WEST (THUS EXCLUDING RUSSIA, CHINA ETC..WHO KEEP 100% OF THEIR PRODUCTION)

THUS IN GOLD WE HAVE THE FOLLOWING:  582,100 TOTAL OI CONTRACTS X 100 OZ PER CONTRACT = 58.21 MILLION OZ/32,150 OZ PER TONNE =  1810 TONNES

THE COMEX OPEN INTEREST REPRESENTS 1810/2200 OR 82.29% OF ANNUAL GLOBAL PRODUCTION OF GOLD.

 

 

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And now for the wild silver comex results

Total COMEX silver OI FELL BY A HUMONGOUS SIZED 9244 CONTRACTS FROM 180,832 DOWN TO 171,588 (AND MOVING FURTHER FROM THE NEW ALL TIME RECORD OI FOR SILVER SET ON FEB 25.2020(244,710) ECLIPSING OUR PREVIOUS RECORD, AUGUST 25/2018 RECORD (244,196).  THE PREVIOUS RECORD TO THAT WAS SET ON APRIL 9.2018/ 243,411 CONTRACTS) . OUR CONSIDERABLE OI COMEX LOSS TODAY OCCURRED WITH OUR 155 CENT DECREASE IN PRICING/FRIDAY.  THE LOSS IN OI WAS MITIGATED WITH 1)  A HUGE ISSUANCE OF EXCHANGE FOR PHYSICALS 2) HUGE INCREASE IN SILVER OZ STANDING AT THE COMEX, 3)  SOME  BANKER SHORT COVERING COUPLED WITH WE SOME LONG LIQUIDATION. 

 

 

WE ARE NOW INTO THE  ACTIVE DELIVERY MONTH OF MAR.

MAR ACTIVE DELIVERY MONTH.

 

THE FRONT MONTH OF MAR HAS A TOTAL OPEN INTEREST OF 660 CONTRACTS  WITH A GAIN OF 122 CONTRACTS. WE HAD 4 CONTRACTS ISSUED YESTERDAY SO WE GAINED 126 CONTRACTS OR 630,000 ADDITIONAL OZ WILL STAND FOR DELIVERY AS THEY REFUSED TO MORPH INTO LONDON BASED FORWARD CONTRACTS AS WELL AS NEGATING A FIAT BONUS.

 

THE NEXT CONTRACT MONTH OF APRIL SAW A LOSS OF 79 CONTRACTS DOWN TO 439 CONTRACTS. THE BIG CONTRACT OF MAY SAW ITS OI FALL  BY 8342 DOWN TO 114,204

 

 

We, today, had  303 notice(s)  for 1,515000, OZ for the MAR, 2019 COMEX contract for silver

 

Trading Volumes on the COMEX TODAY: 592,701 contracts

CONFIRMED COMEX VOL. FOR YESTERDAY:

635,743 contracts//

 

 

 

INITIAL standings for  MARCH/GOLD

MARCH 16

 

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
43 notice(s)
 4300 OZ
(0.1337 TONNES)
No of oz to be served (notices)
8 contracts
(800 oz)
0.0249 TONNES
Total monthly oz gold served (contracts) so far this month
1725 notices
172500 OZ
5.3254 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

 

 

 

total dealer deposits:nil oz

total dealer withdrawals: nil oz

 

we had 0 deposit into the customer account

i) Into JPMorgan: 0  oz

 

ii) Into everybody else: 0

 

 

 

 

total deposits:  0  oz

 

 

we had 0 gold withdrawals from the customer account:

 

 

total gold withdrawals;  nil  oz

 

ADJUSTMENTS: 

nil

 

 

 

 

The front month of MARCH saw its open interest register 51 contracts for a LOSS of 73 contracts.. Surprisingly we had 114 notices filed on FRIDAY so we gained 41 contracts or an additional 4100 oz will stand on this side of the pond as they refused to morph into London based forwards.  The bankers are seeking rapidly depleting physical supplies of gold.

 

APRIL HAD  a LOSS of 18.893 contracts DOWN to 269,794 contracts

May saw its ANOTHER gain of 43 contracts to stand at 652.

June saw a GAIN of 4701 contracts up to 200,018

 

 

We had 43 notices filed today for 4300 oz

 

 

 

FOR THE  MAR 2020 CONTRACT MONTH)Today, 0 notice(s) were issued from JPMorgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equates to 43 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 0 notice(s) was (were) stopped/ Received) by j.P.Morgan customer account and 0 notices by the squid  (Goldman Sachs)

To calculate the INITIAL total number of gold ounces standing for the March /2020. contract month, we take the total number of notices filed so far for the month (1725) x 100 oz , to which we add the difference between the open interest for the front month of  MAR. (51 CONTRACTS ) minus the number of notices served upon today (43 x 100 oz per contract) equals 173,300 OZ OR 5.3909 TONNES) the number of ounces standing in this  active month of MAR

thus the INITIAL standings for gold for the MAR/2020 contract month:

No of notices served (1725)x 100 oz)  + (51 OI for the front month minus the number of notices served upon today (43 x 100 oz )which equals 173,300 oz standing OR 5.3903 TONNES in this active delivery month which is  a great amount for gold standing for a MAR. delivery month.

We gained 41 contracts or 4100 oz will stand for delivery at the comex.

 

 

 

NEW PLEDGED GOLD:  BRINKS

3027.500 OZ  REMOVED TO THE PLEDGED ACCOUNT JAN 10.2020/Brinks

176,211.457 oz NOW PLEDGED  JAN 21.2020/HSBC  5.4807 TONNES

331,789.41.3 oz PLEDGED  MARCH 2020:  10.3200 TONNES

TOTAL PLEDGED GOLD NOW IN EFFECT:  50,800.009 MILLION OZ OR 15.800.959  TONNES

 

SURPRISINGLY WE HAVE BEEN WITNESSING NO REAL PHYSICAL GOLD ENTERING THE COMEX VAULTS FOR THE PAST YEAR!! ..ONLY PHONY KILOBAR ENTRIES…. WE HAVE ONLY 37.74 TONNES OF REGISTERED GOLD WHICH CAN SETTLE UPON LONGS.

HERE IS WHAT STOOD DURING THESE PAST 7 MONTHS:  AUGUST 27.153 TONNES

SEPT:                                                                      5.4525 TONNES

OCT…………………………………………………………………………..   37.99 TONNES

NOV……                                                                5.3841 tonnes

DEC………………………….                                              45.912 TONNES

JAN……………………                                                    8.448 TONNES

FEB……………………………………………..                             25.611 tonnes

MARCH………………………………………………………..              5.3903 TONNES

 

total: 161.31 tonnes

 

ACCORDING TO COMEX RULES:

 

IF WE INCLUDE THE PAST 9 MONTHS OF SETTLEMENTS WE HAVE 25,709 TONNES SETTLED

 

 

IF WE ADD THE 9 DELIVERY MONTHS: 161.31  tonnes

 

Thus:

161.31 tonnes of delivery –

25.709 TONNES DEEMED SETTLEMENT

 

=135.622 TONNES STANDING FOR METAL AGAINST 37.74 TONNES OF REGISTERED OR FOR SALE COMEX GOLD! THIS IS WHY GOLD IS SCARCE AT THE COMEX.

 

total registered or dealer gold:   1,721,321.265 oz or  53.54 tonnes
which  includes the following:
a) pledged gold held at HSBC   which cannot settled upon   176,211.457 oz x ( 5.4807 TONNES)//
b) pledged gold held at JPMorgan (added March 2020) which cannot be settled upon:  331,789.443 oz (or 10.3200 tonnes)
total pledged gold:  508,000.900 oz or 15.800 tonnes
thus:
registered gold that can be used to settle upon:1,213,320.3  (37.74 tonnes)
true registered gold  (total registered – pledged tonnes  1,213512.9  (37.74 tonnes)
total registered, pledged  and eligible (customer) gold;   8,665,926.914 oz 269.54 tonnes

 

THE GOLD COMEX IS NOW IN STRESS AS

 

1. GOLD IS LEAVING THE COMEX 

 

2. GOLD IS LEAVING THE REGISTERED CATEGORY OF THE COMEX.

 

3. NO GOLD IS ENTERING THE COMEX

 

WHY ARE THEY NOT SETTLING?

 

THE COMEX IS AN ABSOLUTE FRAUD..

 

 

end

 

And now for silver

AND NOW THE  DELIVERY MONTH OF MARCH.

INITIAL  standings/SILVER

IN TOTAL CONTRAST TO GOLD, HUGE ACTIVITY IN SILVER TODAY.
MARCH 16/2019
Silver Ounces
Withdrawals from Dealers Inventory NIL oz
Withdrawals from Customer Inventory
 86,988.866 oz
CNT
int Delaware

 

 

Deposits to the Dealer Inventory
nil oz

 

Deposits to the Customer Inventory
197,401.000 oz
CNT
No of oz served today (contracts)
303
CONTRACT(S)
(1,515,000 OZ)
No of oz to be served (notices)
357 contracts
 1,785,000 oz)
Total monthly oz silver served (contracts)  3971 contracts

19,855,000 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

**

total dealer deposits: 0 oz

total dealer withdrawals: 0 oz

i)we had  1 deposits into the customer account

into JPMorgan:   0

into CNT:  x 97,401.000 oz

 

 

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

JPMorgan now has 160.819 million oz of  total silver inventory or 49.62% of all official comex silver. (160.819 million/323.442 million

 

 

 

total customer deposits today:  97,401.000   oz

 

we had 2 withdrawals out of the customer account:

i) Out of CNT:  50,166.270 oz

ii) Out of Int Delaware: 36,822.596 oz

 

 

 

 

total withdrawals; 86,988.866  oz

We had 0 adjustments:

 

total dealer silver:  80.212 million

total dealer + customer silver:  323.452 million oz

 

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The total number of notices filed today for the MAR 2020. contract month is represented by 303 contract(s) FOR 1,515,000 oz

To calculate the number of silver ounces that will stand for delivery in MAR we take the total number of notices filed for the month so far at 3971 x 5,000 oz = 19,855,000 oz to which we add the difference between the open interest for the front month of MAR.( 660) and the number of notices served upon today 303 x (5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the MAR/2019 contract month: 3971 (notices served so far) x 5000 oz + OI for front month of MAR (660)- number of notices served upon today (303) x 5000 oz equals 21,640,000 oz of silver standing for the MAR contract month.

WE GAINED 126 CONTRACTS OR 630,000 OZ WILL STAND FOR DELIVERY ON THIS SIDE OF THE POND

 

 

 

 

 

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: 147,425 CONTRACTS //extremely high

 

 

CONFIRMED VOLUME FOR YESTERDAY: 177,314 CONTRACTS..,

 

 

 

 

 

YESTERDAY’S CONFIRMED VOLUME OF 177,314 CONTRACTS EQUATES to 886 million  OZ  127% OF ANNUAL GLOBAL PRODUCTION OF SILVER..

 

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

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

 

end

 

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NPV for Sprott

 

1. Sprott silver fund (PSLV): NAV FALLS TO -2.80% ((MARCH 16/2020)

2. Sprott gold fund (PHYS): premium to NAV FALLS TO -5.67% to NAV:   MAR 16/2020 )

Note: Sprott silver trust back into NEGATIVE territory at +%-/Sprott physical gold trust is back into NEGATIVE/ 2.80%

(courtesy Sprott/GATA

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

NAV 14.34 TRADING 13.51///DISCOUNT 5.76

 

END

 

 

And now the Gold inventory at the GLD/

MARCH  16/WITH GOLD DOWN $30.00/ A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER WITHDRAWAL OF 12.59 TONNES/INVENTORY RESTS AT 931.59 TONNES

MARCH 13//WITH GOLD DOWN $73.60: A HUGE WITHDRAWAL OF 9.02 TONNES OF PAPER GOLD FROM THE GLD//

INVENTORY RESTS AT 944.18 TONNES

MARCH 12/WITH GOLD DOWN $55.05 TODAY:  NO CHANGE IN GOLD INVENTORY AT THE GLD/953.26 TONNES

 

MAR 11/WITH GOLD DOWN $14.95?/A HUGE WITHDRAWAL OF 10.53 TONNES//INVENTORY RESTS AT 953.26 TONNES

MARCH 10/WITH GOLD DOWN $14.25//A HUGE 8.00 TONNES OF PAPER GOLD DEPOSIT INTO THE GLD//INVENTORY RESTS AT 963.79

MARCH 9//WITH GOLD UP $1.50 : NO CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 955.60 TONNES

March 6/WITH GOLD UP $6.25 A MASSIVE 21.37 PAPER TONNES OF GOLD INTO THE GLD INVENTORY//INVENTORY RESTS AT 955.60 TONNES

MARCH 5/WITH GOLD UP $25.40//NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS TONIGHT AT 934.23 TONNES

MARCH 4//WITH GOLD DOWN 1 DOLLAR: NO CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 934.23 TONNES//

MARCH 3//WITH GOLD UP 48.55 TODAY; NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 934.23 TONNES

MARCH 2//WITH GOLD UP $27.00// no change in gold inventory at the gld//inventory remains  at 934.23 tonness

FEB 28/WITH GOLD DOWN $73.00 WE LOST NO GOLD FROM THE GLD/INVENTORY REMAINS 934.23 TONNES

FEB 27/WITH GOLD DOWN $3.45: A HUGE WITHDRAWAL OF 5.86 TONNES FROM THE GLD

FEB 26./WITH GOLD DOWN  TODAY/ GOLD INVENTORY INCREASES BY 6.15 TONNES//GLD INVENTORY AT 640.09 TONNES

FEB 24/with gold up $28.40//NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 933.94 TONNES

FEB 21/WITH GOLD UP $28.40 TODAY: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A HUGE PAPER DEPOSIT OF:2.34 TONNES   //INVENTORY RESTS AT 933.94 TONNES

FEB 20/WITH GOLD UP $9.00 TODAY: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A HUGE 1.76 TONNES OF GOLD DEPOSIT//INVENTORY RESTS AT 931.60 TONNES

FEB 19/WITH GOLD UP $8.25 TODAY//A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER DEPOSIT OF 5.85 TONNES//GOLD INVENTORY RESTS AT 929.84 TONES

FEB 18. WITH GOLD UP $17.00//A BIG CHANGE IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 1.76 TONNES OF GOLD INTO THE GLD//INVENTORY RESTS AT 923.99 TONNES

FEB 14/WITH GOLD UP $6.80 NO CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 922.23 TONNES

FEB 13/WITH GOLD UP $8.00 TODAY:NO CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 922.23 TONNES

FEB 12/WITH GOLD UP $1.80 TODAY: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 6.15 TONNES OF GOLD INTO THE GLD//INVENTORY RESTS AT 922.23 TONNES

FEB 11/WITH GOLD DOWN $9.30 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 916.08 TONNES

FEB 10/WITH GOLD UP $6.10 TODAY:A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 1.17 TONNES OF GOLD INTO THE GLD////INVENTORY RESTS AT 916.08 TONNES

FEB 7/WITH GOLD UP $3.20 TODAY: NO CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS THIS WEEKEND AT; 914.91 TONNES

FEB 6/WITH GOLD UP $8.80: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 2.33 TONNES OF GOLD INTO THE GLD////INVENTORY RESTS AT 914.91 TONNES

FEB 4//WITH GOLD DOWN $26.10: A VERY STRANGE PHENOMENA: A MONSTROUS DEPOSIT OF 9.38 TONNES//INVENTORY RESTS AT 912.58 TONNES

FEB 3/WITH GOLD DOWN $5.40 TODAY: A SMALL CHANGE: A TINY WITHDRAWAL OF .29 TONNES OF GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 903.21 TONNES( TO PAY FOR FEES LIKE STORAGE INSURANCE ETC)

 

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MARCH 16/2020/Inventory rests tonight at 931.59 tonnes

*IN LAST 778 TRADING DAYS: -5.79 NET TONNES HAVE BEEN REMOVED FROM THE GLD

*LAST 678 TRADING DAYS;+ 160.34. TONNES HAVE NOW BEEN ADDED INTO  THE GLD INVENTORY.

 

 

end

 

Now the SLV Inventory/

MARCH 16/WITH SILVER DOWN 177 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESETS AT 356.938 MILLION OZ//

MARCH 13//WITH SILVER DOWN 155 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 2.893 MILLION OZ FROM THE SLV///INVENTORY RESTS AT 356.938 MILLION OZ;

MARCH 12/WITH SILVER DOWN 77 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 1.119 MILLION OZ FROM THE SLV//INVENTORY RESTS AT 359.828 MILLION OZ

MARCH 11/SILVER DOWN 16 CENTS:  A SMALL WITHDRAWAL OF .467 MILLION OZ AT THE SLV/INVENTORY RESTS AT 360.947 MILLION OZ//

MARCH 10/WITH SILVER DOWN 10 CENTS: NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 361.414 MILLION OZ//

MARCH 9/NO CHANGE IN INVENTORY LEVELS: SLV INVENTORY RESTS AT 361.414 MILLION OZ//

MARCH 6//WITH SILVER DOWN 10 CENTS: NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 361.414 MILLION OZ

MARCH 5//WITH SILVER UP 15 CENTS TODAY; A SMALL WITHDRAWAL DUE TO FEES ETC//INVENTORY RESTS TONIGHT AT 361.414 MILLION OZ..

MARCH 4/SILVER SILVER UP 3 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 361.880 MILLION OZ//

MARCH 3/WITH SILVER UP 44 CENTS//A HUGE CHANGE IN SILVER INVENTORY AT THE SLV/: A LOSS OF 5.75 MILLION OZ FROM THE SLV../INVENTORY RESTS AT 361.880 MILLION OZ

MARCH 2//WITH SILVER UP 18 CENTS//NO CHANGE IN SILVER INVENTORY AT THE SLV..INVENTORY RESTS AT 367.632 MILLION OZ//

FEB 28/ WITH SILVER DOWN 18 CENTS: a loss of 1.867 million oz//inventory rests at 367.632 million oz

FEB 27/WITH SILVER DOWN TODAY: A STRONG GAIN OF 747000 OZ OF SILVER INTO THE SLV

FEB 26\WITH SILVER DOWN TODAY,A HUGE GAIN OF 5.319 MILLION OZ OF SILVER INTO THE SLV//INVENTORY RESTS AT 368.752 MILLION OZ

FEB 24/WITH SILVER UP 35 CENTS TODAY; NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 363.433 TONNES

FEB 21//WITH SILVER UP 22 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 363.433 TONNES

FEB 20/WITH SILVER DOWN 7 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 363.433 TONNES

FEB 19/WITH SILVER UP 23 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 363.433 MILLION OZ//

FEB 18/. WITH SILVER UP 42 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 363.433 MILLION OZ.

FEB 14/WITH SILVER UP 10 CENTS TODAY: A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 746,000 FROM THE SLV///INVENTORY RESTS AT 363.433 MILLION OZ.

FEB 13/WITH SILVER UP 14 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 364.179 MILLION OZ/

FEB 12//WITH SILVER DOWN 10 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 364.179 MILLION OZ/

FEB 11/ WITH SILVER DOWN 19 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER DEPOSIT OF 1.166 MILLION OZ INTO THE SLV//INVENTORY RESTS AT 364.179 MILLION OZ//

FEB 10/WITH SILVER UP 8 CENTS TODAY: A SMALL CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF //INVENTORY RESTS AT 363.013 MILLION OZ//

FEB 7/WITH SILVER DOWN 11 CENTS TODAY: A SMALL CHANGE IN SILVER INVENTORY AT THE SLV A DEPOSIT OF 701,000//INVENTORY RESTS THIS WEEKEND AT 363.013 MILLION OZ//

FEB 6//WITH SILVER UP 24 CENTS TODAY:A SMALL  CHANGE IN SILVER INVENTORY: A WITHDRAWAL OF 154,000 OZ AT THE SLV/INVENTORY RESTS AT 362.312 MILLION OZ// AND GENERALLY THIS IS TO PAY FOR FEES LIKE INSURANCE/STORAGE

FEB 4//WITH SILVER DOWN 9 CENTS TODAY: NO CHANGE IN SILVER INVENTORY//SLV INVENTORY RESTS AT 362.466 MILLION OZ//

FEB 3/WITH SILVER DOWN 30 CENTS TODAY; A SMALL DEPOSIT OF 560,000 OZ INTO SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 362.466 MILLION OZ/

MARCH 16.2020:

SLV INVENTORY RESTS TONIGHT AT  356.938 MILLION OZ.

 

LIBOR SCHEDULE AND GOFO RATES:

 

 

YOUR DATA…..

6 Month MM GOFO 0.74/ and libor 6 month duration 0.820

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

G0LD LENDING RATE: + .08

 

XXXXXXXX

12 Month MM GOFO
+ 0.68%

LIBOR FOR 12 MONTH DURATION: .82

 

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = +.14

end

 

 

end

 

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

 

 

ii) Important gold commentaries courtesy of GATA/Chris Powell

iii) Other physical stories:

Price Of Physical Gold Decouples From Paper Gold

Submitted by BullionStar.com

In the last month, from 14 February 2020 to 14 March 2020, we have seen a record number of orders, record order revenue and a record number of visits to our newly renovated and extended bullion centre at 45 New Bridge Road in Singapore.

For the above-mentioned period, we have served 2,626 customers with a sales revenue of more than SGD 50 M, which is 477% higher compared to the same period last year.

The last few days have been our busiest days of all time. Our staff members have been doing a fantastic job in going out of their way to serve as many customers as possible.

With order volume increasing to this magnitude, it’s difficult for us to timely answer all phone and support requests but we are doing our very best to keep response times down.

Gold & Silver Shortages – Supply Squeeze

The enormous increase in demand is straining our supply chains. BullionStar has supplier relations with most of the major refineries, mints and wholesalers around the world. Most of our suppliers don’t have any stock of precious metals and are not taking orders currently. The U.S. Mint for example announced just this Thursday that American Silver Eagle coins are sold out. The large wholesalers in the U.S. are completely sold out of ALL gold and ALL silver and are not able to replenish.

We are already sold out of several products and will sell out of additional products shortly if this supply squeeze continues. All products listed as “In Stock” on our website are available for immediate delivery. For items listed as “Pre-Sale”, the items have been ordered and paid by us with incoming shipments on the way to us.

Paper Gold vs. Physical Gold

As we have repeated frequently over the years, only physical gold is a safe haven.

It’s noteworthy that the paper price of gold, although up 5.7% Year-to-Date denominated in SGD, has been trading downward in the last few days.

Paper gold is traded on the unallocated OTC gold spot market in London and on the COMEX futures market in New York. Both of these markets are derivative markets and neither is connected to the physical gold market.

This means that the physical gold market is a price taker, inheriting the price from the paper market, and that the derivative markets are the exclusive and dominant price makers. The entire market structure of this financialized gold trading is flawed. So while there is unprecedented demand for physical gold, this is not reflected in the gold price as derived by COMEX and the London unallocated spot market.

By now it is abundantly clear that the physical gold market and paper gold market will disconnect.

If the paper market does not correct this imbalance, widespread physical shortages of precious metals will be prolonged and may lead to the entire monetary system imploding.

And with progressive central banks in Eastern Europe and Asia having stocked up on gold in the last three years, gold will likely be the anchor of the new monetary system arising out of the ashes.

Mainstream media assertions that “Gold has been stripped of its Safe Haven Status” are utterly ridiculous and distorted beyond belief, when in fact the complete opposite is true. Unbacked paper gold and silver may be stripped of safe haven status, but certainly not real physical gold bullion.

Physical Premiums & Spreads

The current supply squeeze and physical bullion shortage has caused and is causing an increase in price premiums. It’s currently difficult and expensive for us to acquire any inventory. We have therefore had to increase premiums on products to compensate for the constraints. We have endeavoured to also raise our prices offered to customers selling to us, but with the extreme volatility and wild price fluctuations, the spread between the buy and sell price may temporarily be larger than normal. It is regrettable that premiums and spreads are larger than normal but it is outside our control that the paper market is not reflecting the demand and supply of the physical market. As many of you know, we are one of the largest critical voices of the LBMA run paper market and its bullion bank members in London.

Please note that premiums are likely to be higher on weekends when the markets are closed compared to weekdays.

We do not take lightly the decision to alter premiums but feel that it is a better alternative than to stop accepting orders altogether during weekends. Likewise it is a better alternative than to stop accepting orders when the paper gold market is in turmoil and failing to reflect the demand and supply realities of the physical bullion market.

Currently, we are completely sold out on BullionStar Gold BarsBullionStar Silver Bars and are running low on several other products which we are not able to replenish for now. Several stock items will therefore likely go out of stock shortly. This is despite us having been aggressively buying bullion to create a buffer reserve inventory.

end
Robert to me : re real estate//and the coronavirus

My response to a well known real estate party

“I imagine you mean here in Toronto and not abroad. As real estate in Europe is selling at 30% of listing value at any real size. The problem is capital, banks there are illiquid and not in a very shape so obtaining house loans is tough, and even tougher if you are a Canadian. In England you cannot even open a bank account unless you have a residency permit. In Europe starting next year you will need a visa.

The Canadian residential index is down from 935 5 weeks ago to 705 headed down. What sold and was funded is Great. But what maybe sold now is questionable as to funding as banks have tightened right up and what was a mortgageable deal a month ago is dead on arrival. We are entering a time of “no bid” where cash is king and asking prices matter not. This will take some time for Sellers to accept and for buyers to acknowledge. And if you look at one’s stock portfolio you want to puke 🤮. The only place to make money recently has been to stay in cash. Many people will assume prices will decline. And perhaps short term they will as pressure to sell will cause bargains for cash buyers. However, very few people will be willing to put liquid cash into a asset that is illiquid given the changing realities.

And when to look to housing, I believe people will look to independent living. Meaning that things like generators, access to shopping without transportation will become more pressing. Who wants to risk a virus 🦠 on the subway? Walking is better, especially as people are conditioned to distance themselves from others. Although as long as gas prices are down, and they will be much lower in a month’s time may wish to travel. I see real stress in the faces of many a business person not cushioned by substantial cash holdings.
Canadians will be told and warned to return home or face restrictions on entry either later tonight or tomorrow. In America, interstate travel maybe restricted as early as tomorrow or next weekend. We are in the early stage of beginning to understand the impact as curtailment of travel and work and socializing  at a distance is just real starting.

Households will continue to need real estate 🏡 as needs change and perhaps realities change as to global travel. I have cancelled Several months of scheduled travel for business as I simply do not know anymore where I can travel and return without worry. We thought of going to cayman’s for a couple days only to learn that a elderly Italian just died there and they have closed their medical facilities. Who wants to a place where if you need medical attention for whatever the reason and  none is available on island? Recently, I looked at place in Bahamas that was offered below replacement cost at a size discount and passed. Someone no doubt bought it as it was a Canadian selling for financial concerns. If it has not sold and closed, it is a dead asset today, I suspect.

My guess is the spring is shot and maybe fall will have a spurt of activity and that all depends on what happens. All I know, is that even accountants tell me their building clients are suffering and several builders I know of with product coming on will choke on on it.
As we all know the true value of real estate is what a person will pay on a given day and today with the uncertainty of normal business everyone is affected and the willingness to buy is substantially reduced.”

Cheers
Robert

END
CROOKS!!!

Employee At BIS’ Basel Headquarters Infected With Coronavirus, Nine Others Exposed

Frequent readers will know the Bank of International Settlements as not only the central banks’ central bank and ultimate financial regulator, but also as the (not so) secretive group…

… which runs the world out of Conference Room E in the ominous circular tower block next to the Basel train station (strategically located to provide a quick and easy exit if things ever get heated), where the world’s top central bankers meet every other month on Sunday evenings at 7pm to determine the fate of the world.

Others will recall the BIS as the employer of Benoit Gilson, the man who runs the BIS’ trading desk and is in charge of both FX and gold, and who judging by his “green” light today, is likely quite busy.

Well, today the BIS also showed that while it may be immune to angry peasants revolting and demanding an overthrow of the monetary system, it is quite exposed to weaponized Chinese viruses, and on Monday, the FT reported that the Bank for International Settlements said a member of staff working at its Basel headquarters has tested positive for Covid-19. On Monday afternoon, the organisation reported that the individual had received medical treatment and was currently recovering at home.

A further nine staff members who had been working in close proximity to the infected employees had been told to to work from home temporarily.

News of the positive test came despite measures that BIS had put in place since the beginning of March. These, according to the FT, included cancelling or rescheduling all physical meetings due to take place in its offices, and having “almost all staff” work from home.

However, the institution said it had “rigorous business continuity measures in place” to ensure it can continue its normal operations.

For the monetary sake of the world, especially now that the Fed has no more credibility left, we certainly hope so. It also begs the question: is Benoit working from home?

END
TIC report

Foreign Central Banks Dump Treasuries For 17th Straight Month, Continue To Hoard More Gold

For the first time since June, China added to its US Treasury holdings in January (the latest month from TIC data).

The total for China — the second-largest holder of U.S. government debt after Japan – rose $8.7 billion in January to $1.08 trillion.

Source: Bloomberg

 

The coming months’ data will help show if the virus’s blow to China’s economy is starting to pressure central bank officials to sell Treasuries to support the yuan, a step they’ve avoided over the past several years, preferring instead to manage the currency via the daily fixing, says Mark Sobel, former IMF and Treasury official and chair of the OMFIF.

If COVID-19 hit the yuan hard, he said, “China might intervene to cushion any decline.”

Japan remains the largest foreign holder with $1.21 trillion, as the value of its holdings rose $56.8 billion at the start of the year, the data showed.

Source: Bloomberg

Overall, Foreigners were net buyers of US assets excluding corporate debt

  • Foreign net buying of Treasuries at $25.6b
  • Foreign net buying of equities at $2b
  • Foreign net selling of corporate debt at $31.8b
  • Foreign net buying of agency debt at $32.3b

But foreign central banks dumped US Treasuries for the 17th straight month…

Source: Bloomberg

But, while reducing of exposure to US Treasuries continues worldwide, Central banks started out 2020 buying more gold.

Source: Bloomberg

On net, central banks added 21.5 tons of gold to their reserves in January, according to the latest data from the World Gold Council.

Central bank demand came in at 650.3 tons in 2019. That was the second-highest level of annual purchases for 50 years, just slightly below the 2018 net purchases of 656.2 tons. According to the WGC, 2018 marked the highest level of annual net central bank gold purchases since the suspension of dollar convertibility into gold in 1971, and the second-highest annual total on record.

The World Gold Council bases its data on information submitted to the International Monetary Fund.

Turkey was the leading gold-buyer in January. The Turks added 16.2 tons of gold to their reserves.

Russia continued to stockpile the yellow metal, adding another 8.1 tons to their hoard. Russia’s quest for gold has paid off in a big way. The Russian Central Bank’s gold reserves topped $100 billion in September 2019 thanks to continued buying and surging prices.

The Russians have been buying gold for the last several years in an effort to diversify away from the US dollar.  Russian gold reserves increased 274.3 tons in 2018, marking the fourth consecutive year of plus-200 ton growth. Meanwhile, the Russians sold off nearly all of its US Treasury holdings. According to Bank of America analysts,  the amount of US dollars in Russian reserves fell from 46% to 22% in 2018.

Mongolia and Kazakhstan both added 1 ton of gold to their reserves in January. The only other buyer was Greece at 0.1 tons.

There were two significant net-sellers – Uzbekistan (2.2t) and Qatar (1.6t).

The People’s Bank of China did not report any gold purchases for the fourth straight month  It’s not uncommon for China to go silent and then suddenly announce a large increase in reserves.

January’s net gold purchases represented a 57% decline year-on-year. World Gold Council analyst Krishan Gopaul said it was too early to determine what this could mean for 2020.

World Gold Council director of market intelligence Alistair Hewitt said there are two major factors driving central banks to buy gold – geopolitical instability and extraordinarily loose monetary policy.

Central banks are looking toward gold to balance some of that risk. We’ve also got negative rates and yields for a large number of sovereign bonds.”

“This recent trend shouldn’t be ignored. But nor should we also lose sight of the fact that central banks remain net purchasers, even if at a lower level than we have come to expect to in the last two years.”

Peter Schiff has talked about central bank gold-buying. He has noted that the US went off the gold standard in 1971, but he thinks the world is going to go back on it.

The days where the dollar is the reserve currency are numbered and we’re going back to basics. You know, everything old is new again. Gold was money in the past and it will be money again in the future, and central banks that are smart enough to read that writing on the wall are increasing their gold reserves now.”

Ron Paul made a similar point in an episode of the Liberty report. He said foreign central banks are increasingly gravitating to sound money like gold and ripping themselves away from the Fed’s dollar.

The central banks of the world are looking at gold again.”

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.

tic REPORT

 

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

A federal judge tells traders that they can combine cases (with the other 6 banks) as they accused JPMorgan of rigging the precious metals market
(courtesy CNBC)

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

  • Litigation in a separate civil case has been put on hold until at least May at the behest of the Justice Department, which is investigating a “related criminal case” that involves alleged market manipulation by precious metals traders at J. P. Morgan.
  • Judge John Koeltl of the Southern District of New York appointed the White Plains, N.Y., law firm Lowey Dannenberg as interim lead counsel for the proposed class action.

71671201

Spencer Platt | Getty Images

A group of traders from across the U.S. who allege that J. P. Morgan Chase manipulated precious metals markets for years are one step closer to bringing a class action suit against the nation’s largest bank.

Earlier this month, a federal judge said five separate lawsuits making similar allegations against the bank could be combined, potentially including thousands of people who traded in the precious metals market from Jan. 2009 through Dec. 2015.

Litigation in a separate civil case has been put on hold until at least May at the behest of the Justice Department, which is investigating a “related criminal case” that involves alleged market manipulation by precious metals traders at J. P. Morgan.

J. P. Morgan declined to comment on this story.

Judge John Koeltl of the Southern District of New York appointed the White Plains, N.Y., law firm Lowey Dannenberg as interim lead counsel for the proposed class action.

Vincent Briganti, a partner at the firm, filed the first suit seeking class action status in November on behalf of Dominick Cognata, a trader who alleges he suffered losses due to J.P. Morgan’s illegal trading conduct in the silver and gold futures and options markets.

That was after the federal court in Connecticut unsealed a criminal plea agreement by John Edmonds, a former J.P. Morgan metals trader. In his guilty plea, Edmonds, who is 36-years old, admitted that he and other “unnamed co-conspirators” fraudulently manipulated the precious metals markets while they were employed at J. P. Morgan from 2009 to 2015.

Edmonds said he had learned the illegal trading tactics from senior traders, and then used them hundreds of times with the knowledge of and consent of his immediate supervisors.

Briganti’s lawsuit also names John Edmonds and a group of yet-to-be-identified precious metals traders and the bank as defendants.

On Wednesday, the lawyers sent a letter to Judge Koeltl saying they were having difficulty locating Edmonds to serve him legal papers and requested a 30-day extension to do so, which the judge granted on Thursday. Briganti noted that they have been in contact with Edmonds’ attorney in the criminal case. Edmonds’ attorney and Briganti could not be reached for comment.

“We are hopeful that this extension will result in completing service on Mr. Edmonds without formal motion practice and a request for alternative means of service,” Briganti said in the letter.

The next step in the civil case is for the plaintiffs to file an amended class action complaint and set a schedule for defendants to respond.

In addition to the proposed class action, J. P. Morgan also faces a separate civil suit which also accuses the bank of rigging precious metals markets.

end

March 4.2019

Parker City News

JP Morgan faces potential class action lawsuit after guilty pleas by a former metals trader

Traders from across the U.S. are banding together to accuse J. P. Morgan Chase of manipulating precious metals markets for years.

At least six lawsuits, all making similar allegations against the nation‘s largest bank, have been filed in New York federal court in the past month, since federal prosecutors in Connecticut with a former J. P. Morgan Chase metals trader.

The cases could potentially include thousands of people who traded in the precious metals market. The White Plains, N.Y., law firm Lowey Dannenberg is asking the court to combine the cases and name it as the lead.

The law firm‘s commodities group is led by Vincent Briganti, the attorney who filed the first lawsuit on behalf of Dominick Cognata, a New York resident who alleges he suffered losses due to J. P. Morgan‘s trading conduct in the silver and gold futures and options markets.

A combined case, seeking class action status, would include anyone who purchased or sold futures contracts or an option on NYMEX platinum or palladium or COMEX silver or gold between at least Jan. 1, 2009, and Dec. 31, 2015. The lawyers believe that “at least hundreds, if not thousands” of traders would be eligible to join the case.

Named as defendants in all of the lawsuits are John Edmonds, a 36-year old former metals trader at J. P. Morgan, a group of yet-to-be-identified precious metals traders and the bank.

Edmonds, a New York resident, pleaded guilty in October to one count of conspiracy to defraud the market and manipulate prices of precious metals futures contracts and one count of commodities fraud. In the criminal plea, Edmonds admitted that he and other “unnamed co- conspirators” at J. P. Morgan, fraudulently manipulated precious metals markets from 2009 to 2015, the same time frame covered in the class action suits.

Briganti filed the initial class action on Nov. 7, just one day after the Justice Department unsealed Edmonds‘ plea in the U.S. District Court of Connecticut.

Edmonds admitted in his guilty plea that he deployed the illegal trading scheme hundreds of times with the direct knowledge and consent of his immediate supervisors. Plaintiffs say they have suffered economic injury, including monetary losses, as a direct result of actions by Edmonds and the other unnamed J. P. Morgan metals traders in the futures and options contracts.

One of the suits alleges that “the number of unlawful trades that JP Morgan traders executed in precious metals futures markets is at least in the thousands.”

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

The Justice Department‘s criminal investigation is still ongoing and recently caused a separate related civil case to be put on hold for at least six months while the government continues its investigation. That civil lawsuit, which also accuses J. P. Morgan of rigging the precious metals market, was filed in 2015 by hedge fund manager Daniel Shak and two commodity traders.

After reviewing the details of the plea agreement, David Kovel, the attorney for Shak‘s suit, sought to re- interview Edmonds, along with two other current and former senior traders at the bank. However, the government argued that reopening questioning would be detrimental to the ongoing criminal investigation. The federal judge overseeing the proceedings ordered a six-month stay in the civil case.

Kovel declined to comment.

Edmonds was originally scheduled to be sentenced in Hartford, Conn., on Wednesday, Dec. 19, but a court filing on Nov. 27 shows the sentencing has been postponed until June. A spokesman for the U.S. Attorney for Connecticut could not elaborate on why the sentencing was postponed since the court filing is under seal.

-END-

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

 Section: 

9:47a ET Tuesday, March 5, 2019

Dear Friend of GATA and Gold:

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

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

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

… 

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

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

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

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

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

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

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

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

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

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

* * *

END

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: 7.0107/ GETTING VERY DANGEROUSLY CLOSE TO 7:1

//OFFSHORE YUAN:  67.0214   /shanghai bourse CLOSED DOWN 98.17 POINTS OR 2.40%

HANG SANG CLOSED DOWN 969.34 POINTS OR 4.03%

 

2. Nikkei closed DOWN 429.08 POINTS OR 2.46%

 

 

 

 

3. Europe stocks OPENED ALL RED/

 

 

 

USA dollar index DOWN TO 98.02/Euro RISES TO 1.1166

3b Japan 10 year bond yield: RISES TO. +.01/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 105.97/ 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:: 29.65 and Brent: 30.59

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

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

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

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

3i European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund RISES TO -.54%/Italian 10 yr bond yield DOWN to 1.95% /SPAIN 10 YR BOND YIELD DOWN TO 0.75%…ITALIAN 10 YR BOND YIELD/GERMAN BUND: 2.49: DANGEROUS FOR THE ITALIAN BANKING SYSTEM

3j Greek 10 year bond yield RISES TO : 2.56

3k Gold at $1459.50 silver at: 12.06   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 265/100 in roubles/dollar) 75.07

3m oil into the 29 dollar handle for WTI and 30 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 105.97 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 .9441 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0547 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 0.54%

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 0.77% early this morning. Thirty year rate at 1.41%

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

6.  TURKISH LIRA:  UP  TO 6.3921..

Quarantative Easing Fails: S&P, Brent Down 10%, European Banks Hit All Time Low In Monday Massacre

The Fed’s quarantative easing has failed.

After last week’s miserable Monday moves, we are running out “black Monday” designations, so we’ll keep today’s Ides of March action simple, especially since it is likely to recur for many weeks to come: just call it the Ides Of March Mondays Massacre.

With S&P futures promptly plunging 5% limit down at the Sunday reopen of electronic trading after the Fed quite literally “blew” its largest emergency intervention ever, which instead of calming markets only exacerbated the sense of panic and dread, this morning the SPY ETF shows what to expect, and it’s a disaster, as the S&P is indicated to open about 10% lower, which will be sufficient for at least one 15 minute trading halt when markets reopen at 930am.  The fact that Nike and Apple announced mass store closings, did not help, neither did Chairman Powell’s warning that US growth next quarter will be weak.

The question, however, is whether the market will be halted fully and indefinitely to prevent further selling and to “own the shorts” whether due to continued selling or by presidential decree. We will find out in a few hours, and until then here are the appropriate circuit breaker levels. If the S&P drops to 2,168 it may be all over.

  • 2521.25 (down 7%)
  • 2358.59 (down 13%)
  • 2168.82 (down 20%)

Until then, we can merely list the carnage in the market which includes a near record surge in the VIX, whose front-month futures contract jumped as high as 57.9 on Monday.  The actual spot VIX which tracks the 30-day implied volatility of the S&P 500 based on out-of-the-money options prices, wasn’t quoted as of 9:15 a.m. London time. A notice on Cboe’s website said the opening for S&P 500 and VIX products has been delayed, meaning we can now add a broken VIX to the list of everything else that is broken about this market.

As Bloomberg notes, Monday’s surge sent VIX futures beyond their highs of last week, which included several limit-down pauses to U.S. stocks and the S&P 500’s biggest tumble since the crash on Black Monday in 1987.

Investors have been unable to digest a ceaseless newsflow of companies shutting operations, countries sealing borders and governments devising targeted rescue plans. The Fed cut its key interest rate by a full percentage point to near zero and said it will boost its bond holdings by $700 billion. The Bank of Japan moved to accelerate asset purchases, doubling the amount of equity ETFs the central bank buys every year to 12 trillion.

“In normal circumstances, a large policy response like this would put a floor under risk assets and support a recovery,” Jason Daw, a strategist at Societe Generale SA in Singapore, wrote in a note. “However, the size of the growth shock is becoming exponential and markets are rightfully questioning what else monetary policy can do and discounting its effectiveness in mitigating coronavirus-induced downside risks.”

European stocks were not halted but the carnage was just as bad, with all sectors tumbling, while the European Stoxx 600 Banks Index plunged 7.8% Monday, falling below its low of 2009, in the aftermath of the Global Financial Crisis. Banks have underperformed the wider market as European countries are increasingly going into lock-down mode.

Predictably, debt insurance costs for European banks and sovereigns rose sharply on Monday, shrugging off massive rate-cutting moves and liquidity injections by the U.S. Federal Reserve and other global central banks over the weekend. Five-year credit default swaps for Italy’s UniCredit rose 33 basis points (bps) from Friday’s close to 243 bps, Deutsche Bank saw levels jump 18 bps to 138 bps while France’s Societe Generale saw a 10 bps rise. Sovereign debt CDS levels also gained with southern European issues suffering the sharpest increase. Italy saw CDS levels spike 18 bps to 246 bps to revisit last week’s levels while Spain gained 14 bps to 119 bps – its highest level since June 2016.

Earlier, all markets in the Asian region were also down, with Thailand’s SET falling 6.4%. The Topix declined 2%, with Kurabo and Maeda Road falling the most. The Shanghai Composite Index retreated 3.4%, with Kangni Mechanical and Sunny Loan Top posting the biggest slides. Australian equities fell almost 10%, the most since 1992, even after the Reserve Bank of Australia said it stood ready to buy bonds for the first time – an announcement that sent yields tumbling.

In rates, after the Fed cut rates to zero, 10Y US Treasury yields retreated more than 33 bps at one point overnight, but have since trimmed the move, while bonds were mixed in Europe as Italian and Greek yields blew out amid fears the ECB will not be there to bail everyone out.

There was one silver lining: the all important FRA/OIS spread suggests that liquidity may be returning to the bond market after the Fed’s Sunday bazooka, although it is just as likely that this is a misprint.

Still, until there is some confirmation that liquidity is returning to normal, investors are liquidating first and asking questions later, and nowhere is this more obvious than in the plunge in precious metals with gold crashing to $1,465, down almost $250 in just a few days.

In FX, the yen rebounded from Friday’s plunge after the Fed and five counterparts said they would deploy foreign-exchange swap lines. New Zealand’s currency slumped after an emergency rate cut by the country’s central bank.

In commodities, besides the precious metals rout, the selling shifted back to oil, which crashed to a fresh 4 year low after Goldman calculated over the weekend that the US SPR crude buying would barely make a dent on overall demand.

Economic data include Empire manufacturing survey. Tencent Music is among companies reporting earnings

Market Snapshot

  • S&P 500 futures down 4.8% to 2,567.50
  • STOXX Europe 600 down 8.4% to 274.06
  • MXAP down 3.8% to 131.51
  • MXAPJ down 5% to 434.15
  • Nikkei down 2.5% to 17,002.04
  • Topix down 2% to 1,236.34
  • Hang Seng Index down 4% to 23,063.57
  • Shanghai Composite down 3.4% to 2,789.25
  • Sensex down 6.3% to 31,956.62
  • Australia S&P/ASX 200 down 9.7% to 5,002.00
  • Kospi down 3.2% to 1,714.86
  • German 10Y yield fell 3.5 bps to -0.579%
  • Euro up 0.9% to $1.1211
  • Brent Futures down 6.7% to $31.58/bbl
  • Italian 10Y yield rose 2.5 bps to 1.611%
  • Spanish 10Y yield rose 11.3 bps to 0.735%
  • Brent Futures down 6.7% to $31.58/bbl
  • Gold spot up 0.6% to $1,539.15
  • U.S. Dollar Index down 1.1% to 97.65

Top Overnight News

  • The Federal Reserve on Sunday cut its benchmark rate by a full percentage point to near zero and will boost its bond holdings by $700 billion to cushion the U.S. economy from the coronavirus outbreak
  • Credit markets reeling from their worst week since the global financial crisis weren’t impressed by a dramatic rate cut by the Federal Reserve, as investors including Pacific Investment Management Co. called for governments to do more to avert a meltdown
  • Italy’s government will meet Monday to pass a new package of measures including increased spending for its stricken healthcare sector and moves to cover extraordinarylayoffs after deaths in the country from the coronavirus jumped by 368 Sunday
  • Deutsche Bank AG will operate in split teams globally from Monday as a way to curb the spread of the coronavirus

Asian equity markets weakened and US equity futures hit limit down to start the week as coronavirus fears and disruptions continued to spook investor sentiment, despite numerous policy measures to address the fallout from the outbreak including the Fed throwing the kitchen sink with a 100bps emergency cut and USD 700bln QE announcement. This followed the national emergency declaration by US President Trump last Friday which opens access to USD 50bln of emergency funds for states to tackle the coronavirus, while BoC and RBNZ also recently announced emergency cuts of 50bps and 75bps respectively. Nonetheless, ASX 200 (-9.7%) failed to benefit from the global policy measures and announcement the RBA stands ready to purchase government bonds, with heavy losses in mining names, financials and industrials resulting the index’s worst ever drop, while Nikkei 225 (-2.6%) was choppy amid the BoJ’s emergency meeting in which it kept rates and the yield target unchanged but doubled ETF and J-REIT purchases. Hang Seng (-4%) and Shanghai Comp. (-3.4%) were both negative due to widespread fears and after surprise contractions to Chinese Industrial Production (-13.5% vs. Exp. 1.5%) and Retail Sales (-20.5% vs. Exp. 0.8%), but with losses in the mainland stemmed after the PBoC’s recent targeted RRR cuts of 50bps-100bps and additional 100bps cut for joint-stock banks which will unleash CNY 550bln of funds, while the HKMA authority also announced a rate cut in lock step with the Fed albeit to a lesser extent of just 64bps. Finally, 10yr JGBs opened lower due to the after-hours slump on Friday as stock markets found some firm but brief relief, although JGB prices rebounded off their lows as fears returned to the fore of investors’ minds before retreating again after the BoJ announced to keep main policy settings unchanged but instead boosted purchases of ETFs, J-REIT, Commercial Paper and Corporate Bonds, while pressure was also seen in the Australian 10yr yield after the RBA signalled a readiness to purchase government bonds.

Top Asian News

  • Shell-Shocked Markets Find Little Relief in Volatile FX Trading
  • RBNZ Delays New Capital Rules; Sees NZ$47b Boost to Lending
  • India’s RBI to Hold Briefing Amid Flurry of Asia Rate Cuts
  • China’s Economy Set to Shrink 6% This Quarter, Macquarie Says

European equities continue to erode in early trade [Euro Stoxx 50 -8.5%] despite pre-emptive monetary easing measures from global Central Banks including a 1ppt reduction by the Fed alongside a USD 700bln QE boost. The downbeat sentiment from the APAC session reverberated into Europe as the underlying coronavirus theme further crystallises, which saw US equity futures hit the 5% limit down at the open and hover at the levels during European trade thus far (Full details available here). Meanwhile, Euronext stated that it will be doubling the ETF threshold amid “exceptional market conditions caused by recent news and events”, with the normal threshold set to return once condition return back to normal. Sector-wise, the usual suspects show underperformance – Financials (-9.6%) sink as banks bear the brunt of the lower yield environment, whilst Consumer Discretionary (-9.3%) follow closely amid a further deterioration in Travel & Leisure (-18.0%) in light of renewed fleet groundings in airline and cruise names. On that front, Air France-KLM (-16.7%) remains a laggard in the Stoxx 600 after noting that flight activity will be reduced significantly over the next few days, with the number of seats available per km seen dropping between 70-90%. easyJet (-21.0%) meanwhile stated that it has taken on further cancellations, with these actions to continue for the foreseeable future. Tui (-30.0%) plumbed the depths following after withdrawing its FY20 guidance and applying for state aid to support the business. Credit Suisse (-12.0%) shares feel extra pressure after US prosecutors are pursuing the Co. for its role in a USD 2bln Mozambieq corruption case, in which they believe that they have enough evidence against the Co. Elsewhere, Associated British Foods saw considerable downside in early European trade despite a rosier trading update (sees adj. operating profit ahead of prior guidance), with some attributing the move to a fat-finger. Finally, Bayer (-4.7%) outperforms the German index but conforms to the overall sell-off despite source reports that the Co. is a step closer in agreeing to draft settlement regarding tens of thousands Roundup weed killer claims.

Top European News

  • U.K.’s FCA Suspends Finablr Trading in London
  • H&M, Primark Brace for Downturn in Europe as Epicenter Shifts
  • Virus Delivers New Blow to Rio Tinto’s Flagship Copper Project

In FX, the Greenback has handed back almost all Friday’s gains and would surely be even weaker if the non-US Dollars were not underperforming on a combination of rate cuts and risk aversion. Indeed, the DXY is only just off its pre-weekend low of 97.335 within a 97.446-98.473 range after the Fed’s latest intermeeting policy action (-100 bp FF cut to 0-0.25% and Usd700 bn QE) as the US Treasury curve unwinds some of its initial bull-steepening.

  • CAD/NZD/AUD – As noted above, the Loonie, Kiwi and Aussie are all conceding ground to their US counterpart in wake of various forms of stimulus designed to protect respective economies from further COVID-19 contagion, including a standard 50 bp BoC rate cut (on top of the ½ point reduction at the scheduled March meeting), -75 bp from the RBNZ and the RBA introducing more repos ahead of additional ‘measures’ to come on Thursday that may involve some for of asset purchases. Usd/Cad is back up near 1.3900, Nzd/Usd is straddling 0.6000 within a wide 0.6153-0.5945 band and Aud/Usd is hovering around 0.6170 between 0.6303-0.6097 parameters, with the latter also taking on board extremely bleak Chinese data (ip and retail sales) that is keeping Usd/CNH afloat on the 7.0000 handle.
  • JPY/CHF/EUR – It’s abundantly evident that safe-haven appeal is considerably stronger than any negativity associated with looser monetary policy or the prospect in the case of the Yen and Franc that have both strengthened vs the Buck and generally. Usd/Jpy has retreated through 106.00 from almost 108.00, while Usd/Chf has tested 0.9400, with Eur/Jpy and Eur/Chf eyeing 118.00 and sub-1.0550 respectively even though the single currency is outpacing the Usd either side of 1.1200. To recap, the BoJ joined others in the fight against nCoV via increased QE, while the clock is ticking down to the SNB’s quarterly policy review this Thursday and latest weekly Swiss sight deposits suggest more intervention. For its part, ECB’s Holzmann has reiterated that the GC is willing to do more after last week’s targeted measures.
  • SCANDI/EM – As usual when oil and other commodities (Gold also) succumb to broad and severe risk-off positioning, the Nok, Rub, Mxn and Zar tend to get hit harder than most and today is no exception, albeit with crude prices not quite experiencing the near panic selling/liquidation seen this time last week. However, many regional currencies are at fresh record or multi-year lows and only being propped by intervention, like the Ils to name just one.

In commodities, WTI and Brent front-month futures continue to deteriorate amid further materialisation in coronavirus woes, and with further cancellations in the Travel and Leisure sector dampening demand growth in the complex. WTI Apr’20 dipped below USD 30/bbl at the open of electronic trade before taking multiple stabs at the level to the downside since Europe entered the market, although giving up the handle at the time of writing. Meanwhile, Brent May’20 underperforms its US counterpart with the prospect of the OPEC breakdown further weighing on the contract – Brent gapped lower to sub-40/bbl vs. Friday’s close of ~USD 45/bbl. Analysts at ING state that the underperformance doesn’t come as too much of a surprise “given the severity of the breakout across Europe, along with the action taken by governments to try to contain the virus”. The Dutch bank also suggests that the current weakness in oil prices is likely to persist through Q2 this year as the surge in supply and demand hit means that the markets will likely see a significant surplus. Elsewhere, spot gold (-1.8%) trades weaker as investors flee for cash holdings amid significant losses in riskier assets, traders also note that a decline below USD 1500/oz may induce a stop-chase, with the yellow metal’s 200DMA ~1500.25/oz and a Fib level at USD 1495.96/oz. On that front, spot silver (-10.7%) slid since the open and briefly fell south of USD 13/oz to levels last seen in 2009. Similarly, the flight to cash and a significant slump in Chinese IP figures have prompted copper prices to crash from ~USD 2.55/lb to sub USD 2.40/lb.

US Event Calendar

  • 8:30am: Empire Manufacturing, est. 4.9, prior 12.9
  • 4pm: Net Long- term TIC Flows, prior $85.6b
  • 4pm: Total Net TIC Flows, prior $78.2b

DB’s Jim Reid concludes the overnight wrap

What a weekend in terms of news-flow as more and more evidence mounted that the global economy is about to go into an unprecedented hibernation. Then just as I was going to bed last night the Fed cut rates 100bps to near zero and announced that it was going to increase their bond purchases by “at least” $700billion split $500bn Treasuries and $200bn MBS. The forward guidance is that they will keep them here until “confident that the economy has weathered recent events and is on track to achieve maximum employment and price stability”. The Fed also announced it was reducing reserve requirements for banks to zero as well as letting banks borrow at the discount window for up to 90 days. In a coordinated move with other central banks, the Fed lowered the rate on USD liquidity swap arrangement by 25 bps.

During the ensuing press conferences, Fed Chair Powell noted that the virus was having a profound impact on the U.S economy and that financial conditions have tightened significantly. He noted that the shutdown and the “illness will have a significant effect on the economic activity in the near term.” He also expects that inflation will be held down this year given the recent events. As far as emergency rate cuts go, this is the largest on record and probably only stopped from being more by the fact that we’re at the zero bound now. The Fed chair expects the second quarter to be weak, but that “after that it’s very hard to say how big the effects will be”, and so the FOMC forecasts will return next quarter. Powell continued to reiterate that forward guidance and asset purchases will be the toolkit going forward rather than negative rates. The chair also acknowledged that the central bank does not have tools to reach individuals and smaller businesses”, but then added that “(The committee) thinks fiscal response is critical”, and is happy to see those being considered.

The 100bps cut was almost all priced in so that was to be expected. The QE was more of a an immediate surprise. The reason we’ve maintained and extended our bearish view on credit is that we think the global economy screeching to a halt is more worrying than the Fed is comforting. 0% interest rates won’t make up for much of the massive loss of activity/income for companies and consumers.

Even with the surprise move by the Fed, futures on the S&P 500 are down -4.79% after hitting the lower circuit limit while those on the Dow (-4.56%) and Nasdaq (-4.55%) are also down. Because the S&P rose c.7% in the last 30 minutes of trading on Friday for no apparent reason its hard to disentangle the Fed impact from a reversal of this. Elsewhere yields on 10yr USTs are down -30.9bps to 0.655% while those on 30yrs are down -26.8bps to 1.268%. Asia equity bourses are also trading down (but for most not aggressively) with the Nikkei (-0.21%), Hang Seng (-2.60%), Shanghai Comp (-0.55%) and Kospi (-2.10%) falling. However the ASX is down nearly -10% which is around the largest fall since October 1987. As for fx, the Japanese yen is up +0.78% while the Swiss franc is up +0.25%. In commodities, brent crude oil prices are down -3.16% while gold is up +1.03%.

In other news, as we go to print, the BoJ have just met after bringing forward Thursday’s meeting. They have said that they will continue to buy more commercial paper and corporate bonds until end-September and have also introduced low-cost lending facility for companies affected by the virus. They’ve raised their annual ETF purchase target to JPY 12tn (vs. JPY 6tn previously) while the JREIT target was revised up to JPY 180bn. The bank guideline for ETF and JREIT purchases reiterated the prior language that “in principle,” the BOJ will buy 6t yen ETFs and 90b yen JREITs, though these amounts may rise or fall depending on market conditions.

Elsewhere New Zealand issued an overnight emergency cut of 75ps and promised to keep the rate that low for a year while on the liquidity side, the PBoC injected $14.3 billion into the financial system while leaving interest rates unchanged. The RBA also boosted cash injections and said it “stands ready” to purchase government bonds. Australia is also considering further fiscal easing.

Back to our credit view, on Friday we published a short note looking at a framework for where Credit trades in a recession. We think the normal boom to recession pricing is c.100-250bps for cash IG and c.350-1000bps for HY. We also talk about what might make this cycle better or worse than a “normal” recession. Given that US HY is now in the 730bp area, we still don’t feel that enough risk is priced in yet, especially when you consider the huge illiquidity issue that the market would face in normal times if clients became forced sellers. Given that these aren’t normal times with traders, sales and PMs seeing compromised working conditions, liquidity is likely to be far worse in this current episode. We’ve previously published that the next recession would likely be the third worst for spreads in history and behind only the Great Depression and the GFC due to the massive mismatch between the likely desired liquidity and what will be on offer. It’s probably time to back up that call. In fact we are going to put out a note today increasing our already bearish HY spread forecasts in US and Europe to around +1000bps from our previous target of just under +750bps (US) in light of the more draconian measures adopted by Western governments over the weekend. See Friday’s note here which will explain most of the reasons. We will publish more later which will also extend our spread widening view for IG.

There isn’t a lot of point going through all the weekend virus developments as I’m sure you are all watching the news but for a moment let’s step back and take in how remarkable the following announcements were. For example;

* Spain is now on lockdown (joining Italy) and will only allow people to leave their homes to buy essentials, for special circumstances or to work.
* France has closed all non-essential stores/shops and done the same for all restaurants and cafes. Travel across the country is being discouraged.
* Germany has closed it’s borders with France, Switzerland and Austria outside of goods and commuter traffic.
* All main European and US Ski resorts are now closed.
* The U.K. may tell all people over 70 to stay at home and isolate soon.
* Austria has banned gatherings of more than FIVE people. Sounds like my old band could still play in Vienna then. * In Italy I saw on the telly last night long queues for supermarkets but with 2 meter gaps between people in these queues. It was quite surreal.
* In micro terms SAS is idling 90% of all its staff and will cancel most flights from today.
* NYC joins many in the world in terms of shutting down schools. The U.K. and other parts of the US remain out on a limb in keeping them open for now.
* NYC and Los Angeles also said overnight that they will close nightclubs and entertainment venues while limiting restaurants and bars to takeout and delivery.

Assuming these aggressive measures carry on then surely over the next 10-14 days the number of new cases in Europe should slow dramatically. Clearly these stats will be complicated by some countries deliberately (or from lack of resources) not testing all potential victims but we should see the direction of travel. Whether these draconian measures are the correct ones or not will be debated for months or maybe years to come. It’s irrelevant for now as it’s happening, whether you agree with it or not. What it does mean, is that most Western governments have decided to take the maximum short term economic pain route in order to stop the spread. The problem with this is that it’s not clear when you can end this once you start it. Although the case numbers should soon slow, one would think that the minimum time until we slowly re-open economies would be a month’s time at the very earliest. That’s a lot of economic and market disruption to come. The U.K. has come under criticism for not being as aggressive as many countries at closing down schools etc. However in listening to the U.K. Chief Medical Officer he made the point that if they close too early then children might be forced to spend a lot more time with their grandparents as child carers. Given this group is more likely at risk then this could be counterproductive. He also said the danger is also that we get isolation fatigue if we shut down too early as it would have to go on for a long period. So whether this is right or wrong, it certainly has been thought through. However I suspect the U.K. will soon be pressurised to move in line with everyone else.

We also got China’s monthly economic data dump overnight and it highlighted an even deeper slump in economic activity than expected. YTD Feb industrial production recorded the largest decline since the series began in January 1997 at -13.5% yoy (vs. -3.0% yoy expected) while retail sales printed at -20.5% yoy (vs. -4.0% yoy est.), the largest decline since January 1998, and fixed asset investment dropped to -24.5% (vs. -2.0% yoy est.), the largest decline since January 1997. February unemployment rate also rose to a record 6.2% as the outbreak worsened in China.

In term of this week’s planned events (I suspect they’ll be a lot of unplanned ones) the Fed meeting on Wednesday was going to be the highlight but they have upstaged themselves by last night’s actions.

Elsewhere, the Eurogroup (euro area finance ministers) meets today with the EU counterpart —ECOFIN — meeting tomorrow. So these are crucial meetings to learn what the phrase “whatever is necessary” that has been used by Merkel, Scholz and European Commission President von der Leyen over the last few days means. For more on the German government interventions last week see our economists piece from Friday night here. Mark Wall’s team have previewed the two days of very important meetings in this note here. It is well worth a read as it outlines what they might do and what the size of the potential package might be relative to the GFC.

For all data in the week ahead best to see our day by day calendar at the end. It’s still too early for the three week market crisis to feed into much of the data but you’ll start to get the first signs, especially in some of the sentiment indicators.

This past week saw an even more volatile week than the last, with European and US Equity markets seeing truly once-in-a-generation sized moves. The S&P 500 saw its 5th worst daily loss since 1927 on Thursday when it was down -9.51% before rallying +9.29% on Friday – which was the 10th largest daily gain in the history of the index – as there seemed to be a clear response to the US government’s initial fiscal actions. Considering that with only 27 minutes before the close the index was only up +2.4% shows what a remarkable end to the week we saw.

In total, the index was still down -8.79% on the week though. Although this was less than 2 weeks ago, it was still the 24th worst week in the history of the index, with all of the other weeks taking place during the Great Depression, October 1987, the Dot Com Bubble, or the Financial Crisis. On Friday, The S&P 500 posted only its 5th daily gain in 19 sessions. Since its record high on Feb. 19, the index is now down just under 20% at -19.94% and entered “bear market” territory on Thursday for the first time since 2009. The large cap index has lost $5.7 trillion of market capitalization since those all-time highs.

10-year U.S. Treasury yield were up even as equities continued lower on the week as correlations started to breakdown. Yields rose just under +20bps over the week to finish at 0.960% (+15.6bps Friday, +19.8bps last week). 30y US treasuries were +24.2bps on the week (+8.9bps Friday). At one point last week, the entire US Yield curve fell under 1.0% for the first time in history. Oil had its worst week since 2008 – down -25.23% on week, up +1.90% Friday – with the commodity being hit from a demand shock as the global economy slows due to Covid-19, while simultaneously being hit by a supply shock as Saudi Arabia and Russia continue their price war on crude.

If anything it was more volatile in Europe, where many indices saw their worst day on record this past week on Thursday as the STOXX 600 fell -18.44% on the week (+1.43% on Friday) Much of the underperformance relative to the US last week was due to the very late mammoth US rally on Friday. Italy lagged with the FTSE MIB down -23.30% on the week (+7.12% Friday on the hope of fiscal stimulus and bouncing off the worst ever recorded day on Thursday), while BTP yield saw their worst day on record on Thursday (+58.5bps on week, 2.5bps Friday). 10yr bund yields finished the week at -0.544%, rising +19.7bps on Friday and +16.6bps over the week. Credit spreads were wider as well on both HY and IG – US HY was +167bps wider on the week (-11bps Friday), while IG was +80bps wider on the week (+7bps Friday). In Europe, HY was +189bps wider on the week (+5bps Friday), while IG was +46bps wider on the week (+1bps Friday). The VIX closed the week at 57.8, which is the highest closing level since the Financial Crisis. It spiked over 75 at the close on Thursday in the worst of the selloff. Gold sold off -8.60% on the week (down -2.9% Friday), as the risk off hedge did not seem to work with dollar rallying +2.9% around the same time (+1.3% Friday).

 

3A/ASIAN AFFAIRS

I)MONDAY MORNING/ SUNDAY NIGHT: 

SHANGHAI CLOSED DOWN 98.17 POINTS OR 3.40%  //Hang Sang CLOSED DOWN 969.34 POINTS OR 4.03%   /The Nikkei closed DOWN 429.08 POINTS OR 2.46%//Australia’s all ordinaires CLOSED DOWN 9.52%

/Chinese yuan (ONSHORE) closed DOWN  at 7.0109 /Oil UP TO 57.21 dollars per barrel for WTI and 64.13 for Brent. Stocks in Europe OPENED RED/ONSHORE YUAN CLOSED DOWN // LAST AT 7.0214 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 7.0109 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY CLOSE TO 7:1//TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED/CORONAVIRUS  : /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST USA DOLLAR/OFFSHORE YUAN TRADING WEAKER AGAINST THE DOLLAR /TRADE DEAL NOW DEAD..TRUMP  RAISED RATES TO 25%

 

 

3 a./NORTH KOREA/ SOUTH KOREA

South Korea

 

b) REPORT ON JAPAN

 

3 C CHINA AFFAIRS

CHINA/CORONAVIRUS

As expected a huge 79% crash in auto sales and now the big Chinese automakers are begging the government for a bailout

(zerohedge)

After 79% Sales Crash In February, China Automakers Beg Government For Bailout

We had been reporting China’s February auto sales numbers on a week by week basis, so Zero Hedge readers knew they were going to be ugly for the month. They just didn’t know how ugly.

Industry wide, sales fell 79% in February, marking the biggest ever monthly plunge on record, according to Reuters.

And the industry is starting to panic. Automakers are now asking the government for relief after the industry’s collapse, which occurred in the midst of an already-in-progress global recession for automakers. Specifically, they are asking for cuts on the purchase tax for smaller vehicles and support for sales in rural markets, in addition to the easing of emission requirements.

Sales for February fell to just 310,000 vehicles from a year earlier, marking the 20th straight month of declines.

Chen Shihua, a senior CAAM official said: “China’s auto sales for February returned to levels not seen since 2005.”

And the once silver lining of EV sales is no longer. New energy vehicles contracted for an 8th month in a row as the CAAM pleaded the government for more subsidies on NEVs.

Yale Zhang, head of Shanghai-based consultancy AutoForesight, said: “The government will consider these proposals but it is unlikely they will launch so many policies. Measures like cuts to the purchase tax, support for rural markets and easing purchase restrictions on new energy vehicles are reasonable and would have an immediate impact.”

Auto makers are also asking the CAAM for improved logistics and the support of a resumption of production in Hubei province, where the coronavirus outbreak began. In Hubei, production for China’s automakers had resumed to about 40% of normal output levels, according to a CAAM survey.

The CAAM predicts sales numbers will “definitely” rebound in March. A CAAM official said last month that sales are likely to plunge 10% for the first half of 2020. Containing the coronavirus outbreak is going to be key in whether or not the industry rebounds, and by how much.

And remember, as production comes back online in China, demand globally will likely be falling off a cliff as other major countries deal with their “Wuhan moments”.

end

4. EUROPEAN AFFAIRS

Spain/Coronavirus
As expected, Spain sees its tourism crash.  Tourism is a big part of their GDP
(zerohedge)

“A Tsunami Has Arrived” – Spanish Tourism Collapses

Anyone with the slightest bit of common sense has ditched their dream trip to Europe as Covid-19 steamrolls across the continent, with Italy, France, Spain, and Germany, so far experiencing the brunt of the virus outbreak.

As a result of mass quarantines and businesses’ shuttering their doors, Europe’s travel industry, accounting for 782 billion euros to GDP in 2018 and 14.4 million jobs, is on the verge of a deep correction.

In particular, we’re going to focus on Spain, where authorities have reported 2,277 confirmed cases, 55 deaths, and 183 recoveries. Spanish officials imposed limits on holding large public events to cut down on the transmission risk of the virus.

Oh boy what a shot@ohboywhatashot

Crowded supermarkets in (Spain) after the government announced new measures to limit the spread of the

The fear of the outbreak has led to a bust in the Spanish travel industry, as of Thursday, Reuters reports that occupancy rates at hotels have crashed.

CEHAT (Confederacion Espanola de Hoteles y Alojamientos Turisticos (Spain’s hotels and tourist accommodations federation)) Secretary-General Ramon Estalella told Reuters that many hotels have “no new bookings” as tourists stay away from the country during the virus crisis.

“A tsunami has arrived. A meteorite has fallen on us, and we have to see how we survive,” Estalella said.

He has requested the Spanish government to take quick action to protect the travel industry from a massive bankruptcy and job loss wave that could decimate hotels and or the industry as a whole.

More than 2.65 million jobs in Spain are reliant on tourism, accounting for 159 billion euros to GDP in Spain, or about 11.7% of GDP. The crisis is so bad at the moment for Spain’s tourism industry, on top of an existing economic downturn, that a full-blown recession could be nearing.

President Trump’s travel restrictions on 26 European countries, including Spain, to help combat the spread of the virus, for the next month, could further pressure tourism for the first half of the year.

Spain’s economy is coming to a crawl this week with mass gatherings banned, schools and universities canceled, and a reduction in business hours.

All soccer matches in the country have been suspended for two weeks after Real Madrid put its team in quarantine for virus infection fears.

The government’s virus prevention measures come as Spain’s Queen Letizia tested positive for Covid-19. The leader of Vox, a right-wing political party in the country, tested positive for the virus on Thursday. Both government officials are in quarantine.

Take note of how the virus outbreak is grinding Europe’s economy to a halt, especially triggering a bust in tourism and services. Community spreading in America is already underway, the same shutdowns in Europe are going to happen here.

end
EUROPE/CORONAVIRUS
European leaders acknowledge the scale of the crisis.  Here is an update on how the virus is taking countries within the EU
(GATESTONE)

Covid-19: European Leaders Finally Acknowledge Scale Of Crisis

Authored by Soeren Kern via The Gatestone Institute,

The Coronavirus Disease 2019 (COVID-19) has now reached more than 45 countries in Europe, where (as of March 12) more than 30,000 people have tested positive for the disease, according to a Gatestone Institute tally based on calculations from European health ministries.

The disease is spreading fast: more than 28,000 coronavirus cases (93% of all cases) in Europe were confirmed during just the first twelve days of March. The number of new cases has been doubling, on average, every 72 hours.

Italy is Europe’s worst-affected country, followed by Spain, France and Germany. Twelve other European countries have reported coronavirus cases in the triple digits: Switzerland, Norway, Sweden, Denmark, the Netherlands, the United Kingdom, Belgium, Austria, Greece, the Czech Republic, Finland and Iceland.

In Europe as a whole, more than 1,200 people — 4.0% of those confirmed as having been infected — have died from COVID-19.

The European Center for Disease Prevention and Control (ECDC), in a risk assessment, warned that the actual number of COVID-19 cases in Europe could be far higher due to under-detection, particularly among mild or asymptomatic cases that do not lead to a visit to the hospital.

In an interview with Britain’s Channel 4 news, Dr. Richard Hatchett, Chief Executive Officer of the Coalition for Epidemic Preparedness Innovations, a Norway-based international alliance for developing vaccines against infectious diseases, explained the long-term dangers of the COVID-19, not only for Europe, but globally:

The threat is very significant… There are many epidemiologists who talk about the potential of the virus in terms of attack rates globally that could be between 50% and 70% of the global population.

“It is important to recognize that the virus is here and that it has tremendous potential to be disruptive, to cause high rates of illness and even high rates of death….

“I don’t think we are dealing with the flu here… this is a virus that is now circulating in a population that has absolutely no immunity to it…. You might have an attack rate that is three times higher than seasonal flu with a mortality rate that is ten times higher.

“The most concerning thing about this virus is the combination of infectiousness and the ability to cause severe disease or death. We have not since 1918 — since the Spanish flu — seen a virus that combined those two qualities in the same way. We have seen very lethal viruses — Ebola’s mortality rate in some cases is greater than 80% — but they don’t have the infectiousness that this virus has. They don’t have the potential to explode and spread globally.

I think that what we are seeing is a virus that is many, many times more lethal than the flu, and a population that is completely vulnerable to it, and we are seeing its ability to explode. It has increased in some countries over the last two weeks by one thousand-fold and many countries are seeing ten-fold or one hundred-fold increases in cases. There is nothing to stop that expansion from continuing unless those societies move aggressively, engage their publics, implement multiple public health interventions, including introducing social distancing….

We need to modify our behavior. We need to start practicing that now. We have to modify our behavior in ways that reduces the risk of transmitting the virus…. One challenge that we face is that people who are young and are generally healthy won’t perceive personal risk and they will govern their behavior based on what they perceive their personal risk to be. I think we need to start thinking in terms of the social risk. If I have a cold and I go to work and shake hands with my older colleague who has a chronic medical condition, I could be responsible for that colleague’s death. We all need to think about our responsibility to each other as we govern our behavior. We can’t view the epidemic in terms of our personal risk, we need to act collectively in a cooperative manner….

“I don’t think it’s a crazy analogy to compare this to World War 2… I think this is an appropriate analogy and the mindset that people need to get into….

“We don’t see any way that a vaccine can be available much more rapidly than 12 to 18 months, and even it if were to be available in 12 and 18 months, that would literally be the world record for developing and delivering a vaccine. We would not have seven billion doses of that vaccine in 12 months.

This is a virus that is going to be with us for some time. There are many epidemiologists who believe that this virus is likely to become globally endemic and be with us in perpetuity…. I think this is a virus that we are going to be dealing with for years.

This is the most frightening disease that I have ever encountered in my career. That includes Ebola, MERS and SARS. It’s frightening because of the combination between infectiousness and a lethality that appears to be many-fold higher than flu.”

After months of complacency, European leaders are beginning to acknowledge the scale of the unfolding crisis.

In Germany, Europe’s most populous country, Chancellor Angela Merkel, in her first public comments on the coronavirus, warned that more than two-thirds of the population — 58 million people — could get infected. During a press conference on March 11, nearly three weeks after the crisis in Germany began, she admitted:

“The virus has arrived in Europe, it is here, and we must all understand that. As long as there is no immunity in the population, no vaccines and no therapy, then a high percentage of the population — experts say 60% to 70% — will become infected.”

Merkel said that her government’s top priority was to slow down the contagion to prevent a collapse of the German healthcare system. Nevertheless, Germany has not implemented social distancing measures such as those in other European countries, including Italy, Spain and France.

In Britain, a leaked government report estimated that in a worst-case scenario, up to 80% of the population — 53 million people — could become infected with the coronavirus, and that half a million Britons could die from COVID-19. A survey conducted by The Doctors’ Association UK, a trade association for British doctors, found that only 1% of doctors in the country believe that the National Health Service is prepared to deal with a major outbreak of coronavirus.

In Ireland, one of Europe’s smaller countries with only 4.8 million inhabitants, healthcare officials said that 40% of the population — 1.9 million people — will almost certainly become infected with the coronavirus. Most of those would become sick within a three-week concentrated burst, which would place “intense pressure” on the healthcare system. Those figures were effectively confirmed by Paul Reid, CEO of the Health Service Executive (HSE), which manages the delivery of all public health services in Ireland.

In Spain, where the number of confirmed cases of coronavirus has increased exponentially in recent days, hospitals are overwhelmed and the healthcare systems in the most affected regions are in danger of collapse. In Andalusia and the Basque Country, hundreds of doctors and nurses have been quarantined to prevent hospitals from becoming centers of infection.

In Madrid, the head of the regional government, Isabel Díaz Ayuso, said that medical professionals expected a significant increase in coronavirus cases this coming weekend and that the spread of the virus would peak over the next three weeks.

In France, President Emmanuel Macron said that the coronavirus epidemic was the country’s worst health crisis in a century and announced that schools throughout the country would close indefinitely beginning next week. “We are just at the beginning of this crisis,” Macron said. “In spite of all our efforts to break it, this virus is continuing to propagate and to accelerate.”

In Italy, more than 12,000 people are infected with coronavirus. On March 9, Prime Minister Giuseppe Conte ordered a nation-wide lockdown. The quarantine of Europe’s third-most populous country, with 60 million inhabitants, bans non-essential travel to, from and within Italy; prohibits all public events; and requires that people maintain a distance from each other of at least one meter (three feet). The restrictions were subsequently extended: all restaurants and bars, as well as all stores, except for grocery stores and pharmacies, have been ordered closed.

Dr. Daniele Macchini, who works at the Humanitas Gavazzeni hospital in Bergamo, ground zero of the coronavirus crisis in Italy, warned about the dangers of complacency:

“After thinking for a long time if and what to write about what is happening to us, I felt that the silence was not at all responsible. I will therefore try to convey to people more distant from our reality, what we are experiencing in Bergamo during these pandemic days from Covid-19.

“I myself looked with some amazement at the reorganization of the entire hospital in the previous week, when our current enemy was still in the shadows: the wards slowly ’emptied,’ the elective activities interrupted, the intensive therapies freed to create as many beds as possible. All this rapid transformation brought into the corridors of the hospital an atmosphere of surreal silence and emptiness that we still did not understand, waiting for a war that was yet to begin and that many (including me) were not so sure would ever come with such ferocity.

“Well, the situation is now nothing short of dramatic. No other words come to mind. The war has literally exploded, and the battles are uninterrupted day and night. One after the other, the unfortunate people come to the emergency room. What they have is much more than the complications of a flu. Let’s stop saying it’s a bad flu.

“Now, however, that need for beds in all its drama has arrived. One after another, the departments that had been emptied are filling up at an impressive rate. The display boards with the names of the sick, of different colors depending on the operating unit they belong to, are now all red and instead of the surgical operation there is the diagnosis, which is always the damn same: bilateral interstitial pneumonia. Now, tell me which flu virus causes such a rapid tragedy?

“An epidemiological disaster is taking place. There are no more surgeons, urologists, orthopedists, we are only doctors who suddenly have become part of a single team to face this tsunami that has overwhelmed us.”

On March 11, U.S. President Donald J. Trump announced a 30-day ban on continental Europeans traveling to the United States. “The European Union failed to take the same precautions and restrict travel from China and other hotspots,” Trump said. “As a result, a large number of new clusters in the United States were seeded by travelers from Europe.” The restrictions, which will go into effect at midnight on March 13, will not apply to the United Kingdom, and exemptions will be made for U.S. citizens. “This is the most aggressive and comprehensive effort to confront a foreign virus in modern history,” he said.

end

CORONAVIRUS/YOUNG PATIENTS

The myth that it will only attack older people is wrong. Now 50% of the ICU patients in Franc are under 60 years.  In the Netherlands: under 50 years

(zerohedge)

 

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

IRAN/IRAQ/USA

 

Another Iranian backed militia attack on a USA base wounding 3 troops.  And yet Iran is asking USA backed iMF for a 5 billion loan.?

(zerohedge)

Another Wave Of Rockets Slam Into Camp Taji, Wounding 3 US Troops

A US airbase just north of the Iraqi capital has come under more major rocket fire a mere days after an initial attack killed one British and two American soldiers. A US defense official has told Reuters that three American troops were wounded in the attack.

Iraqi security officials separately confirmed Saturday a barrage of some 33 rockets were fired on the base, also injuring multiple Iraqi national forces – some critically – in the early morning hours. And US coalition statements indicated at least 25 107mm rockets hit the base before 11 am, according to the AP.

Unusually this latest attack came during the daylight hours and also followed major US airstrikes Thursday night which targeted at least 5 Kataib Hezbollah locations across southern Iraq. It appears that Iraqi Shia militias are attempting to draw ‘red lines’ — and feel emboldened to respond to the earlier American airstrikes given growing Iraqi government anger at Washington.

 

Iraqi Army file image, via AFP/Getty Images

The Pentagon had immediately blamed the large Iran-backed militia for killing US troops in the initial Wednesday assault.

Many analysts and pundits fear this is the start of yet another tit-for-tat between the US and Iran and its proxies leading to significant military escalation, similar to the series of events which paved the way for the US killing by drone of IRGC Quds Force chief Qassem Soleimani on January 3rd. Since then, the two have been on a war footing, despite things cooling a bit of late as the region and the world grapples with the pressing threat of the coronavirus pandemic.

Interestingly, all of this is a source of soaring tensions between uneasy allies Baghdad and Washington, given Iraq’s government immediately condemned the Thursday Pentagon ‘retaliation’ attack on Kataib Hezbollah, which it said killed five Iraqi security force members and a civilian.

 

Air Force Staff Sgt. Marshal D. Robert and Army Spc. Juan Miguel Mendez Covarrubia. Source: Stars & Stripes/US Army

Meanwhile, top US forces general in the region, Marine Gen. Frank McKenzie, brushed Baghdad’s condemnation aside, essentially saying it was Iraqi forces’ fault for being there. But many officers in the Iraqi Army essentially see Khatib Hezbollah as a de facto extension of national forces.

“These locations that we struck are clear locations of terrorist bases,” McKenzie said Friday. When asked about Iraq’s fierce response, he said, “If Iraqi military forces are there, I would say it’s probably not a good idea to position yourself with Khatib Hezbollah in the wake of a strike that killed Americans and Coalition members.”

 

Via AFP

But assuming it is Iran-backed Iraqi militias behind this newest Saturday morning rocket volley on Camp Taji, it appears Khatib Hezbollah or its Shia allies in the Iraqi military didn’t get the message.

end

6.Global Issues

CORONAVIRUS UPDATE//MONDAY MORNING//world in lockdown

“Assume Everyone Is Infected”: US & Europe Wake Up To World In Lockdown As Death Toll Rises: Live Updates

Update (0735ET): European newswires are reporting that European Commission President Ursula von der Leyen and European Council President Charles Michel have agreed on measures to potentially close or tighten the EU border. Those measures will be released in the coming hours.

So Brussels is finally throwing in the towel…

*  *  *

Update (0730ET): US Surgeon General Jerry Adams said Monday that the country will likely need 6-8 weeks for the virus to run its course.

If Europeans have anybody to blame for the continent-wide spread of the novel coronavirus, the European Commission should be pretty high on that list. Since the beginning, Brussels has advised member states to leave their borders open, arguing that closures within the Schengen Area are not the answer.

Unfortunately, the absurdity of this open-borders-at-all-costs philosophy has finally been exposed as Spain and France joined Italy in imposing a national lockdown, and Germany, Austria and Denmark joined the Czech Republic, Hungary (which announced its border closure just minutes ago) and Poland – where populists hold outsize sway – in closing their borders. The Czech Republic has also joined in the mass quarantine movement, sealing off some towns entirely.

In a leaked statement on Monday, Brussels doubled-down on its stance, saying that border closures are not the answer as France mulls shutting its borders after Germany announced its border closures on Sunday.

Italy’s neighbors have mostly shut their borders with the literal ‘sick man of Europe’.

Meanwhile, in China, health officials suspiciously warned on Monday that ‘imported’ cases of the virus are creating ‘uncertainties’ as the outbreak comes to an end.

So get ready for Beijing to blame foreigners for re-starting the epidemic (giving it fodder to reject international calls for Beijing to acknowledge some accountability for the outbreak) as doctors suddenly “discover” another 100,000 ill.

In the UK, Boris Johnson’s senior advisor Dominic Cummings insisted that the government’s plan doesn’t rely on building so-called “herd immunity” to an outbreak. The UK is taking a different approach, leaving businesses open while advising any ill persons to immediately stay home in quarantine.

*  *  *

Those who spent their weekend on one last bar crawl may not have noticed that millions of people are waking up to a fundamentally different situation on Monday than they saw on Friday. In the US, more than one million students in NYC schools – including ~100,000 homeless students with no regular access to shelter or hot meals – are waking up to the first of many school-free days. Some of their parents are scrambling to find childcare, others, left at home because of the mass closures of restaurants, gyms (just in LA), concert venues, nightclubs, cafes, plus myriad other closures, are desperately hoping that government check lands soon.

In Italy, Italians are heading into a second week of nationwide lockdown, while citizens in Spain and France are facing these measures for the first time.

In Washington’s King County, Executive Director Dow Constantine said late Sunday night that “it’s time, right now, for people to assume that they and everyone they meet is infected.”

Meg Tirrell

@megtirrell

“It is time, right now, for people to assume that they and everyone they meet is infected.” King County, WA, as confirmed cases reach 420, bans gatherings of 50+, orders restaurants, bars, theaters, gyms, and similar venues to cease operations until March 31

View image on Twitter

In the Philippines, which acted early to bar visitors from China, infections have repeatedly doubled over the past week, leading the government on Sunday to prepare to lock down the entire island of Luzon, according to the Rappler.

President Duterte said earlier that his ultimate goal with the country’s virus-containment measures is to “save ourselves from ourselves”.

Rappler

@rapplerdotcom

BREAKING NEWS. The Philippine government is set to place the entire island of Luzon on total lockdown in a bid to contain the spread of the coronavirus disease. https://www.rappler.com/nation/254726-luzon-total-lockdown-battle-coronavirus-outbreak?utm_medium=Social&utm_source=Twitter#Echobox=1584351724 

Luzon to be placed on lockdown to battle coronavirus – Malacañang

The government orders over 57 million people in 8 regions to stay home after officials struggle to implement strict social distancing measures in Metro Manila

rappler.com

In some places, neighborhoods are banding together to coordinate child care…though in other communities, dangerous levels of hoarding continue.

BisphamGreen@BisphamGreen

My street are pulling together. Whatsapp group set up, everyone offering help. No-one asking for right now but that might change

In China, the government is expanding its crack down on foreign arrivals by threatening to “probe and punish” anyone who violates rules on mandatory 14-day quarantines for foreign travelers arriving in the country, especially “those who plan to lie about whether or not thy are infected,” according to a Bloomberg report.

The global outbreak reached a grim milestone on Sunday: the number of coronavirus cases confirmed outside China has now surpassed the mainland total. Last night, China’s NHC reported 16 new confirmed cases, extending their streak of near-zero infection figures into its second week. Though few ever trusted the Chinese data, there’s now little doubt that the outbreak that originated in the city of Wuhan is now mostly under control.

Then, in the early hours of Monday morning, Johns Hopkins University reported that the number of deaths outside mainland China had also surpassed the number of deaths (at least the number of officially disclosed deaths) in mainland China.

Nearby in Australia, the conservative government led by PM Scott Morrison is considering a second round of economic stimulus, Reuters reports, as Canberra accelerats efforts to contain the spread of the coronavirus that has now killed five people in the country.

The situation in Australia is especially concerning, because, as Harvard epidemiologist Dr. Eric Feigl-Ding reports:

Eric Feigl-Ding@DrEricDing

Why should we all care & deeply worry about New South Wales, Australia 🇦🇺 ‘s 171 cases? Because it is the MIDDLE OF SUMMER THERE!!! This virus will not be die out when summer comes to Northern Hemisphere. Forget that fantasy. We are stuck with it until vaccine arrives! https://twitter.com/newscomauhq/status/1239405782338351104 

View image on TwitterView image on Twitter

news.com.au

@newscomauHQ

#BREAKING: NSW Health Minister @BradHazzard says there has been additional 37 confirmed cases since yesterday. There are now 171 total cases in the state.https://www.news.com.au/lifestyle/health/health-problems/coronavirus-australia-live-coverage-death-toll-rises-to-five-as-covid19-cases-surge-government-urged-to-shut-schools/live-coverage/f55bf66e9f75436b8614a6ebbe59bd57 

Back in the US, after several governors on the east coast joined in the national emergency, closing schools etc., VP Pence and the rest of the White House coronavirus response team again promised to have testing on-line and paid for by the end of the week, with millions of tests and up to 2,000 labs across the country expected to come online this week, now that the CDC has revised its strict standards that allegedly surrounded the testing process with red tape. After Trump tested negative on Sunday, the media was quick to lash out at him again after he said that the virus is “something we have tremendous control of” during last night’s press conference.

During the press conference, Pence and the team promised to release federal guidelines on ‘social distancing’ some time on Monday.

Five governors have now closed bars and restaurants, including California, and mayors in Nashville and New Orleans announced restrictions in those cities, too, with more cities expected to join in the coming days. In Las Vegas, Wynn Resorts and MGM closed their casinos. Casinos in Massachusetts also closed over the weekend. At this point, more than 30 US states have closed schools, with many not set to reopen for at least two weeks, with schools in NYC closed until April 20.

Before we go, here are a few quick updates on the state of the epidemic around the world.

Canada:

Norbert Elekes@NorbertElekes

Coronavirus update, Canada:

– 89 new cases today
– 341 cases in total
– 13% hospitalized
– 51% women
– 74% are travelers
– 31% above age 60

The US:

Norbert Elekes@NorbertElekes

Coronavirus update, U.S.

– 823 new cases in last 24 hours
– 3,774 cases in total
– 12 recovered
– 69 deaths
– 49 states reporting cases

Norbert Elekes@NorbertElekes

Coronavirus cases, U.S.

Washington: 769
New York: 729
California: 371
Massachusetts: 164
Florida: 155
Colorado: 135
Georgia: 111
New Jersey: 108
Louisiana: 103
Illinois: 93
Texas: 77
Pennsylvania: 66
Virginia: 45
Michigan: 45
Tennessee: 39
Oregon: 39
Ohio: 37
Minnesota: 35

The Americas:

Norbert Elekes@NorbertElekes

Coronavirus update, Americas:

– USA: 823 new cases
– Canada: 89 new cases
– Brazil: 79 new cases
– Peru: 28 new cases
– Mexico: 17 new cases
– Venezuela: 15 new cases
– Chile: 14 new cases
– Argentina: 11 new cases
– Colombia: 11 new cases
– Ecuador: 9 new cases

Europe:

Norbert Elekes@NorbertElekes

Coronavirus update, Europe:

– Netherlands: 176 new cases
– Czechia: 104 new cases
– Greece: 103 new cases
– Sweden: 79 new cases
– Portugal: 76 new cases
– Estonia: 56 new cases
– Ireland: 41 new cases
– Slovenia: 38 new cases
– Denmark: 28 new cases
– Luxembourg: 26 new cases

Coronavirus update, Europe:

– Italy: 3,590 new cases
– Spain: 1,801 new cases
– Germany: 1,228 new cases
– France: 924 new cases
– Switzerland: 842 new cases
– UK: 251 new cases
– Austria: 205 new cases
– Belgium: 197 new cases
– Norway: 177 new cases

In Africa, more cases are beginning to crop up as South Africa, which reported its first case last week, begins the process of closing its borders with several neighboring states.

Brazil reports 79 new cases of coronavirus, 200 cases in total, with 136 cases in Sao Paulo alone. Offering another jarring stat, one twitter user pointed out that 50% of coronavirus patients in intensive care in the Netherlands, which has like many other European countries seen cases spike last week, are younger than 50. In Bavaria, the hardest-hit German state, the governor has also closed schools and bars. The government of Ireland has shut pubs across the country (just in time for St. Paddy’s Day).

On Monday, Iran reported 1,053 new cases of coronavirus and 129 new deaths, bringing its total case load to 14,991, and the ‘official’ death toll to 853.

And finally, we’d like to leave off with a bit of levity.

Gene Park BFG Edition

@GenePark

im annoyed that this isn’t some new ongoing series someone came up with 4 days ago https://twitter.com/davdchristmas/status/1239196410857340933 

CH𓂀IS☥MAS@davdchristmas

Day 4 with no sports:

Marble1 racing is intense!

Embedded video

end

We are basically in a 12 trillion dollar margin call as production has seized.  The Fed must supply this liquidity or else the globe’s finances cease.

(zerohedge/Sunday)

The World Is Hit With A $12 Trillion Dollar Margin Call

Earlier today Trump declared that Sunday would be a national day of prayer.

Donald J. Trump

@realDonaldTrump

TODAY IS A NATIONAL DAY OF PRAYER. GOD BLESS EVERYONE!

With Americans having far bigger concerns on their minds, we doubt many will have time for prayer today, although there is one person who certain could do with some divine assistance: Fed chair Jerome Powell.

And there is a specific reason for that… or rather 12 trillion reasons.

But first, let’s back up to a post we write back in October 2009 explaining how the Fed’s emergency response during the financial crisis – which included credit facilities backed by corporate bonds and even stocks, all the way to unlimited FX swap lines with foreign central banks – was first and foremost in response to a massive dollar margin call that resulted in the aftermath of the Lehman and AIG collapse as conventional cross-border funding pathways froze up, forcing the Fed to step in and flood the world with dollars to avoid a catastrophic surge in the dollar as the entire world scrambled to obtain the world’s reserve currency.

Back then the BIS published a paper titled “The US dollar shortage in global banking and the international policy response” which explained how then-Fed Chair Ben Bernanke in essence bailed out the entire developed world, which was facing an unprecedented dollar shortage crisis due to the sudden deflationary shockwave unleashed by the financial crisis, which also ground the global economy, and conventional dollar funding pathways to a halt while heightened counterparty risk after Lehman’s collapse and liquidity concerns compromised short-term interbank funding, resulting in a lock of shadow banking conduits and money market funds “breaking the buck.” In short: an unprecedented crisis as a result of a global dollar margin call. 

This is how the BIS quantified the peak dollar shortage at the heights of the financial crisis:

… European banks’ US dollar investments in nonbanks were subject to considerable funding risk at the onset of the crisis. The net US dollar book, aggregated across the major European banking systems, is portrayed in Figure 5 (bottom left panel), with the non-bank component tracked by the green line. By this measure, the major European banks’ US dollar funding gap had reached $1.0–1.2 trillion by mid-2007. Until the onset of the crisis, European banks had met this need by tapping the interbank market ($432 billion) and by borrowing from central banks ($386 billion), and used FX swaps ($315 billion) to convert (primarily) domestic currency funding into dollars. If we assume that these banks’ liabilities to money market funds (roughly $1 trillion, Baba et al (2009)) are also short-term liabilities, then the estimate of their US dollar funding gap in mid-2007 would be $2.0–2.2 trillion. Were all liabilities to non-banks treated as short-term funding, the upper-bound estimate would be $6.5 trillion (Figure 5, bottom right panel).

Had the Fed not stepped in with a barrage of liquidity-providing instruments and facilities, the rest of the world would have simply collapsed as the $6.5 trillion dollar funding gap closed in on itself, causing an indiscriminate sell off of all dollar denominated assets. It also triggered the first ever launch of virtually unlimited dollar swap lines between the Fed and all other central banks:

The severity of the US dollar shortage among banks outside the United States called for an international policy response. While European central banks adopted measures to alleviate banks’ funding pressures in their domestic currencies, they could not provide sufficient US dollar liquidity. Thus they entered into temporary reciprocal currency arrangements (swap lines) with the Federal Reserve in order to channel US dollars to banks in their respective jurisdictions (Figure 7). Swap lines with the ECB and the Swiss National Bank were announced as early as December 2007. Following the failure of Lehman Brothers in September 2008, however, the existing swap lines were doubled in size, and new lines were arranged with the Bank of Canada, the Bank of England and the Bank of Japan, bringing the swap lines total to $247 billion. As the funding disruptions spread to banks around the world, swap arrangements were extended across continents to central banks in Australia and New Zealand, Scandinavia, and several countries in Asia and Latin America, forming a global network (Figure 7). Various central banks also entered regional swap arrangements to distribute their respective currencies across borders.

The newly created swap lines which served as a “letter of credit” underwritten by the entity that prints the US currency…

… soared in usage in the early days of the financial crisis, and were critical to contain a far greater liquidation cascade.

Why do we bring all this ancient history up? For two reasons.

First, it may come as a shock to some but ever since the financial crisis nothing has been actually fixed, and instead the Fed stepped in at every market stress event to inject more liquidity, aiding the issuance of even more debt, and kicking the can while while helping mask the symptoms of the crisis, only made the underlying financial instability even more acute. Meanwhile conventional wisdom that the US banking system was rendered more stable now are dead wrong, with the public and countless financial professionals fooled by the nearly two trillion in excess reserves (we all saw what happened when this number dropped to a precarious “low” of “only” $1.3 trillion in September of 2019) injected by the Fed in recent years. All this liquidity upon liquidity has only made the system that much more reliant on the Fed’s constant bailouts and liquidity injections.

Ssecond,as the events of last week so ominously demonstrated, the dollar shortage is back with a vengeance, as confirmed by last week’s concurrent surge in both the Bloomberg Dollar index and the FRA/OIS spread, a closely followed indicator of interbank dollar funding availability.

Indeed, as of Friday, and following a rollout of various “bazooka” interventions by the Fed including a massive $5 trillion repo facility and the launch of QE5, as well as an emergency six POMO operations on Friday to unlock the freezing Treasury market which failed to boost risk sentiment, the FRA/OIS not only failed to respond but surged to the highest level since the financial crisis.

At the same time cross-currency basis swaps – especially for Japan – are screaming dollar shortage…

… which is not worse only thanks to the trillions in excess dollars already sloshing in the system as well as last week’s emergency liquidity injections which boosted the Fed’s balance sheet by over $200 billion in just a few days in the form of expanded repos and quantitative easing.

And yet – as the market’s response to the Fed’s bazooka announcement demonstrated – it does not appear to be enough.

Why?

Because, and going back to the original topic of a massive dollar margin call, there is now – in JPMorgan’s calculations – a global dollar short that has doubled since the financial crisis and was $12 trillion as of this momentsome 60% of US GDP.

So what can the Fed do? For one possible answer we go to Zoltan Pozsar who last week laid out precisely why the coronavirus pandemic (and subsequent oil crisis) would led to a historic run on the dollar (as he so aptly put it “the supply chains is a payment chain in reverse… and so an abrupt halt in production can quickly lead to missed payments elsewhere”), and concluded that to offset the dollar scramble, the Fed would need to “combine rate cuts with open liquidity lines that include a pledge to use the swap lines, an uncapped repo facility and QE if necessary.

So far the Fed has already launched stealth QE, which will likely transform into an official, full-blown QE5 this week when the FOMC meets, and all that’s missing are swap lines and an uncapped standing repo facility, both of which cross beyond the purely monetary realm and have political implications. Whether those are also announced today will depend on if the Fed will pursue another intermediate step first, in the form of a Commercial Paper facility, which Bank of America believes will be unveiled in just a few hours.

end

 

A good commentary from Michael Snyder…John Hopkins prof fears the “worst public health crisis since polio and he is right

(Michael Snyder)

“Don’t Believe The Numbers” – Johns Hopkins Prof Fears “Worst Public Health Crisis Since Polio”

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

The COVID-19 pandemic continues to explode all over the globe, and authorities are warning that it is going to continue to get worse.

The number of confirmed cases outside of China roughly tripled once again this week, and if this outbreak continues to escalate at this pace there will be more than a million confirmed cases in less than a month.  But as bad as the official numbers are, the truth is that there are a whole lot more people walking around out there that have caught the virus but have not been tested.  In fact, a medical professor at Johns Hopkins University named Marty Makary believes that there are “probably 25 to 50 people who have the virus for every one person who is confirmed”

 

Don’t believe the numbers when you see, even on our Johns Hopkins website, that 1,600 Americans have the virus,” he said.

“No, that means 1,600 got the test, tested positive. There are probably 25 to 50 people who have the virus for every one person who is confirmed.

He added:

“I think we have between 50,000 and half a million cases right now walking around in the United States.”

If he is correct, and considering how easily this virus spreads from person to person, it isn’t going to be too long before this virus is everywhere, as Makary concluded:

“…we’re about to experience the worst public health epidemic since polio”

Other health experts are also warning that the number of Americans that have become infected is already extremely high.  As I pointed out yesterday, Ohio Department of Health Director Amy Acton is convinced that the number of victims in her state is now above 100,000

Ohio health officials announced Thursday that the state has five known cases of the coronavirus, but one expert said that the number is likely much higher and estimated 100,000 undiagnosed cases.

Dr. Amy Acton, the director of the state’s health department, told reporters that the virus is “among us, but we can’t see it yet,” WBRB reported.

But of course what we have seen so far could just be the tip of the iceberg.

According to the New York Times, the CDC is projecting that up to 214 million Americans could eventually become infected…

Between 160 million and 214 million people in the United States could be infected over the course of the epidemic, according to one projection. That could last months or even over a year, with infections concentrated in shorter periods, staggered across time in different communities, experts said. As many as 200,000 to 1.7 million people could die.

Can you imagine how overwhelmed our healthcare system will be if that actually happens?

According to an analysis that was just conducted by USA Today, we could soon see 17 seriously ill coronavirus patients competing for each open hospital bed…

A USA TODAY analysis shows that if the nation sees a major spike, there could be almost six seriously ill patients for every existing hospital bed.

That analysis, based on data from the American Hospital Association, U.S. Census, CDC and World Health Organization, is conservative. For example, it assumes all 790,000 beds will be empty.

Since two thirds are not, the reality could be far worse: about 17 people competing for each open bed.

And we still have no idea how long this pandemic will last.

Many officials are hoping that it will be over in a matter of months, but what if lasts for three full years like the Spanish Flu pandemic did?

At this point, the entire western world is literally in the process of shutting down as fear of the coronavirus spreads like wildfire.  Many people are going to be deathly afraid to go out in public for the foreseeable future because this virus is so easy to catch.

It could be on the next surface that you touch, it could be on the next hand that you shake, and there is even the possibility that you could breathe it in during the next breath that you take.

Considering how many people our national leaders interact with on a daily basis, they are particularly vulnerable.  Canadian Prime Minister Justin Trudeau’s wife has already tested positive for the virus, and Trudeau himself has gone into voluntary self-quarantine.

Here in the United States, President Trump says that he will “most likely” get tested soon after being exposed to someone that had the virus.  The following comes from ABC News

He also said he “most likely” will get tested himself, although he said he had no symptoms. “I think I will be,” he said. “Fairly soon, we’re working on that, we’re working out a schedule,” he responded to a reporter’s question, saying not because of any exposure he might have had, “but because I think I will do it anyway.” He had been photographed last weekend standing next to a Brazilian official who tested positive.

In addition, we just learned that Ivanka Trump is staying home for now after meeting with an Australian official that has tested positive

Ivanka Trump self-isolated at home on Friday, not going into the White House, after she was photographed with Australian Home Affairs Minister Peter Dutton days before he tested positive for coronavirus.

The White House said Dutton was ‘asymptomatic’ during his interaction with the first daughter and Ivanka Trump, who serves as an adviser to President Donald Trump, is showing no symptoms, doesn’t need to self-quarantine and stayed home out of an abundance of caution.

Things are really starting to get crazy out there.

When COVID-19 originally starting sweeping across China, most Americans weren’t really too concerned about it, but now a brand new survey has found that about two-thirds of all Americans are worried about catching the virus…

Two-thirds of Americans are concerned that they or someone they know will be infected with the novel coronavirus, but in a country with a growing partisan divide, political tribalism is having a large impact when it comes to anxiety over the disease, according to a new ABC News/Ipsos poll released Friday.

Although unease over the coronavirus is high, it also strongly breaks along partisan lines. Among Democrats, 83% are concerned about getting coronavirus, including 47% who are very concerned, and among Republicans, 56% are concerned, including only 15% who are very concerned. Only 17% of Democrats are not concerned while a larger 44% of Republicans are not concerned.

Now that President Trump has officially declared a state of national emergency, hopefully that partisan divide will start to diminish.

This virus should not be treated like a political issue.  This is the biggest public health crisis of our time, and we all need to be taking it very seriously.

Of course some Americans are responding to this pandemic by completely “freaking out”

A panic-buying fever swept through the Big Apple Thursday, as mobs of freaked-out New Yorkers frantically scoured store shelves for any remaining supplies amid spreading coronavirus fears.

“We’re freaking out about it,” Monica Gang, 27, said as she braved the crowds at Trader Joe’s in Manhattan. “We came in here looking for rice, and there is no rice left. Rice crumbs are the only thing left. We don’t even know what to stock up on.”

But so far there are only about 2,000 confirmed cases in the U.S. and less than 100 people have died.

If this virus is causing this much fear now, what will our society look like if thousands (or even millions) of people start dying?

Let us continue to hope that this pandemic will eventually start to subside, but so far it has just continued to escalate week after week.

If something is not done to dramatically slow this virus down in the United States, soon the level of fear will be absolutely unprecedented.

end

 

Seems that the sex trade has blown a gasket: sex worker income crashes

(zerohedge)

Covid-19 Pandemic To Crash Sex Worker Income

The world has already transitioned into panic about Covid-19. Widespread social, political, and economic disruptions have developed. Hard-hit countries, as we noted last week, have responded with a similar blueprint of shutting down their economies for virus containment purposes.

Social distancing has been one of the most widely enforced policies by governments, imposed on their citizens to mitigate the spread of the highly contagious disease. As a result, sex workers in many countries have seen their incomes crash as clients abide by the new public health policies, reported Vice News.

Let’s first start with defining social distancing. It’s a public health practice that aims to reduce disease transmission, including canceling large public gatherings, closing public spaces, working from home, and avoiding other people. The purpose is to slow down the outbreak to reduce the rate of infections and to reduce overwhelming the health care system.

Sex workers, many of which depend on the intimate physical interaction of their clients to get paid, are warning that social distancing could leave them penniless in the near term:

 

“A lot of sex workers are freaking out right now,” said Andrea Werhun, 30, a stripper based in Toronto.

Multiple sex workers told VICE their clientele volumes at clubs had seen a notable drop since social distancing policies have been implemented across North America.

“I feel like my career as a dancer is in jeopardy as it becomes increasingly less viable to hang out in crowds, which is kind of what I do every Friday and Saturday night in order to make money,” Werhun said.

Werhun said businessmen are a considerable part of her client book. Still, since corporations have told employees to work remotely and restrict travel – this has led to the decline in her business. She said strippers don’t have the luxury of a salary or sick days:

“It’s a big, big blow,” she said. “Locals and regulars are keeping sex workers afloat right now.”

Werhun has thought about diversifying to live streaming performances at home if a nationwide lockdown was seen.

She has yet to screen clients who could be carriers of the disease. Community spreading has already taken place in major metro areas in North America; the true extent of the spread is still unknown as test kits lack.

 

Americas Covid-19 Virus Map 

Amanda Winters, 27, a stripper based in Miami, told VICE she started stripping to pay off student loans, and now she’s struggling to make ends meet as clients avoid clubs out of fear, they might contract the virus.

“I am getting more concerned about my financial situation,” Winters said. “On a stable schedule, I often would have two to four good clients a night…the past week—going on two now—I have had one full client.”

Winters said if the business at the Miami club remains low – she might be forced to live stream at home.

Taylor Stevens, 29, a diversified stripper bouncing between Toronto and Las Vegas, has live stream shows that are doing well. She said in recent weeks, traffic volume from Italy was off the charts.

 

Taylor Stevens

Toronto dominatrix Lady Pim told Vice she’s preparing for a Covid-19 downturn and has diversified her sex work.

“It’s kind of looking like parts of Canada could go into a time where we aren’t going to be able to leave our houses—then, your livelihood might be threatened, like, I’m not on salary, I don’t have sick days,” said Lady Pim.

“My sex work is diversified. I will still make a portion of my income doing it from home with Skype sessions, texting dominations, and phone call dominations, so a quarantine wouldn’t lead to a complete loss in income,” she said.

Lady Pim said quarantines would drive people to pay for online sex:

Lady Pim@TheLadyPim1

It’s severe up in here.

View image on Twitter

“If we’re in lockdown—just by ourselves, don’t have a partner, and don’t have any sex or kink outlets—then I can 100 percent see people turning around to do a Skype session or phone session.”

Smart strippers are now diversifying their sex work before a “coronavirus winter” leads to mass quarantines and an economic crash.

end
CRUISE SHIP/BRAEMER/CORONAVIRUS
Another cruise ship, the British owned Braemer is the latest ship that is not allowed to dock anywhere after 5 passengers and creew test positive
(zerohedge)

Another Cruise Ship Is Stranded At Sea As 5 Passengers & Crew Test Positive

After being denied entry to a port in San Juan and several other Caribbean ports, the cruise ship MS Braemer is the latest cruise ship to be dangerously stranded at sea after at least five cases were confirmed on board, and another 40 passengers and crew have been quarantined in the hold after exhibiting flu-like symptoms.

Puerto Rico denied the ship entry yesterday after a rumor about another ship allowing infected passengers to disembark in San Juan sparked a public uproar, leading the governor to ban all cruise ships from docking. The transatlantic cruise ship, which is carrying some 600 passengers, is frantically searching for somewhere to dock after it was refused entry at several Caribbean ports.

The vessel, which is carrying 682 passengers and 381 crew members, arrived in the Bahamas on Saturday. The ship was prevented from docking, but was given permission to drop anchor southwest of Freeport, according to CNN.

In a statement, British cruise company Fred Olsen Cruise Lines said on Sunday that “no other Caribbean ports were willing to accept the ship because of local sensitivities towards COVID-19 coronavirus.”

Presently, the Braemar is anchored about 25 miles offshore from the Bahamas waiting for clearance from the local government to bring aboard vital food, fuel and medications and two doctors and two nurses who are preparing to assist the cruise’s onboard medical team.

“No other Caribbean ports were willing to accept the ship because of local sensitivities towards COVID-19 coronavirus,” the company said in a statement. The British government was engaged in a diplomatic effort to find a solution to the drama.

A spokeswoman for the cruise line told CNN that “all options on where to go” were being considered, including returning to the cruise’s starting point in Southampton, back in the UK.

“We are exploring a number of opportunities and working extremely hard to find a resolution,” she said. “It is an option to do a transatlantic crossing but we need to weigh that up against other options.”

“The key thing for us is to get guests home as quickly and as safely as possible.”

Most of the passengers aboard the ship are British, but the group also includes Canadian, Australian, Belgian, Colombian, Irish, Italian, Japanese, Dutch, New Zealand, Norwegian and Swedish citizens.

Last Monday, March 9, the company reported that two people who had been on the Braemar were diagnosed with the coronavirus after returning home. Six people reporting flu-like symptoms on the ship were tested, and five cases were confirmed on Wednesday, four crew and one passenger, with another testing inconclusive (it’s unclear how these tests were conducted or what kinds of tests are being used).

The ship was refused permission to dock at Curaçao on Tuesday, or Barbados on Thursday and changed course to the Bahamas, the ship’s flag state, with the captain hoping to allow passengers to disembark there.

Before the ship arrived in the Caribbean, there were no confirmed cases in the area. The first cases weren’t confirmed until two passengers who had disembarked tested positive back in the UK.

The cruise line was unable to drop passengers on its Caribbean cruise in La Romana in the Dominican Republic on February 27 after a number of influenza-like cases on board were reported.

Instead, it made an unscheduled stop in St. Maarten on March 2 to allow passengers to disembark and take the cruise’s charter flights back to the UK. New passengers boarded and the vessel set sail for Jamaica as it continued to the Western Caribbean and Central America.

It was due to continue to Costa Rica, Panama, Colombia, Curacao, and reach Barbados on March 12.

The captain told passengers in an announcement that he was in talks with local authorities and asked passengers to “bear with me in this incredibly frustrating time, where rumor is plentiful and facts are in short supply.”

But the Bahamas has promised nothing beyond humanitarian assistance.

It’s just the latest nightmare at sea as cruise line stocks get hammered.

END

NEW ZEALAND/

 

NEW ZEALAND follows Canada in cutting rates by 75% to a record low of .25%.  They warn that QE is coming
(zerohedge)

New Zealand Unexpectedly Slashes Rates by 75bps To Record Low 0.25%; Warns Kiwi QE Coming

Following in the footsteps of the Bank of Canada which on Friday was the latest bank to announce an “unexpected” rate cut, following a barrage of central bank easing on Friday morning, moments ago New Zealand became the latest bank to join the “emergency” rate cut fray when the RBNZ announced an unexpected, whopping 75bps rate cut bringing the policy rate to just 0.25%, the lowest on record.

Dipping into armageddon calendar guidance, in its statement, the RBNZ said the rate will remain at this level for at least the next 12 months, suggesting it may well go lower.

The central bank also said the negative economic implications of the COVID-19 virus continue to rise, warranting further monetary stimulus, noting that “since the outbreak of the virus, global trade, travel, and business and consumer spending have been curtailed significantly. Increasingly, governments internationally have imposed a variety of restraints on people movement within and across national borders in order to mitigate the virus transmission.”

 

And since “financial market pricing has responded to these events with declining global equity prices and increased interest rate spreads on traditionally riskier asset classes”, the “negative impact on the New Zealand economy is, and will continue to be, significant. Demand for New Zealand’s goods and services will be constrained, as will domestic production. Spending and investment will be subdued for an extended period while the responses to the COVID-19 virus evolve.”

Of course, that’s the same identical script followed by every major central banks which has been quick to blame the coming economic Armageddon on the viral pandemic.

And since the rate cut will do nothing to stabilize the economy, which is crippled as a result of the pandemic, the Monetary Policy Committee also “agreed that should further stimulus be required, a Large Scale Asset Purchase program of New Zealand government bonds would be preferable to further OCR reductions.”

Translation: Kiwi QE coming (say that fast 5 times), and the currency has reacted appropriately, with the NZD plunging as low as 0.5944 after closing 0.6134 on Friday, the lowest level since May 2009.

END

Michael Every

Rabobank: “Markets Must Now Accept: This Is War”

Submitted by Michael Every of Rabobank

We can ill afford another Klendathu

Markets must now accept: this is war.

How else does one react to the slew of international borders being closed; to the slew of school and businesses within said borders being closed; to reports that elderly people may to self-isolate for months in the UK; that the army may be needed to ensure we get food; that companies are being co-opted by governments to fight the virus as now required (“Build ventilators!” “Make virus tests free!”); that there is talk of supply-chains and virus experts attempting to be poached by the US to work solely for them; and, contra-wise, for key virus-related goods being on-shored or even nationalised, even in Germany?

How else does one react to the scale of staggering scale and breadth of uncosted fiscal packages being rolled out, even in the US (though this has an end-year sunset clause – if you want to believe that). Believe me, those fiscal bills are going to get bigger and bigger. Governments are going to have to support households, the self-employed AND businesses large and small through this all, or we face a domino-style economic collapse. Many are saying they will, or suggesting they will, even the EU’s somnambulant Khrushchev, Angel Merkel.

And what else but war, or utter calamity, would see the Fed not able to wait even a further couple of days to deliver its latest 100bp bazooka cut? (We are now at the zero lower bound again, as our Fed Watcher Philip Marey has been saying all along we would be in 2020.) What else could see the Fed offer up another USD700bn in QE, which on top of the recent liquidity pledges made now mean that USD5.5 trillion is available, if needed (as well as letting banks borrow from the discount window for 90 days and slashing reserve requirement ratios to zero!)? That is genuinely the kind of cash a war usually destroys. Even the smaller central banks are at it: the RBNZ has just slashed rates to 0.25%, once again showing itself more nimble than the RBA (NZD dipped sub-60 for a moment). Indeed, it would seem that with a few exceptions, we are all going to be at the zero lower bound imminently.

Amazingly, China might be one of those exceptions because of the deep debt-and-inflation-and-fear-of-a-CNY-collapse hole that they are already stuck in. Yes, the PBOC has cut its Reserve Requirement Ratio again – but that looks small beer now, especially when retail sales for January AND February, hence flattering the data upwards a lot, was -20.5% y/y (bless those Bloomberg survey respondents whose median guess was -4%!), industrial production was -13.5%, fixed asset investment was -24.5%, and even unemployment was up to 6.2%: who would ever have predicted that China would face problems shovelling in enough liquidity, and perhaps even enough fiscal stimulus, and have a higher cost of capital than the rest of the world?

Yet that certainly doesn’t mean CNY will in any way be pushing USD aside, even if so: quite the opposite. Indeed, alongside this barrage of latest virus-fighting measures we continue to see signs of enormous stress in the markets. Most obviously: S&P futures are limit down following the Fed move, which is hardly a ringing endorsement; while 30-year US Treasuries are back over 1% at 1.26%, vs. just 0.27% for the 2-year, the 10-year is down to 0.65% again, a 31.4bp move today that does not suggest imminent reflation on the back of all this fiscal and monetary fire-power; the superstructure of the global credit markets continues to groan worryingly; FRA-OIS spreads are not where one would want them to be; and cross-currency basis swaps continue to point to a demand for USD. Need I add, the dash for dollars and for cash are again what one would expect to see during a war?

In short, the big policy guns have now all been rolled out and fired. Short of open helicopter money entering playing The Flight of the Valkyries over loudspeaker, there is little left to do already. (“I love the smell of MMT in the morning! Smells like victory!”) And those helicopters are surely coming too if one reads the latest secret UK Public Heath England report obtained by the media, which says that this crisis will not be over in Q2, or even H2. Rather, it is expected to last until Spring 2021, see 80% of the population infected, 7.9m hospitalised, and anywhere from 318,660 to 531,100 deaths – assuming the health service is not over-run and the mortality rate hence stays around 1% max.

So we have an array of monetary and fiscal weapons. But these are likely to face the same fate as 1997’s Starship Troopers did in their first battle with the bugs at Klendathu if they do not understand that nature, not the business cycle, is the most dangerous opponent. (Spoiler: the bugs win big over the arrogant humans.)

Even the jaw-dropping concept of the central banks and governments making everyone whole until this crisis passes, with all the equally mind-bending socio-economic and socio-political implications, is not the real battle. The real battle is the virus. Even helicopter money would just be palliative to keep can-kicking until we can kick the virus.

Further, in a real war markets are right to sell-off. Unlike our recent, comfortable experiences of conflict, fought by people we never meet socially in places we never want to go, the long-run history of war is of blood and tears. Wars destroy economies. They smash currencies. They topple regimes. They remake demography. They shift borders. They rewrite social contracts. They even change national identity and psychology.

If this is a true global epidemic that lasts until we get a vaccine in 18 months (and not due to the “herd immunity” that the UK seems to be chasing away from the rest of the herd), then the cost of fighting it is going to be high for everyone. A whole generation, perhaps two, of market ‘teenage-scribblers’ are unaware what this is really likely to mean: there are still voices out there suggesting this will all be over in weeks and a V-shape recovery will return us to normal: public health officials strongly disagree. Who knows best?

Yes, in the long run one wants to back humanity – science has a great track record when applied during war: the question is how much is lost and destroyed before then. Moreover the alternative logical end-point, no working vaccine and no herd immunity, as with flu, is that we will all have to accept that once we reach old age we probably won’t live that long. Surely no takers there.

However, for now please prepare yourselves carefully – and in markets terms that means ignore Steven Mnuchin and his “I see no recession” call: ‘We can ill afford another Klendathu’.

end

Airlines seek a 50 billion dollar grant/loans amid the Covid 19 chaos
(zerohedge)

Airlines Seek $50 Billion In Government Aid Amid Covid-19 Chaos

With the global airline industry crashed, US airlines are seeking upwards of $50 billion in government aid, according to The Wall Street Journal sources.

The assistance program could include “government-backed loans, cash grants or other measures including relief from taxes and fees.”

Over the weekend, Treasury Secretary Steven Mnuchin said the Trump administration is focused on providing relief for airlines, hotels, cruise ships, and other industries that have been heavily impacted by the virus.

 

“This is a unique circumstance,” Mnuchin was quoted by Bloomberg at a Saturday press conference at the White House.

“There’s no question, because of the things that we’re requesting to do, there are parts of the economy shutting down or slowing down dramatically.”

The global airline industry has plunged into chaos as governments impose flight restrictions across the world. This has resulted in a massive demand shock leaving airliners with absolutely no bookings. Many US carriers have had to slash international flights, with new risks emerging of domestic flights being grounded in the weeks ahead.

Henry Harteveldt, a travel industry analyst in San Francisco, tweeted on Sunday evening that a “Growing number of sources within #airlines & DC telling me the WH giving serious consideration to grounding all passenger flights for 14-30 days (cargo would be exempted).”

Henry Harteveldt@hharteveldt

Growing number of sources within & DC telling me the WH giving serious consideration to grounding all passenger flights for 14-30 days (cargo would be exempted).

Part of me hopes it is not true, the other part understands why it may need to happen.

Ugh.

297 people are talking about this

The worst-case scenario could play out for US airliners, who have already been suffering from international flight cancellations, could soon see domestic flights grounded, which is all in an attempt to flatten the curve and slowdown infections. And maybe it’s the proposed $50 billion in aid that would allow airliners to weather a shutdown.

7. OIL ISSUES

The energy downgrade begins and expect a cascade of fallen angels

(zerohedge)

The Energy Downgrade Avalanche Begins: Exxon Loses AA+ Rating

For the past 9 years ever since the downgrade of the US government by S&P from AAA to AA+, American energy giant Exxon, which back in 2007 had a market cap of over $500 billion only to see that cut by two thirds to $150BN today (half of where it was at the start of the year) , had the same Standard and Poor’s credit rating as the US government. That period of perplexing parity ended just after 1pm on Monday, when S&P, confirming it would move quickly on rating downgrades this time following a near record plunge in the price of oil last week, downgraded Exxon from AA+ to AA as Exxon’s “Lower Oil Price Assumption Weakens Cash Flow/Leverage Metrics”; and since the outlook is negative, it means more downgrades are coming.

Highlights from the downgrade below:

  • U.S.-based integrated oil company Exxon Mobil Corp.’s cash flow/leverage measures fell well below S&P’s expectations for the rating in 2019, and with lower oil and natural gas prices, low refining margins and weak chemicals demand anticipated over the next two years, the rating agency expects measures to remain weak without a significant change in the company’s financial plans.
  • S&P revised its estimates to reflect the recent reduction in our crude oil and natural gas price deck assumptions.
  • As a result, S&P is lowering its issuer credit rating and unsecured debt ratings on ExxonMobil to ‘AA’ from ‘AA+’.
  • The negative outlook reflects the potential for a further downgrade if the company does not take adequate steps to improve cash flows and leverage over the next 12 to 24 months, in order to bring funds from operations (FFO)/debt closer to 60% and debt to EBITDA to about 1.5x for a sustained period.

The full note is below:

Hit by moderating crude oil and natural gas prices and an increase in capital spending, and with downstream and chemicals margins dropping to a five-year low, ExxonMobil’s cash flow leverage weakened significantly in 2019 with FFO/debt falling below 45% from over 60% in 2018, and debt to EBITDA increasing to 1.8x from 1.2x. In addition, the company’s discretionary cash flow deficit came in at about $10 billion, leading to an increase in debt levels. Based on our revised oil and natural gas price deck assumptions and our outlook for continued weakness in the refining and chemicals sectors, we now expect cash flow leverage to remain weaker than our expectations for the ‘AA+’ rating over the next two to three years.

The negative outlook reflects S&P Global Ratings’ view that Exxon Mobil Corp.’s current financial leverage is weak for the rating, as well as the potential for a downgrade if credit measures do not improve over the next 12 to 24 months. We project FFO to debt to be in the 45% to 50% range and debt to EBITDA of about 1.7x in 2020 and 2021, as oil production increases and refining margins increase due to improved reliability relative to 2019. Our estimates assume the company exercises prudent financial policies in the near term including tempering capital spending and limiting share repurchases in 2020, and that it takes additional steps to improve leverage over the next two years.

We could lower ratings if we no longer expected leverage to improve such that FFO/debt approached 60% and debt/EBITDA approached 1.5x for a sustained period. This would most likely occur if the company did not adjust capital spending in light of lower commodity prices, failed to improve capital efficiency or refining and chemicals margins, did not execute on additional asset sales, or continued to return cash to shareholders beyond internally generated cash flow.

We could consider a revision of the outlook to stable if the company were able to bring FFO/debt back closer to 60% and debt/EBITDA to around 1.5x for a sustained period, achieving these levels even at our long-term West Texas Intermediate (WTI) price deck assumption of $50 per barrel (bbl). This would most likely occur if the company were able to boost operating efficiency, improve refining and chemicals margins, complete more asset sales than we are currently projecting, or reduce shareholder distributions.

And with Exxon down, we now await as some $140 Billion in BBB rated “investment grade” energy debt is cut to junk…

.. finally starting the fallen angel avalanche which we have been warning about since 2017.

8 EMERGING MARKET ISSUES

 

 

 

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

Euro/USA 1.1166 UP .0064 REACTING TO MERKEL’S FAILED COALITION/ REACTING TO +GERMAN ELECTION WHERE ALT RIGHT PARTY ENTERS THE BUNDESTAG/ huge Deutsche bank problems ///ITALIAN CHAOS//CORONAVIRUS /AND NOW ECB TAPERING BOND PURCHASES/JAPAN TAPERING BOND PURCHASES /USA RISING INTEREST RATES /FLOODING/EUROPE BOURSES /RED

 

 

USA/JAPAN YEN 105.97 DOWN 0.187 (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 1.2282   UP   0.0027  (Brexit March 29/ 2019/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED/

 

USA/CAN 1.3916 UP .0116 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 ROSE BY 64 basis points, trading now ABOVE the important 1.08 level RISING to 1.1166 Last night Shanghai COMPOSITE CLOSED DOWN 98.17 POINTS OR 3.40% 

 

//Hang Sang CLOSED DOWN 969.34 POINTS OR 4.03%

/AUSTRALIA CLOSED DOWN 9,52%// EUROPEAN BOURSES ALL RED

 

Trading from Europe and Asia

EUROPEAN BOURSES ALL RED 

 

 

2/ CHINESE BOURSES / :Hang Sang CLOSED DOWN 969.34 POINTS OR 4.03%

 

 

/SHANGHAI CLOSED DOWN 98.17 POINTS OR 3.40%

 

Australia BOURSE CLOSED DOWN. 42% 

 

 

Nikkei (Japan) CLOSED DOWN 429.08  POINTS OR 2.46%

 

 

 

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1471.60

silver:$12.41-

Early MONDAY morning USA 10 year bond yield: 0.77% !!! DOWN 21 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 1.41 DOWN 13  IN BASIS POINTS from FRIDAY night.

USA dollar index early MONDAY morning: 98.02 DOWN 73 CENT(S) from  FRIDAY’s close.

This ends early morning numbers MONDAY MORNING

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And now your closing MONDAY NUMBERS \1: 00 PM

Portuguese 10 year bond yield: 1.04% UP 22 in basis point(s) yield from YESTERDAY/

JAPANESE BOND YIELD: +.01%  UP 2   BASIS POINTS from YESTERDAY/JAPAN losing control of its yield curve/56

SPANISH 10 YR BOND YIELD: 0.83%//UP 21 in basis point yield from yesterday.

ITALIAN 10 YR BOND YIELD:2.09 UP 31 points in basis points yield from yesterday./

 

 

the Italian 10 yr bond yield is trading 126 points higher than Spai

 

GERMAN 10 YR BOND YIELD: RISES TO –.48% IN BASIS POINTS ON THE DAY//

THE IMPORTANT SPREAD BETWEEN ITALIAN 10 YR BOND AND GERMAN 10 YEAR BOND IS 2.57% 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 1.1126  UP     .0024 or 24 basis points

USA/Japan: 106.43 DOWN 1.399 OR YEN UP 1.40  basis points/

Great Britain/USA 1.2324 UP .0069 POUND UP 69  BASIS POINTS)

Canadian dollar DOWN 132 basis points to 1.3

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

The USA/Yuan,CNY: AT 6.9938    ON SHORE  (UP)..GETTING DANGEROUS

THE USA/YUAN OFFSHORE:  6.9962  (YUAN UP)..GETTING REALLY DANGEROUS

TURKISH LIRA:  6.4128 EXTREMELY DANGEROUS LEVEL/DEATH WISH.

the 10 yr Japanese bond yield closed at +.01%

 

Your closing 10 yr US bond yield DOWN 15 IN basis points from FRIDAY at 0.84 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 1.44 DOWN 11 in basis points on the day

Your closing USA dollar index, 98.25 DOWN 50  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 183.49  6.13%

German Dax :  CLOSED DOWN 424.20 POINTS OR 4.59%

 

Paris Cac CLOSED DOWN 243.62 POINTS 5.62%

Spain IBEX CLOSED DOWN 548.40 POINTS or 8.27%

Italian MIB: CLOSED DOWN 875.24 POINTS OR 5.49%

 

 

 

 

 

WTI Oil price; 30.96 12:00  PM  EST

Brent Oil: 30.96 12:00 EST

USA /RUSSIAN /   RUBLE FALLS:    73.79  THE CROSS HIGHER BY 1.15 RUBLES/DOLLAR (RUBLE LOWER BY 115 BASIS PTS)

 

TODAY THE GERMAN YIELD RISES  TO –.48 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 :  28.63//

 

 

BRENT :  29.72

USA 10 YR BOND YIELD: … 0.73..down 25 basis points…

 

 

 

USA 30 YR BOND YIELD: 1.30..down 25 basis points..

 

 

 

 

 

EURO/USA 1.1169 ( UP 67   BASIS POINTS)

USA/JAPANESE YEN:105.97 DOWN 1.860 (YEN UP 186 BASIS POINTS/..

 

 

USA DOLLAR INDEX: 98.06 DOWN 69 cent(s)/

The British pound at 4 pm   Britain Pound/USA:1.2239 DOWN 16  POINTS

 

the Turkish lira close: 6.4356..DEATH WISH

 

 

the Russian rouble 74.66   DOWN 2.03 Roubles against the uSA dollar.( DOWN 203 BASIS POINTS)

Canadian dollar:  1.4002 DOWN 201 BASIS pts

USA/CHINESE YUAN (CNY) :  6.9938  (ONSHORE)/

 

USA/CHINESE YUAN(CNH): 7.0125 (OFFSHORE)

 

German 10 yr bond yield at 5 pm: ,-0.54%

 

The Dow closed DOWN 2997.10 POINTS OR 12.93%

 

NASDAQ closed DOWN 970.28 POINTS OR 12.32%

 


VOLATILITY INDEX:  82.69 CLOSED UP 24.86

LIBOR 3 MONTH DURATION: 0.843%//

 

 

USA trading today in Graph Form

“Total F**king Carnage” – Global Liquidation Accelerates Despite Massive Monetary Intervention

The Fed unleashed a massive QE5/rate-cut/swap-line splooge overnight…

Stalingrad & Poorski@Stalingrad_Poor

From reddit

Embedded video

And here’s what The Fed hoped it would achieve…

 

Fischer Black@fischersblack

BREAKING: Federal Reserve cuts rates to zero and launches massive $700 billion quantitative easing program

Embedded video

Here’s what the market thought of it…

As one veteran trader exclaimed in FULL CAPS over text: “it’s total f**king global carnage” as wherever you look today there is blood in the streets.

For example:

 

  • STOXX EUROPE 600 ENDS DOWN 4.9%, LOWEST CLOSE SINCE MID-2013
  • SOUTH AFRICA’S FTSE/JSE INDEX FALLS AS MUCH AS 12.2%, MOST EVER
  • MUNI BONDS EXTEND WORST ROUT SINCE 1987
  • COPPER SLUMPS AS MUCH AS 5.2% AMID WEAKENING RISK APPETITE
  • BRENT CRUDE OIL PLUNGES BELOW $30 FOR FIRST TIME SINCE 2016
  • SILVER PLUNGES TO 2011 LOWS
  • U.S. WHOLESALE GASOLINE PRICES PLUNGE 21%
  • HYG WORST DROP SINCE 2008
  • LQD WORST DROP SINCE 2008

Year-to-date, the long-bond is the best-performing asset with stocks the worst and gold just dipping into the red today…

Source: Bloomberg

Only Dow Industrials is still green from the start of 2019…

Source: Bloomberg

Since Trump’s election, Small Caps and Transports are now down 8% and 12% respectively…

Source: Bloomberg

And to comprehend what just happened, Small Caps and Trannies are down 35% from their highs and the rest of the majors down around 27%…

Source: Bloomberg

Seems like Hindenberg nailed it again…

Source: Bloomberg

Chinese stocks are starting to awaken from their margin-fueled stupor…

Source: Bloomberg

European stocks crashed to their lowest since Nov 2012…

Source: Bloomberg

Elsewhere in Europe, banking stocks were a bloodbath, smashed to their lowest since 1987…

Source: Bloomberg

With Deutsche Bank reaching the vinegar strokes, below EUR5 for the first time ever…

Source: Bloomberg

US Futures were halted limit-down overnight, and when cash markets opened, they were halted (down over 7%) before rallying all the way back up to the halted levels before slumping back… Losses accelerated into the close as the White House press conference began…

US Equity ETFs showed the price action a little better (as they were not halted overnight)…

On the cash side, The Dow ended back below 21,000 (crashing 3,000 points today)

…but Small Caps were the worst hit on the day…

The December 2018 lows are all that matters for now for the S&P 500…

Source: Bloomberg

And the S&P broke through totally critical support…

The Dow has caught down to its EPS contraction… but will multiples collapse even more?

Source: Bloomberg

Bank stocks were destroyed today after abandoning buyback plans, erasing all post-Trump-election gains…

Source: Bloomberg

And just when you thought virus-impacted sectors had priced it all in… they plunge another 10-12%…

Source: Bloomberg

It’s been total liquidation…

Source: Bloomberg

The virus trade continues to play extremely well… Long Food, Short Leisure…

Source: Bloomberg

VIX spiked even higher today, within reach of its record highs…

Source: Bloomberg

And systemic event risk is soaring…

Source: Bloomberg

Credit markets suffered more carnage with IG spreads exploding higher…

Source: Bloomberg

As well as HY…

Source: Bloomberg

Treasury yields plunged today, crashing at the open before rising around the European open before being dumped after Europe closed…

Source: Bloomberg

The entire curve was lower but the short-end underperformed…flattening the yield curve.

Source: Bloomberg

The Dollar surged for the 5th straight day, rallying 3.9% – the biggest 5-day jump since Lehman…

Source: Bloomberg

Cryptos went on a wild roller-coaster in the last 24 hours, crashing 10-2% before ripping back…

Source: Bloomberg

The dollar’s ongoing surge (amid liquidity shortages) prompted further liquidations across commodities with Silver slammed the most…

Source: Bloomberg

Precious metals were broadly pummelled today with gold majorly outperforming (NOTE – the precious metal puke started as Europe opened)…

Source: Bloomberg

Silver puke below $12 today…

Which sent the gold/silver ratio exploding to a record high…

Source: Bloomberg

And WTI busted back below $30…

And finally, despite massive monetary intervention overnight, the global shortage just went to ’11’…

Source: Bloomberg

The market got its 100bps cut and is still demanding more…

Source: Bloomberg

And the number of bets on The Fed going negative are soaring…

Source: Bloomberg

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

MARKET TRADING//USA

a)Market trading/LAST NIGHT/USA

Federal Reserve cuts rates to zero and launches massive $700 billion quantitative easing program

KEY POINTS
  • In an emergency move Sunday, the Federal Reserve announced it is dropping its benchmark interest rate to zero and launching a new round of quantitative easing.
  • The QE program will entail $700 billion worth of asset purchases entailing Treasurys and mortgage-backed securities.
  • Markets responded negatively, with Dow futures pointing to a drop of 900 points when the market opens Monday morning.
RT: Jerome Powell, 191211
Federal Reserve Chair Jerome Powell holds a news conference following the Federal Open Market Committee meeting in Washington, December 11, 2019.
Joshua Roberts | Reuters

The Federal Reserve, saying “the coronavirus outbreak has harmed communities and disrupted economic activity in many countries, including the United States,” cut interest rates to essentially zero on Sunday and launched a massive $700 billion quantitative easing program to shelter the economy from the effects of the virus.

The new fed funds rate, used as a benchmark both for short-term lending for financial institutions and as a peg to many consume rates, will now be targeted at 0%-0.25% down from a target range of 1% to 1.25%.

Facing highly disrupted financial markets, the Fed also slashed the rate of emergency lending at the discount window for banks by 125 bps to 0.25%, and lengthened the term of loans to 90 days.

Despite the aggressive move, the market’s initial response was negative. Futures pointed to a decline of some 900 points at the Wall Street open Monday morning.

The discount window “plays an important role in supporting the liquidity and stability of the banking system and the effective implementation of monetary policy … [and] supports the smooth flow of credit to households and businesses,” a separate Fed note said.

The discount window is part of the Fed’s function as the “lender of last resort” to the banking industry. Institutions can use the window for liquidity needs, though some are reluctant to do as it can indicate they are experiencing financial issues and thus sends a bad message.

The Fed also cut reserve requirements for thousands of banks to zero. In addition, in a global coordinated move by centrals banks, the Fed said the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank took action to enhance dollar liquidity around the world through existing dollar swap arrangements.

The banks lowered the rate on these swap line loans and extended the period for such loans. Fed Chairman Jerome Powell is scheduled to hold a press conference via telephone at 6:30 pm ET. The actions by the Fed appeared to be the largest single day set of moves the bank had ever taken, mirroring in many ways its efforts during the financial crisis that were rolled out over several months. Sunday’s move includes multiple programs, rate cuts and QE, but all in a single day.

The quantitative easing will take the form of $500 billion of Treasurys and $200 billion of agency-backed mortgage securities. The Fed said the purchases will begin Monday with a $40 billion installment.

The Fed cut rates from the previous target range of 1% to 1.25% and said it would remain there “until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.”

Cleveland Fed President Loretta Mester was the lone no vote, preferring to set rates at 0.5% to 0.75%, which would have represented a 50 basis point, of half percentage point, reduction.

The Fed added in its statement that it “is prepared to use its full range of tools to support the flow of credit to households and businesses and thereby promote its maximum employment and price stability goals.”

It appeared, though it was not entirely clear, that the meeting that took place will replace the regularly scheduled meeting of the Federal Open Market Committee.

The move follows several actions by the Fed over the past two weeks in which it enacted a 50 basis point emergency rate cut and expanded the overnight credit offering, or repo, for the financial system up to $1.5 trillion.

—CNBC’s Jeff Cox contributed.

end

zerohedge

same story as above:

Fed Panics: Powell Cuts Rates To Zero, Announces $700BN QE5, Unveils Enhanced Global Swap Lines

With Wall Street desperate for  the Fed to announce emergency measures on Sunday (after disappointing last week), and ideally before the futures open, Jerome Powell did not disappoint and moments ago the Fed announced a barrage of emergency measures which included:

  • Welcome back ZIRP: Fed cuts rates by 100bps to 0-25bps from 1.00 -1.25bps. This is in addition to the 50bps rate cut on March 3, which means that in just under two weeks the Fed has cut rates by 150bps to zero.
  • Fed officially launches QE5 (no more “Non-QE” bullshit), consisting of “at least” $500BN in Treasury purchases and $200 billion in MBS.
  • Boosting intraday liquidity: The Fed announces Measures related to the discount window, intraday credit, bank capital and liquidity buffers, reserve requirements, and—in coordination with other central banks—the U.S. dollar liquidity swap line arrangements
  • Reserve requirements cut to zero: The Fed cuts reserve requirement ratios to zero percent effective on March 26.
  • Coordinated swap lines: The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank announced a coordinated action to enhance the provision of liquidity via the standing U.S. dollar liquidity swap line arrangements. The pricing on the dollar liquidity swap arrangements is cut by 25 basis points, so the new rate will be the US dollar overnight index swap (OIS) rate plus 25 basis points.

Amusingly, the Fed announces that the emergency action wasn’t unilateral, with Loretta J. Mester voting against the action, as she was “fully supportive of all of the actions taken to promote the smooth functioning of markets and the flow of credit to households and businesses but preferred to reduce the target range for the federal funds rate to 1/2 to 3/4 percent at this meeting.”

The full statement is below (link):

which caused this;

Fed Disaster: S&P Futures Crash, Halted Limit Down; Gold, Treasuries Soar After Historic Fed Panic

The Fed may have a very big problem on its hands.

After firing the biggest emergency “shock and awe” bazooka in Fed historyone which was meant to restore not just partial but full normalcy to asset and funding markets, Emini futures are not only not higher, but tumbling by the -5% limit down at the start of trading…

… Dow futures down 1,000 and also limit down…

 

… the VIX surging 14%….

… perhaps because the Fed has not only tipped its hand that something is very wrong by simply waiting an additional three days until the March 18 FOMC, but that it can do nothing more to fix the underlying problem, while gold is surging over 3% following today’s dollar devastation (if only until risk parity funds resume their wholesale liquidation at some point this evening)…

… as US Treasury futures soar (which will also likely be puked shortly once macro funds are hit again on their basis trades), as it now appears that the Fed’s emergency rate cut to 0% coupled with a $700BN QE is seen as note enough by a market which is now openly freaking out that the Fed is out of ammo and has not done enough.

In short, with the ES plunging limit down, this has been an absolutely catastrophic response to the Fed’s bazooka; expect negative interest rates across the curve momentarily.

As FX strategist Viraj Patel puts it, “the Fed has thrown a kitchen sink of policy measures that should in theory weaken the US dollar. Problem is the global backdrop due to Covid-19 isn’t conducive to putting money to work in other countries/FX. Fed making US risky assets relatively more attractive may support $USD”

Viraj Patel@VPatelFX

The Fed has thrown a kitchen sink of policy measures that should in theory weaken the US dollar. Problem is the global backdrop due to Covid-19 isn’t conducive to putting money to work in other countries/FX. Fed making US risky assets relatively more attractive may support

View image on Twitter

END

Never thought that this would arrive:  NIRP!! has arrived

NIRP Arrives: Treasuries Trade With Negative Yield

With the Fed’s cutting rates three days ahead of the regular Wednesday FOMC announcement by 100bps to 0%-25bps, while also announcing a fresh $700BN QE as well as enhanced FX swaps, panic is in the air as reflected in the S&P futures which have been locked limit down since the open, and with equity traders frozen out and unable to do anything all the attention has shifted to rates where all hell is breaking loose.

As BMO’s Ian Lyngen wrote in his Fed post-mortem “it is not inconceivable that we see negative Treasury yields in the front end when Asia comes back on line”, and that’s precisely what has happened, when yields on several Treasury bonds expiring in the next three months are getting quoted at slightly negative levels during Asia hours following the Fed’s 100bps rate cut.

One such example is the US govt bond maturing April 23, or in five weeks, which briefly dipped below zero, touching -0.01% after trading at 1.50% just two weeks ago.

And while so far NIRP is confined to short-dated maturities, expect to see negative rates migrating further right on the yield curve with every passing day, and as IG Markets’ analyst Kyle Rodda notes “everywhere effectively could see their yields under pressure and turn negative – you’ve got the Fed coming in cutting rates to near zero, and the Reserve Bank of New Zealand slashing to ensure liquidity in markets.”

As Rodda correctly notes, “it’s all about keeping financial conditions and liquidity as supported as they can, and investors might take this as another reason to just pile into safety.”

“It’s a sign the Fed and other central banks are doing whatever it takes to keep liquidity ticking, especially when we saw Treasuries trading almost like equities last week when all people wanted to do was hoard cash.”

Then there is the question of the Fed’s ad hoc QE announcement which, as Powell’s press conference made clear, is being made up as we go along, with the Fed simply stating that “to support the smooth functioning of markets for Treasury securities and agency mortgage-backed securities that are central to the flow of credit to households and businesses, over coming months the Committee will increase its holdings of Treasury securities by at least $500 billion and its holdings of agency mortgage-backed securities by at least $200 billion. The Committee will also reinvest all principal payments from the Federal Reserve’s holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities.”

Purchases will begin Monday on the below schedule, similar to Friday’s QE shocker:

  • 10:15 – 10:30 am: Treasury Coupons 0 to 2.25 year sector, for around $10 billion
  • 11:00 – 11:15 am: Treasury Coupons 2.25 to 4.5 year sector, for around $8 billion
  • 11:45 am – 12:00 pm: Treasury Coupons 4.5 to 7 year sector, for around $9 billion
  • 12:30 – 12:45 pm: Treasury Coupons 7 to 20 year sector, for around $5 billion
  • 1:15 – 1:30 pm: Treasury Coupons 20 to 30 year sector, for around $5 billion
  • 2:00 – 2:15 pm: TIPS 7.5 to 30 year sector, for around $3 billion

It is this likelihood that the Fed will monetize anything and everything at far higher prices than market, coupled with a non-trivial probability that the Fed’s next move will, in fact, be to cut below zero, that will keep yields depressed, pushing them ever lower, especially if equities are locked out, until most of the curve eventually drops below zero.

end

b)MARKET TRADING/USA/AFTERNOON

ii)Market data/USA

iii) Important USA Economic Stories

Monday/Repo

Seems that everything is broken:  the Repo pool is again clogged, forcing another emergency scramble of a $1/2 trillion repo.

(zerohedge)

Repo Market Breaks Again, Forcing Fed To Scramble Emergency $500BN Repo Operation

Earlier this morning we were quick to congratulate the Fed for seemingly stabilizing the repo market, as the utilization of the day’s first two repo ops – which also included one of the brand spanking new $500BN, 1 month ops – was tiny and the FRA/OIS rate appeared to normalize.

Unfortunately, a few hours later it has turned out that we spoke too soon, because this time the liquidity clog has shifted away from funding shortages (i.e., various OIS swaps) and right back to repo market access and availability, because a quick look at the overnight general collateral repo rate shows that despite the Fed’s multi-trillion liquidity bazooka-cum-ZIRP, its rate surged by more than 200 basis points in early Monday trading, with GC briefly exploding as high as 2.50%, more than 2% above the effective fed funds rate and proof that one again something is broken, before retreating modestly, and according to Bloomberg, just prior to noon ET, GC was bid at 1%.

While this deserves an extended discussion, we will merely point out that each day there a distinct part of the credit and/or funding market is breaking:

 

  • One day it is ETF NAV discounts blowing out;
  • The next day the treasury Treasury Cash/Swap basis surges and funds suffer a historic VaR crash amid forced liquidations;
  • Day three sees the FRA/OIS explode higher as a massive dollar funding margin call strikes;
  • Then, day four sees the same repo crisis that was supposed to be fixed back in September return with a vengeance, as banks freak out about counterparty risk.

At the risk of being flippant, we would say that what the Fed needs is the monetary equivalent of Dr. House: someone who can diagnose what is actually wrong with the monetary plumbing, instead of using the same old shotgun approach of shoveling trillions in blunt liquidity into the market, which clearly is not working anymore.

Alas, the man who actually knows how to fix everything that the Fed has fucked up over the past decade, has not been born yet (and likely never will) which means the Fed is stuck throwing even more liquidity at the problem, and sure enough, after today’s $500BN, 1 month repo, moments ago the Fed – clearly seeking to address the return of the repo crunch – announced that it will “conduct an additional overnight repurchase agreement (repo) operation for same-day settlement today from 1:30 PM ET to 1:45 PM ET. This repo operation will be conducted for up to an aggregate offered amount of $500 billion with a minimum bid rate of 0.10 percent.”

And, as the NY Fed explains:

This action is taken to ensure that the supply of reserves remains ample and to support the smooth functioning of short-term U.S. dollar funding markets.

 

Hey hold on, wasn’t the “supply of ample reserves” problem fixed last September when the Fed launched repos and, don’t laugh, “NOT QE”?

Guess not.

That said, we don’t even need to wait until 1:45pm to tell you what will happen: uptake on today’s half a trillion repo will be tiny, probably around $15BN-$20BN, and while we doubt the GC repo rate will stabilize, we expect that a new crisis symptom will emerge somewhere as the Fed’s liquidity is now no longer helping but is instead hurting a market which is flooding in excess liquidity and can’t put any of it to the proper use.

Check back at 1:45pm for the result from today’s repo which will do absolutely nothing to fix the broken credit and funding markets.

end

Nothing is working as the funding markets remain frozen: dealers balk at the latest 500 billion repo largesse from the Fed.  The real problem is a massive shortage of dollars and nothing can fix it.

(zerohedge)

Emergency Fed Repo Fiasco: Funding Markets Remain Frozen After Dealers Balk At $500BN Operation

Less than an hour ago, when previewing today’s emergency repo operation which the fed announced ad hoc on Monday morning in response to the latest credit market turmoil, this time affecting the GC repo rate, we said that “we don’t even need to wait until 1:45pm to tell you what will happen: “uptake on today’s half a trillion repo will be tiny, probably around $15BN-$20BN.”

The result? $19.4BN, precisely as we expected – a non-existent uptake of an overnight operation that allowed as much as half a trillion dollars in securities to be tendered to the Fed.

We also said that today’s repo operation “will do absolutely nothing to fix the broken credit and funding markets”, because the Fed no longer knows what is and what isn’t broken, and merely is throwing trillions in liquidity at anything that vaguely looks like a crisis. In some ways we sympathize – as we explained earlier, every day something new breaks:

  • One day it is ETF NAV discounts blowing out;
  • The next day the treasury Treasury Cash/Swap basis surges and funds suffer a historic VaR shock amid forced liquidations;
  • Day three sees the FRA/OIS explode higher as a massive dollar funding margin call strikes;
  • Then, day four sees the same repo crisis that was supposed to be fixed back in September return with a vengeance, as banks freak out about counterparty risk.

As we further said, “what the Fed needs is the monetary equivalent of Dr. House: someone who can diagnose what is actually wrong with the monetary plumbing, instead of using the same old shotgun approach of shoveling trillions in blunt liquidity into the market, which clearly is not working anymore.”

And sure enough that’s precisely what happened, because after the massive, $500BN facility came and went, the GC repo rate actually rose from 0.30% to 0.425% after the operation, the Global Basis Swap explosion continues…

… as nothing the Fed has done so far – not the rate cuts, not the QE, not the $5TN in repos, not the enhanced FX swap lines – has succeeded in unlocking any of the liquidity that remains frozen deep inside America’s increasingly broken financial system.

end

Miami Florida/USA/Coronavirus

The mayor of Miami Suarez confirmed on Friday that he has tested positive for the coronavirus/

Miami Mayor Francis Suarez confirmed Friday that he has tested positive for the new coronavirus.

The Brazilian presidency has slammed initial reports Friday — originating in one of the country’s biggest newspapers citing “government sources” — saying President Jair Bolsonaro tested positive for Covid-19. Soon after the Brazilian presidency’s Facebook page officially said the test came back “negative,” despite Fox News and The Guardian among others reporting that he had the virus. Bolsonaro’s son also blasted the media reports as “too much lies”.

No doubt the White House breathed a sigh of relief, given Bolsonaro had just dined with President Trump Saturday night at Mar-a-Lago, but still a close call given a top aide among the Brazilian delegation did test positive Thursday. But guess who did come into contact with both Bolsonaro and the confirmed Covid-19 infected aide?

Miami Mayor Francis Suarez confirmed Friday that he has tested positive for the new coronavirus.

Suarez, 42, said in a statement that he was not feeling any symptoms and advised anyone who shook hands with him or was close to him since Monday to self-isolate for 14 days.

 

Mayor Francis Suarez with Brazilian President Jair Bolsonaro in Miami, Florida, on March 10. AFP via Getty Images

“It is confirmed that I have the coronavirus,” Suarez told the Miami Herald earlier in the day Friday. “I did test positive for it.”

He’s been in isolation since Thursday after it was initially learned that Bolsonaro aide Fabio Wajngarten tested positive for it.

Worrisomely it remains that Suarez, along with Miami-Dade Mayor Carlos Gimenez, Sen. Rick Scott (R-Fla.) and President Trump, all hosted Boslonaro and his staff in south Florida this week, including at a major public event at the Forum Of The Americas at the InterContinental Miami, where Bolsonaro was awarded with the keys to the city.

Mayor Francis Suarez

@FrancisSuarez

My message to our residents in light of the news that I have tested positive for COVID-19.

Embedded video

This could have further implications in terms of potential spread in Miami, as NBC Channel 6 reports:

NBC 6 has also learned that Miami commissioners, their staff, and city hall staff have been advised to self-isolate if they came in contact with Suarez. City hall was also decontaminated Thursday night, a source said.

A number of top city officials are now self-isolating after contact with both the Miami mayor and the Brazilian delegation.

END
New York/Coronavirus
New York restaurants experiencing a mass event cancellation.  Fears are growing in this city
(zerohedge)

“It’s Terrible”: NYC Restaurants Shocked With “Mass Event Cancellations” As Virus Fears Grow

We already wrote weeks ago about how the coronavirus was wreaking havoc among Chinese business owners in various cities across the U.S.

Since then, fear of the virus has been ramped up significantly, and so it should come as no surprise that people are starting to cancel events at NYC restaurants en masse, according to Eater.

Restaurants across NYC are reporting that parties are being cancelled and business is “seeing dips” since the first confirmed coronavirus case in NYC last week. And if we were willing to bet, those would not be “dips” you’d want to buy. It’ll likely get worse.

As of Monday, there were 19 confirmed cases in the city and many corporate offices are encouraging employees to work from home. Hotels and restaurants are getting hit the hardest. One restaurant owner, Tom Colicchio, says his revenue is down “as much as 70%”. The NYC Hospitality alliance says it’s seen a “big drop” in business.

 

Another restaurateur, Michael Sinensky, founder of Simple Venue, a hospitality group that runs Sushi by Bae and Sushi by Bou, says sales have dropped off by as much as 25% and he’s expecting it to continue for “several weeks”.

Additionally, fewer companies are booking events for the spring. Colicchio said: “It’s terrible. It’s just an unknown here. You have no idea how long it’s going to last. It’s hard to get in front of … who knows when things will go back to normal?”

Restaurants that rely on large parties are also seeing declines in foot traffic. Xi’an Famous Foods’s CEO Jason Wang saw a 20% drop in his locations in Flushing and Chinatown last month. He also says customer foot traffic is lower.Owner of East Village Korean restaurant Nowon, Jae Lee, said business started falling about three weeks ago, but has tapered since then. The restaurant group behind Japanese spots like Sobaya said that foot traffic is “visibly lower”. And things aren’t looking optimistic. Not unlike the market itself, this is a dip that may not be getting better anytime soon. Ravi DeRossi — who owns 15 restaurants and bars, said: “Over the weekend, a quarter of reservations canceled day-of, with some saying they’re concerned about being in public places and others worried about not feeling well. This was the first weekend. My feeling is every weekend, it’s going to get worse and worse.”Many restaurants are now dealing with extra precautions for hygiene. More things are getting disinfected, more frequently, according to Eater. One owner says the “unprecedented” situation has them training their staff on how to deal with “fear and panic”. Colicchio’s restaurants are keeping less inventory on hand and holding off on larger purchases for the time being. The Sushi by Bae and Sushi by Bou restaurants are developing a delivery box to try and “balance the business we expect to lose due to the virus panic.”

DeRossi concluded: “I’ll be honest, I’m a little scared. I’m in the East Village. All it takes is one case. If one restaurant in the East Village says, ‘This person at this restaurant got that,’ and the entire East Village will shut down overnight. I honestly don’t know what to do, other than take every serious precaution that we can.”

“I think we’re in for a long period of uncertainty right now,” Colicchio added.

end

New York/Seattle/Restaurant traffic/Sunday//Coronavirus

Restaurant traffic in New York and Seattle plummet greater than 50%

(zerohedge)

Restaurant Traffic Implodes: New York, Seattle Plummet More Than 60%

The past week was not only the most painful for US capital markets since the global financial crisis: it was also the week the US service economy finally died (at least until the coronavirus pandemic is finally under control).

One week ago, when predicting that a coronavirus recession could send the S&P500 to 2,450 by year end – a level that was almost breached last Thursday – Goldman showed that the the most important leisure sectors such as airlines, casino, hotels and cruises, had been clobbered in the market as fears of coronavirus put Americans in self-imposed, or otherwise, quarantine would lead to a hard stop for service providers.

One industry was missing from the chart above: restaurants, and for good reason – for all the panic about a viral pandemic, it appeared that nothing could stand between Americans and their favorite pastime: eating out.

Then everything changed last weekend when restaurant traffic suddenly imploded.

As online reservation website OpenTable Reservations writes on its blog, “reservations stayed stable in February with a big increase on Valentine’s Day. But March brought new health and safety concerns around the world. Looking at comprehensive data from restaurants on our platform — across online reservations, phone reservations, and walk-ins — we note sharp declines over the last week.

The data, which can be pulled here, is unprecedented and shows that starting around last Sunday, when the market crashed, restaurant traffic plunged both around the globe, with the world and US posting a historic 36% Y/Y drop in restaurant traffic…

… a collapse which was most notable among US “epicenter” cities such as Seattle and New York, which both saw traffic tumble more than 60%…

… although according to OpenTable not a single city around the developed world appeared to be spared.

A full breakdown of the ongoing collapse can be seen at the country-level

… state level…

… and most notably, city level, where traffic is a sea of red compared to last year

Keep in mind that changing human behaviors and long-running habits is extremely difficult, which is why it took this long for restaurant use to plunge. However, it will now be just as difficult for “eating out” to get back to normal, and is also why OpenTable, whose entire business model depends on a quick reversal of this collapse has a plea to everyone: please eat out more!

Please support your local restaurants during this turbulent time, as they are a vital part of our communities. Many operate on thin margins and fear staff layoffs and shut downs. Home delivery through the OpenTable app is a good alternative to dining out. Another option is to buy restaurant gift cards for future use.

OpenTable generously “offering” the use of its app as an alternative to dining out aside, the impact of the coronavirus on the already razor-thin margin restaurant industry will be absolutely devastating, and should the self-imposed quarantine last for several weeks, look for a wave of bankruptcies and shutterings as companies, already buried under a mountain of debt, suddenly find themselves with zero new cashflow, and absent a countrywide interest or debt payment moratorium, the US is about to be hit with a tidal wave of small business defaults.

end

NEW YORK CITY/USA/SPAIN/ITALY//CORONAVIRUS//update/Saturday

Spain declares a two week emergency and stops all travel to Spain//New York city confirms its first death to the coronavirus

(zerohedge)

New York reports its first death//Spain declares a two week emergency and stops travel to Spain

 

Goldman Takes Out The Chainsaw: Cuts US Q2 GDP To -5%; Says Recession Has Begun

While it will probably not come as a surprise to anyone who read our earlier post to “Brace For A Record Decline in GDP“, but moments ago Goldman – which last week called the bear market just hours before it officially materialized, and cut its year-end S&P price target to 2,450 which the S&P almost hit late on Thursday – finally capitulated on its optimistic take for the US economy, and in a note published moments ago by its chief economist Jan Hatzius, Goldman said that it expects US economic activity “to contract sharply in the remainder of March and throughout April as virus fears lead consumers and businesses to continue to cut back on spending such as travel, entertainment, and restaurant meals. Emerging supply chain disruptions and the recent tightening in financial conditions will likely add to the growth hit.”

As a result, the bank is now expecting Q2 GDP to crater -5%, down from its prior forecast of 0%, and the biggest quarterly GDP contraction since the peak of the financial crisis when GDP cratered by 8.4%.

Goldman lays out the details of how it gets to this worst GDP print in 12 years below:

 

Over the last week, the number of coronavirus cases in the US has risen rapidly. In response, business and government leaders have begun much stronger measures to combat the spread of the virus. Even with monetary and fiscal policy turning sharply further toward stimulus—we expect a 100bp rate cut on Wednesday and a fiscal impulse of 1-2% of GDP—these shutdowns and rising public anxiety about the virus are likely to lead to a sharp deterioration in economic activity in the rest of March and throughout April.

Virus fears have already begun to lead US consumers and businesses to reduce spending on activities such as travel, entertainment, and restaurant meals. Airlines have eliminated a significant share of flights, conferences have been called off, major cruise lines have canceled all cruises, theme parks have shut down, and hotel occupancy has fallen sharply in cities with early virus outbreaks. Among sports leagues, the professional and college basketball, hockey, and soccer seasons have been cancelled, as have major golf and tennis events, and the baseball season has been postponed. Data from online restaurant reservations also points to a large drop in restaurant visits, especially in the worst affected cities such as Seattle.

While we are not assuming an Italy-style national shutdown in the US, the experience of countries like Italy, Spain and France offers some indications of the impact that extreme local-level quarantines could have. In Italy, for example, all retail stores except drug stores and grocery stores are closed, all restaurants are closed, hotel occupancy is at a small fraction of capacity, and some factories have closed temporarily while many others are operating below normal levels because workers are resisting going to work out of fear of getting sick.

Exhibit 1 provides illustrative estimates of how large the GDP impact of these consumption cutbacks could be at their peak in the worst-affected areas. The bottom of the exhibit shows our assumptions about the peak magnitude of cutbacks—for example, we assume an 80% decline in spending on sports and entertainment and a 50% decline in hotel and restaurant spending. We have scaled up some of our earlier estimates based on preliminary signals from US cutbacks to date and from the experiences of other economies that went through large outbreaks earlier this year. The bars in the exhibit multiply these assumed cutbacks by the GDP share of each category to estimate the impact on the level of GDP.

In total, our assumptions about consumption cutbacks in these categories imply a peak hit to the level of GDP in the worst-affected areas of 6-7%. Reductions in home sales of the sort seen in other virus-hit economies and in business investment would add to the hit to GDP. The impact on US GDP growth depends on what share of the country is affected at a particular time, how close the affected areas come to the peak hit shown in Exhibit 1, and how long the retreat from normal economic life lasts. Our baseline scenario assumes the largest impact in April, with many areas of the US experiencing about two-thirds of the peak effect shown in the chart.

Naturally, this being Goldman, the bank just has to error on the side of optimism, and so it does, noting that its baseline assumption is that “activity will start to recover after April and that H2 will see strong sequential growth, but the specifics depend on a number of important questions. Some are medical, including the extent to which social distancing and seasonally higher temperatures will reduce infections as well as whether good treatments will emerge. Others are behavioral and economic, including how quickly reduced infections will bring back everyday activities and how effective easier monetary and fiscal policy will be in providing support.”

And just to confirm it really has no idea, or visibility about what happens in the period it expects a super surge in GDP, Hatzius caveats that “the uncertainty around all of these numbers is much greater than normal.”

In short, while Goldman has no idea if and how the V-shaped recovery will take place, it is certain it will, and it now sees Q3 GDP surging +3%, up from +1%, and even higher, or +4% in Q4, from +2¼%, with further strong gains in early 2021.

Yet despite the sharply higher second half GDP forecasts, the bank still cuts its 2020 GDP forecast down to +0.4%, from 1.2%, which even in this optimistic, V-shaped recovery scenario, would be the worst annual GDP since the crisis.

What is perhaps most amusing about Goldman’s note is that it manages to incorporate a discussion of whether this catastrophic contraction – which will magically be limited to just one quarter – is classified as a recession.

Would the NBER business cycle dating committee classify our new forecast as a recession, given that it involves only one quarter of strictly negative growth? It is not entirely clear, but we think the answer is probably yes. The committee has noted previously that even a contraction of just a few months can meet its recession definition if it is sufficiently deep.

One shudders to think what the real GDP will be at the end of the year, when Goldman’s V-shaped recovery never materializes, and instead the far more probably L-shaped “recovery” emerges.

end

THE HAMPTONS VS CORONAVIRUS

“It’s A Frenzy”: The Rich Are Making A Run On The Banks In The Hamptons

As the ultra rich Snake Plisken out of the soon-to-be quarantined Manhattan – where at least one bank has are already run out of $100 bills – to fortify themselves against the viral zombie peasant hordes in their impregnable castles in the Hamptons, one thing they’re looking to hoard is cash, which has caused some substantial pressure on financial institutions in the area, according to Bloomberg. At least one New Yorker had his $30,000 cash withdrawal request denied at a Chase bank after being told the limit was $10,000. Meanwhile, bank employees said they were waiting on a “shipment of cash” to fulfill other requests that have been made exceeding the $10,000 amount.

Other branches in the area were unable to help in fulfilling the request, with the East Hampton branch reportedly telling the Southampton branch that it had “two massive withdrawal orders” of its own that it was trying to deal with. Of course, this being the same Hamptons where back in 2011 an infamous ATM withdrawal receipt showed a $99.8 million balance, this is hardly surprising.

JP Morgan maintains that there is plenty of cash available and that ATMs remain “well funded”. The bank also said that sometimes money is not allowed to be taken out in large amounts due to “security” purposes. Bank of America faced similar demands. A branch in Midtown briefly ran out of $100 bills to meet large withdrawals, including some for as much as $50,000 last week. The ATMs did not run out of cash, the NY Times reported.

 

The cash grab in the Hamptons speaks not only to the affluence of the area, but the panic over the spread of the novel coronavirus.

The Hamptons looks like a “peak summer Saturday,” said one East Hampton shop owner. “Even the lowly IGA, that place was jammed. I was able to buy some toilet paper. It’s a frenzy. It’s a terror of starving to death is what it looks like.”

For some, the cash scramble is just what the doctor ordered, so to speak. Charlotte Sasso of Stuart’s Seafood Market in Amagansett said the early shift to the Hamptons is actually good for business and giving fishermen a boost: “Just from one boat yesterday we got a load of fluke, flounder, squid, cod, sea bass, monkfish, whiting.”

And of course, Hamptonites are also stocking their liquor cabinets. “People are buying cases instead of a bottle or two,” said the owner of Wines by Morell in East Hampton.

end

And now the next company to draw down their entire line of credit is Kraft Heinz to the tune of $4 billion dollars.

No question about it: we have a huge dollar liquidity problem

(zerohedge)

Liquidity Panic Reaches Staples: Kraft Heinz To Fully Draw Down $4 Billion Revolver

Last week investors were shocked when a barrage of major US corporations – including Boeing, Hilton, Wynn and a handful of PE portfolio companies – announced their decision to fully draw down on their existing credit lines. That said, for all the ominous banking crisis undertones – many still remember that one of the early symptoms of the global financial crisis was countless companies whose revolvers were pulled by a panicking banking sector – there was a common theme linking all these companies: they were all in sectors (airlines, casinos, lodging, energy) that were directly impacted by either the coronavirus pandemic or the recent oil price war.

Today, that changed when food giant Kraft Heinz – which should be benefiting generously from the recent food hoarding panic – was set to also draw down on its credit facility of as much as $4 billion, even though it faced none of the same coronavirus/oil headwinds as so many other companies that jumped the gun to boost their liquidity while they still could.

“We maintain our $4.0 billion senior credit facility, and subject to certain conditions, we may increase the amount of revolving commitments and/or add additional tranches of term loans in a combined aggregate amount of up to$1.0 billion,” the company said.

Speaking to Bloomberg, which first reported the drawdown of the Buffett-owned company, a Kraft Heinz spokesman said that “the demand for our brands, our cash flow and our balance sheet remain strong,” which is a rather bizarre explanation why it would need billions more in liquidity. “As a matter of practice, we typically maintain a conservative liquidity posture, which is even that much more important as we focus on making sure all our products remain available to the public during these challenging times.”

One possible reason for Heinz’s liquidity problems is that while other sectors have been crippled by the ongoing dual viral-oil shock, the ketchup maker has seen it share of corporate woes in recent years, most recently its downgrade to junk by S&P Global Ratings and Fitch Ratings, when it also warned that the downgrades may limit its access to financing sources such as the commercial paper market, requiring it to use alternative funding sources such as its senior credit facility.

And, as we discussed yesterday, the commercial paper market is starting to freeze up (something the Fed failed to address in its emergency Sunday announcement) which is forcing companies like Heinz to seek alternative, last ditch sources of liquidity.

Indeed, as Bloomberg noted today, issuance of commercial paper dropped to 3,125 transactions on March 13, according to figures released Monday; that’s down 13% from the average daily rate in the week ending March 6 and 18% since February. At the same time, a closely watched CP spread – that between three-month AA rated financial and non-financial commercial paper rates versus overnight index swaps – shows some of the most stress since the financial crisis.

“I am not surprised, liquidity is the lifeblood of these types of programs,” said Scott Kimball, a portfolio manager at BMO Global Asset Management. “When markets lock up like this, interest rates surge to levels that are unsustainable for business.”

Yet what is odd, is that Kraft Heinz said in a regulatory filing last month that it had no commercial paper outstanding at the end of 2019 and that the maximum amount it held during last year was $200 million.

So maybe the company’s rush to its banking syndicate is simply that: a panicked attempt to grab as much cash as it can before it is locked out as banks go into cash conservation mode, something their halt of stock buybacks made quite clear is coming.

Created in a catastrophic merger five years ago orchestrated by Warren Buffett’s Berkshire Hathaway and private equity firm 3G Capital, Kraft Heinz is in the midst of a turnaround as its brands fall out of favor with consumers. Its shares have crashed 16% in the past month, less than the decline of the S&P 500 Index, amid ongoing consumer demand for food and beverages, although today’s revolver news will hardly excite investors.

end

iv) Swamp commentaries

The FBI/Russian collusion case falls apart with this latest memo release.  They knew already in the first month of Trump’s Presidency that this was a hoax.

(zerohedge)

FBI’s Russia Collusion Case Fell Apart In First Month Of Trump Presidency, Memos Show

Authored by John Solomon via JustTheNews.com,

The piecemeal release of FBI files in the Russia collusion investigation has masked an essential fact: James Comey’s G-men had substantially debunked the theory that Donald Trump’s campaign conspired with Moscow by the time the 45th president was settling into the Oval Office, according to declassified memos, court filings and interviews.

And that means a nascent presidency and an entire nation were put through two more years of lacerating debate over an issue that was mostly resolved in January 2017 inside the bureau’s own evidence files.

The proof is now sitting in plain view.

In rapid fire sequence in January 2017, U.S. officials:

  • received multiple warnings about the credibility of informant Christopher Steele and his dossier;
  • affirmed key targets of the FBI counterintelligence investigation made exculpatory statements denying collusion to undercover sources;
  • concluded retired Lt. Gen. Mike Flynn, Trump’s first national security adviser, was not engaged in collusion with the Russians.

The latter revelation has mostly escaped much notice, contained in a single sentence in a once-sealed court motion filed by Flynn defense attorney Sidney Powell that requested what is known as Brady material, or evidence of innocence.

That motion dated Sept. 11, 2019 requested access to “an internal DOJ document dated January 30, 2017, in which the FBI exonerated Mr. Flynn of being ‘an agent of Russia.’”

Flynn’s motion is confirmed by a 2018 letter obtained by Just the News between Special Counsel Robert Mueller’s office and defense lawyers. It shows the DOJ exoneration memo was written after Flynn had been interviewed by FBI agents in January 2017 and after the government learned the former Defense Intelligence Agency chief had kept his old agency briefed on his contacts with Russia, something that weighed heavily against the notion he was aiding Moscow.

“According to an internal DOJ memo dated January 30, 2017, after the Jan. 24 interview, the FBI advised that based on the interview the FBI did not believe Flynn was acting as an agent of Russia,” Mueller’s team wrote in the letter.

U.S. District Judge Emmett Sullivan so far has concluded that the exoneration of Flynn on the Russia collusion charge wasn’t relevant to his conviction since he pled guilty to a different crime, making a false statement to the FBI.

But for the American public, such a revelation is momentous.

Less than two weeks into Trump’s presidency the FBI had concluded his national security adviser had not been working as an agent of Russia. While that was the view of federal law enforcement, the false storyline of Flynn as a Russian stooge was broadcasted across the nation, with leaks of his conversations with a Russian ambassador and other tales, for many more months.

In an interview with Just the News and its John Solomon Reports podcast, Powell confirmed she was provided by letter three sentences from the DOJ memo but has been unable to get the full document.

“It’s just horrible,” Powell said. “They gave us a little three lines summary of it and the letter and told us it existed but have refused to give us the actual document, which I know means there’s a lot of other information in it that would be helpful to us.”

Powell also confirmed that Mueller was fully aware of a letter sent in early January 2017 to Flynn from Britain’s national security adviser raising concerns about Steele’s credibility.

The British government “hand-delivered” a letter to Flynn’s team that “totally disavowed any credibility of Christopher Steele, and would have completely destroyed the Russia collusion narrative,” Powell said.

Flynn himself has no memory of receiving the communique, but people around him at the time do and confirmed the existence of the document, Powell explained. Flynn was questioned about it during his debriefings by Mueller’s team, she added.

“I was told that a copy of the document would have been given to [then-National Security Adviser] Susan Rice as well,” she added. “So the Obama administration knew full well that the entire Russia collusion mess was a farce.”

Instead of responding to the British government’s warning by abandoning the Russia collusion narrative and sparing her client the years-long ordeal of being targeted for investigation, top U.S. intelligence officials hid the communication, Powell said.

Her account confirms information that Rep. Mark Meadows (R-N.C.) provided for a May 2019 article for The Hill.

Other significant red flags also emerged in January 2017 that the Russia collusion theory used by the FBI to open a Trump campaign-focused probe in July 2016 was simply wrong. So too was the evidence the FBI submitted to secure an October 2016 FISA warrant targeting Trump campaign adviser Carter Page.

According to information made public by Justice Department Inspector General Michael Horowitz and the Foreign Intelligence Surveillance Court, the FBI interviewed Steele’s primary sub-source around Jan. 7, 2017. That source disavowed much of the Russia collusion evidence attributed to him in the dossier, a fact the bureau hid from the court.

recent order by FISC Chief Judge James Boasberg lays bare how devastating the revelation from Steele’s source was to the entire Russia collusion theory.

“Steele obtained this information from a primary sub-source, who had, in tum, obtained the information from his/her own source network,” the judge wrote.

“The FBI did not, however, advise DOJ or the Court of inconsistencies between sections of Steele’s reporting that had been used in the applications and statements Steele’s primary sub-source had made to the FBI about the accuracy of information attributed to ‘Person 1,’ who the FBI assessed had been the source of the information in Reports 95 and 102. The government also did not disclose that Steele himself had undercut the reliability of Person 1, telling the FBI that Person 1 was a ‘boaster’ and an ‘egoist’ and ‘may engage in some embellishment.'”

An FBI spreadsheet similarly found that nearly all of Steele’s information in the dossier was either false, could not be proved, or amounted to Internet-based rumor, making it mostly worthless as actionable intelligence.

Further eroding by January 2017 the FBI’s “mosaic” (former FBI Director James Comey’s term) of evidence cited for suspicions of collusion, the bureau had collected exculpatory statements in fall 2016 in which two central targets of the investigation — former Trump advisers Carter Page and George Papadopoulos — told undercover informants they were not colluding with Russia.

Boasberg’s ruling also slammed the FBI for hiding these statements from his court, saying they substantially undercut the FBI’s predicate for the investigation, including the now-disproven allegation that Page had altered the RNC platform at the 2016 nominating convention to help Putin.

“The government also omitted Page’s statements to a confidential human source that he intentionally had ‘stayed clear’ of efforts to change the Republican platform, as well as evidence tending to show that two other Trump campaign officials were responsible for the change,” the judge wrote. “Both pieces of information were inconsistent with the government’s suggestion that, at the behest of the Russian government, Page may have facilitated a change to the Republican platform regarding Russia ‘s annexation of part of Ukraine.”

The Horowitz report confirms the court’s finding in much greater detail

Flynn was cleared of being a Russian agent in January 2017. That same month Steele’s dossier was both discredited by the British government and repudiated by his own confidential sources. And the FBI had evidence its two main Trump targets were innocent. All as President Trump was starting his first two weeks in office.

Congressional investigators are now looking at whether Comey’s approach to Trump at a Feb. 14, 2017 dinner at the White House may have been part of an effort to pivot away from the bogus Russia collusion investigation and lay a predicate for a new investigation focused on possible obstruction of justice. Those same investigators also are inquiring as to why Mueller’s final report did not more clearly spell out how the FBI’s collusion case fell apart in January 2017.

Wherever that congressional inquiry lands, there is now clear and convincing evidence that the country, the president and the courts were kept in the dark about an historic turnaround in the evidence in January 2017, even as defendants were being pressured to plead guilty to crimes unrelated to the collusion allegation. Time will tell whether those who kept this secret for two more years will be held to account.

end

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

Sunday news & developments

  • Germany closed its borders; Mexico is considering closing its border
  • High Probability that Volkswagen Plant near Bratislava closes… PM – BBG
  • France’s Fin Min LeMaire: France to put in place solidarity fund on Monday – BBG
  • SAS to halt most flights, temporarily lay off 90% of staff – Reuters
  • The UK ask people over 70 to stay home…, Health Secretary Matt Hancock said – BBG
  • Norway’s Fin Min Says We Must Be Prepared for Bankruptcies in Norway – BBG
  • Norway PM: Norway to Close All Airports, Ports, Control Borders – BBG
  • Spanish police use megaphones to tell people to stay indoors or face £25,000 fines as tourists scramble to leave country – Daily Mail
  • Austria announces major restrictions on movement over coronavirus – Reuters
  • DJT had a conf call with CEOs from 24+ grocery chains & their suppliers to ensure food supplies
  • The WH said it was “unnecessary to hoard food and supplies”
  • Goldman changed its US Q1 GDP to 0% from 0.7%, Q2 to -5% from 0% and Q3 to 3% from 1%
  • Illinois, CA, Ohio and NYC closed schools, restaurants (ex-delivery & take out) & bars

 

Dr. Saphier: U.S. Rejected Foreign Coronavirus Testing Kits Because of 48% False Negative Rate

The U.S., she noted, developed its own test, but was also “found to be faulty” once it was distributed…

South Korea had been successful at testing because of mass production of testing kits by private biotech companies…  https://www.breitbart.com/health/2020/03/13/coronavirus-u-s-rejected-foreign-testing-kits-because-of-48-false-negative-rate/

The FDA Is Forcing the CDC to Waste Time Double Testing Some Coronavirus Cases

The FDA’s strict guidance on test confirmations is one of several obstacles that has slowed the federal government’s response to COVID-19. The FDA could change its rules to speed things up, but hasn’t…

   The CDC says it is simply following the process set out by federal regulations, though it couldn’t say how many false positives, if any, have shown up in the verification process

https://www.propublica.org/article/the-fda-is-forcing-the-cdc-to-waste-time-double-testing-some-coronavirus-cases

@realDonaldTrump: For decades the @CDCgov looked at, and studied,  its testing system, but did nothing about it. It would always be inadequate and slow for a large scale pandemic, but a pandemic would never happen, they hoped. President Obama made changes that only complicated things further… Their response to H1N1 Swine Flu was a full scale disaster, with thousands dying, and nothing meaningful done to fix the testing problem, until now. The changes have been made and testing will soon happen on a very large scale basis. All Red Tape has been cut, ready to go!

NYT: U.S. Moves to Speed Testing as Fight against Virus Intensifies

https://www.nytimes.com/2020/03/13/world/coronavirus-news.html

WaPo: Trump administration to partner with private sector to set up drive-through testing sites for coronavirus – a model similar to that in South Korea…  https://www.washingtonpost.com/health/under-heavy-fire-trump-administration-takes-steps-to-expand-coronavirus-testing/2020/03/13/f86b481e-6525-11ea-acca-80c22bbee96f_story.html

The midday rally intensified because the Fed announced that it would do $37B of coupon QE via POMO (Permanent Open Market Operations).  The Fed bought across the curve and said it would monetize $80B of debt monthly.  https://www.newyorkfed.org/markets/opolicy/operating_policy_200313

After a natural retrenchment, ESMs and stocks rallied into Trump’s 15:00 ET address.  DJT did not appear at the scheduled time.  This kept the rally percolating, possibly a part of the usual Team Trump Friday intervention – and a way to keep stocks from tanking before the Friday close.

DJT surfaced at 15:30 ET and declared a national emergency, which unleashed $50B of federal aid.  ESMs plunged 66 handles in four minutes.  But, they immediately reversed with a 63-handle rally.

Trump Covid-19 program highlights

  • Asked hospitals to activate their emergency preparedness plans
  • Gave HHS Sec. Azar power to waive certain legal provisions to give doctors & hospitals “maximum flexibility” to care for patients·
  • Cut massive red tape obstacles for Telehealth
  • Trump said the FDA approved a new Coronavirus test; 500k will be available by next week
  • 5 million tests will be available in one month
  • 98% of the tests on Americans have been negative
  • Cited a partnership w/Google to ensure testing sites will be mapped out and available
  • Waived interest rates on all federal student loans
  • Instructed the Energy Dept. to acquire oil for the Strategic Petroleum Reserve (SPR)

OAN’s @ChanelRion: Dr. Debbie Birx (Appointed by Obama in 2014 to lead the fight against the global AIDS epidemic.)Covid-19 Testing made available with unprecedented speed. Incredible strides made behind the scenes.  Dr. Fauci (NIH): The White House has been aggressive and proactive. There will be many more cases, but what we’re doing today will mitigate spread. [Dr. Birx said Trump ordered an entire overhaul of our healthcare system because it wasn’t adequate for this type of emergency.]

ESMs & stocks soared into the close.  ESMs and stocks soared into the close.  The S&P 500 Index rallied 9.28%, the largest gain since October 2008!  Why the crash before the surge?  We think we know why.

Did someone try to orchestrate a crash when Trump started to deliver his Covid-19 antidote?  Are conspiratorial forces driving ESMs/stocks lower for political or financial gain?  Are conspiratorial forces trying to boost stocks for financial & political gain?  If we were on Team Trump, we’d investigate to find out who attempted to crush the stock market.

China hints at denying Americans life-saving coronavirus drugs

In an article in Xinhua, the state-run media agency… China could impose pharmaceutical export controls which would plunge America into “the mighty sea of coronavirus.”…

https://www.foxnews.com/world/chinese-deny-americans-coronavirus-drugs

We’re old enough to remember when US elites, both parties & most of Wall Street told us that embracing China and helping it industrialize would be a great benefit to Americans.  The final nails in this coffin have arrived. Can you say ‘aiding and abetting’ a persistently self-declaring enemy of the USA that regularly makes clear its intention is to bury the USA?  And we’re not talking about Nikita Khrushchev!

@CNBC: Cramer praises Trump for involving private sector in coronavirus response: ‘This is real firepower’ [So Korea did this and got great results vs Italy, China and Iran.]

Standard & Poor’s has postponed Friday’s rebalance.  PMs tell us this will be disruptive.

On Friday night, DJT & Pelosi reached agreement on a Covid-19 relief bill (Families First Coronavirus Response Act). The bill provides paid sick leave for affected workers, unemployment insurance and funds for food stamps & other food programs.  The House passed it by 363-40.  The Senate votes this week.

 

ESMs peaked at 2697.25 at Friday’s close.  Minutes later, ESMs traded at 2643, -2% from the close on DJT has Covid-19 rumors.  On Saturday, DJT said he took a Covid-19 test.  The test result is negative.

(As of Dec. 6, 2019) As Many As 2,400 People in the US Have Died From the Flu since October, CDC Says– Up to 2.5 million people have been infected and 29,000 hospitalized…This year marks the earliest start to widespread flu outbreaks in more than 15 years…As many as 61,000 people died from the flu during the 2018-19 season…  https://weather.com/health/cold-flu/news/2019-12-06-flu-season-fast-start-cases-spread

The flu has killed 20,000 Americans so far this season, including 136 children https://cbsn.ws/39UAAfS\

@SharylAttkisson [Friday]: Two more coronavirus deaths at Washington State nursing home… bringing the home’s total to 29, almost half of the nation’s total 67 coronavirus deaths so far.  The first 67 U.S. coronavirus deaths by state and age https://sharylattkisson.com/2020/03/new-the-first-59-u-s-coronavirus-deaths-by-state-and-age/

@TheJordanRachel: Coronavirus kills 15 people and the U.S. LOSES IT.  Heart disease kills over half a million per year and we put fried chicken between 2 donuts [with bacon and cheese!]

Actor @RealJamesWoods: I remember the H1N1 and SARS epidemics. Everyone supported our president then. There was no hysteria & the doomsayers kept their mouths shut. Thousands of people died & yet the press supported the astonishingly tepid response by the leaders of the time. Why the hysteria now?

CNBC’s @carlquintanilla: The two most important parameters in respiratory fitness are: 1. whether the person smokes cigarettes; 2. the pollution level of the country.  And by both measures, the US is playing with a relatively decent hand.  https://twitter.com/carlquintanilla/status/1238429710637568001?s=09

@AnnCoulter: “A quarantined boat is an ideal …natural laboratory to study a virus…” Diamond Princess stats: 3,711 people on board; 705 tested positive for the coronavirus; 6 died. All 6 were more than 70 years old. Fatality rate: 0.85 percent.

@PamelaGeller: Tom Hanks thanks his helpers as he recovers from coronavirus: “They both are fine, they’re not even that sick.,” said Hanks older son. Wuhan virus news the media isn’t reporting. https://t.co/HEvX5J3x5u

Ex-Schiff staffer, led House impeachment questioning @danielsgoldman: My COVID19 test came back positive. I want to thank everyone for the outpouring of support. It means a lot to my family and me. I am almost back to 100%. I’m lucky… it was just like the flu[He then goes on to blame Trump,]

@washingtonpost: Get a grippe, America. The flu is a much bigger threat than coronavirus, for now. https://t.co/71OsdttcXT

McConnell @senatemajldr: Senator Fischer’s bipartisan PREP Act would expand medical professionals’ access to vitally-needed respirators and create certainty for mask manufacturers. It is not controversial. The Senate could have passed it today. But Senate Democrats refused to let it move forward.

@SenTomCotton (R-AR): “It’s remarkable that our media will rush to attack the President in the middle of a pandemic while remaining silent on Xi Jinping and what the CCP did to create this crisis in the first place by refusing to sound the alarm in early Dec., silencing Drs., etc.”

@Gingrich_of_PA: Democrats in DC are invested in seeing Trump Admin fail in their efforts to contain a pandemic. That, folks, is the most dangerous politics of our generation

@thehill: (Dem –CT) Sen. Richard Blumenthal: “I am appalled and astonished that we have lost a critical two months.”  (You care to know why Covid-19 consciousness/action was “lost” in Dec. & Jan.?)

Trump allies are starting to make the case that impeachment obsession prevented Covid-19 prevention.

Instead of Bracing for Coronavirus, Democrats Focused on Impeachment

Pelosi’s first public comment on February 24 about the Wuhan virus wasn’t until a month after the first U.S. case was reported…During a February 26 meeting of the House Appropriations subcommittee on labor, health and human services, and education, coronavirus came up briefly with Health and Human Services Secretary Alex Azar. (The budget hearing then veered into unaccompanied minors at the border and gun violence.)… https://www.amgreatness.com/2020/03/12/instead-of-bracing-for-coronavirus-democrats-focused-on-impeachment/

Pollak: Democrats Pushed Impeachment While Coronavirus Spread

January 11: Chinese state media report 1st known death from an illness originating in Wuhan market.

January 15: Pelosi (D-CA) holds a vote to send articles of impeachment to the Senate. Pelosi and House Democrats celebrate the “solemn” occasion with a signing ceremony, using commemorative pens.

January 21: The first person with coronavirus arrives in the US from China… he had been in Wuhan.

January 23: The House impeachment managers make their opening arguments for removing… Trump.

January 23: China closes off the city of Wuhan completely to slow the spread of coronavirus…

January 30: Senators begin asking two days of questions of both sides in the pres. impeachment trial.

January 30: The World Health Organization declares a global health emergency as coronavirus spreads.

January 31: The Senate holds a vote on whether to allow further witnesses and documents in the… trial.

January 31: President Trump declares a national health emergency and imposes a ban on travel to and from China… Biden calls Trump’s decision “hysterical xenophobia … and fear-mongering.”

February 2: The first death from coronavirus outside China is reported in the Philippines.

February 3: House impeachment mgrs begin closing arguments, calling Trump a threat to nat’l security.

February 4: Trump talks about coronavirus in his State of the Union address; Pelosi rips up every page.

February 5: The Senate votes to acquit President Trump on both articles of impeachment…

February 5: House Dems finally take up coronavirus in the House Foreign Affairs Subcommittee on Asia.

https://www.breitbart.com/politics/2020/03/13/pollak-democrats-pushed-impeachment-while-coronavirus-spread/

In the month of December, when Covid-19 exploded, Pelosi and Schiff ran a rushed impeachment in order to get it finished before the holiday break.

@SteveGuest: In Joe Biden’s virtual town hall, he gets the time frame between now and November WRONG by well over a year.  “I can’t do that for another two year, actually another year between now and November.”  https://twitter.com/SteveGuest/status/1238614231655895040

Biden’s first virtual town hall riddled with technical glitches – A mess of a virtual town hall Friday night, asking if he was live on air and eventually wandering off camera… The town hall ran for only four buggy minutes on Facebook Live before aides pulled the plug… https://trib.al/rL69APk

Joe Biden Falsely Says He Sponsored the Endangered Species Act

https://lawandcrime.com/high-profile/joe-biden-falsely-says-he-sponsored-the-endangered-species-act/

Biden made a faux pas, on average, every minute of his 4-minutes virtual town hall on Friday.

Biden-Bernie Debate Highlights (last night)  (Most important: Biden moved to the left on major issues]

Biden said, “We’ve already been through with, ah, what happened in Africa.”  He forgot the word Ebola.

Sanders [It] exposes the incredible weakness and dysfunctionally of our current health care system.”

Bernie then calls for free medical care for everyone, including illegal immigrants

Biden would deploy the US military to build hospital beds and tents

Biden said we need to protect against financial instability from “SARS

Joe said the US “should have our experts in China” help with the crisis

Biden: “I don’t wanna get this into a back and forth regarding our politics.” [It’s a political debate!]

Sanders commanded Americans to “go to the YouTube” to fact check Biden on Social Security cuts

Biden & Sanders commit to a woman as VP; Joe wants black woman for SC; this is litmus-test politics.

Bernie jabbed at Joe’s capacity: “Let me ask you a question, Joe. You’re right here with meoh well.”

Joe said no new oil drilling and fracking.  Climate change is as threatening as Covid-19.

Joe said no deportations for 100 days, advocates “taking millions of automobiles off the road.”

Well that does it for today

I will see you tomorrow

H/

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