MAY 22//GOLD AND SILVER HOLD DESPITE THE RAID: GOLD UP $13.05 TO $1735.25//SILVER UP 22 CENTS TO $17.23//COMEX EXPIRY TUESDAY EVENING//CORONAVIRUS UPDATES FOR TODAY//CHINA GETS TOUGH ON HONG KONG AND THAT CAUSES ALARM BELLS THROUGHOUT THE GLOBE//IN THE USA HUGE WAVE OF DEFAULTS COMING//SWAMP STORIES FOR YOU TONIGHT//

GOLD:$1735.25  UP $13.05   The quote is London spot price

 

 

 

 

 

Silver:$17.23  UP  22 CENTS (London spot closing price

COMEX OPTIONS EXPIRY TUESDAY MAY 26

OTC/LBMA OPTIONS EXPIRY FRIDAY MAY 29

 

The reason for the raid today is the comex expiry this coming Tuesday.

Expect gold/silver to be subdued in price until after first day notice.

Closing access prices:  London spot

 

 

i)Gold : $1736.50  LONDON SPOT  4:30 pm

 

ii)SILVER:  $17.23//LONDON SPOT  4:30 pm

CLOSING FUTURES PRICES:  KEY MONTHS

 

MAY COMEX GOLD:  XXX

 

JUNE GOLD:  $1736.25  CLOSE 1.30 PM//   SPREAD SPOT (LONDON) VS/FUTURE JUNE: $0.//PREMIUMS WENT UP AGAIN

 

CLOSING SILVER FUTURE MONTH

 

 

JULY: 1:30 PM:                          $17.65//1:30 PM //SPREAD SPOT LONDON VS FUTURE JULY:      42 CENTS PER OZ//

 

 

the gold market continues to be broken as future prices are much higher than spot prices.  The comex is desperate to fix things but they have no available gold.

If one is to buy gold and or gold coins, the price is around $2800. usa per oz

and silver; $31.00 per oz//

 

LADIES AND GENTLEMEN: YOU ARE NOW WITNESSING FIRST HAND THE DIFFERENCE BETWEEN PAPER GOLD/SILVER AND THE REAL PHYSICAL STUFF!!

DO NOT PAY ANY ATTENTION TO WHAT THE CROOKS ARE DOING AT THE COMEX AND LONDON LBMA..PHYSICAL IS THE NAME OF THE GAME AND NOTHING ELSE

 

COMEX DATA

 

 

 

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

today RECEIVING:  34/440

EXCHANGE: COMEX
CONTRACT: MAY 2020 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,720.500000000 USD
INTENT DATE: 05/21/2020 DELIVERY DATE: 05/26/2020
FIRM ORG FIRM NAME ISSUED STOPPED
____________________________________________________________________________________________
072 C GOLDMAN 2
118 H MACQUARIE FUT 214
132 C SG AMERICAS 2
323 H HSBC 3
355 C CREDIT SUISSE 1
657 C MORGAN STANLEY 12 32
661 C JP MORGAN 34
685 C RJ OBRIEN 2
686 C INTL FCSTONE 6
690 C ABN AMRO 385 127
732 C RBC CAP MARKETS 1
737 C ADVANTAGE 30 13
800 C MAREX SPEC 7
878 C PHILLIP CAPITAL 3
905 C ADM 6
____________________________________________________________________________________________

TOTAL: 440 440
MONTH TO DATE: 10,262

NUMBER OF NOTICES FILED TODAY FOR  MAY CONTRACT: 440 NOTICE(S) FOR 44,000 OZ (1.368 tonnes)

 

TOTAL NUMBER OF NOTICES FILED SO FAR:  10262 NOTICES FOR 1026200 OZ  (31.912 TONNES)

 

 

SILVER

 

FOR MAY

 

 

0 NOTICE(S) FILED TODAY FOR  nil  OZ/

total number of notices filed so far this month: 8910 for 44,550,000 oz

 

BITCOIN MORNING QUOTE  $9157 UP 91

 

BITCOIN AFTERNOON QUOTE.: $9169 UP 103

 

GLD AND SLV INVENTORIES:

WITH GOLD UP $13.05 AND NO PHYSICAL TO BE FOUND ANYWHERE:

WITH ALL REFINERS CLOSED//MEXICO ORDERING ALL MINES SHUT:   WHERE ARE THEY GETTING THE “PHYSICAL”?

 

A HUGE CHANGE IN GOLD INVENTORY AT THE GLD:

A DEPOSIT OF 3.93 TONNES OF GOLD INTO THE GLD///

 

 

GLD: 1,116.71 TONNES OF GOLD//

 

WITH SILVER UP 22 CENTS TODAY: AND WITH NO SILVER AROUND

A HUGE CHANGE IN SILVER INVENTORY AT THE SLV/// A WITHDRAWAL OF 1.864 MILLION OZ FROM THE SLV/

RESTING SLV INVENTORY TONIGHT:

 

SLV: 455.817  MILLION OZ./

 

XXXXXXXXXXXXXXXXXXXXXXXXX

Let us have a look at the data for today

 

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

IN SILVER THE COMEX OI ROSE  BY A SMALL SIZED 231 CONTRACTS FROM 151,890 UP TO 155,485 AND CLOSER TO OUR NEW RECORD OF 244,710, (FEB 25/2020. THE SMALL SIZED GAIN IN  OI OCCURRED DESPITE  OUR VERY LARGE 50 CENT GAIN IN SILVER PRICING AT THE COMEX. IT SEEMS THAT THE  GAIN IN COMEX OI IS DUE TO STRONG  BANKER SHORT COVERING PLUS A STRONG EXCHANGE FOR PHYSICAL ISSUANCE, ZERO LONG LIQUIDATION, ACCOMPANYING  A SMALL DECREASE IN SILVER OZ STANDING AT THE COMEX FOR MAY. WE HAD A NET GAIN IN OUR TWO EXCHANGES OF 1660 CONTRACTS  (SEE CALCULATIONS BELOW).

 

 

 

WE HAVE ALSO WITNESSED A HUMONGOUS AMOUNT OF PHYSICAL METAL STAND FOR COMEX DELIVERY AS WELL WE ARE WITNESSING CONSIDERABLE LONGS PACKING THEIR BAGS AND MIGRATING OVER TO LONDON IN GREATER NUMBERS IN THE FORM OF EFP’S.  WE WERE  NOTIFIED  THAT WE HAD A STRONG SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP ROUTE:  MAY: 0 AND JULY: 1120  AND ZERO FOR ALL  OTHER MONTHS  AND THEREFORE TOTAL ISSUANCE  1120 CONTRACTS. WITH THE TRANSFER OF 1120 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 1120 EFP CONTRACTS TRANSLATES INTO 5.60 MILLION OZ  ACCOMPANYING:

1.THE 50 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

23.005  MILLION OZ FINAL STANDING FOR MAR

4.660  MILLION OZ FINAL STANDING FOR APRIL

45.290 MILLION OZ INITIALLY STANDING FOR MAY

 

THURSDAY, 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 50 CENTS).. AND, OUR OFFICIAL SECTOR/BANKERS  WERE  UNSUCCESSFUL IN THEIR ATTEMPT TO FLEECE ANY AMOUNT OF SILVER LONGS FROM THEIR POSITIONS. THE SMALL GAIN AT THE COMEX WAS ACCOMPANIED BY : i)  A STRONG ISSUANCE OF EXCHANGE FOR PHYSICALS 2) A SMALL LOSS IN SILVER OZ STANDING FOR MAY,3) CONSIDERABLE BANKER SHORT COVERING  AND 4) ZERO LONG LIQUIDATION AS  WE DID HAVE A  NET GAIN OF 1351 CONTRACTS OR 6.755 MILLION OZ ON THE TWO EXCHANGES! YOU CAN BET THE FARM THAT OUR BANKER  ARE DESPERATE TO LIQUIDATE THEIR HUGE SHORT POSITIONS IN SILVER

 

 

 

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

12,028 CONTRACTS (FOR 16 TRADING DAYS TOTAL 12,028 CONTRACTS) OR 60.140 MILLION OZ: (AVERAGE PER DAY: 751 CONTRACTS OR 3.758 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH OF MAY: 60.14 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 8.59% 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:          1,048.98 MILLION OZ.

JANUARY 2020 EFP TOTALS SO FAR: 181.61 MILLION OZ

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

MARCH EFP’S …..                     452.280 MILLION OZ  //TOTALS//AND A NEW RECORD FOR THE MONTH)

APRIL EFP                               95.355 MILLION OZ.  (EX. FOR PHYSICALS BECOMING A LOT LESS)

MAY EFP SO FAR:                   60.14 MILLION OZ

EXCHANGE FOR PHYSICAL ISSUANCE FOR THE PAST 30 DAYS IS A LOT LESS.  NO DOUBT THAT THE COST TO CARRY THESE THINGS HAS EXPLODED AND AS SUCH CANNOT BE DONE AS FREQUENTLY AS BEFORE.

 

RESULT: WE HAD A TINY SIZED INCREASE IN COMEX OI SILVER COMEX CONTRACTS OF 231, DESPITE OUR CONSIDERABLE 50 CENT LOSS IN SILVER PRICING AT THE COMEX ///THURSDAY THE CME NOTIFIED US THAT WE HAD A STRONG SIZED EFP ISSUANCE OF 1120 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 GAINED A STRONG SIZED OI CONTRACTS ON THE TWO EXCHANGES:  1351 CONTRACTS (DESPITE OUR 50 CENT LOSS IN PRICE)

 

THE TALLY//EXCHANGE FOR PHYSICALS

i.e 1120 OPEN INTEREST CONTRACTS HEADED FOR LONDON  (EFP’s) TOGETHER WITH A SMALL SIZED INCREASE OF 231 OI COMEX CONTRACTS. AND ALL OF THIS DEMAND HAPPENED WITH A HUGE 50 CENT LOSS IN PRICE OF SILVER/AND A CLOSING PRICE OF $17.02 // THURSDAY’S TRADING. YET WE STILL HAVE A STRONG AMOUNT OF SILVER STANDING AT THE COMEX FOR DELIVERY. 

 

In ounces AT THE COMEX, the OI is still represented by JUST UNDER 1 BILLION oz i.e. 0.7050 BILLION OZ TO BE EXACT or 100.7% of annual global silver production (ex Russia & ex China).

FOR THE NEW  MAR DELIVERY MONTH/ THEY FILED AT THE COMEX: 0 NOTICE(S) FOR  NIL 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: 23.005 MILLION OZ/APRIL 4.660 MILLION OZ//MAY  45.290 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 SMALL SIZED 2219 CONTRACTS TO 530,794 AND FURTHER FORM OUR NEW RECORD (SET JAN 24/2020) AT 799,541 AND  PREVIOUS TO THAT: (SET JAN 6/2020) AT 797,110.

THE SMALL SIZED LOSS OF COMEX OI OCCURRED DESPITE OUR STRONG COMEX LOSS IN PRICE  OF $26.40 /// COMEX GOLD TRADING// THURSDAY// WE  HAD STRONG BANKER SHORT COVERING , A SMALL SIZED DECREASE IN GOLD OZ STANDING AT THE COMEX, ALONG WITH ZERO LONG LIQUIDATION ACCOMPANYING A HUGE  EX. FOR PHYSICAL ISSUANCE. THIS ALL HAPPENED WITH OUR LARGE LOSS IN THE PAPER PRICE OF GOLD.

WE HAD A VOLUME OF 0  4 -GC CONTRACTS//OPEN INTEREST  10

 

WE GAINED A STRONG SIZED 7539 CONTRACTS  (23.45 TONNES) ON OUR TWO EXCHANGES.

 

E.F.P. ISSUANCE

 

 

 

THE CME RELEASED THE DATA FOR EFP ISSUANCAND IT TOTALED A HUGE SIZED 9758 CONTRACTS:

CONTRACT. MAY: 0, AND JUNE 9082.; AUG 676 AND ALL OTHER MONTHS ZERO//TOTAL: 9758.  The NEW COMEX OI for the gold complex rests at 530,794. 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 SIZED INCREASE IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 7539 CONTRACTS: 2219 CONTRACTS DECREASED AT THE COMEX AND 9758 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI GAIN OF 7539 CONTRACTS OR 23.45 TONNES. THURSDAY, WE HAD A LOSS OF $26.40 IN GOLD TRADING.…..

AND WITH THAT LOSSIN  PRICE, WE HAD A VERY STRONG SIZED GAIN IN  TOTAL/TWO EXCHANGES GOLD TONNAGE OF 23.45 TONNES!!!!!! THE BANKERS/OFFICIAL SECTOR WEE SUPPLYING INFINITE SUPPLIES OF SHORT GOLD COMEX PAPER WITH RECKLESS ABANDON. THE BANKERS WERE SUCCESSFUL IN THEIR ATTEMPT TO LOWER GOLD’S PRICE (IT FELL $26.40).AND IT ALSO SEEMS THAT THEIR ATTEMPT TO FLEECE ANY GOLD LONGS FROM THE GOLD ARENA WAS  UNSUCCESSFUL  (SEE BELOW).

4 GC VOLUME: 0  // open interest 10 

 

 

 

 

CALCULATIONS ON GAIN/LOSS ON OUR TWO EXCHANGES:

WE HAD A HUGE SIZED ISSUANCE IN EXCHANGE FOR PHYSICALS  (9758) ACCOMPANYING THE SMALL SIZED LOSS IN COMEX OI  (2219 OI): TOTAL GAIN IN THE TWO EXCHANGES:  9112 CONTRACTS. WE NO DOUBT HAD 1 )CONSIDERABLE BANKER SHORT COVERING, 2.)A SMALL DECREASE IN OUNCES STANDING AT THE GOLD COMEX FOR THE FRONT MAY MONTH,  3) ZERO LONG LIQUIDATION; 4) SMALL COMEX OI LOSS,  AND  …ALL OF THIS WAS COUPLED WITH OUR STRONG LOSS IN GOLD PRICE TRADING//THURSDAY

 

SPREADING OPERATIONS

 

OUR SPREADING OPERATION HAS NOW SWITCHED INTO GOLD…..

SPREADING OPERATION FOR OUR NEWCOMERS:

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

 

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

 

 

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

 HERE IS A BRIEF SYNOPSIS OF HOW THE CROOKS FLEECE UNSUSPECTING LONGS IN THE SPREADING ENDEAVOUR;

 

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

 

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 MAY HEADING TOWARDS THE  ACTIVE DELIVERY MONTH OF JUNE FOR GOLD:

 

YOU WILL ALSO NOTICE THAT THE COMEX OPEN INTEREST  STARTS TO RISE IN THIS NON ACTIVE MONTH OF MAY. 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 (JUNE), 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 MAY : 53,449 CONTRACTS OR 5,344,900 oz OR 166.24 TONNES (15 TRADING DAYS AND THUS AVERAGING: 3563 EFP CONTRACTS PER TRADING DAY

 

TO GIVE YOU AN IDEA AS TO THE STRONG SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 15 TRADING DAY(S) IN  TONNES: 166.24 TONNES

TOTAL ANNUAL GOLD PRODUCTION, 2019, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 3555 TONNES

THUS EFP TRANSFERS REPRESENTS 166.24/3550 x 100% TONNES =4.68% OF GLOBAL ANNUAL PRODUCTION

ISSUANCE OF EXCHANGE FOR PHYSICAL GOLD HAS DISSIPATED THIS MONTHTHE COST TO THE BANKERS TO CARRY THESE CONTRACTS IN LONDON IS BECOMING TOO GREAT FOR THEM.

 

ACCUMULATION OF GOLD EFP’S YEAR 2020 TO DATE   2732.259  TONNES

JANUARY 2220 TOTAL EFP ISSUANCE; : 570.19 TONNES

FEB 2020 TOTAL EFP ISSUANCE :            653.78 TONNES

MARCH TOTAL EFP ISSUANCE                1,098.93  TONNES  (*AND A NEW ALL TIME RECORD ISSUANCE//22 DAYS)

APRIL TOTAL EFP. ISSUANCE:               243.45  TONNES  (EFP ISSUANCE BECOMING A LOT LESS)

MAY TOTAL EFP ISSUANCE:                     166.24 TONNES (EFP ISSUANCE STILL LOW// PREMIUM COST TO THE BANKERS IS HUGE..SO ISSUANCE IS LESS)

 

 

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

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

1.Today, we had the open interest at the comex, in SILVER, ROSE BY A SMALL SIZED 231 CONTRACTS FROM 155,794 UP TO 155,485 AND CLOSER TO 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 GAIN IN COMEX OI WAS DUE TO 1) CONSIDERABLE BANKER SHORT COVERING , 2) A STRONG ISSUANCE OF EXCHANGE FOR PHYSICALS (SEE BELOW), 3) A TINY DECREASE IN SILVER OZ STANDING AT THE COMEX FOR MAY AND  4) ZERO LONG LIQUIDATION 

 

EFP ISSUANCE 1120 CONTRACTS

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: 0 JULY: 1120 CONTRACTS   AND ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 1120 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON.  IF WE TAKE THE  COMEX OI GAIN  OF 231 CONTRACTS TO THE 1120 OI TRANSFERRED TO LONDON THROUGH EFP’S,  WE OBTAIN A  STRONG GAIN OF 1120 OPEN INTEREST CONTRACTS FROM OUR TWO EXCHANGES. THUS IN OUNCES, THE GAIN ON THE TWO EXCHANGES 6.755 MILLION  OZ!!! OCCURRED WITH THE 50 CENT GAIN IN PRICE///

 

 

RESULT: A STRONG SIZED INCREASE IN SILVER OI AT THE COMEX WITH THE 50 CENT LOSS IN PRICING THAT SILVER UNDERTOOK IN PRICING// THURSDAY. WE ALSO HAD A STRONG SIZED 1120 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE STRONG  SIZED AMOUNT OF SILVER OUNCES STANDING FOR THIS MONTH, DEMAND FOR PHYSICAL SILVER CONTINUES TO INTENSIFY AS WE WITNESS SEVERE BACKWARDATION IN SILVER IN LONDON.

 

BOTH THE SILVER COMEX AND THE GOLD COMEX ARE IN STRESS AS THE BANKERS SCOUR THE BOWELS OF THE EXCHANGE FOR METAL

(report Harvey)

 

 

 

2 ) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY: Bloomberg

3. ASIAN AFFAIRS

i)FRIDAY MORNING/ THURSDAY NIGHT: 

SHANGHAI CLOSED DOWN 54.16 POINTS OR 1.89%  //Hang Sang CLOSED DOWN 1349.89 POINTS OR 5.56%   /The Nikkei closed DOWN 164.15 POINTS OR 0.80%//Australia’s all ordinaires CLOSED DOWN .92%

/Chinese yuan (ONSHORE) closed DOWN  at 7.1350 /Oil UP TO 32.01 dollars per barrel for WTI and 34.28 for Brent. Stocks in Europe OPENED MIXED//  ONSHORE YUAN CLOSED DOWN // LAST AT 7.1350 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 7.1528 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY PAST 7:1//TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED//CHINA VS HONG KONG//  : /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%

 

 

COMEX DATA//AMOUNTS STANDING//VOLUME OF TRADING/INVENTORY MOVEMENTS

GOLD

LET US BEGIN:

THE TOTAL COMEX GOLD OPEN INTEREST SURPRISINGLY FELL BY A SMALL SIZED 2219 CONTRACTS TO 532,367 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 SMALL COMEX OI LOSS WAS SET WITH OUR CONSIDERABLE LOSS OF $26.40 IN GOLD PRICING /THURSDAY’S COMEX TRADING//). WE ALSO HAD A VERY STRONG EFP ISSUANCE (9758 CONTRACTS),.  THUS WE HAD 1) STRONG BANKER SHORT COVERING AT THE COMEX AND 2)   ZERO  LONG LIQUIDATION AND 3)  ANOTHER INCREASE IN GOLD OZ STANDING AT THE COMEX//MAY DELIVERY MONTH , SMALL COMEX OI LOSS// …  AS WE ENGINEERED A STRONG GAIN ON TWO EXCHANGES OF 9112 CONTRACTS DESPITE YESTERDAY’S SHELLACKING. THIS IS THE FIRST BIG EXCHANGE FOR PHYSICAL ISSUANCE SINCE THE GOLD COMEX BROKE ON MARCH 26/2020

WE AGAIN HAD 0    4 -GC VOLUME//open interest remains at 10

 

 

 

EXCHANGE FOR PHYSICAL ISSUANCE

WE ARE NOW IN THE  ACTIVE DELIVERY MONTH OF APRIL..  THE CME REPORTS THAT THE BANKERS ISSUED A HUGE SIZED  TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS., THAT IS 9758 EFP CONTRACTS WERE ISSUED:

 FEB: 0; MARCH 00 AND APRIL: 0, MAY: 0  JUNE : 9082 AND 676 FOR AUG AND  ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE: 9758 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:  7539 TOTAL CONTRACTS IN THAT 9758 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE LOST A SMALL SIZED 2219 COMEX CONTRACTS.  THE BANKERS PROVIDED ALL THE NECESSARY SHORT PAPER TO WHICH OUR LONGS DUTIFULLY ACCEPTED AS THEY GOBBLED UP A HUGE AMOUNT OF EXCHANGE FOR PHYSICALS WITH CONSIDERABLE BANKER SHORT COVERING, ACCOMPANYING A TINY DECREASE IN COMEX OI   AND A STRONG INCREASE IN GOLD  TONNAGE STANDING FOR DELIVERY (SEE CALCULATIONS BELOW)… ZERO LONG LIQUIDATION…… ALL OF THE ABOVE OCCURRED WITH A CONSIDERABLE FALL IN PRICE

 

THE BANKERS WERE SUCCESSFUL IN LOWERING GOLD’S PRICE  //// (IT FELL BY $26.40).  AND, THEY WERE  UNSUCCESSFUL IN FLEECING ANY LONGS, AS THE TOTAL GAIN ON THE TWO EXCHANGES REGISTERED A CONSIDERABLE 23.45 TONNES.

 

 

NET GAIN ON THE TWO EXCHANGES :: 7539 CONTRACTS OR 753900 OZ OR 23.45 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:  530,794 TOTAL OI CONTRACTS X 100 OZ PER CONTRACT = 53.07 MILLION OZ/32,150 OZ PER TONNE =  1650 TONNES

THE COMEX OPEN INTEREST REPRESENTS 1650/2200 OR 75.02% OF ANNUAL GLOBAL PRODUCTION OF GOLD.

Trading Volumes on the COMEX TODAY: 248,363 contracts//volume higher than normal

CONFIRMED COMEX VOL. FOR YESTERDAY314,428 contracts// volume still very low

MAY 22 /2020

MAY GOLD CONTRACT MONTH

 

Gold Ounces
Withdrawals from Dealers Inventory in oz nil oz
Withdrawals from Customer Inventory in oz
162,547.625 oz
jpmorgan
from enhanced inventory
Deposits to the Dealer Inventory in oz 96,453.000 oz

Brinks

2,000 kilobars

 

 

 

Deposits to the Customer Inventory, in oz  

772,424.042

OZ

BRINKS

HSBC

JPMORGAN

SCOTIA

 

 

No of oz served (contracts) today
440 notice(s)
 4400 OZ
(1.368 TONNES)
No of oz to be served (notices)
5 contracts
(500 oz)
2.43 TONNES
Total monthly oz gold served (contracts) so far this month
10,262 notices
1,026,200 OZ
31.912 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 1 deposits into the dealer

I) Into Brinks: 96,453.000 oz

2,000 kilobars

 

 

 

total dealer deposits:  96,453.000 oz

 

total dealer withdrawals: nil oz

we had 4 deposits into the customer account

 

i) HSBC: 54,688.85 oz

ii) Brinks: 32,118.85 oz (999 kilobars)

iii) JPMorgan;  613,151.721 oz

iv) Scotia: 72,464.6205

 

 

 

 

total deposits: 772,424.042    oz

 

 

we had 1 gold withdrawals from the customer account:

 

i) Out of  (JPMorgan enhanced)..  162,547.625

 

 

 

 

 

 

total gold withdrawals;  162,547.625   oz

We had 3  kilobar transactions  +

 

We had 0  4 KC bar volume transactions/10 contracts oi

 

 

 

 

ADJUSTMENTS: 1 //    

 

customer account to dealer//HSBC

i)  96,453.00 oz 3,000  kilobars

 

 

 

 

 

The front month of May registered a LARGE total of 445 oi contracts for a LOSS of 83 contracts. We had 13 notices filed upon yesterday so we LOST 70contracts or an additional 7000 oz will  not stand as these guys   morphed into London based forwards and thus accepted a fiat bonus for their effort.  There is basically no gold to be found over here so they will try their luck over in London.

The next delivery month after May is the huge delivery month of June.  Here June saw a LOSS OF 27,933 contracts DOWN to 201,298 contracts. July had a GAIN of 69 OI contracts  and thus 578 contracts  outstanding.  Next comes August another strong delivery month and here the OI ROSE by 23,918 contracts up to 220,239 contracts.

June is not falling in OI fast enough.  It looks like we are going to have another dilly amount of gold oz standing for June. We have 4 more reading days before first day notice Friday, May 29.2020

 

 

We had 440 notices filed today for 44000 oz

 

FOR THE  MAY 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 440 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 34 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 MAY /2020. contract month, we take the total number of notices filed so far for the month (10,262) x 100 oz , to which we add the difference between the open interest for the front month of  May. (445 CONTRACTS ) minus the number of notices served upon today (440 x 100 oz per contract) equals 1,026,700 OZ OR 31.934 TONNES) the number of ounces standing in this  non active month of May

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

No of notices served (10,262)x 100 oz + (45 OI) for the front month minus the number of notices served upon today (440) x 100 oz which equals 1,026,700 oz standing OR 31.934 TONNES in this non active delivery month. This is  a record amount for gold standing for any May delivery month or any non active delivery month.

We lost 70 contracts or an additional 7,000 oz will seek out metal on the side of the pond as no gold could be found over here.

 

 

NEW PLEDGED GOLD:  BRINKS

3027.500 OZ  REMOVED TO THE PLEDGED ACCOUNT JAN 10.2020/Brinks

144,088.952 oz NOW PLEDGED  JAN 21.2020/HSBC  5.4807 TONNES

322,144.443 oz PLEDGED  MARCH 2020  JPMORGAN:  10.020 TONNES

42,548.308.00 PLEDGED  APRIL 3/2020: SCOTIA:            1.3234 tonnes

19,290.600 oz Pledged May 8/2020   INT DELAWARE:  .600 TONNES

17,853.197  oz pledged May 8.2020   MANFRA:            .553 TONNES

 

TOTAL PLEDGED GOLD NOW IN EFFECT:  545,925.500  OZ OR 16.980  TONNES

SURPRISINGLY WE HAVE BEEN WITNESSING NO REAL PHYSICAL GOLD ENTERING THE COMEX VAULTS FOR THE PAST YEAR!! ..ONLY PHONY KILOBAR ENTRIES…. WE HAVE 250.56 TONNES OF REGISTERED GOLD WHICH CAN SETTLE UPON LONGS ie. 31.945 tonnes

CALCULATION OF REGISTERED GOLD THAT CAN BE SETTLED UPON:

total registered or dealer  8,601,325.167 oz or 267.537  tonnes
which  includes the following:
a) pledged gold held at HSBC   which cannot settled upon   144,088.952 oz x ( 4.4817 TONNES)//
b) pledged gold held at JPMorgan (added March 2020) which cannot be settled upon:  322,144.443 oz (or 10.0200 tonnes)
total pledged gold:
c)  pledged gold at Scotia: 1.3234 tonnes or 42,548.308 oz which cannot be settled  (1.3234 tonnes)
d) pledged gold at Manfra:  17,853.197 oz  which cannot be settled:   (.5553 tonnes)
e) pledged gold at int.Del.    19,290.600 oz  which cannot be settled:   (.600 tonnes)
total weight of pledged:  545,925.500 oz or 16.905 tonnes
thus:
registered gold that can be used to settle upon: 8,055,400.2  (250.56 tonnes)
true registered gold  (total registered – pledged tonnes  8,055,400.2 (250.56 tonnes)
total eligible gold:  16,645,932.676 oz (517.76 tonnes)

total registered, pledged  and eligible (customer) gold;   25,247,257.743 oz 785.31 tonnes (INCLUDES 4 GC GOLD)

total 4 GC gold:   123.958 tonnes

total gold net of 4 GC:  661.35 tonnes

 

end

 

I have compiled  data with respect to registered (or dealer) gold taken on first day notice for each of the past 24 months

The data begins on first day notice for the May month taken on the last day of April 2018. and it continues to present day.  Thus 24 data entry points.

 

I then took, how many deliveries were recorded by the CME for each and every month.  I also included for reference the price of gold on first day notice.

 

The first graph is a logarithmic  graph and the second graph, linear.

You can see the huge explosion of registered gold at the comex along with deliveries.  Gold owners are very clear people.  They would know full well that

the gold at the comex is unallocated and that they would not be stupid enough to keep their gold at the comex especially in the registered category once deliveries are asked upon. If physical gold was present it would be have removed from the comex… It shows there is no gold at the comex.  They are just trading in sticky paper.

 

 

THE GOLD COMEX SEEMS TO BE  UNDER SEVERE ASSAULT FOR PHYSICAL

 

END

MAY 21/2020

And now for the wild silver comex results

Total COMEX silver OI ROSE BY A SMALL SIZED 231 CONTRACTS FROM 155,254 UP TO 155,485(AND CLOSER TO OUR 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) . THE SMALL OI COMEX GAIN TODAY OCCURRED DESPITE OUR VERY STRONG 50 CENT LOSS IN PRICING//THURSDAY. WE GAINED A TOTAL OF 1120 CONTRACTS IN OUR TWO EXCHANGES.  THE GAIN IN TOTAL OI (TWO EXCHANGES) OCCURRED WITH 1)  A STRONG ISSUANCE OF EXCHANGE FOR PHYSICALS 2) A SMALL DECREASE IN SILVER OZ STANDING AT THE COMEX, 3)  CONSIDERABLE BANKER SHORT COVERING , 4) ZERO LONG LIQUIDATION,5) SMALL COMEX GAIN IN OI AND ALL OF THIS OCCURRED WITH OUR STRONG 50 CENT LOSS IN PRICE 

 

WE ARE NOW INTO THE ACTIVE DELIVERY MONTH OF MAY

THE FRONT DELIVERY OF MAY SAW  148 OPEN INTEREST CONTRACTS STANDING  AND THUS WE HAD A LOSS OF 10 CONTRACTS.  We had 2 notices filed yesterday so we LOST 8 contracts or an additional 40,000 oz will NOT stand at the comex as these guys morphed into London based forwards and thus they accepted  a fiat bonus for their efforts..

 

 

AFTER MAY WE HAVE THE NON ACTIVE MONTH OF JUNE.  HERE JUNE SAW A GAIN OF 5 CONTRACTS RESTING AT 449.

AFTER JUNE COMES THE VERY BIG DELIVERY MONTH OF JULY AND HERE THE OI LOST 945 CONTRACTS DOWN TO 116,645 CONTRACTS

 

 

We, today, had  0 notice(s) FILED  for NIL OZ for the APRIL, 2020 COMEX contract for silver

 

MAY 22/2020

MAY SILVER COMEX CONTRACT MONTH

 

 

Silver Ounces
Withdrawals from Dealers Inventory NIL oz
Withdrawals from Customer Inventory
 1,248,216.450 oz
CNT
Delaware
Scotia

 

 

Deposits to the Dealer Inventory
nil oz

 

Deposits to the Customer Inventory
18,957.04 oz
CNT
No of oz served today (contracts)
0
CONTRACT(S)
(NIL OZ)
No of oz to be served (notices)
148 contracts
 740,000 oz)
Total monthly oz silver served (contracts)  8910 contracts

44,550,000 oz)

Total accumulative withdrawal of silver from the Dealers inventory this month NIL oz
Total accumulative withdrawal of silver from the Customer inventory this month
We had 0 deposit into the dealer:

total dealer deposits: nil oz

i) We had 0 dealer withdrawal

 

total dealer withdrawals: nil oz

i)we had 1 deposits into the customer account

into JPMorgan:   0

ii)into CNT;   18,957.04 oz

 

 

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

JPMorgan now has 160.819 million oz of  total silver inventory or 51.22% of all official comex silver. (160.819 million/314.220 million

 

total customer deposits today: 18,957.04    oz

we had 3 withdrawals:

 

i) Out of CNT:  642,301.973 oz

ii) Out of Delaware:  5003.095 oz

iii) Out of Scotia:  600,911.450 oz

 

 

 

total withdrawals; 1,248,216.518    oz

We had 0 adjustments

 

total dealer silver: 91.117 million

total dealer + customer silver:  310.483 million oz

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

The total number of notices filed today for the MAY 2020. contract month is represented by 0 contract(s) FOR NIL oz

 

To calculate the number of silver ounces that will stand for delivery in MAY we take the total number of notices filed for the month so far at 8910 x 5,000 oz = 44,550,000 oz to which we add the difference between the open interest for the front month of MAY.(148) and the number of notices served upon today 0 x (5000 oz) equals the number of ounces standing.

.

Thus the INITIAL standings for silver for the MAY/2019 contract month: 8910 (notices served so far) x 5000 oz + OI for front month of MAY (148)- number of notices served upon today (0) x 5000 oz of silver standing for the MAY contract month.equals 45,290,000 oz.

We LOST 8 or an additional 40,000 oz will seek out metal on the London side of the pond as they ACCEPTED a London based forward contract..

 

TODAY’S ESTIMATED SILVER VOLUME: 50,995 CONTRACTS //volume very high

 

 

FOR YESTERDAY: 81,518 CONTRACTS..,CONFIRMED VOLUME//

 

 

YESTERDAY’S CONFIRMED VOLUME OF 81,518  CONTRACTS EQUATES to 407 million  OZ 58.3% 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

 

NPV for Sprott

1. Sprott silver fund (PSLV): NAV  FALLS TO- 1.17% ((MAY 22/2020)

2. Sprott gold fund (PHYS): premium to NAV  FALLS TO -0.14% to NAV:   (MAY 22/2020 )

Note: Sprott silver trust back into NEGATIVE territory at +%-/Sprott physical gold trust is back into NEGATIVE/ 1.17%

(courtesy Sprott/GATA

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

NAV 16.37 TRADING 16.30///NEGATIVE 0.43

END

 

 

And now the Gold inventory at the GLD/

MAY 22//WITH GOLD UP $13.05//A BIG CHANGE IN GOLD INVENTORY:: A PAPER ADDITION OF 3.93 TONNES//INVENTORY RESTS THIS WEEKEND AT:  1116.71 TONNES

MAY 21//WITH GOLD DOWN $26.70//NO CHANGE IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 1112.32 TONNES

MAY 20/WITH GOLD UP $7.20: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER WITHDRAWAL OF 1.46 TONNES FROM THE GLD////INVENTORY RESTS TONIGHT AT 1112.32 TONNES

MAY 19//WITH GOLD UP $10.60//NO CHANGES IN GOLD INVENTORY AT THE GLD////INVENTORY RESTS AT 1113.78 TONNES

MAY 18/WITH GOLD DOWN $15.40 TODAY: A HUGE CHANGE IN GOLD INVENTORY: A PAPER DEPOSIT OF 9.06 TONNES./INVENTORY RESTS AT 1113.78 TONNES

MAY 15.WITH GOLD UP $16.30 TODAY: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER DEPOSIT OF 12.58 TONNES/  INVENTORY RESTS AT 1104.72 TONNES

MAY 14//WITH GOLD UP $19.25 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD////INVENTORY RESTS AT 1092.14 TONNES

MAY 13//WITH GOLD UP $9.05 TODAY: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD//A DEPOSIT OF 11.07 TONNES/INVENTORY RESTS AT 1092.14 TONNES

MAY 12//WITH GOLD UP $6.60 TODAY; A SMALL CHANGES IN GOLD INVENTORY AT THE GLD/: A WITHDRAWAL OF .58 TONNES FROM THE GLD///INVENTORY RESTS AT 1081.07 TONNES

MAY 11/WITH GOLD DOWN $12.65 TODAY: NO CHANGES IN GOLD INVENTORY: //INVENTORY RESTS AT 1081.65 TONES..

MAY 8/WITH GOLD DOWN $7.00 TODAY; A BIG CHANGE IN GOLD INVENTORY: A PAPER ADDITION OF 5.85 TONNES/INVENTORY RESTS AT 1081.65 TONNES

MAY 7/WITH GOLD UP $29.65 TODAY : A SMALL CHANGE IN GOLD INVENTORY AT THE GLD//A PAPER ADDITION OF .41 TONNES/INVENTORY RESTS AT 1075.80 TONNES

MAY 6//WITH GOLD DOWN $17.00 TODAY/ A HUGE CHANGE IN GOLD INVENTORY AT THE GLD//A PAPER ADDITION OF 3.68 TONNES/INVENTORY RESTS AT 1075.39 TONES

MAY 5/WITH GOLD DOWN $1.65 TODAY: A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER ADDITION OF 3.81 TONNES//INVENTORY RESTS AT 1071.71 TONNES

MAY 4//WITH GOLD UP $12.00 TODAY//A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A MASSIVE PAPER DEPOSIT OF 11.4 TONNES INTO THE GLD////GOLD INVENTORY RESTS AT 1067.90 TONNES

MAY 1/WITH GOLD UP $8.45 NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 1056.50 TONNES

APRIL 30/WITH GOLD DOWN $15.95 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 1056.50 TONNES

APRIL 29/WITH  GOLD DOWN $7.65/A HUGE CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER DEPOSIT OF 8.19 TONNES OF GOLD INTO THE GLD////INVENTORY REST AT 1056.50 TONNES//

APRIL 28/WITH GOLD DOWN $4.50//NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 1048.31 TONNES

APRIL 27/WITH GOLD DOWN $12.75//A HUGE  CHANGE IN GOLD INVENTORY AT THE GLD: A PAPER DEPOSIT OF 5.85 TONNES INTO THE GLD////INVENTORY RESTS TONIGHT AT 1048.31 TONNES

APRIL 24/WITH GOLD DOWN $4.90 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS TONIGHT AT 1042.46 TONNES

APRIL 23/WITH GOLD UP $10.00 TODAY:  NO CHANGES IN GOLD INVENTORY AT THE GLD///INVENTORY RESTS TONIGHT AT 1042.46 TONNES

APRIL 22/WITH GOLD UP $40.75 TODAY:; TWO HUGE CHANGES IN GOLD INVENTORY AT THE GLD//A)A MONSTROUS  3.8 PAPER TONNES WERE ADDED TO THE GLD INVENTORY AND B) ANOTHER HUGE 9.07 TONNES OF PAPER GOLD ADDED LATE IN THE DAY//INVENTORY RESTS AT 1042.46 TONNES

APRIL 21/WITH GOLD DOWN $21.60 TODAY: A HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A MONSTROUS ADDITION OF 7.9 PAPER TONNES TO THE GLD INVENTORY//INVENTORY RESTS AT 1029.59 TONNES

APRIL 20//WITH GOLD UP $10.00 TODAY; NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 1021.69 TONNES

APRIL 17/WITH GOLD DOWN $27.80 TODAY: SURPRISINGLY NO CHANGES IN GOLD INVENTORY AT THE GLD///INVENTORY RESTS AT 1021.69 TONNES TONNES..THE STRING OF 12 STRAIGHT STRONG DEPOSITS ENDS..

APRIL 16/WITH GOLD DOWN $4.50 TODAY: ANOTHER HUGE CHANGE IN GOLD INVENTORY: A STRONG DEPOSIT OF 4.10 TONNES WAS ADDED TO THE GLD INVENTORY//INVENTORY RESTS AT 1021.69 TONNES/12TH STRAIGHT STRONG DEPOSIT

APRIL 15//WITH GOLD DOWN $19.10 TODAY; ANOTHER HUGE CHANGE IN GOLD INVENTORY; A STRONG 7.89 TONNES WAS ADDED TO THE GLD INVENTORY//INVENTORY RESTS AT 1117.59 TONNES.//11TH STRAIGHT STRONG DEPOSIT

APRIL 14/WITH GOLD UP $23.55 TODAY: ANOTHER HUGE CHANGE IN GOLD INVENTORY: A STRONG 15.51 TONNES WAS ADDED TO THE GLD INVENTORY/INVENTORY RESTS AT 1009.70 TONNES//THIS IS THE 10TH STRAIGHT STRONG DEPOSIT//THIS IS A FRAUDULENT VEHICLE..THEY HAVE NO PHYSICAL GOLD IN THE TRUST..

APRIL 13//WITH GOLD UP $27.65 TODAY: ANOTHER HUGE CHANGE IN GOLD INVENTORY: A STRONG 5.36 TONNES WAS ADDED TO THE GLD//INVENTORY RESTS AT 994.19 TONNES

APRIL 9 WITH GOLD UP $37.30 TODAY: ANOTHER HUGE CHANGE IN GOLD INVENTORY: A STRONG 2.92 TONNES WAS ADDED TO THE GLD//GOLD INVENTORY RESTS TONIGHT AT..988.63 TONNES

APRIL 8/WITH GOLD DOWN $.60//ANOTHER HUGE CHANGE IN GOLD INVENTORY/;; A STRONG 1.45 TONNES WAS ADDED TO THE GLD/GOLD INVENTORY RESTS AT 985.71 TONNES

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

Inventory rests tonight at

MAY 22/ GLD INVENTORY 1116.71 tonnes*

LAST;  826 TRADING DAYS:   +169.94 NET TONNES HAVE BEEN REMOVED FROM THE GLD

 

LAST 726 TRADING DAYS://+345.09  TONNES HAVE NOW BEEN ADDED INTO  THE GLD INVENTORY.

 

 

end

 

 

Now the SLV Inventory/

MAY 22/WITH SILVER UP 22 CENTS TODAY/ A HUGE PAPER WITHDRAWAL OF 1.864 MILLION OZ//INVENTORY RESTS AT 455.817 MILLION OZ/

LAST 5 DAYS: SILVER UP 60 CENTS: INVENTORY  UP A WHOOPING 23.767 MILLION OZ///

MAY 21/WITH SILVER DOWN 50 CENTS TODAY: A HUGE PAPER DEPOSIT OF 7.923 MILLION OZ///INVENTORY RESTS AT 457.681 MILLION OZ//

MAY 20//WITH SILVER UP ANOTHER 11 CENTS TODAY: A HUGE CHANGE IN SLV INVENTORY: A HUGE PAPER DEPOSIT OF 9.601 MILLION OZ INTO THE SLV// //INVENTORY RESTS AT 449.758 MILLION OZ

MAY 19/WITH SILVER UP ANOTHER 29 CENTS TODAY:  NO CHANGES IN SILVER INVENTORY AT THE SLV////INVENTORY RESTS AT 440.157 MILLION OZ//

MAY 18/WITH SILVER UP ANOTHER 48 CENTS TODAY: TWO BIG CHANGES IN SILVER INVENTORY AT THE SLV I.E. 2 PAPER DEPOSIT OF ( I) 8.39 MILLION OZ AND THEN ( 2) 8.109 MILLION OZ//INVENTORY RESTS AT 432.048 MILLION OZ// (TOTAL DEPOSITS 16.500 MILLION OZ///)

MAY 15/WITH SILVER UP 81 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV: /INVENTORY RESTS AT 423.65 MILLION OZ.

MAY 14//WITH SILVER UP 33 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV.//INVENTORY RESTS AT 423.65 MILLION OZ

MAY 13/WITH SILVER UP 2 CENTS TODAY: A HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A PAPER DEPOSIT OF 2.79 MILLION OZ INTO THE SLV..//INVENTORY RESTS AT 423.65 MILLION OZ//


MAY 12/WITH SILVER UP 5 CENTS TODAY: A BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 3.076 MILLION OZ INTO THE SLV////INVENTORY RESTS AT 420.861 MILLION OZ//

MAY 11.WITH SILVER DOWN 5 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 417.785 MILLION OZ//

MAY 8/WITH SILVER UP 11 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A MONSTER DEPOSIT OF 4.661 MILLION OZ OF SILVER INTO THE SLV..///INVENTORY RESTS AT 417.785 MILLION OZ//

MAY 7/WITH SILVER UP 45 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 413.124 MILLION OZ//

MAY 6/WITH SILVER DOWN 6 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 413.124 MILLION OZ//

MAY 5/WITH SILVER UP 17 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 413.124 MILLION OZ///

MAY 4//WITH SILVER DOWN 5 CENTS TODAY:2 HUGE PAPER CHANGES IN SILVER INVENTORY AT THE SLV.i).A  LARGE 1.399 MILLION OZ OF PAPER SILVER REMOVED FROM THE SLV//..//INVENTORY RESTS AT 411.427 MILLION OZ and ii) A LARGE 1.647 MILLION OZ OF PAPER SILVER ADDED TO THE SLV//  INVENTORY RESTS AT 413.124 MILLION OZ//


MAY 1/WITH SILVER FLAT IN PRICE: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 412.826 MILLION OZ///

APRIL 30/WITH SILVER DOWN 26 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 412.826 MILLION OZ//

APRIL 29/WITH SILVER DOWN ONE CENT TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 412.826 MILLION OZ//

APRIL 28 /WITH SILVER DOWN 2 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 412.826 MILLION OZ..

APRIL 27/WITH SILVER UP ONE CENT TODAY: TWO SMALL  CHANGE IN SILVER INVENTORY AT THE SLV: a) A WITHDRAWAL OF 373,000 OZ FORM THE SLV// b) A SECOND WITHDRAWAL OF 466,000: ////INVENTORY RESTS AT 412.826 MILLION OZ//

APRIL 24//WITH SILVER UP 3 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 413.665 MILLION OZ

APRIL 23/WITH SILVER UP 0 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 2.891 MILLION OZ INTO THE SLV/////INVENTORY RESTS AT 413.665 MILLION OZ//

APRIL 22/WITH SILVER UP 42 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY: A PAPER WITHDRAWAL OF 1.865 MILLION OZ INTO THE SLV//INVENTORY RESTS AT 410.774 MILLION OZ//

APRIL 21//WITH SILVER DOWN 60 CENTS TODAY; A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A PAPER ADDITION OF 1.398 MILLION OZ INTO THE SLV INVENTORY//INVENTORY RESTS AT 412.639 MILLION OZ//

APRIL 20//WITH SILVER UP 16 CENTS TODAY: A BIG CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 2.797 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 414.038 MILLION OZ//

APRIL 17/WITH SILVER DOWN 24 CENTS TODAY; A BIG CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 1.3999 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 415.437 MILLION OZ//

APRIL 16/WITH SILVER UP 5 CENTS TODAY: NO CHANGE IN SILVER INVENTORY AT THE SLV////INVENTORY RESTS AT 415.437 MILLION OZ//

APRIL 15//WITH SILVER DOWN 45 CENTS TODAY: TWO HUGE CHANGES IN SILVER INVENTORY AT THE SLV TWO HUGE DEPOSITS: A DEPOSIT OF 1.679 MILLION OZ AND ANOTHER 5.222 MILLION OZ INTO THE SLV////INVENTORY RESTS AT 415.437 MILLION OZ//

APRIL 14./WITH SILVER UP 51 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV//A MASSIVE PAPER DEPOSIT OF XXX MILLION OZ//INVENTORY RESTS AT 408.536 MILLION OZ//

APRIL 13//WITH SILVER DOWN 29 CENTS TODAY;  A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A MASSIVE PAPER DEPOSIT OF 6.155 MILLION OZ////INVENTORY RESTS AT 408.536 MILLION OZ//

APRIL 9/WITH SILVER UP 60 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A HUGE DEPOSIT OF 1.84 MILLION OZ INTO THE SLV///INVENTORY RESTS AT 402.381 MILLION OZ.

 

 

MAY 22.2020:

SLV INVENTORY RESTS TONIGHT AT

455.817 MILLION OZ.

END

 

LIBOR SCHEDULE AND GOFO RATES//  GOLD LEASE RATES

 

 

YOUR DATA…..

6 Month MM GOFO 3.16/ and libor 6 month duration 0.58

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

GOLD LENDING RATE: -2.59%

NEGATIVE GOLD LEASING RATES INCREASING//GOLD SCARCITY AND CENTRAL BANKS CALLING IN ALL OF THEIR GOLD LEASES

 

XXXXXXXX

12 Month MM GOFO
+ 2.18%

LIBOR FOR 12 MONTH DURATION: 0.68

 

GOFO = LIBOR – GOLD LENDING RATE

GOLD LENDING RATE  = -1.50%

NEGATIVE GOLD LEASING RATES  INCREASING//GOLD SCARCITY AND CENTRAL BANKS CALLING IN ALL OF THEIR GOLD LEASES

 

 

 

 

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

 

 

ii) Important gold commentaries courtesy of GATA/Chris Powell

Long before the pandemic countries went on a gold buying spree. The author explains why

(Drew Woodhouse/The Conversation.com/London/GATA)

Countries went on a gold-buying spree before coronavirus took hold — here’s why

 Section: 

By Drew Woodhouse
Lecturer in Economics
Sheffield Hallam University, Sheffield, England, UK
TheConversation.com, London
Thursday, May 21, 2020

The global economy was flashing danger signs long before the pandemic.

For one thing, many countries were clamouring to get hold of as much gold as possible. For the past decade they have been buying new reserves and bringing it home from overseas storage to an extent never seen in modern times. Then just before the pandemic, there was a pause.

What does all this mean?

Central banks added 650 tons to their reserves in 2019, the second highest shift in 50 years, after the 656 tons added in 2018. Before the 2007-09 financial crisis, central banks were net sellers of gold worldwide for decades. Leading the recent spree has been China, Russia, Turkey, Kazakhstan, and Uzbekistan.

We have also seen a large effort by central banks to repatriate their gold from other countries, mostly from storage in New York and London. …

… For the remainder of the report:

https://theconversation.com/countries-went-on-a-gold-buying-spree-before…

* * *

iii) Other physical stories:

This is an extremely important podcast for you to see.  Andrew explains how the LME will now be the new platform for trading in physical gold and silver and that will leave the COMex dead in its tracks.  As Andrew states RIP Comex..The LBMA will have to make a quick decision if it want to join or else they fall as well.

a must must view…

Start at one hr: 20 minute mark to view Andrew

a must view….

Episode 12 : Live from the Vault – Featuring CEO Thomas Coughlin, Eric Maine & Andrew Maguire

END

J. Johnson…

https://www.jsmineset.com/2020/05/22/mr-resolute-aint-done-buyn-yet/

Mr. Resolute Ain’t Done Buy’n Yet!

Posted May 22nd, 2020 at 9:04 AM (CST) by J. Johnson & filed under General Editorial.

Great and Wonderful Friday Morning Folks,

    They just can’t keep the first currency down like they used to with Gold recovering from yesterday’s dip with the trade at $1,735.50 up $13.60 after reaching $1,742.00 from a low at $1,722.50. Silver is recovering from its usual bigger beating with the trade at $17.47 up 10.6 cents after reaching $17.565 from its low down at $17.19. The US Dollar’s magnet is pulling it towards par with the value pegged at 99.74 up 33.7 points with its high at 99.895 from the low starting point at 99.40. Of course, all this started before 5 am pst, the Comex open, the London close, and after a Philadelphia Judge of Elections was caught stuffing the ballot box, admitting in court he literally was standing in a voting booth and voting over and over, as fast as he could.

     The Venezuelan Bolivar now has Gold priced at 17,333.31 showing a loss of 15.98 with Silver losing 2.447 Bolivar with the price at 174.482. Argentina’s price for Gold now sits at 118,094.77 Peso’s as the currencies pull – pushed the price down only 78.39 with Silver at 1,188.19 A-Peso’s showing a drop of 15.38 overnight. The Turkish Lira’s price, close to settling for the week, now sits at 11,811.85 Lira, and increase of 3.21 T-Lira with Silver’s trade at 118.901 down only 1.516 T-Lira.

      May Silver Delivery Demands now shows 148 fully paid for contracts waiting for receipts. Reducing yesterday’s count by 10, and with a Volume of 11 up on the board today with a trading range between $17.435 and $17.385 with the last trade at the high, up 10 cents, and with NO way to confirm if any of these 11 “buys” are spread trade entries/exits or “new buys”. Yesterday’s price, for the claimed 8 lot purchase was at $17.335. The daily delivery chart claimed a trade happened at $17.435 yesterday, but it doesn’t show up in their tick chart after I reported yesterday morning’s starting Volume of 2, which went to 4 with no price posted. Silver’s Overall Open Interest gained another round of Call Option Killers as the count reached 155,795 Overnighters proving 434 more shorts stayed in the trade after yesterday’s punch in the gut price drop.

      May Gold’s Delivery Demands now total 445 fully paid for contracts waiting for receipts proving a reduction of 83 contracts from yesterday’s trades with today’s starting point trading range between $1,726.70 and $1,726.60 for the 6 Lot Volume already up on the board. Yesterday proves the importance of watching the delivery numbers as Thursday’s Volume reached up to 528 contracts which just so happened to be yesterday’s Open Interest in the delivery month. The Volume Column does not include any of the previous purchases. These are either additional purchases or more entry/exit swaps in deliveries made in a single day. What this may be telling us is Mr. Resolute ain’t done buy’n and soaked up another 52,800 ounces on the dip! That purchase must have puckered up some of the short traders as the Overall Open Interest dropped 342 Obligations leaving the count at 532,367 paper contracts with only 3 days from their Options roll. Maybe it’s nothing to worry about, maybe it is. After all Silver and Gold are very small markets in the eyes of everyone else but the currency manipulators of the world. But when someone steps in and takes away $92,000,000 worth of marbles, they have less marbles (Gold) and more jacks (Debt) to contend with.

      As mentioned here for years, the inability to maintain debt continues to rise and rise (until?) as the virus is now “the blame in the game” as US Commercial Loan defaults, hit a 6 year high. Today’s default news shows a couple of overseas issues with tourism in Japan falling 99.9% in a months’ time with new car sales over in Europe plunging 76% in the same time period, which is also the largest drop ever. These are only a very few examples of the repercussions in the ability to maintain debt payments and staying in business. We expect a sharp increase in these stories, including an epic wave of global bankruptcies, as the world corrects the imbalances in debt, and as the political machine, that seems to have encompassed a few nations politicos, gets fully exposed.

      Those that hold the physicals, are not affected by any political news or these highly valued AAA+ rated debt instruments, held by every single central, which are artificially propped up by our ever-so-truthful rating agencies and their positive spin. Back when Jim Sinclair gave the warning, our marbles where placed at Tier 3. Now our marbles are placed as Tier 1 instruments! Since then we simply watch the show, knowing our retirements are in the safety of our own hands and not those that hold more debt than what can be paid. Those that hold debt, are now jacked, with the ratings heading towards Tier 3.

     Monday is our Memorial Day. I offer my deepest bow of respect to those that fought, bled, and died before us. If it wasn’t for them, we wouldn’t be here. Have a great and wonderful extended weekend and as always …

Stay Strong!

  1. Johnson

More J.Johnson content is available with purchase of a JSMineset subscription.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

71671201

Spencer Platt | Getty Images

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

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

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

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

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

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

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

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

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

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

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

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

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

end

March 4.2019

Parker City News

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Kovel declined to comment.

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

-END-

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

 Section: 

9:47a ET Tuesday, March 5, 2019

Dear Friend of GATA and Gold:

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

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

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

… 

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

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

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

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

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

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

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

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

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

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

* * *

Your early FRIDAY 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: 7.1350/ GETTING VERY DANGEROUSLY PAST 7:1//TROUBLE AHEAD

//OFFSHORE YUAN:  7.1528   /shanghai bourse CLOSED DOWN 54.16 POINTS OR 1.89%

HANG SANG CLOSED DOWN 1349.89 POINTS OR 5.56%

 

2. Nikkei closed DOWN 164.15 POINTS OR 0.80%

 

 

 

 

3. Europe stocks OPENED ALL MIXED/

 

 

 

USA dollar index UP TO 99.73/Euro FALLS TO 1.0907

3b Japan 10 year bond yield: FALLS TO. –.01/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 107.44/ 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:: 32.01 and Brent: 34.78

3f Gold UP/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 FALLS TO -.50%/Italian 10 yr bond yield DOWN to 1.61% /SPAIN 10 YR BOND YIELD DOWN TO 0.69%…ITALIAN 10 YR BOND YIELD/GERMAN BUND: 2.11: DANGEROUS FOR THE ITALIAN BANKING SYSTEM

3j Greek 10 year bond yield FALLS TO : 1.69

3k Gold at $1732..65 silver at: 16.98   7 am est) SILVER NEXT RESISTANCE LEVEL AT $18.50

3l USA vs Russian rouble; (Russian rouble DOWN 61/100 in roubles/dollar) 71.54

3m oil into the 32 dollar handle for WTI and 34 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 107.44 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 .9712 as the Swiss Franc is still rising against most currencies. Euro vs SF is 1.0593 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 0.50%

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 0.65% early this morning. Thirty year rate at 1.36%

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

6.  TURKISH LIRA:  UP  TO 6.7988..

Futures Slide, Yuan Tumbles, Hang Seng Plunges Most In 5 Years On Hong Kong Crackdown

S&P futures dropped alongside European and Asian stocks on Friday, while the Hang Seng index crashed 5.6%, the most in five years, as markets braced for an escalation in tensions between Washington and Beijing after China announced plans to impose a national security law on Hong Kong during its National People’s Congress. Treasuries climbed with the dollar while oil snapped a six-day winning steak.

Still, Wall Street’s main indexes were set to end Friday with weekly gains on the back of stimulus hopes and optimism over a pickup in business activity with a nationwide easing in lockdowns.  Hewlett Packard Enterprise fell 7.1% in premarket trade after missing second-quarter revenue and profit estimates, hit by global lockdowns since February.

China moved on Friday to impose a national-security law in Hong Kong that could see Mainland intelligence agencies set up bases in the global financial hub, raising fears of more pro-democracy protests. The move could also ratchet up U.S.-China tensions as President Donald Trump on Thursday warned Washington would react “very strongly” if Beijing went ahead with the law.

After rising above the key resistance level of 2,950 in the Thursday cash session, ES once again slumped below it dropping as low as 2905 before rebounding following the European open, if still holding on to losses while food and mining companies led the Stoxx Europe 600 Index lower. The risk-off tone took hold earlier in Asia, where Hong Kong’s benchmark stock index plunged more than 5%, its biggest drop since July 2015.

Also at the NPC, Chinese Premier Li announced the Government Work Report did not contain a GDP target for 2020 citing global pandemic and uncertainties for global economy and trade, but stated that China will make policy more flexible and will use policy tools such as open market operations, interest rate cut, RRR cut, re-lending and re-discount to keep liquidity reasonably ample. Furthermore, Li stated China is to issue CNY 1tln in special bonds this year and will cut tax and fee burdens for companies by CNY 2.5tln this year although noted China faces unprecedented risks and challenges. China also reiterated its intent to implement phase one of the trade deal with the US despite recent tensions between the two nations.

European stocks drifted lower, led by commodity-related equities such as miners and energy companies after China announced plans to impose a national security law on Hong Kong, while for the first time ever scrapping a GDP target, disappointed investors. Stoxx 600 basic resources dropped as much as 3.1%, dragged lower by miners: Rio Tinto -2%, BHP -2.3%, Glencore -3%, Anglo American -3%; Steelmakers also declined ArcelorMittal -3%, Evraz -2.5%, despite ArcelorMittal raising prices in U.S. Gold miners outperform: Polymetal +0.4%.

Asian stocks fell, led by finance and energy, after falling in the last session. All markets in the region were down, with Hong Kong’s Hang Seng Index dropping 5.6% and Singapore’s Straits Times Index falling 2.2%. Trading volume for MSCI Asia Pacific Index members was 14% above the monthly average for this time of the day. The Topix declined 0.9%, with I’rom Group and Fields falling the most. The Shanghai Composite Index retreated 1.9%, with Wuxi Hongsheng Heat Exchanger Manufacturing and Yangyuan Zhihui posting the biggest slides.

In rates, yields dropped, richer by 0.5bp to 4bp across the curve into early New York trading, holding most of their bull-flattening move during Asia session. Advance was spurred by the prospect of renewed political turmoil in Hong Kong after China introduced sweeping national security legislation, setting up a collision course with the U.S. 10-year TSY yields are lower by more than 2bp at ~0.645% while new 20-year bond continues to outperform; curve flatter with 2s10s, 5s30s spreads tighter by ~2bp. Gilts also in focus, outperforming bunds over European session after BOE policy maker Ramsden said more QE is possible at the June meeting, has an open mind on negative rates.

In FX, the Bloomberg Dollar Spot Index headed for its biggest rise in two weeks and Treasuries gained as investors braced for rising tensions between Washington and Beijing. The Australian weakened against most G-10 peers as sentiment was damped by China-Hong Kong tensions; the Norwegian krone led losses, tracking the drop in oil.

The yuan plunged to a 2 month low as China’s National People’s Congress abandoned its decades-long practice of setting an annual target for economic growth amid uncertainty unleashed by the coronavirus pandemic. The pound weakened for a third day as data showed retail sales in the U.K. dropped by almost a fifth in April.

Many are asking what happens next, with the emerging consensus that China will allow the Yuan to drift lower to 7.20 in response to any moves by the US.

“China’s move on legislation about Hong Kong and the risk of further deterioration in U.S.-China relations is worrying for market players,” said Masafumi Yamamoto, chief currency strategist at Mizuho Securities Co. in Tokyo. “They’re are keen to see how big an economic stimulus China may provide, which would affect risk-sensitive currencies such as the Aussie.”

In commodities, oil plunged, with Brent tumbling as much as $3 from Thursday’s high of $37, before settling around $34.50. West Texas oil plunged as much as 9.4% before trimming its losses to trade around $32 a barrel in New York. Base metals slumped in London on China fears: copper -2%, aluminum -1%, nickel -5%, zinc -1%; iron ore -0.7% in Singapore; gold +0.7%. Citi sees lower copper prices in the near term, as global surplus meets lower Chinese physical and speculative activity, but expect $5,800/t on a 6-12 month view as the market rebalances driving prices up the rising cost curve

Looking to the day ahead now and there are less data highlights. The UK and Canada will release retail sales data, which are likely to continue to show the deterioration caused by the pandemic. From central banks, the ECB will be publishing the account of their most recent monetary policy meeting and will grab some attention. Finally, as usual there are fewer earnings releases on Friday, but two important ones for the macro-environment include Deere & Company and Alibaba.

Market Snapshot

  • S&P 500 futures down 0.7% to 2,917.00
  • STOXX Europe 600 down 1.1% to 336.50
  • MXAP down 2% to 145.25
  • MXAPJ down 2.7% to 465.00
  • Nikkei down 0.8% to 20,388.16
  • Topix down 0.9% to 1,477.80
  • Hang Seng Index down 5.6% to 22,930.14
  • Shanghai Composite down 1.9% to 2,813.77
  • Sensex down 0.9% to 30,649.13
  • Australia S&P/ASX 200 down 1% to 5,497.03
  • Kospi down 1.4% to 1,970.13
  • Euro down 0.4% to $1.0910
  • Brent Futures down 5.2% to $34.17/bbl
  • Italian 10Y yield fell 1.9 bps to 1.441%
  • Spanish 10Y yield rose 1.0 bps to 0.643%
  • Brent Futures down 5.3% to $34.16/bbl
  • Gold spot up 0.6% to $1,736.71
  • U.S. Dollar Index up 0.4% to 99.73

Top Overnight News from Bloomberg

  • Asian, European shares slid and futures retreated in the U.S. as China announced plans to impose a national security law on Hong Kong, which threatened to further escalate tensions between Washington and Beijing
  • The Chinese government abandoned its decades-long practice of setting an annual target for economic growth amid the storm of uncertainty unleashed by the coronavirus pandemic, and said it would continue to increase stimulus
  • Britain posted a record budget deficit in April as the government unleashed an unprecedented package to prevent the collapse of the virus-stricken economy
  • Oil retreated from the highest level in more than two months as doubts over the strength of China’s economic recovery and geopolitical tensions ate away at its weekly advance
  • Bank of England Deputy Governor Dave Ramsden added his voice to the chorus of policy makers refusing to rule out negative interest rates in the U.K.

Asian indices weakened as markets digested today’s key events including the BoJ off-schedule meeting and start of China’s NPC where it omitted setting a GDP growth target for this year due to the coronavirus pandemic, as well as uncertainties surrounding economy and trade. ASX 200 (-1.0%) declined with energy names pressured by an aggressive pullback in oil prices and with sentiment subdued after Fitch revised its outlook on Australia’s sovereign rating to negative from stable, while Nikkei 225 (-0.8%) suffered the ill-effects of a firmer currency despite the BoJ’s announcement of a new measure to boost lending to small and mid-sized businesses impacted by the coronavirus in which it set aside JPY 75tln for its new loan programme but which was widely anticipated. Hang Seng (-5.6%) and Shanghai Comp. (-1.4%) were lower amid the start of China’s Two Sessions conclave where the Government Work Report refrained from setting an economic growth target but pledged to reduce tax and fee burdens for companies by CNY 2.5tln this year and use several tools to keep liquidity ample. Furthermore, the losses in Hong Kong were exacerbated after China’s attempts to tighten its grip on the Special Administrative Region through a new national security law, and is likely to stoke further unrest for the region which had already been mired by months of protests since the middle of last year. Finally, 10yr JGBs were relatively uninspired with only mild upside seen despite the downbeat risk tone and upside in T-notes, while the conclusion of the BoJ’s emergency meeting and announcement of a new lending scheme also failed to spur any meaningful price action.

Top Asian News

  • China Will Improve Hong Kong’s Security Laws, Premier Li Says
  • Hong Kong Stocks Haven’t Suffered This Much Since 2008

European majors trade mostly negative (Euro Stoxx 50 -0.3%) but have drifted off lows following a dismal APAC handover in which the Hang Seng was pummelled by the prospect of a resurgence in violent pro-democracy protests, whilst Chinese markets were dragged lower in sympathy as the nation is on course for further escalation with the US and as the NPC did not provide a GDP growth target for the year. Back to Europe, peripheries fare better than the core markets, whilst the FTSE 100 (-0.9%) and SMI (-1.4%) lag European peers, albeit the former weighed on by energy, materials and financials and the latter more-so on catch-up play. Sectors are red across the board but do not reflect a clear risk tone as specific sectors take hits on Hong Kong woes – with Financials and Energy underperforming, the latter amid price action in the complex and the former dragged by a lower yield environment alongside Hong Kong-exposed banks plumbing the depths; HSBC (-5.4%) and Standard Chartered (-4.0%). The wide US-China implication and downbeat sentiment prompts materials sector to trade on a poor footing. Fears of protests also see luxury names on the backfoot; LVMH (-1.2%), Kering (-1.2%), Richemont (-3.1%), Swatch (-1.1%) hold onto losses. In terms of other individual movers: Burberry (+1.8%) holds onto gains after the Co. said it can weather the pandemic with a strong balance sheet and protected liquidity. Renault (-2.0%) opened weaker amid little progress with the French gov’t on state aid; Co. are due to meet with Finance Minister Le Maire today.

Top European News

  • U.K. Budget Deficit Largest Since Modern Records Began in 1993
  • Putin Presses Plan to Extend Rule Amid Crisis Hurting Russians
  • Credit Suisse Targets Luckin Ex-Billionaire’s Family Assets

In FX, USDCNH was not the biggest move in percentage terms, but pertinent in the context of gauging the rising level of US-China angst as the pair climbs to highs not seen since March above 7.1600, and closer to record peaks in early September last year when trade wars were raging. Moreover, confirmation that Beijing is not setting an official 2020 growth target and the NPC drafting legislation on national security for Hong Kong have ruffled the Yuan, with the latter also adding yet another point of dispute to the increasingly long list jeopardising already strained relations between the 2 nations. In terms of the wider repercussions, risk sentiment has deteriorated further to the benefit of the Greenback above all rivals bar the Yen, as the DXY extends its rebound from recent lows and at least 2 close scrapes with the 99.000 level to a 99.838 high, and still seemingly on the up.

  • AUD/CAD/EUR/GBP/NZD – No surprise to see the Aussie bearing the brunt of the latest Washington-Beijing spat, especially as the Hong Kong Dollar is pegged, but Aud/Usd and Aud/Nzd have also retreated in response to Fitch downgrading the sovereign’s triple A ratings outlook to negative from stable. The former is now hovering nearer 0.6500 from 0.6600+ yesterday and the latter is down through 1.0700 compared to a 1.0830 apex earlier in the week, as the Kiwi manages to stay within sight of 0.6100 against its US counterpart following comments from NZ Finance Minister Robertson about formative discussions on the topic of helicopter money. Meanwhile, the Euro has handed back more gains vs the Buck after its fleeting or false break over the 1.1000 mark on Thursday and has been back under the round number below, but not quite far enough to stir hefty option expiry interest between 1.0885-75 in 2.8 bn. Elsewhere, the Loonie has lost its oil prop and trying to contain declines through 1.400 ahead of Canadian retail sales data, and on that very note Cable is straddling 1.2200 and the Eur/Gbp cross 0.8950 after weaker than expected UK consumption rattled Sterling somewhat more than equally bad public sector finances and tripped some stops in the former at 1.2180. However, underlying bids said to be sitting from 1.2160 to 1.2150 have not been troubled so far.
  • JPY/CHF – As noted above, the Yen is marginally outperforming vs the Greenback, albeit still rangebound either side of 107.50 and only retaining an element of safe-haven premium after no shocks from the inter-schedule BoJ meeting or more recent joint statement from Governor Kuroda and Japanese Finance Minister Aso expanding on the rationale behind new bank lending provisions. Conversely, Usd/Chf remains elevated on the 0.9700 handle, but the Franc is still unwinding losses relative to the Euro and probing 1.0600 ahead of the ECB minutes (full preview available via the headline feed) and next Monday’s Swiss bank sight deposit balance update.
  • EM – Aside from broad depreciation on risk aversion, the Indian Rupiah got an unexpected 40 bp RBI rate cut to contend with, though Usd/Idr has reversed after a knee-jerk jump to trade lower on the day.

In commodities, WTI and Brent front month futures experience substantial intraday losses as sentiment takes a hit from developments regarding the Hong Kong legislations as well as wider implications such as escalating trade tensions with the US and souring sentiment with the UK. As such, clear risk aversion is seen – with WTI and Brent July around USD 31.50/bbl and 34/bbl, down around 7% and 5% respectively and with current bases at USD 30.70/bbl and USD 33.50/bbl respectively. Spot gold sees haven demand, residing towards the top-end of its USD 1725-38/oz current range. Copper prices gapped lower below USD 2.4/lb and holds onto sentiment-driven losses, with some also attributing the downside to China refraining from assigning a GDP target.

US Event Calendar

  • Nothing major scheduled

DB’s Jim Reid concludes the overnight wrap

Today is the last Corona Crisis Daily unless we see a resurgence of case numbers. Let’s hope not. In our last edition we part with some stats comparing US fatalities between February 1st and May 16th this year for flu and covid-19. Interestingly in all age buckets up to at least 24yrs old, flu has killed more people (141 total) than covid-19 has (27). In the 25-34 year bucket the numbers pivot and are 138 versus 463. By the time we get to the over 55 year olds the divergence is stark with 5,184 dying of flu against 63,923 for covid-19. Across all ages more people have died of pneumonia though than covid-19 in the US over this period. Hopefully we’ve been balanced in our reporting on covid-19. One of the key themes we’ve tried to highlight over the last couple of months or so is how savagely discriminant covid-19 is, especially by age. It’s staggering given that flu is seemingly more deadly for under 24 year olds and is also staggering how susceptible the elderly and those with underlying conditions are relative to the young. Why the young are so spared is a welcome mystery. However as we increasingly understand this about the virus it surely gives the global politicians more options going forward as to how to protect economies from a second wave. Good luck to them.

Moving on to markets now and for a second day in row, US President Trump escalated the rhetoric war with China, specifically criticizing the country’s leadership. Then later in the day Trump posted a letter to Congress on the “Strategic Approach” to China, saying that the US, “has adopted a competitive approach to the People’s Republic of China, based on a clear-eyed assessment of the Chinese Communist Party’s intentions and actions, a reappraisal of the United States’ many strategic advantages and shortfalls, and a tolerance of greater bilateral friction.” Lastly on China, the country is proposing a new security law in Hong Kong that could ban sedition, secession and treason. This will likely draw a large amount of opposition given the pro-democracy protests in the country over the past year. This could be another wedge between China and the US, given how many US politicians on both sides of the aisle supported HK’s efforts last year. The China-US headlines were accompanied by news that the Trump administration is moving to withdraw from the Open Skies treaty, a nearly 30 year old accord meant to reduce tensions between Russia and the West, citing a lack of adherence by the Russians.

Risk markets reacted negatively to the political uncertainty as economic data continued to show that recovery from the virus-induced lockdowns may not be as sharp as markets are pricing. The S&P 500 fell -0.78% although it was off the session lows of -1.11% just as Europe went home. Or at least left the home office and went to the kitchen if they weren’t already there on holiday. For the activity that was there in Europe, stocks fell on the further agitation with the Stoxx 600 down -0.75% on lower volumes (down -17% from the 30-day average) with much of Scandinavia and the Swiss markets closed and France and Germany observing the public holiday albeit with markets thinly trading. Oil continued to rally though, albeit at a slower pace, with WTI futures up +1.28% and Brent crude rallying +0.87%.

Overall it’s fascinating to see that markets are shaking off the very bad news on the future US/China relationship much more now in the face of a global pandemic than it did last year when the tensions were fraught but most likely still pointing towards a trade deal at some point. The relationship feels more in terminal decline now than it did 6-12 months ago. Maybe the answer to this puzzle lays in the central bank liquidity surge. DB’s Alan Ruskin yesterday updated his aggregated key country central bank liquidity charts (link here) where he showed that rolling 12 month central bank liquidity is already running double the peak it reached at any point during the GFC. It took more than three and a half years (September 2008 thru and into 2012) to ‘achieve’ the $4.5 trillion cumulative expansion in G10 central bank balance sheet assets that we have seen over the last 12 weeks. Worth having a look at the graphs. All fairly remarkable.

Staying with stimulus, DB’s Peter Sidorov updated his latest excellent G-20 policy response document yesterday ( link here ) which actually shows that G-10 central bank balance sheets have now gone well above $20 trillion from over $16 trillion before the crisis. When you include total G-20 central bank measures already injected or promised so far it amounts to around $9 trillion. The piece also includes details of fiscal commitments from every one of these countries. Italy and Germany are the top of the list for combined fiscal above and below the line (guarantees etc.) commitments.

One of the main beneficiaries of this liquidity has been bonds as they’ve stayed firm during the strong risk on over the last two months. In the small risk off seen yesterday they rallied again. US 10yr yields were -0.8bps lower at 0.672%, while German bunds fell -2.7bps to -0.50% and Gilts fell -5.8bps to 0.17%. Both Gilts and US Treasuries are now roughly back to around 11bps from all-time lows. Peripheral spreads widened slightly (1-2bps) during a week of increased tightening. Safe havens were not uniformly higher, as gold had its worst day since 30 April falling -1.21%.

Overnight, the text of China’s Premier Li Keqiang’s annual policy address has confirmed that the country is indeed abandoning its GDP growth target for this year. The text specifically states that, “I would like to point out that we have not set a specific target for economic growth this year” and “this is because our country will face some factors that are difficult to predict in its development due to the great uncertainty regarding the Covid-19 pandemic and the world economic and trade environment.” The text of speech also contained announcement of plans to impose a national security law in Hong Kong which as we noted above will only add to tensions between the US and China. The Hang Seng is trading down -4.61% on the back of this and as you’ll see below, appears to be dragging other markets lower too.

China has also set the target for the urban surveyed unemployment rate of around 6%, higher than 2019’s goal and proposed a wider budget deficit at 3.6% of GDP (vs. 2.8% of GDP in 2019). In terms of policy, fiscal was smaller than what our economists expected while there were strong signals on monetary, “specifically higher than last year”. Finally, the government said explicitly that it will “mutually enforce the phase on trade deal with the US”. More support has also been granted to SMEs. See the full summary from our economists here.

The Shanghai Comp and CSI 300 are down -1.31% and -1.59% respectively in the wake of that and the Kospi -1.46%, while there are more modest losses for the Nikkei (-0.76%). Meanwhile, futures on the S&P 500 are down -0.60% while yields on 10y USTs are down -2.5bps. Elsewhere, WTI oil prices are down -6.93% this morning while iron ore is up +1.34% continuing its winning run since April 29th.

In a busy overnight session, the BoJ’s unscheduled monetary policy meeting has ended with key interest rates and asset purchases unchanged. The central bank instead launched a new lending program worth JPY 30tn to support small businesses struggling amid the coronavirus in order to prevent bankruptcies. The program is due to run through March next year and will channel money to companies via commercial banks and other financial institutions. Also, like the other BoJ facilities, the facility will encourage lending to companies by providing free loans to financial institutions and then paying them 0.1% interest on the amount they in turn lend out. In other overnight news, Fitch revised the outlook for Australia’s credit rating to ‘negative’ from ‘stable’ citing that “Government spending in response to the health and economic crisis will cause large fiscal deficits and a sharp increase in government debt/GDP.”

In a busy week for the Fed Chair, Jerome Powell spoke with Fed Governor Brainard at a live-streamed “Fed Listens session” to get feedback from small-business, labour, and non-profit organization leaders over their policy stances. In remarks that could be used by lawmakers to push for further stimulus, Powell said, “While the burden is widespread, it is not evenly spread…Those taking the brunt of the fallout are those least able to bear it.” Fed Vice Chair Clarida also spoke yesterday, and echoed recent calls for further fiscal stimulus, but thought that the economy would show signs of growth sometime after June.

Looking at the economic data yesterday, US initial jobs claims registered another 2.44m people for the week ending May 16, down from last week’s 2.69m. This was slightly above the consensus forecast of 2.4m. Continuing claims are now at a record 25.1m through the week ending 9 May – this in turn takes the insured unemployment rate to 17.2%. The good news is that initial jobless claims have now fallen for 7 straight weeks, but they are still at least triple the previous highs.

The other big data of the day was the flash PMIs for May. This month, metrics rebounded slightly but remained in deep contraction territory. The Eurozone composite PMI registered 30.5, up appreciably from the 13.6 reading in April and above consensus at 27.0. On the country level, France had one of the bigger recoveries with composite PMIs rising from 11.1 in April to 30.5 in May, still slightly under consensus at 32.4 though. Germany’s flash composite PMI for May was 31.4, up from 17.4 in April but below the consensus estimate of 33.1. The UK’s composite PMI was at 28.9, well above consensus at 25.7 and April’s 13.8 reading.

On the other side of the Atlantic, the US composite PMI was 36.4, up from 27.0. The country did not register as large a fall in April, and so the rebound was not as sharp. Remember again that PMIs are diffusion indices, where respondents simply say whether things are better or worse than last month, and so during extreme events they don’t necessarily give the most accurate picture on the scale of the declines or rebounds when they happen, though direction still matters.

Looking to the day ahead now and there are less data highlights. The UK and Canada will release retail sales data, which are likely to continue to show the deterioration caused by the pandemic. From central banks, the ECB will be publishing the account of their most recent monetary policy meeting and will grab some attention. Finally, as usual there are fewer earnings releases on Friday, but two important ones for the macro-environment include Deere & Company and Alibaba.

 

3A/ASIAN AFFAIRS

i)FRIDAY MORNING/ THURSDAY NIGHT: 

SHANGHAI CLOSED DOWN 54.16 POINTS OR 1.89%  //Hang Sang CLOSED DOWN 1349.89 POINTS OR 5.56%   /The Nikkei closed DOWN 164.15 POINTS OR 0.80%//Australia’s all ordinaires CLOSED DOWN .92%

/Chinese yuan (ONSHORE) closed DOWN  at 7.1350 /Oil UP TO 32.01 dollars per barrel for WTI and 34.28 for Brent. Stocks in Europe OPENED MIXED//  ONSHORE YUAN CLOSED DOWN // LAST AT 7.1350 AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 7.1528 TRADE TALKS STALL//YUAN LEVELS GETTING DANGEROUSLY PAST 7:1//TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS AT HUAWEI /CFO ARRESTED//CHINA VS HONG KONG//  : /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

JAPAN

As expected, Japan’s tourism tumbles a huge 99.9% in April

(zerohedge)

 

Japanic! Tokyo Tourism Tumbles 99.9% In April

Japan saw an estimated 2,900 foreign travelers in April, down 99.9% from a year earlier, as COVID-19 travel restrictions and lockdowns left the once-booming tourism sector in a state of paralysis.

The drop in foreign visitors was the most significant percentage decline on record dating back to 1964, the Japan National Tourism Organization (JNTO) reported. It was the first time the monthly figure fell sub 10,000. The previous low for monthly foreign visitors was 17,543 set back in February 1964.

The reason for the sharp decline stems from the government’s restrictions on international travel following a surge in domestic virus cases and deaths. On April 3, entry restrictions for international travelers were applied to 100 countries, including China, the US, and Europe, resulting in a collapse of inbound travel that severely impacted the country’s tourism industry.

Before the pandemic, tourism in the country was increasing at healthy growth rates. Around 31.8 million people visited Japan in 2019, up 2.2% over the previous year. Japan had high aspirations to boost tourism to a record 40 million this year, but those estimates were crushed due to the now-postponed Tokyo Olympics that have been rescheduled for 2021.

Travel restrictions and shutdowns have found success in mitigating the spread of the virus, Prime Minister Shinzo Abe said on Thursday, adding that Japan could lift the state of emergency in Tokyo as early as next week, that is if virus infections can remain low. Emergencies were recently lifted in Osaka, Kyoto, and Hyogo because of a drop in confirmed cases.

Japan’s tourism industry is expected to remain in a slump throughout the year. The world’s third-largest economy dove into recession for the first time since 2015:

“The economy entered the coronavirus shock in a very weak position,” said Izumi Devalier, chief Japan economist at BofA, but “the real big ugly stuff is going to happen in the April, June print. It’s going to be three-quarters of very negative growth.”

Read: “Japan Exports Worst Since Financial Crisis; Korea Early May Export Data Just As Dire

Abe, like other world leaders, is quickly trying to reopen his crashed economy and simultaneously contain the pathogen’s spread. This difficult task could ignite into a second virus wave later this year.

Japan’s low rate of testing for the virus suggests the scope of the outbreak is still yet to be known.

end

3 C CHINA

CHINA/LAST NIGHT

What is going on here?  China hoarding PPE as it braces for another wave?

(zerohedge)

 

 

China Is Hoarding PPE Again As It Braces For COVID-19’s “Second Wave”

A while back, we reported on one notable US Intel leak claiming Beijing deliberately waited until Jan. 22 to warn the world about the possibility of a widespread outbreak (before that, Beijing insisted there was no evidence of human to human transmission, implying that this would likely be an isolated incident) so the CCP would have time to grab up all the PPE and other vital supplies.

That was why, when the tidal wave of infections finally hit in the US, a sudden and inexplicable shortage of PPE forced nurses and doctors in some of the most notorious hotspots – including NYC – to work without masks and gowns. Many used garbage bags, or used one disposable mask for a week or more.

Now, Fox News reports that the CCP appears to be gobbling up all the capacity once again as businessmen complain about suppliers warning about being unable to process new orders.

China’s Communist Party is again seizing factory lines churning out the world’s supply of medical safety gear — sparking fears the country is preparing for a second wave of the coronavirus, American traders in China told The Post.

New Yorker Moshe Malamud, who has done business in China for over two decades, was moving tens of millions of pieces of protective gear to the U.S. at the height of the crisis but said suppliers in recent weeks had been overwhelmed with orders from the Chinese government.

“I was placing a larger order with one of the bigger distributors and he tells me, ‘I can complete this order but after this we’ve been contracted by the Chinese government to produce 250 million gowns,’” said Malamud, who lived in China for a decade before founding aviation company M2Jets.

Thermometer makers have also been inundated with government orders.

He said he heard a similar story about another manufacturer making thermometers.

“We hear how China is up and running and the virus is past them, so I asked, ‘What are they ordering 250 million gowns for?’ and of course no one is talking.”

“I’ve been hearing this a lot from other manufacturing institutions that say, ‘We can give you a little bit, but basically we’re concentrated between now and the end of the summer manufacturing stuff for the Chinese government in anticipation of a second wave,'” he continued.

Last month, leading U.S. manufacturers of medical safety gear told the White House that China had prohibited them from exporting goods as the crisis mounted, a Post report revealed.

Beijing has already forced some 108 million Chinese in northeastern Jilin Province back under “partial lockdown” following another outbreak. They’re also carrying out a mass-testing campaign in Wuhan.

Although Dr. Anthony Fauci has repeatedly warned that the US should brace for a second wave of the virus, a second wave isn’t a foregone conclusion. As NYT opinion columnist Nicolas Kristof wrote in his column published in Thursday’s paper, “epidemiology is full of puzzles.” In 2003, the WHO feared a deadly resurgence of SARS that fall. But instead, the virus petered out. As Dr. Fauci explained once several months ago, we know little for certain about the virus, and because of this, it’s important to be prepared for the worst-case scenario.

And if the outbreak in Brazil continues to rage out of control, the possibility that Brazilians could reinfect the entire Western Hemisphere is looking increasingly plausible.

END
CHINA/USA/HAWLEY
We are probably looking at the next President of the uSA in 2024, Josh Hawley
(zerohedge)

Sen. Hawley Lays Out Super-Nationalist, Anti-China Vision

Sen. Josh Hawley (R-MO) delivered a well-practiced speech on Wednesday blasting China for its virus response, and warning of the threat posed by Beijing’s economic ambitions.

If Trump’s China rhetoric is a 7, Hawley’s is a solid 11.

The international order as we have known it for thirty years is breaking. Now imperialist China seeks to remake the world in its own image, and to bend the global economy to its own will,” Hawley warned, adding “Are we in this nation willing to witness the slow destruction of the free world? Are we willing to watch our own way of life, our own liberties and livelihoods, grow dependent on the policy of Beijing?

Hawley also argued that China’s “failures and lies” unleashed the COVID-19 pandemic onto the world, according to Axios.

He’s also calling for the US to withdraw from the World Trade Organization, which he sees as an obstacle to American sovereignty.

His charge sheet against the WTO reflects White House talking points: US negotiators paid too much in past negotiations and got too little in return; competitive traders like China unfairly exploit rules to help poor developing countries; and the system for settling disputes is flawed with rulings that impinge on US rights and expand US obligations beyond what was agreed at the negotiating table.  –Piie

Hawley accused China in a NYT Op-Ed of maintaining “protectionist workarounds” while stealing American intellectual property – which the US cannot contest due to restrictive WTO obligations, according to the Peterson Institute for International Economics.

In his Wednesday speech, Hawley said that Americans cannot be both prosperous and secure in a world where China’s influence and economic power have dwarfed America’s due to unfair trade relations.

Watch:

end 

HONG KONG/CHINA/USA

This is it:  China’s Congress announces a huge crackdown on Hong Kong with its new ‘National Security” Law. For the first time it abandons its GDP targets.

(zerohedge)

“This Is The End Of Hong Kong”: China Congress Announces Crackdown On Hong Kong With New “National Security” Law; Abandons GDP Target

With China’s ambitions toward Hong Kong having emerged as the top political fault line in recent days, the market was closely following the start of Friday’s National People’s Congress (NPC) where in addition to disclosures on Chinese political strategy, Beijing announces decisions on targets on GDP, CPI and fiscal deficit.

Which is why many were surprised when in the text of Premier Li Keqiang’s annual address, for the first time China abandoned its usual practice of setting a numerical target for economic growth this year due to the turmoil caused by the coronavirus pandemic.

“I would like to point out that we have not set a specific target for economic growth this year,” the report said, according to Bloomberg which saw a leaked version. “This is because our country will face some factors that are difficult to predict in its development due to the great uncertainty regarding the Covid-19 pandemic and the world economic and trade environment.”

As Bloomberg adds, the shift away from a hard target for output growth not only breaks with decades of Communist Party planning habits, but is an admission of the deep rupture that the disease has caused in the world’s second-largest economy. With the growth outlook depending also on the efforts of trading partners to rein in the pandemic, the government is shifting its focus to employment and maintaining stability.

Among the various other economic goals disclosed by China, are:

  • The addition of 9 million urban jobs; surveyed jobless rate around 6% (as we reported recently, the People’s Liberation Army is aggressively hiring all those who lost their jobs due to the pandemic, so at least China’s army will soon be absolutely massive)
  • Plans 3.75 trillion Yuan of Special Local Govt Bonds in 2020 (a relatively modest number)
  • Sell 1t yuan of anti-virus sovereign bonds in 2020 (even more modest)
  • Deficit-to-GDP ratio this year is projected at more than 3.6% and the deficit increase is projected at 1 trillion yuan (about $141.6 billion) over last year (remember when China actually ran a budget deficit)
  • China to work with U.S. to implement phase 1 trade deal (a noble goal, also one which will never happen)
  • China sets 2020 CPI target at about 3.5% (China may have to launch another “pig ebola” virus to boost food inflation)
  • China to use innovative monetary policy tools to finance real economy (so China will do QE as well?)
  • China’s monetary stance unchanged; to make prudent monetary policy more flexible, appropriate
  • China to use RRR cuts and interest rate cuts, relending
  • China to guide money supply ‘significantly’ higher than 2019
  • China targets more stable, high-quality imports, exports
  • China to keep yuan at reasonable and equilibrium level
  • China targets basic equilibrium in balance of payments
  • China to cut taxes, fees by about 500b yuan this year
  • China to asks large banks to boost lending to small firms by 40% (the US doesn’t hold a trademark on a debt bubble after all)
  • China sees defense spending up 6.6% to 1.268 trillion yuan (see “China’s Military Seeks Bigger Budget Amid “Growing Threat Of US Conflict”“)

While none of the above was especially remarkable (with the exception of the hint at QE), the reason why stocks gave the report a thumbs down is because as Premier Li also said, China will safeguard national security in Hong Kong, i.e., China plans on expanding its crackdown on Hong Kong sovereigntya step that comes one day after China announced dramatic plans to rein in dissent by writing a new law into the city’s charter, and just hours after the Senate passed a bill that will retaliate against China should it do precisely that, effectively ensuring an even further deterioration in US-Sino relations.

Specifically, the National People’s Congress confirmed plans to pass a bill establishing “an enforcement mechanism for ensuring national security” for Hong Kong, with Reuters adding that China’s draft Hong Kong legislation says Hong Kong “should finish enacting as soon as possible the regulations in basic law regarding national security” and that Hong Kong government and legal bodies should effectively prevent, stop and punish activities that endanger national security.

Chinese lawmakers were preparing to soon pass measures that would curb secession, sedition, foreign interference and terrorism in the former British colony, local media including the South China Morning Post reported Thursday, citing unidentified people.

“We will establish sound legal systems and enforcement mechanisms for safeguarding national security in the two special administrative regions, and see that the governments of the two regions fulfill their constitutional responsibilities,” Li said according to prepared remarks on Friday.

As Bloomberg adds, any attempt to impose security laws now could reignite the unrest that hammered the city’s economy last year and serve as a flash point amid broader U.S.-China tensions. Protesters urged democracy advocates to hold rallies across the city Thursday night, with one poster describing the moment as a “battle of life and death,” but mass demonstrations didn’t immediately materialize.

This is the end of Hong Kong,” said Dennis Kwok, an opposition lawmaker representing the legal sector. “I foresee that the status of Hong Kong as an international city will be gone very soon.

More importantly, we now have a timeline: the law is expected to pass China’s parliament before the end of its annual session May 28, so retail investors have about a week to ramping stocks higher before the trapdoor opens.

The legislation would still require several procedural steps including approval by the NPC’s decision-making Standing Committee, which could come as early as next month, the SCMP said. The move comes before citywide elections in September in which opposition members hoped to gain an unprecedented majority of the Legislative Council.

* * *

Although national security laws are required to be passed by Article 23 of the Basic Law, Hong Kong’s mini-constitution, successive governments have failed to pass them, with one effort in 2003 resulting in widespread street demonstrations. This new strategy could potentially allow authorities to skip the local legislative process, although the mechanics of how that would work remained unclear.

“It is absolutely necessary that the country’s top legislature fulfill its obligation to guarantee national security, by strengthening the legal framework with regard to Hong Kong,” the state-run China Daily said in a commentary. “There is nothing untoward in this as all countries attach the utmost significance to national security, and the introduction of such a law will safeguard the long-term stability and prosperity of Hong Kong.”

In addition to a more than 3% drop in Hong Kong stocks following the report of the imminent crackdown, three- and 12-month forwards on the Hong Kong dollar rose in New York trading, indicating traders expected more weakness ahead for the currency, which slipped the most in six weeks earlier in the day.

The market is taking this news negatively for Hong Kong given the likely return of violent protest activities, higher risk for the U.S. to remove certain preferential terms for Hong Kong, such as the special tariff status, and risk-off sentiment,” said Becky Liu, head of China macro strategy at Standard Chartered Bank Ltd.

In addition to an imminent return of violent Hong Kong protests, China’s position sets up an election-year showdown with Trump, who has come under pressure in Washington to reconsider the special trading status before the city’s return to Chinese rule under a promise to maintain its liberal financial and political structure. Secretary of State Michael Pompeo has delayed an annual report on whether the city still enjoys a “high degree of autonomy” from Beijing, telling reporters Wednesday that he was “closely watching what’s going on there.”

On Thursday, Trump warned that the U.S. would respond to any move to curtail protests and democratic movements in Hong Kong: “I don’t know what it is because nobody knows yet,” Trump, speaking to reporters as he left the White House on Thursday, said about the possible Chinese actions. “If it happens, we’ll address that issue very strongly.” He didn’t elaborate.

Assuring that this will only get worse, much worse, a late Thursday tweet from Global Times editor in chief Hu Xijing said that “Hong Kong belongs to China, not the US. If senior officials in Washington are confused about this, President Trump’s granddaughter can tell them this common sense.”

The climax came when late on Thursday, senators Chris Van Hollen (Democrat) and Pat Toomey (Republican) introduced legislation to punish Chinese entities involved in enforcing the proposed new security law in Hong Kong and penalize banks that do business with those entities. They acted in response to what they said was the Chinese Communist Party’s “brazen interference” in Hong Kong’s autonomy. Meanwhile, China has repeatedly stressed that the US should mind its own business and not mess in internal affairs, with Hong Kong considered one of them.

Perhaps this is a good time to reread the latest Dalio blog post on why a war between the US and China is now inevitable.

END
CHINA/HONG KONG/USA
The USA is furious with China’s new “National Security Law”. It spells the death knell for Hong Kong freedoms
(zerohedge)

A “Death Knell” For Hong Kong Freedoms – Furious Pompeo Slams China’s “Disastrous” New National Security Law

Secretary of State Mike Pompeo has issued a statement responding to China’s new “National Security” law effectively criminalizing all forms of political dissent in the territory. In it, he unequivocally insisted the US would “stand with Hong Kong” and oppose Beijing’s decision to “unilaterally and arbitrarily” crack down on Hong Kong’s freedoms, which were supposedly enshrined in the “one country, two systems” deal with the British back in the 1980s.

Beijing has capitalized on a loophole in HK’s “Basic Law” requiring the city state to have some kind of National Security law. But the sensitive political climate has kept an official law off the books for decades. Now, it’s being extraneously imposed by Beijing.

As Hong Kongers prepare to take to the streets in protest, Pompeo hinted that the law – which would be a “death knell” for political freedoms and autonomy for Hong Kong – would result in the US stripping the city-state of its special economic status, which was contingent on China keeping its hands off Hong Kong.

  • POMPEO SAYS U.S. STANDS WITH PEOPLE OF HONG KONG, STRONGLY URGES BEIJING TO RECONSIDER ITS ‘DISASTROUS PROPOSAL’ -STATEMENT
  • U.S. SECRETARY OF STATE POMPEO SAYS CHINA’S DECISION TO BYPASS HONG KONG’S LEGISLATIVE PROCESSES AND IGNORE WILL OF THE PEOPLE ‘WOULD BE A DEATH KNELL’ FOR AUTONOMY PROMISED UNDER AGREEMENT -STATEMENT
  • U.S. STRONGLY URGES BEIJING TO RECONSIDER `DISASTROUS PROPOSAL’

A State Department spokeswoman exhorted China to “honor” its commitments under the Sino-British agreement that led to Hong Kong return to Beijing.

“We urge Beijing to honour its commitments and obligations in the Sino-British Joint Declaration,” said State Department spokeswoman Morgan Ortagus in a statement, referring to the bilateral treaty signed in 1984 that guarantees a “high degree of autonomy”

Hong Kong’s government said Friday it would “fully cooperate” with the Standing Committee and the NPC as the law is implemented, and urged Hong Kongers to view the law “positively”.

Of course, Hong Kong Chief Executive Carrie Lam, better known to demonstrators as “piglet” due to her obsequiousness to Beijing, is deeply unpopular and has reportedly said she would resign her post if Beijing would allow it.

  • H.K.’S LAM SAYS CITIZENS SHOULD VIEW SECURITY LAW ‘POSITIVELY’
  • LAM: SECURITY LAW CAN BOLSTER BUSINESS CONFIDENCE IN HONG KONG
  • LAM SAYS HONG KONG FINANCIAL SYSTEM REMAINS ROBUST
  • CARRIE LAM: HONG KONG WILL REMAIN A FREE SOCIETY
  • LAM: H.K. GOVT WILL RELAY CONCERNS ON SECURITY LAW TO BEIJING

As we’ve explained for President Xi, it’s just the start of a his promise to reassert dominance over Chinese territories like Taiwan and Hong Kong, where anti-government protests flared during the second half of 2019. Rising unemployment and a crumbling economy will likely make matters worse as an increasingly frustrated public blames Beijing for their strife.

“Xi feels threatened, the leadership feels threatened — this is a crisis,” David Zweig, an emeritus professor at the Hong Kong University of Science and Technology and director of Transnational China Consulting, told BBG. “This is, ‘We’re not going to give an inch, we’re going to tighten up, and Hong Kong’s national security as a potential subversive center is greater than its economic value.’”

In the meantime, officials responsible for overseeing Beijing’s relationship with Hong Kong insisted that the law would impact “very few people”, and the Chinese press rolled out a full-on offensive playing down the significance of the law.

With all the economic and political drama, Kyle Bass’s decision to bet on the HKD peg to the dollar finally breaking is looking increasingly prescient, as the currency comes under increasing pressure.

end
HONG KONG/USA
USA set to retaliate against CHINA
(ZEROHEDGE)

White House Weighs Economic Retaliation Against China As Hassett Warns “All Options Are On The Table”

While Secretary of State Mike Pompeo slams China over its planned ‘National Security’ law, which clearly aims to suppress all political dissent and “foreign influence” in Hong Kong, while hinting that the special trade status enjoyed by the city-state might soon be revoked, White House economic advisor Kevin Hassett appears on CNN Friday to play ‘bad cop’ to Pompeo’s ‘good cop’.

As Huawei scrambles to find suppliers not based in the US, Hassett insisted that the White House is “absolutely not going to give China a pass” and is already considering any and all forms of economic punishment, including, presumably, more laws to force the de-listing of Chinese companies on US exchanges, or even the cancellation of US debt held by Beijing.

“We’re absolutely not going to give China a pass. All the options are on the table,” Hassett said.

He added that the new law was a “scary move” as it shows Beijing is starting to care less and less about the objections of the West.

“And that’s going to be very costly to China and the people of Hong Kong. So, yeah, I think it is a very difficult, scary move and that it is something that people need to pay close attention to,” he said.

Ultimately, a less-free Hong Kong will hurt the city-state’s status as a financial hub.

“If Hong Kong stops being Hong Kong, the open place it is, then it is no longer going to be the financial center that it is.”

For some reason, CNN chose not to share the clip of Hassett discussing the potential to economically punish China. However, it did share clips where he discussed the potential May unemployment rate, which Hassett said could be as high as 22%…

…as well as a clip where he said there ‘probably will’ be another White House stimulus bill, something President Trump himself has said, though the president has noted that he’s in “no rush” to pass the legislation.

In a separate interview with Fox Business, Hassett said China would see “a lot of economic harm” over this decision, and also predicted it would “backfire” against Beijing, and trigger “capital flight” problems in Hong Kong, potentially forcing a devaluation of HKD (much to the delight of one Kyle Bass).

“They’re going to see a lot of economic harm from what they’re doing, because if I had capital to invest, would you really want to invest it in a place where they’re basically, you know, sneering at the rule of law the way they are right now?” he said Friday in an interview on Fox Business Network.

“I would expect that they’re going to have serious capital flight problems in Hong Kong, if they follow through this, they will no longer be the financial center of Asia, and that they themselves will pay very very heavy costs,” he added.

Yesterday, China’s National Party Congress supported a resolution to allow the Standing Committee – China’s most-senior legal authority – to draft a new “National Security” bill to prohibit political dissent, “terrorism” and “foreign influence.” Demonstrators during the unrest in Hong Kong last fall were frequently branded as “terrorists” by the mainland press.

END
HONG KONG
Michael Every discusses Hong Kong in this extremely important commentary. He questions how could it function as a financial centre.  Also Michael Every discusses the days events….
(Michael Every)

Rabobank: How Does Hong Kong Continue To Function As A Financial Center?

Submitted by Michael Every of Rabobank

“Great Uncertainty”

If there are two things markets hate today they are a lack of central bank liquidity and uncertainty. Well, we have lots of the latter.

The National People’s Congress (NPC) that just kicked off in China has seen Premier Li Keqiang admit “We have not set a specific target for economic growth this year. China economists will have to actually try to predict what growth will be in 2020 for the first time in a generation. This is because China “will face some factors that are difficult to predict in its development due to the great uncertainty regarding the Covid-19 pandemic and the world economic and trade environment.” But China has beaten the virus, hasn’t it? We are all rolling back lockdowns elsewhere, aren’t we?

Of course, this being China there were some hard targets of the Panglossian variety. There will be 9 million urban jobs created and every effort will be made to stabilize employment. This is clearly the new policy goal – not growth. Certainly not productivity given it means massive labour-intensive public investment in what is no longer a low-wage urban economy, or propping up failing firms to save jobs.

The fiscal deficit, reported by Bloomberg with a straight face as usual, is going to widen from 2.8% of GDP to 3.6%. This despite nobody pretending to know what GDP will be, and that too many pretend this covers ALL the public-sector deficit when the IMF says it is 10% if you include local governments, which you must unless you want to imagine vast defaults ahead. There is talk of issuance of CNY3.75 trillion in “special” bonds, up from 2.15 trillion in 2019, and CNY1 trillion in sovereign bond issuance. Yet that is a drop in the ocean compared to what the US or even the UK are spending relative to GDP. Indeed, the South China Morning Post yesterday ran a story suggesting a larger fiscal stimulus is coming soon than was seen post-GFC. If so, as we keep saying, watch CNY very closely.

Monetary policy will remain “prudent” and “flexible” and “appropriate. At the same time, steps will be taken to “ensure enterprises can secure loans more easily and promote steady reduction in interest rates” and money supply will be guided “significantly higher” as loans to SMEs now have to rise 40% in 2020 after mandated 30% growth in 2019. Has this rhetorical left hand ever met the right hand? Again, watch CNY – because boosting local money supply that fast, and to struggling firms, and with no FX reserve gains, means one thing and one thing only.

On which front, Li also stated that the phase one US-China trade deal is going to be stuck to. Really? Because it is way behind target already, and we already saw news this week of a vast digital Keynesian plan to push ahead with local chip development to replace those of the US. (Australia is also experiencing the odd trade-related issue as well.) Nonetheless, the markets got the headline they wanted – which I doubt was a coincidence.

Meanwhile, one key China problem is not based on uncertainty but on certainty. Beijing will be directly imposing a draconian national security law on Hong Kong, bypassing the local legislature entirely. Many voices are calling this a fatal blow to One Country, Two Systems despite the NPC saying otherwise; one local law-maker is quoted as saying “This is the end of Hong Kong.” Moreover, it comes just as the US concludes its mandated –and specifically delayed– annual appraisal of Hong Kong’s autonomy, which is now guaranteed to generate a swift response, something US President Trump has already publicly promised.

Indeed, bipartisan legislation has just passed the US senate to impose sanctions on Chinese individuals and entities in Hong Kong responsible for implementing this law, and for any banks who deal with them. Yes, it needs to get through Congress and be signed by Trump: but that seems easily done based on past record and present atmosphere. Then we would have to see who the US would hold responsible: token individuals or the entire arm of the Chinese state?

If so, how does Hong Kong continue to function as a financial centre? (And/or with mass street protests again?)

The fact that Beijing is prepared to push ahead with such a step knowing what the response will be, and what that could mean for Hong Kong –and for US relations with Taiwan– should be of deep concern to markets.

But back to the ‘relief’ of uncertainty:

  • The Fed’s Clarida yesterday said more fiscal and monetary support may well be needed, with the emphasis on the former. Fed Chair Powell said the US faces “a whole new level of uncertainty…those taking the brunt of this fallout are those least able to bear it.”;
  • A survey in the UK suggests 30,000 pubs and restaurants will not re-open after the lock-down is lifted;
  • The BOJ has announced a new loan program taking total commitments to JPY 75 trillion (around USD700bn) to support small businesses; that’s as April data show deflation is back again; and
  • The Reserve Bank of India made an emergency rate cut of 40bp to 4.0%; and it will start buying debt from shadow banks, as it did during the GFC.

Happy Friday! At least the days of the week are still certain for now. Though recall after the French Revolution they even got rid of those

end
Hong Kong/China
Bill Blain on the China/Hong Kong affair

“The Mood Is Getting Uglier” …And China’s Not Helping

Authored by Bill Blain via MorningPorridge.com,

“The two aims of the Party are to conquer the whole surface of the earth and to extinguish once and for all the possibility of independent thought.”

40 million unemployed Americans. Pretty powerful piece of BBC reporting last night on 5-hour queues for upstate NY middle class food banks. “These people have now missed 5 or 6 paychecks and they need to eat”, said a charity worker. A protester demanding reopening screamed into a microphone: “What is the point in saving people from coronavirus and then letting them starve instead?”  America looks divided. 

It’s not just them. The mood is getting uglier. A chum at a leading investment firm has just been quietly told he won’t be getting paid the bonus he expected – it been worded as deferral, but looks permanent. He says he puffed up and cited his rights but got brutally slapped down: told he’s lucky to have a job, and if he complains or says anything he’s on furlough and out the door immediately thereafter. He’s terrified. He’s highly levered, has school fees to pay, and feels trapped. It’s made a bad social situation worse, stuck in a small London house with kids and a now very unhappy wife.

Repeat the same scenario some 20 million times around the globe – as the upper middle classes are “disciplined”.  Job losses are accumulating across the global economy. But don’t worry, your Pension plan, Super or 401 is doing just fine… for now…

A particularly cynical client reckons rising fear and job losses are as positive a reason to buy stocks as any he’s heard. Companies are grabbing the virus opportunity to rationalise, cut headcount, cut wages, and axe extraneous departments. As a result; bottom lines are improving as they become more efficient and productive! Everyone expects 2nd and 3rd quarter earning wipe-outs, but this is “capitalism in action” and earnings could surprise to the upside as costs as slashed.

When I commented y’day about the importance of “Social” in ESG investing I was branded a communist on the website. You can call me a complete Bolshevik; but companies planning to slash payroll to increase dividends in this landscape deserve strung up. Sadly.. it will happen. I guess we better get used to it…. Have you read 1984?

Meanwhile, Lufthansa is finally going to get its $9 bln German govt bailout. Emirates are looking to retire their A-380s. Ryanair expects passengers will flout quarantine rules and take holidays abroad anyway… I can just imagine: 2 weeks in Marbs followed by 3 months in the Costa Scrubs. 

But the first order news this morning is all about China…

This morning the Chinese sent a signal round the globe when they didn’t set a target for economic growth for the first time in 30 years. The reality is the People’s Central Committee doesn’t want to reveal anything that hints at just how bad the economic reality is in China. 

There are all kinds of theories about China – you have to cut thru them to focus on what’s real. Some say China is on a deliberate collision course with the US. It’s the end of the US empire as China becomes the new pre-eminent global superpower. A trade war with the US could soon turn into a hot war. Taiwan, Hong Kong, and the Sith China Seas and the Spratlys are flashpoints set to ignite. A slowing China/ the Virus is a weapon of deliberate economic warfare because of the damage and instability it will create across the West. Etc, etc…

The bottom line is China also suffers. I suspect the truth is the Communist party knows it’s in serious trouble honouring its compact with the people – keep them happy, make them rich and they don’t care who’s in power. The compact looks wobbly. This is going to be a massive test for China, and the chances of collateral damage are huge as its responses impact global trade, destabilise overseas entanglements and lead to conflict in international organisations where China and the US face each other.

Whatever I say about China, I bet I get called a shill or an agipropbot of the PCC for even suggesting the Chinese might love their children too.

The party would like us to believe China can achieve a face-saving V-Shaped recovery – but it looks unlikely. The economy took a massive hit (industrial production only recovered 4% in April after a 13.5% crash over Q1). 20% of the migrant workers who assemble everything from iPhones to Electric Scooters never returned to work. The domestic debt markets are as perilous as anywhere else.

While workers in the state sector are protected – it’s a declining piece of the Chinese economy. It’s been the Chinese private sector that’s driven growth, and it’s in exactly the same place as the rest of the global economy: being forced to shutter production and layoff workers – to a far greater extent than officials will admit. Incomes are falling, consumption is waning, and folk are focused on keeping what they have.

The issue for China is how to get the private sector working again before unemployment and declining wealth causes a social issue. They can no more afford a trade war with the west crippling any domestic recovery. Which is why the Chinese also announced this morning their intention to implement the new trade deal with the US. That’s a big de-escalation, but a gesture they had to make. It’s a big risk strategy that could embarrass the party – the main one being just how fast and loose will Trump play with new threats and demands in this election year.

The trade deal news has to weighed against the potential damage implementation of National Security Law in Hong Kong – also announced this morning. That is bound to trigger a new wave of protests and revulsion across the West. The party has done it because it’s a good unifier domestically. If there is one thing the Party has done well, its to have created a very patriotic nation where these terrible Hong Kong Western Stooges have made the ultimate insults to the flag and anthem, thus they are class enemies and must be purged.

And if disciplining Hong Kong doesn’t unite the people.. then there is always the convenient lie about the patriotic duty to restore Taiwan to the motherland. (The truth is Taiwan was never really part of China except briefly – it could well become China’s Troubled Ireland if it ever does..)

All of which means XI has raised the stakes. If the government can’t deliver wealth and prosperity – social unrest and wider democracy calls become a real possibility. He needs to reopen trade to do that.

Interestingly, it’s clear the Party does take the people seriously – unlike the final days of the Soviet empire in the 1980s. One of the reasons China has become such a strong proponent of renewable energy and EVs is its scarred environment – the result of 50 years of industrial growth imperatives and coal power which did enormous environmental damage, poisoning the landscape, water course and public health. It’s a factor the government is now addressing to maintain its social compact.

This is going to be an interesting weekend in terms of how the China story plays out. Although the immediate market reaction has been negative, avoiding a global trade war would be a massive real positive development.

end
ROBERT TO ME ON HONG KONG PEG

“Mainland China  will impose a sweeping national security law in Hong Kong during the annual meeting of its top political body, criminalizing “foreign interference” along with secessionist activities and subversion of state power. This is directed at the protests for independence. It is a very dramatic and bold move that unquestionably undermines Hong Kong’s autonomy. This will threaten Hong Kong as a global financial hub and is already impacting the HK/USD  peg which could break as early as about 30 days from now.

The autonomy that has allowed a 23-year run under the “one country, two systems” framework that has allowed the territory is coming to an Swift end. Hong Kong’s political freedoms have been eroding, but now Beijing signaled that the national security law will be a new tool that allows it to directly tackle the political dissent. It is about absolute party control and should be a warning sign to the West.

Hong Kong has been able to hang on thanks to the US Federal Reserve cutting rates. This has been a lifeline from America and China is determined to severe this. A good sign of what their mindset is really like.

Those people still there with Liquid capital will be running soon to other destinations, leaving behind the past.”

Cheers

Robert
CHINA
CHINA’S total debt to GDP is a staggering 317% and it is their Achilles Heel.  The real problem facing China is their lack of USA dollars.  With their economy faltering, we will be desperate to haul in as much dollars as they can and guard against dollars leaving their country
(zerohedge)

“A Contradiction In Terms” – Here Is The Confusing Message Beijing Just Sent To Global Investors

While it has taken on secondary importance in light of the escalating international fight over the fate of Hong Kong, and it clearly is international as of Friday morning, as the following handy summary from Bloomberg demonstrated:

  • Pompeo condemns China’s plan to impose legislation
  • Biden says U.S. “should not remain silent”
  • U.K. says China must respect city’s freedoms
  • HK’s Lam offers full cooperation on security law
  • China says no country has right to interfere in Hong Kong
  • HKMA says it will maintain HKD stability

… a key message from the National People’s Congress as pertains to China’s economy which as a reminder served as the global reflation dynamo during the 2008 financial crisis, is that China – which for the first time removed its GDP target – plans to boosting growth by expanding its fiscal deficit from 2.8% of GDP to 3.6%, despite, as Rabobank pointed out, “nobody pretending to know what GDP will be, and that too many pretend this covers all the public-sector deficit when the IMF says it is 10% if you include local governments, which you must unless you want to imagine vast defaults ahead.”

Additionally, the NPC projected issuance of CNY3.75 trillion in “special” bonds, up from 2.15 trillion in 2019, and CNY1 trillion in sovereign bond issuance, which as we noted yesterday is pittance compared to what the US or even the UK are spending relative to GDP. Indeed, the South China Morning Post yesterday ran a story suggesting a larger fiscal stimulus is coming soon than was seen post-GFC. If so, as we keep saying, watch CNY very closely.

Meanwhile, a far bigger problem facing China is its already outrageous debt load, which according to the IIF, hit a record 317% of GDP in Q1, 2020 up from 300% at the end of 2019. As shown in the chart below, the rise in China’s total debt in
the years since the 2008 global financial crisis has been unprecedented, from around 172% of GDP to over 300% in 2019.

So one one hand, Beijing has eliminated its anchoring GDP forecast, which for years provided at least artificial stability and was used as a safety benchmark by domestic producers and consumer to know that no matter what happens Beijing will be there to prop up the economy, while on the other it is suggesting that its intervention will be severely limited by the already grotesque debt limitations. As BMO’s FX strategist Stephen Gallo puts it, “the messages from the CCP on domestic policy at the annual session of the 13th NPC were a mix of activism and restraint.”

As he further notes, “while dropping the GDP target and moving away from “unprofitable growth” is not unhelpful for financial stability risks, investors are not left with the impression that debt-dependency is going to decline sharply from here either; for instance, the CCP will be explicitly targeting some forms of credit growth alongside the unemployment rate.”

Put differently, this suggests that “the CCP’s stance on the issues of debt and “growth at all costs” is a confusing contradiction in terms” (i.e. this is the “cold fire” version of economic policy).

Putting these disparate message together, Gallo summarizes that “when these developments are factored into what we already know about local interest rates and the latest geopolitical developments, the case for a sustained rebound in the RMB becomes even less convincing (and it already wasn’t that convincing)” and adds that “one reason PBoC is allowing the RMB to weaken a tad vs the USD now is because the latter is trading sideways” as the last thing Chinese regulators want is to set off a wave of aggressive USD buying across the FX space.

His conclusion: “Who was it that said China is not dollar-dependent? Hint: it is.

4/EUROPEAN AFFAIRS

Auto/sales/registration

The pandemic is having a huge effect on the auto industry…today a huge 76% plunge in auto registrations

(zerohedge)

Auto Registrations In Europe Plunge 76% In April, The Largest Drop On Record

The hits just keep on coming for the auto industry. Frozen amidst a global lockdown due to the coronavirus, auto sales and registrations data continues to be atrocious around the world and the industry that was mired in recession even before the pandemic became a problem continues to face odds that look insurmountable.

The latest batch of cheery optimism came out of Europe, where auto registrations plunged 76% in April. According to the European Automobile Manufacturers Association, the number of new cars sold fell from 1,143,046 to just 270,682 YOY.

The ACEA said: “The first full month with COVID-19 restrictions in place resulted in the strongest monthly drop in car demand since records began.”

The data was driven by each of the 27 EU markets recording double digit declines in April, with Italy and Spain spearheading the misery, posting losses of 97.6% and 96.5% respectively. Sales plunged 61.1% in Germany and France dealt with an 88.8% contraction in April. The U.K. also posted a sales drop of 97.3%, according to CNBC.

Sequentially, the numbers are worse than March, when new car sales fell 55%. It was in mid-March that most European countries instituted their lockdowns.

The global auto industry can only be best described as in the midst of imploding into itself right now. Just a couple of days ago, we reported the news that China NEV sales plunged 43% last month. 

Last month we also reported that April was going to be the worst month on record for auto sales.

Earlier this month we noted how dealers were desperately turning to incentives to try and move inventory off their lots. The consequences of the shut down have been immense. Toyota reported a 54% sales decline in April, for example. Hyundai and Mazda reported drops of 39% and 45%, respectively. 

Recall we also wrote last month  that ships full of cars were being denied entry to ports in California due to the massive inventory glut. Such was the case on April 24 when a cargo of 2,000 Nissan SUVs was approaching the port of Los Angeles. They were told to drop anchor about a mile from the port and remain there.

John Felitto, a senior vice president for the U.S. unit of Norwegian shipping company Wallenius Wilhelmsen said:

“Dealers aren’t really accepting cars and fleet sales are down because rental-car and fleet operators aren’t taking delivery either. This is different from anything we’ve seen before. Everyone is full to the brim.”

“There are basically no sales,” we wrote about the auto industry heading into April. One automotive researcher said of the industry-wide crisis: “The whole world is turned upside down right now.”

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

ISRAEL/HAMAS

Hamas chief vows a huge armed resistance if Trump’s deal of the Century is implemented.

(zerohedge)

Hamas Chief Vows Major “Armed Resistance” If Trump’s Deal Of The Century Implemented

Despite making barely a blip amid the flood international coronavirus crisis headlines, a number of huge developments have rocked the Israeli-Palestine issue, bringing the world nearer an explosion of violence not seen since the second Intifada which ended in 2005.

Earlier this week the Palestinian Authority’s President Mahmoud Abbas announced thatall prior agreements with the United States and Israel are now null and void, including any and all prior ‘security agreements’ with the state of Israel, such as the historic Oslo Accords, and most alarmingly all local security arrangements and any ground-level cooperation.

Days following on Thursday Hamas issued its own dramatic warning, vowing to “confront” the “Zionist-American” plot to annex major parts of the occupied West Bank, especially the Jordan Valley, with “armed military resistance”.

 

In recent years Hamas leader Ismail Haniyeh has been vocal in calling for a new Intifada to challenge Israeli occupation and policies. Image via Reuters

This after Prime Minister Netanyahu in a Sunday speech promised to move on annexing areas of Jewish settlements in the West Bank that were “agreed” to as part of Trump’s much touted ‘Deal of the Century’ first unveiled to the public earlier this year. The PA and Hamas have vehemently rejected from the beginning, saying ultimately the Israeli side had to sacrifice nothing.

Specifically the new Hamas statements the Islamic militant organization’s political chief Ismail Haniya on the occasion of ‘International Day of Jerusalem’ (Quds Day), falling on the last day of Ramadan.

The Hamas leader began by thanking Iran: “We thank Iran for its continuous support for the steadfastness of the Palestinian people.”

“The Palestinian people and the people of Jerusalem defend their chests and their faith in the Al-Aqsa Mosque and the Holy City, and we warn the Zionists against committing follies against them,” Haniyeh said according to Sama News Agency.

“On the International Day of Jerusalem, the Holy City lives in the most dangerous stages, and we are following the American-Zionist talk about the implementation of the deal of the century, which was based on the liquidation of the Palestinian issue, the core of which is Jerusalem, as are the refugees and the land,” he continued.

 

Palestinian President Mahmoud Abbas, right, with Ismail Haniyeh in the Gaza Strip. File image: EPA

The Hamas chief added: “Jerusalem has lived in a siege since it was occupied in 1948 until now, and the blessed Al-Aqsa Mosque is at the head of the siege by obliterating its identity, incursions and denying Jerusalemites access to it.”

“We are facing a great and comprehensive danger and we need a strategy to confront the danger facing our cause and sanctify it, and in its essence the comprehensive resistance project, on top of which is the armed military resistance,” he said.

The speech was focused also especially on resisting the US declaration (as part of the Trump plan) of formal recognition of Jerusalem as the Israeli capital – something other international countries have been urged by the State Department to do as well.

For months, Hamas has been whipping up popular protests against the American-Israeli peace plan:

The fresh Hamas threats followed Abbas’ final ‘cutting off’ of all agreements with Israel, which itself came after Netanyahu’s swearing in of the new Israeli government Sunday wherein he declared “now is the time to annex the Israeli settlements in the West Bank.” 

The Trump plan has been previously described as “Bibi’s dream come true” and has long been seen as merely paying lip service to the Palestinians, ultimately without ceding anything of value.

6.Global Issues

CORONAVIRUS RISK ECONOMICALLY/THE GLOBE

(Mish Shedlock/Mishtalk)

Global COVID-19 Risk Ranges Up To $82 Trillion

Authored by Mike Shedlock via MishTalk,

The GDP risk over five years from COVID-19 could range from $3.3 trillion to $82 trillion, according to risk analysis of what may go right or wrong.

That is quite the wide range, but please consider the Centre for Risk Studies analysis of the Economic Impact of Covid-19.

The GDP@Risk over the next five years from the coronavirus pandemic could range from an optimistic loss of $3.3 trillion (0.65 per cent of five-year GDP) under a rapid recovery scenario to $82.4 trillion (16.3 per cent) in an economic depression scenario, says the Centre for Risk Studies at the University of Cambridge Judge Business School.

Under the current mid-range consensus of economists, the GDP@Risk calculation would be $26.8 trillion or 5.3 per cent of five-year GDP, says a “COVID-19 and business risk” presentation prepared by the Centre for Risk Studies.

Under the Risk Centre’s projections, the GDP@Risk in the United States would range from $550 billion (0.4 per cent of five-year GDP) to $19.9 trillion (13.6 per cent), in the United Kingdom from $96 billion (0.46 per cent) to $3.5 trillion (16.8 per cent), and in China from $1.03 trillion (0.9 per cent) to $19.2 trillion (16.5 per cent).

The full report from the Cambridge Business Risk Hub requires a sign-in.

Four Scenarios

  1. L1: An Optimistic Recovery Path scenario in which pent-up demand fuels a rapid economic recovery with overshoot on the rebound, with short-term results better than currently expected
  2. L2:Consensus Economic Forecast – the mid-range of forecasts by economic experts, now calling for a slow recovery curve with some period of economic growth before the recovery process
  3. L3:Pessimistic Outlook of structural damage to the economy and a lengthy period of recession
  4. L4: Economic Depression Scenario of a long-term recession with the economy tipped into depression, with “worst-case” estimates by economists and negative assumptions such as severe second waves of infection or protectionist politics.

Global Covid-19 GDP at Risk

Too Early to Call

I am inclined to toss L1 and L4.

Note that that the consensus forecast of a 5.3% hit to GDP is not a V-Shaped recovery.

It is still too early. We do not know if Covid-19 will return in the fall, if a reliable vaccine is around the corner, or the results of early end of lockdowns.

There is also mutation risk that could later nullify even a successful vaccine.

Powell Warns Recovery May Stretch to the End of 2021

Meanwhile, please note Powell Warns Recovery May Stretch to the End of 2021

No Shocker

This is not a shocker although it is unusual for the Fed chair to be this blunt.

The message is warranted as the economic data has been nothing but grim.

  1. May 8: Over 20 Million Jobs Lost As Unemployment Rises Most In History
  2. May 15: Retail Sales Plunge Way More Than Expected
  3. May 15: Industrial Production Declines Most in 101 Years

Fed Promotes More Free Money

The Fed cannot directly give money away so that burden falls on Congress.

In additional unusual moves, Fed Chair Jerome Powell and Minneapolis Fed President Neel Kashkari both asked for Congressional Action.

This is a sign of panic. I commented on May 14, Panic Sets In: Fed Promotes More Free Money.

The Fed seldom steps in with fiscal recommendations, especially more deficit increasing measures.

end

7. OIL ISSUES

Oil crashed last night with China’s uncertainty for global growth

(zerohedge)

Oil Is Crashing After China’s “Great Uncertainty” Statement

Although Beijing announced some new stimulus measures, it appears markets prefer to focus on the “great uncertainty” that Chinese officials see ahead (due to the coronavirus) leading to a decision to not release a target for economic growth has thrown the “v-shaped” recovery narrative out the window (for now).

“We have not set a specific target for economic growth this year,” Li said, speaking in the Great Hall of the People.

This is because our country will face some factors that are difficult to predict in its development due to the great uncertainty regarding the Covid-19 pandemic and the world economic and trade environment.”

WTI has crashed over 9%, with the July contract trading back down at a $30 handle…

And US futures are notably weaker with Nasdaq leading the drop…

The shifting away from a hard target for output growth breaks with decades of Communist Party planning habits and is an admission of the deep rupture that the disease has caused.

“The nascent demand recovery is still vulnerable, and the drop in prices today is an injection of reality,” said Victor Shum, vice president of energy consulting at IHS Markit in Singapore.

“China not giving a GDP target means they are not quite certain about the recovery yet.”

The question marks over China’s economy come as relations with the US deteriorate dramatically, clearly damaging the “v” or “u” shaped recovery narrative that has seemed to dominate both equity and oil markets in recent days.

END

8 EMERGING MARKET ISSUES

CORONAVIRUS UPDATE INDIA…//THE GLOBE/FRIDAY

 

India Reports Startling Jump In Cases As Lockdown Eases, Russia Suffers Record COVID-19 Deaths: Live Updates

Summary:

  • India reports record jump in cases as lockdown eases
  • Russia reports record jump in deaths
  • Russian ‘hot nurse’ punished for accidentally exposing underwear due to ‘see-through’ PPE
  • UN warns of looming collapse of Yemen’s health-care system
  • Bulgaria allows EU residents to enter country
  • Brazil becomes sixth country to hit 20k COVID deaths
  • Thailand extends state of emergency even as no new cases reported
  • Russia, Brazil drive largest daily jump in new cases
  • Australia’s largest state, New South Wales, allows up to 50 people in restaurants and bars

* * *

One of the most frustrating aspects of the coronavirus is how it seems to respond differently to the same basic strategies imposed by different governments. For example, in China, and across the US and Europe, lockdowns have coincided with sharp reductions in the spread of the outbreak.

But despite what has been repeatedly described as one of the most strict in the world, the rate at which new coronavirus infections are being confirmed has shown no sign of slowing after nearly 2 months (the lockdown started March 25). As we reported on Tuesday, the number of reported coronavirus cases in India crossed 100,000 earlier in the week, even as most parts of the country began to reopen businesses as India’s lockdown entered a new phase.

Three days later, India registered its biggest jump in coronavirus cases since the start of the outbreak, with 6,000 new cases as the country loosens a nationwide lockdown.

Additionally, India relaxed some of its travel restrictions on Friday to permit members of the Indian diaspora to reenter the country.

Meanwhile, in Russia, which is now home to the world’s second-largest outbreak (behind only the US) has reported 150 new deaths, a record daily rise, taking the country’s official national death toll from the virus to 3,249.

In another somewhat more lighthearted story from the world’s second-worst-hit country, a nurse working at a hospital in Russia’s central Tula region was suspended from her job for the mishap, which she says she didn’t realize until it was pointed out by a colleague. Several high-ranking government officials have weighed in, arguing that the hospital should reverse the punishment, according to multiple media reports.

The UN warned on Friday that as the coronavirus spreads across Yemen, the country’s health care system has, in effect, collapsed. Yemen will need emergency support from the international community to prevent yet another humanitarian crisis in  country that, after Syria, has been among the most war-torn places in the world for a large chunk of the last decade.

Using data from Johns Hopkins, Al Jazeera developed a chart showing how the coronavirus pandemic reached the 5 million mark.

The number of new cases reported globally remained well above recent levels as Russia, Brazil and India pushed the number of new cases to a daily record, as outbreaks in the US and Europe slow while Russia and Brazil report unprecedented growth.

Additionally, Brazil has become the 6th country in the world to report more than 20,000 deaths from the coronavirus as interim Health Minister Eduardo Pazuello warned that while the level of infection had decreased in certain areas in capital cities, its spread across the rest of the country was “inevitable.”

As EU member states slowly lift travel restrictions on neighbors, while the UK devises new quarantine restrictions for foreign travelers, Bulgaria has scrapped its ban on visitors from the EU, according to the country’s health ministry.

Overly optimistic reports about preliminary vaccine trials have set off a handful of biotech pumps in recent days, to the delight of hedge funds that have piled into the sector, Oxford researchers, who have been among the most bullish in the world about the prospects for a vaccine in the near term, reported Friday that they have already immunized 1,000 people during the first phase of the trial, and that the research would be accelerated to begin recruiting the 10k volunteers they will need for the second stage of the study.

Despite reporting zero new coronavirus cases and deaths on Friday, Thailand’s Center for COVID-19 Situation Administration proposed an extension of the country’s state of emergency measures until June to allow more time for new easing measures to be adopted.

In the UK, BoJo’s government has extended its mortgage payment holiday scheme for homeowners in financial distress for another 3 months. In Panama, health officials say 59 migrants stranded at the Panamanian Migration Center have tested positive for the virus.

Finally, Australia’s largest state, New South Wales, has said restrictions imposed to slow the spread of coronavirus will be eased to allow cafes, restaurants and pubs to have up to 50 seated patrons, which should allow many smaller restaurants to move back to 100% capacity. The country also extended its ban on cruise ships for another 3 months, until Sept. 17.

And before we go, during his visit to a Ford factory in Michigan last night (where he infuriated the state’s AG by refusing to wear a mask after repeatedly clashing with the state’s Democratic governor), President Trump said that he wouldn’t be closing down the country again if a “second wave” of the virus does hit.

The FDA on Friday announced plans to crack down on faulty antibody tests, publicly listed dozens of antibody tests that have not yet been proved to work, a major step in its efforts to regulate these exams.

END

 

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

Euro/USA 1.0907 DOWN .0042 REACTING TO MERKEL’S FAILED COALITION/ REACTING TO +GERMAN ELECTION WHERE ALT RIGHT PARTY ENTERS THE BUNDESTAG/ huge Deutsche bank problems ///ITALIAN CHAOS//CORONAVIRUS //PANDEMIC/CHINA VS HONG KONG /AND NOW ECB TAPERING BOND PURCHASES/JAPAN TAPERING BOND PURCHASES /USA RISING INTEREST RATES /FLOODING/EUROPE BOURSES /MIXED

 

 

USA/JAPAN YEN 107.44 DOWN 0.200 (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 1.2183   DOWN   0.0039  (Brexit March 29/ 2019/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED/

 

USA/CAN 1.4011 UP .0066 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  FRIDAY morning in Europe, the Euro FELL BY 42 basis points, trading now ABOVE the important 1.08 level FALLING to 1.0907 Last night Shanghai COMPOSITE CLOSED DOWN 54.16 POINTS OR 1.89% 

 

//Hang Sang CLOSED DOWN 1349.15 POINTS OR 5.56%

/AUSTRALIA CLOSED DOWN 0,92%// EUROPEAN BOURSES ALL MIXED

 

Trading from Europe and Asia

EUROPEAN BOURSES ALL MIXED 

 

 

2/ CHINESE BOURSES / :Hang Sang CLOSED DOWN 1349.89 POINTS OR 5.56%

 

 

/SHANGHAI CLOSED DOWN 54.16 POINTS OR 1.89%

 

Australia BOURSE CLOSED DOWN. 92% 

 

 

Nikkei (Japan) CLOSED DOWN 164.15  POINTS OR 0.80%

 

 

 

INDIA’S SENSEX  IN THE RED

Gold very early morning trading: 1734.90

silver:$17.00-

Early FRIDAY morning USA 10 year bond yield: 0.65% !!! DOWN 2 IN POINTS from THURSDAY’S night in basis points and it is trading WELL BELOW resistance at 2.27-2.32%.

 

The 30 yr bond yield 1.36 DOWN 2  IN BASIS POINTS from THURSDAY night.

USA dollar index early FRIDAY morning: 99.73 UP 37 CENT(S) from THURSDAY’s close.

This ends early morning numbers FRIDAY MORNING

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx6

And now your closing  FRIDAY NUMBERS \1: 00 PM

Portuguese 10 year bond yield: 0.72% DOWN 3 in basis point(s) yield from YESTERDAY/

JAPANESE BOND YIELD: -.01%  DOWN 1   BASIS POINTS from YESTERDAY/JAPAN losing control of its yield curve/56

SPANISH 10 YR BOND YIELD: 0.70%//DOWN 2 in basis point yield from yesterday.

ITALIAN 10 YR BOND YIELD:1,60 DOWN 2 points in basis points yield from yesterday./

 

 

the Italian 10 yr bond yield is trading 90 points higher than Spain.

 

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

THE IMPORTANT SPREAD BETWEEN ITALIAN 10 YR BOND AND GERMAN 10 YEAR BOND IS 2.08% 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 FRIDAY

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

Euro/USA 1.0892  DOWN     .0056 or 56 basis points

USA/Japan: 107.56 DOWN .085 OR YEN UP 9  basis points/

Great Britain/USA 1.2172 DOWN .0050 POUND DOWN 50  BASIS POINTS)

Canadian dollar DOWN 63 basis points to 1.4009

 

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

 

The USA/Yuan,CNY: AT 7.13    ON SHORE  (DOWN)..GETTING DANGEROUS

THE USA/YUAN OFFSHORE:  7.15  (YUAN DOWN)..GETTING REALLY DANGEROUS

TURKISH LIRA:  6.82 EXTREMELY DANGEROUS LEVEL/DEATH WISH.

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

 

Your closing 10 yr US bond yield DOWN 1 IN basis points from THURSDAY at 0.66 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 2.59 DOWN 1 in basis points on the day

Your closing USA dollar index, 99.65 UP  48  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 FRIDAY: 12:00 PM

London: CLOSED DOWN 9.52  0.29%

German Dax :  CLOSED UP 7.94 POINTS OR .07%

 

Paris Cac CLOSED DOWN 0.89 POINTS 0.02%

Spain IBEX CLOSED UP  11.40 POINTS or 0.17%

Italian MIB: CLOSED UP 229.23 POINTS OR 1.34%

 

 

 

 

 

WTI Oil price; 32.82 12:00  PM  EST

Brent Oil: 34.93 12:00 EST

USA /RUSSIAN /   RUBLE FALLS:    71.73  THE CROSS HIGHER BY 0.78 RUBLES/DOLLAR (RUBLE LOWER BY 78 BASIS PTS)

 

TODAY THE GERMAN YIELD FALLS  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 :  33.36//

 

 

BRENT :  35.13

USA 10 YR BOND YIELD: … 0.66..down one basis point…

 

 

 

USA 30 YR BOND YIELD: 1.374…down one basis point..

 

 

 

 

 

EURO/USA 1.0901 ( DOWN 48   BASIS POINTS)

USA/JAPANESE YEN:107.62 DOWN .025 (YEN UP 3 BASIS POINTS/..

 

 

USA DOLLAR INDEX: 99.77 UP 40 cent(s)/

The British pound at 4 pm   Britain Pound/USA:1.2170 DOWN 51  POINTS

 

the Turkish lira close: 6.82

 

 

the Russian rouble 71.63   DOWN 0.68 Roubles against the uSA dollar.( DOWN 68 BASIS POINTS)

Canadian dollar:  1.3990 DOWN 43 BASIS pts

 

German 10 yr bond yield at 5 pm: ,-0.48%

 

The Dow closed DOWN 8.96 POINTS OR 0.04%

 

NASDAQ closed UP 39.71 POINTS OR 0.43%

 


VOLATILITY INDEX:  28.16 CLOSED DOWN 1.37

LIBOR 3 MONTH DURATION: 0.3595%//libor dropping like a stone

LIBOR/OIS: .2984%

TED SPREAD( 3 MONTH TREASURY YIELD VS LIBOR)  = .2345%

 

USA trading today in Graph Form

Stocks, Silver, Black Gold & Bond Yields Jump This Week As Dollar & Yuan Dump

Millions more job losses, thousands more deaths, hundreds more earnings outlooks cut or dismissed, dozens of rancorous threats and promises exchanged between US and China… and still a handful of key US stocks sent the major indices soaring on the week led by Trannies and Small Caps…

 

A panic bid at the close to get the indices green for the day…

 

Almost as if it never happened…

 

Source: Bloomberg

Or put another way…

Notably, after the European close on Monday, The Dow and S&P went nowhere!

 

But hey “vaccines” and shit means it’s a good week!!Source: Bloomberg

Or it could be something else?

 

Source: Bloomberg

Seriously though, it’s Mission Accomplished…

 

Source: Bloomberg

The big banks are higher on the week but notice that from the opening spike on Monday, they are all lower…

Source: Bloomberg

FANG Stocks were up on the week but sold off after The Fed…

Source: Bloomberg

Treasury yields ended the week higher across the curve, but only modestly with the long-end up 4bps…

Source: Bloomberg

Bonds and stocks decoupled…

Source: Bloomberg

The Dollar slipped again this week (selling ahead of The Fed and rallying after)…

Source: Bloomberg

But on a longer-term context, the dollar is coiling…

Source: Bloomberg

Offshore Yuan dumped this week as US-China tensions rose…

Source: Bloomberg

And Hong Kong Dollar Fwds puked amid Beijing’s new “security” law…

Source: Bloomberg

Bitcoin was flat on the week, erasing most of the post-halving gains, but Ethereum had a strong week…

Source: Bloomberg

The dollar continues rangebound against its fiat friends but is weaker and weaker against sound money…

Source: Bloomberg

Oil was the week’s big winner (again) but silver surged as gold slipped…

Source: Bloomberg

Gold/Silver just got too juicy after The Fed went all-in…

Source: Bloomberg

July WTI is back at around the $34 level and stalling again…

Finally, we appear to still be following the 1930s analog for now… which means we lift to around 26k on The Dow… Bear market rallies in 1929, 1938, 1974 saw an average 61% rebound from lows (after an average 49% drop)…which would take SPX to 3180…

Source: Bloomberg

As Johnny Depp said, COVID deaths tell no tales of economic collapse…

And now your more 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

Fed’s balance sheet is now over $7 trillion dollars as it is now buying corporate ETF debt.  That debt on the Fed balance sheet is 1.5 billion dollars.  The total of all ETF corporate bond debt is 48 billion dollars.

(zerohedge)

Fed Balance Sheet Rises Above $7 Trillion; Bond ETF Holdings Hit $1.8 Billion

After crossing back above the $4 trillion mark back in October 2019 in the aftermath of the JPMorgan repo bailout, also known as “No QE”, the Fed’s balance sheet is nearly double that amount a little over half a year later, with the Fed reporting in its latest H.4.1 report that as of May 20, 2020, its total assets rose above $7 trillion for the first time ever, an increase of $103 billion in the past week to $7,038 billion. Putting the increase in context, the Fed’s balance sheet hit $6 trillion on April 2.

The increase was mostly the result of a $79BN increase in settled MBS purchases as well as $32BN in Treasury purchases, while there was no change in the Fed’s holdings in its commercial paper facility.

While the Fed’s balance sheet is broadly expected to hit $12 trillion in the next 12 months, the fact that the expansion has slowed down substantially is a problem, especially after the Fed tapered its daily QE to just $6 billion last week, and JPMorgan expects it to further shrink to just $5 billion per day when the new schedule is published tomorrow.

 

This is a problem because the Treasury has some $3 trillion in debt issuance to go in the next 6 months, and one war or another, the Fed will have to aggressively ramp up its QE again, which as we discussed over the weekend, may mean another market crash “unexpectedly” happens in the coming weeks to provide cover to the Fed for the next massive QE expansion.

There was one surprise in the latest amount of Fed corporate ETF holdings, which can be found in the “Net portfolio holdings of Commercial Paper Funding Facility II, LLC” line time.

As a reminder, earlier today we laid out a BofA report according to which the Fed would disclose $2.5 billion in total bond ETF holdings, and which assumed that the Fed, which unveiled a total of $305MM in the one full day after the program was launched, would now have a $2.5 billion total in holdings. However, the actual number was notably lower at $1.8 billion, which means that in the past 5 work days, the Fed purchased $1.5 billion in ETFs, or $300MM per day, which appears to be the Fed’s now daily purchases of LQD (for those curious, the total assets of LQD are $48 billion).

Incidentally, judging by the sharp jump in LQD pricing, $300MM is more than enough to push this critical – for all future buybacks, not to mention anchor pillar for the US bond market – ETF back to near all-time highs.

And since nobody even jokes anymore that the Fed can one day reverse or even stop these operations, the bigger question is what will the Fed’s balance sheet be when it’s all said and done, an exercise which Deutsche Bank did earlier this week when it calculated that the maximum potential size of the Fed’s balance sheet is $130 trillion and will be hit as soon as the Fed owns… well, everything.

iii) Important USA Economic Stories

the coronavirus will wipe out 4 years of GDP growth.  Now most pundits are suggesting Q2 will plummet from -30% of GDP to -40% GDP

(zerohedge)

“Unlike Anything We Have Seen In History”: The Coronacrisis Will Wipe Out Over 4 Years Of GDP Growth

Now that banks have had a chance to evaluate the collapse in the economy in the post-covid world, a new round of GDP forecast revisions is coming, and it’s a doozy, with Bank of America spearheading the latest effort by slashing its Q2 GDP forecast from -30% to -40%.

Not without a trace of irony, BofA’s chief economist Michelle Meyer writes that “words cannot describe” the loss in economic output, which is unlike anything we have seen in modern history. Back in early April when we introduced our forecasts, we penciled in a stunning 10% cumulative drop in output from the peak with the pain concentrated in 2Q with a 30% qoq saar decline.”

But it seems that it was not extreme enough, and according to data released since then, the drop will be more severe, with BofA now looking for a 40% Q/Q saar decline in 2Q, translating to a cumulative loss of 13%. To put this into perspective, in the Great Recession of ’08-09, the economy declined 4%. This recession would clearly be much deeper.

* * *

As BofA previously noted, ignore all the “letter”-descriptions of the current cycle, and instead think of it in phases, of where there are three: phase 1 is the shutdown, phase 2 is the transition and phase 3 is the recovery. The bank has tweaked its assumptions in each phase – bigger drop in phase 1, stronger bounce in phase 2 but weaker recovery in phase 3.  Here are the three phases in detail:

Lockdown: a deeper contraction. We now believe that 2Q GDP growth will be down 40% qoq saar vs. our prior forecast of -30% qoq saar.

  • Transition: a faster snapback. An earlier reopening means an earlier bounce in activity. We are revising up 3Q GDP growth to +7% qoq saar vs. -1% qoq saar previously. The gain is entirely driven by a snap higher in consumer spending; we still expect a meaningful decline in investment.
  • Recovery: slower. An earlier reopening has prompted health experts to increase estimates for the number of COVID cases, which will slow the recovery. We have also become increasingly concerned about solvency issues and a sticky-high unemployment rate. We now think it will take until the end of 2022, or later, to return to the pre-COVID level of GDP.
  • BofA’s new forecasts reflect the recent data and the early reopening, and leaves BofA’s annual GDP to plunge 8.0% this year with a 4.0% rebound next year. The peak-to-trough drop in GDP is 13%. This breaks the previously held post-war record of -4% in the Great Recession.

What is more troubling is that as shown in the chart below, the corona crisis will wipe out 4 years of GDP growth, with BofA now expecting real GDP at the end of 2021 to be where it was at the end of 2017!

Before it goes into more depth on its various findings, BofA issues a word of caution to all those who see a V-shaped recovery in recent data: “it is important to keep in mind that many indicators will show a significant bounce as the economy moves out of hibernation. But what initially looks like a V-shaped recovery is set to lose steam after the initial gain has subsided.

With that in mind, BofA moves on to the next key subject, the devastation in the labor market and upcoming disinflation. As Meyer writes, “although more than 20 million jobs have been lost over March and April, the jobless claims figures suggest we are likely to see more cuts in the May report”, something we discussed in our report spreading the real jobs report.

BofA now believes that the unemployment rate will reach a peak of 19% at the end of 2Q, while broader measures of unemployment suggest that the rates are already in excess of 20%. In the initial stages of the recovery, the unemployment rate will fall sharply upon reopening but will likely get stuck close to 10% for some time. This, as Meyer warns, is a recipe for disinflation and could prove catastrophic for banks that haven’t provisioned enough for loan losses. The bank forecasts core PCE inflation will reach 0.6% yoy by year-end, although the bank still believes that the US will avoid outright deflation in underlying inflation and that the focus will be on measures of expectations.

One silver lining is that we have not seen any damage to inflation expectations, at least not yet. In fact, the 5-10 year inflation expectations gauge in the University of Michigan consumer sentiment survey has actually crept upwards to 2.6% in May from 2.3% in March, heading to the top of its recent range which of course may merely be a reflection of the prices most Americans truly experience (which are surging) instead those that make up the BLS inflation basket. Indeed, in an economy under lockdown, demand for essentials has exploded higher resulting in a strong bid on prices. For example, food at home prices popped 2.6% mom in April. As a result, BofA says this could “misguide” consumers into believing the higher inflation story (we doubt consumers will be happy to know they are being “misguided” when they pay a record high price for steak ahead of the Labor Day holiday). However, this may prove to be only temporary as broader disinflationary forces take over, with a risk of falling below 0% and therefore entering deflation territory.

Looking ahead, Meyer writes that two of the most critical inputs into her medium-term forecast are i) the path of the virus and ii) the degree of stimulus.

While BofA is currently not forecasting a significant second wave that would prompt shelter-at-home policies to return,  clearly this is a big downside risk. In terms of stimulus, BofA expects the Fed to continue with credit facilities and another fiscal stimulus package albeit smaller and focused on state and local governments. A bigger stimulus plan would present upside risk while lack of support would add to the downside. The path of virus and fiscal response are not mutually exclusive.

Finally, while urging clients to avoid letters to describe the cycle, BofA does just that and in the next chart it looks at four hypothetical types of recoveries: a “V” (upside) a “U” (close to the current), an “L” (downside) or a “W” (downside). In all cases, it assumes that output falls by 40% annualized in 2Q and trend growth of 1.8%.

  • In the V-shaped recovery example, GDP gets back to potential in four quarters (by the end of 1H 2021) and then remains on trend. Therefore the recovery is twice as long as the downturn and lost output is not recovered. Still, this scenario would require nearly 18% growth over the next year, which we think is unrealistic.
  • In the U-shaped recovery scenario, GDP takes longer to return to potential and more output is permanently lost. GDP gets back to trend at the end of 2022. Even this requires an average of 8% growth over the next ten quarters. Notice that BofA’s baseline forecast is closest to a “U” or “swoosh” scenario.
  • An L-shaped recovery is the slowest, with the greatest permanent loss in output. It takes until the end of 2023 for GDP to return to its pre-COVID level. Growth averages 4% in that period.
  • What about a “W”? The most likely scenario for a W-shaped (“double dip”) recovery is a second major virus outbreak in the fall/winter, which causes another round of shutdowns. There are many possibilities depending on the severity and duration of the shutdowns.

Finally, for all the charlatans who focus on Q/Q change instead of Y/Y or trendline, chart 7 illustrates the pitfalls of conflating levels and growth rates. In all scenarios, GDP growth would look quite robust initially. This is because when the economy re-opens, baseline economic activity will be so weak that growth will almost surpass its trend rate for a few quarters. This underscores the importance of considering the level of GDP.

Or, as BofA realistically concludes “we cannot simply snap our fingers and return the economy to the way it was prior to the shock from COVID-19.”

end
The story behind California and why it is in trouble financially..a huge public sector fiasco
(Adam Andrzejewski)

Why California Is In Trouble: 340,000 Public Employees With $100,000+ Paychecks Cost Taxpayers $45 Billion

Submitted by Adam Andrzejewski,

Despite California’s $54 billion budget deficit and $1 trillion unfunded pension liability, there are 340,390 government employees bringing home six-figure salary and pension checks. Recently, though, Gov. Gavin Newsom asked U.S. taxpayers for a bailout.

The governor wrote a letter to Congress requesting $1 trillion in coronavirus 50-state aid. Then, House Speaker Nancy Pelosi obliged by adding $500 billion for the states into the HEROES Act – the bill passed and now awaits action in the Senate.

Here, in part, is why California is asking for taxpayers help.

Our auditors at OpentheBooks.com found truck drivers in San Francisco making $159,000 per year; lifeguards in LA County costing taxpayers $365,000; nurses at UCSF making up to $501,000; the UCLA athletic director earning $1.8 million; and 1,420 city employees out-earning all 50 state governors ($202,000).

Using our new interactive mapping tool, quickly review (by ZIP code) the 340,390 California public employees and retirees who earn more than $100,000 and cost taxpayers $45 billion (FY2018-9). Just click a pin and scroll down to see the results rendered in the chart beneath the map.

Here are a few examples of what you’ll uncover:

  • 109,627 teachers and school administrators – including the CEO of Summit Everest charter schools Diane Tavenner ($450,115); and superintendents Michael Lin ($443,875) at Corona-Norco Unified; Polly Bove ($395,257) at Fremont Union High; Christopher Hoffman ($351,885) at Elk Grove Unified; and Al Mijares ($348,276) at the Orange County Dept. of Education.
  • 66,403 college and university employees – including the athletic director at UCLA, Daniel Guerrero ($1.8 million), who is retiring amid criticisms that his teams lost too frequently. The school’s football coach, Charles (Chip) Kelly ($3.3 million), compiled a 7-17 record during his first two years and is the most highly compensated public employee in the state. Furthermore, there are 11,310 college and university employees making more than $200,000.
  • 62,204 State of California employees – including a nurse, Ito Chikako, at the University of California, who made $501,391 – paid through the state system. David Winsor Sirkin, Sr. Psychiatrist at Correctional & Rehabilitative Services, made $409,399. Corrections paid two dentists $385,596 last year. The chief regulator at barbering & cosmetology made $124,296.
  • 45,718 city and town employees – including 1,420 municipal administrators and employees who out-earned the California governor – the highest paid state governor ($202,000). Highly compensated city managers included Deanna Santana (Santa Clara – $396,158); Paul Arevalo (West Hollywood — $353,603); Fredrick Cole (Santa Monica – $342,780); David Ready (Palm Springs – $340,149); Edward Shikada (Palo Alto – $329,080); and Scott Ochoa (Ontario – $328,500).

Reaching out to all governments mentioned, Santa Clara responded saying that their city is complex and they compete for talent in Silicon Valley. Palm Springs responded by saying the city manager is cutting his pay by 20-percent to $288,579.

In 2017, we found that 44 lifeguards in Los Angeles County cost taxpayers between $200,000 and $365,000. Today, it’s worse with salaries comprising only about half the total cost when including overtime, extra pay and benefits.

In total, $45 billion in cash compensation flows to local and state government workers across California earning six figures. Our auditors did not include the cost of benefits.

We also haven’t included the payroll costs of at least 28,000 federal employees making $100,000+ within the executive agencies based in California.

Corruption In San Francisco

San Francisco’s self-titled “Mr. Clean,” Mohammed Nuru, Public Works Director, is best known for failed efforts to keep feces and hypodermic needles out of the public way. Cases of human waste on city streets spiked to 31,000 in 2019 – an all-time high.

Nuru earned a $269,500 annual salary in 2018 (up $55,000 over a seven-year period). Allegedly, that wasn’t enough. In February, Nuru was arrested for charges that included bribery.

Only in San Francisco can team members on the “poop patrol” cost taxpayers up to $184,000 each.

 

Mapping the San Francisco human waste challenge – 141,000 cases of human waste in the public way

Taxpayer-Expensive Educators

In the community college system, 10,807 employees made six figures and 247 made more than $200,000 last year.

Edward Hernandez, Jr. (Rancho Santiago – $325,799) and Francis Gorrick (West Hills – $316,034) have the highest pensions. In 2015, stakeholders criticized then-president of El Camino College Thomas Fallo for his $345,000 “supersized” salary. Fallo retired and receives a $314,021 pension.

K-12 payrolls show 109,627 teachers and administrators earned over $100,000 per year. Nearly 94,000 of those highly compensated educators are currently employed, and the other 15,735 are retired with six-figure pensions.

Ten educators hit the pension jackpot and retired on $300,000+. These include: William Habermehl (Orange County Dept. of Education – $380,096); Richard Bray (Tustin Unified School District – $329,826); Virginia Shattuck, (Norwalk–La Mirada Unified School District – $327,139); James Smith (Evergreen Elementary – $309,725); and Richard Miller (Santa Anna Unified— $305,066).

Private associations, nonprofits, and lawmakers

All kinds of entities are jumping on the gravy train. Private associations, nonprofit organizations, and former lawmakers have gamed the system for personal gain.

  • Assemblyman Jim Cooper (D-Elk Grove) is double dipping the pay and pension systems. Retired at age 50 from the Sacramento County Sheriff, Cooper earned a $173,820 pension. He makes $107,242 as an elected member of the general assembly – although he refused the non-taxable per diem that’s estimated at $39,000 a year. Total benefit: $281,162
  • Who knew that the “student unions” on college campuses pay their administrators up to $206,000 and their pensions are guaranteed by taxpayers? The union at UCLA – Associated Students, Inc. – paid four administrators between $191,000 and $206,000 last year. There are 52 student union administrators across the state who made six figures last year. Retirees received pensions up to $136,000.
  • Government “associations” of all types are dialed into the public pension system. These associations are organized as “non-profits” and include associations of governments, school boards, water districts, utilities, special districts, and even flood control associations.

We found 314 six-figure administrators who run these government associations, which are funded by taxpayers for $44 million a year. The most highly compensated was Darin Chidsey {Southern California Association of Governments (SCAG) – $289,109}.

SCAG responded to our request for comment saying they are “the nation’s largest metropolitan planning organization” and located in “a very competitive job market.”

Highly Compensated Locals

In the City of Fremont, nearly 700 six-figure employees made $91 million last year. The city attorney, Harvey Levine, was the highest earner at $291,031. Even the animal services manager cost taxpayers up to $130,000 with over four weeks of PTO, pension, and additional retirement annuity benefits – in the first year of employment.

The Sanitation District of Los Angeles has a history of spiking salaries to pad pensions. In fact, four of the top five all-time sanitation high earners are either currently employed or retired from this district: Stephen Maguin ($366,387 – pension); Grace Robinson Hyde ($329,131 – salary); James Stahl ($321,838 – pension); and Robert Ferrante ($306,552 – salary).

The sanitation district responded to our request for comment saying that all laws with respect to compensation were followed and “pension spiking” is not allowed. However, we noticed that some of those retirement pensions exceed current salaries.

Before the COVID-19 crisis, state and local governments in California were plausibly operating. Now, with tax revenues dropping, underlying financial weaknesses are being exposed.

In a move praised by fiscal reformers, Gov. Newsom proposed a 10-percent across-the-board reduction in state employee salaries along with state agency budget cuts of five percent.

However, the governor admitted that if the federal government sends states more aid, then the salary reductions will be restored.

California, in other words, like many states with excessive pay and pension costs, is relying on the U.S. taxpayer to see them through crisis.

end
ILLINOIS
The shutdowns in this largely democratic state is causing protests galore.
(zerohedge)

COVID Showdowns Brewing Across Illinois As Angry Residents, Sheriffs Reject Lockdown

Residents of Illinois fed up with the country’s strictest COVID-19 restrictions are starting to revolt – with protests against Chicago’s cordoned-off lakeshore and no-parking zones around churches, according to Breitbart‘s Warner Todd Huston.

Last Sunday, the city’s first gay mayor sent the Chicago Police Department (CPD) out to erect new signs around the neighborhood of Philadelphia Romanian Church to suddenly create long stretches of new “No parking/tow warning” zones around the building.

Lightfoot also sent the CPD to prowl around outside several of the city’s churches to hand out parking violations, Chicago’s CBS affiliate reported.

The mayor’s campaign against churches comes on the heels of statements by several church officials across the city saying they had no intention of submitting to the mayor’s orders to shut down their houses of worship. –Breitbart

Elsewhere in the state, growing numbers of Illinois residents are coming out in opposition to Gov. Pritzker’s (D) lockdown policies which were found by WalletHub to be the harshest in the country – including a provision which would jail business owners for up to a year for refusing to obey.

Pritzker’s restrictions are so – restrictive, that DuPage County Sheriff James Mendrick announced that he has no intention of enforcing them, according to the report.

I just can’t do this anymore. I stand with our citizens and businesses of DuPage County who have offered no trouble or no resistance to any rule we put upon them, no matter how strange,” Mendrick wrote on Facebook. “I will not victimize lawful residents of DuPage County trying to put food on their children’s table. I’m so proud of our DuPage citizens who have done everything right from the beginning. All I can say is thank you.”

Joining Mendrick is Kendall County Sheriff Dwight Baird, who similarly said he has no intention of enforcing Pritzker’s order to break up gatherings or shut down businesses since “the Governor’s Executive Order is not a law.”

The city of Gibson in Central Illinois also won’t be enforcing the restrictions – announcing that they will not make misdemeanor arrests of individuals or business owners for violating the EO.

In addition, downstate Madison County reopened its businesses despite the orders.

In reply to these officials, Gov. Pritzker warned he would send the state police in to enforce his rules.

Counties that try to reopen in defiance, may not be reimbursed by FEMA for damages they cause because they ignored the law,” Pritzker said adding, “Local law enforcement and the Illinois State Police can and will take action.”

Individual business owners have also defied the governor’s threats.

A gym owner in Moline, a city on the border with Iowa, straight west of Chicago, reopened his business on Monday in direct defiance of Pritzker’s orders.

Madison County Board Chairman Kurt Prenzler helped usher through a resolution that “basically declared all businesses and churches essential.”

“I did the Zoom classes for a while. Rented out all my equipment and, you know, you reach a point where enough is enough, and somebody’s got to say something,” said Chris Ninotta, owner of Omni Strength. “I can’t do it any longer. I’m a single father, and that’s where my loyalty lies, and there’s no man or government on earth that’s gonna tell me I gotta, you know, do this.” –Breitbart

In short, you can only push people so far – even in liberal Illinois.

end

ILLINOIS

In this latest report, it looks like 20% of all Illinois restaurants will go out of business this year.

(zerohedge)

 

“It Felt Like A Death”: 20% Of Illinois Restaurants Will Go Out Of Business In Coming Months

Last week we reported that as much as a quarter of US restaurants will go out of businessdue to the COVID-19 pandemic, according to a forecast by OpenTable, which reported that total restaurant reservations and walk-in customers have fallen 95%over the previous year ending May 13.

For restaurant owners in Illinois this dismal forecast is already coming true. According to CBS, Illinois restaurants – reeling in the coronavirus crisis – are doing anything they can to survive, and while many are trying to reinvent themselves, for others time to close shop. CBS cites a “frightening” number from the Illinois Restaurant Association: In spite of all the take out and delivery services they now offer, restaurant sales are down 80%, and thousands of restaurants are in jeopardy of never opening again.

“The restaurant industry, we’ve kind of alway been up against it anyways,” said Joe Frillman, owner of Daisies Restaurant. “The statistics are never in our favor to begin with.”

Once known for its dine in homemade pastas, the kitchen at Daisies in Logan Square has pivoted to pay the bills: “It’s all to go now, so the whole business model has changed,” said Frillman who debuted a new concept last weekend. His dining space became a farmer’s market with fresh produce,- meal kits and specialty products.

“We had over 150 people come out to support us,” he said. “I was kind of blown away. We didn’t really know what to expect.”

But for every hopeful moment like these, there are thousands of others from restaurants on the brink of closing.  Jeanne Roeser, in business since 1996, was forced to close her two popular brunch destinations, Toast. Each sat only a handful of diners, and an eventual scaled back reopening didn’t add up.

“It felt like a death,” said Roeser, owner of Toast Restaurant. “It felt like going through the grieving process, which I still am. Any time I thought about it, and I looked at the prospects, it just, in my gut, didn’t feel like it was something that would be workable”

According to The Illinois Restaurant Association there were 25,851 restaurants operating in the state in March, and it estimates that 20%, or nearly 5,200 restaurants, will go out of business in the coming months because of COVID-19.

“I think it’s an undercount,” said Roeser.

“I think that’s generous,” said Frillman. “I think would be a best case scenario.”

“Independent restaurants bring wealth to the city, culturally, economically,” said Roeser.

For those whose livelihood is on the line, the push forward against the odds must go on: “It’s not whether or not you’re not going to make it,” said Frillman. “It’s you are always constantly doing whatever you can to make it.”

Alas, there’s an even more important number to keep in mind: About 600,000 people work in Illinois’ restaurant industry and about half have been laid off.

Restaurants find the prospect of resuming dine in service especially frustrating.  Stay-at-home orders are expected to ease on May 29, with much of the state moving from stage two to stage three of Gov. JB Pritzker’s plan to reopen the state. That allows salons and health clubs to reopen with restrictions, but not restaurants for dine in.  Owners argue theirs is a business accustomed to strict health protocols, and with social distancing and scaled back capacity they should be allowed to reopen at stage three.

END
ILLINOIS
Insolvent Illinois may need to tap into the Fed’s emergency muni facility
(zerohedge)

Insolvent Illinois May Tap Into Fed’s Emergency Muni Facility

Illinois is insolventSo what’s new?

Well, the state’s fiscal situation was deteriorating well before the coronavirus pandemic. Traditional lenders have severed ties with the state as local officials struggle in muni bond markets to fund budgets, which has forced them to request funding assistance via the Federal Reserve’s new $500 billion Municipal Liquid Facility (MLF), reported Bloomberg.

The Fed laid out the process last week of how state and local governments can tap into MLF, a tool announced in April that will provide state and local governments affected by virus-related shutdowns, with ample amounts of liquidity as tax revenue collapses.

Carol Knowles, a spokeswoman for Illinois’ budget office, said state officials are drafting a “notice of interest” that will shortly be submitted to the Fed, the first step towards gaining access to MLF.

The move comes after the state suspended a short-term debt auction worth $1.2 billion several weeks ago. The proposed one-year notes were expected to fund state operations as cash flows reach dangerously low levels thanks to the economic fallout.

Once the notice of interest form is submitted, the MLF program will begin to participate in the bidding of Illinois debt. According to the NY Fed, the state is eligible to borrow about $9.7 billion under the program.

Kent Hiteshew, whom the Fed hired to supervise the MLF program, said the central bank is administering virtual meetings that would allow for the quick approval once states and local governments submit the forms.

“We should begin purchasing notes in the very near future,” Hiteshew said.

Even before the outbreak, Illinois had a massive unfunded pension liability problem and soaring budget deficits. As tax revenue collapses and the local economy has ground to a halt, the state’s bonds, rated one notch above junk, are at risk of downgrades.

We recently noted, the state is paying 5.65% on its 10-year bonds is now five times higher than the 1.13% costs AAA-rated states to borrow.

Illinois’ pension shortfalls are continuing to worsen with a visual below mapping out where trouble lurks in the state.

Many of Illinois pension funds are less than 50% funded — we’re assuming that number now is much worse.

Take, for example, the shortfall between Chicago police pension assets and pension liabilities, the gap is absolutely astonishing…

The state also has mounting unpaid bills, which currently stands around $7.5 billion. With recession deepening, don’t expect state officials to pay its bills anytime soon.

Steve Cortes, a conservative political commentator, recently told Fox News that Illinois politicians are using the virus crisis as a means to bailout decades of failed liberal policies. He said much of the instabilities in the state, such as unfunded pensions, existed well before the pandemic.

 

At this point, it appears the Fed via MLF will be giving the bankrupted state another lifeline, another can-kicking policy that will absolutely solve nothing but delay the recovery.

Of course, what Illinois’ liberal leaders really want is a bailout… not a loan. Don’t hold your breath

end

Hertz

Hertz is desperate to avoid bankruptcy as it dumps its huge fleet of corvettes.

(zerohedge)

Hertz Dumps Fleet Of Corvettes While Trying To Avoid Bankruptcy

A tidal wave of supply is hitting the used car market as insolvent rental car companies are forced to liquidate fleets to avert bankruptcy or, if past the default Rubicon, repay creditors during bankruptcy proceedings. Case in point: soon to be bankrupt rental car giant Hertz is dumping a fleet of sports cars on the used car market at significant discounts as it scrambles to build up a liquidity war chest .

Hertz Corvette Z06 listings on AutoTrader

First spotted by Jalopnik, Hertz has flooded the used car market with a fleet of 2019 Chevrolet Corvette Z06s, selling at significant discounts to Kelley Blue Book fair value. Some of the Vettes have made it onto AutoTrader, selling between $58,995 to $63,295, far below the Kelley Blue Book’s $76,938 to $85,275 fair value range. Below is a chart showing the Kelly Blue Book value of 2019 Chevrolet Corvette Z06s vs. Hertz’s liquidation price

In short, this is the start of a firesale by the distressed rental car company, and once Hertz is forced into bankruptcy  creditors could liquidate even more of its fleet. So you ask, just how many rental cars Hertz has in its entire fleet? Well, Jalopnik provides the answer below:

“Used car prices fell 34.4 percent in April, according to the Detroit Free Press, and used car dealers are cutting back on building up inventory. While the Freep says that used car prices could go up soon due to a shortage of new cars caused by plant closures, there is another factor to consider: The more than half a million cars currently sitting on beleaguered Hertz Car Rental’s books.”

Meanwhile, Coronavirus has crushed the Manheim Used Vehicle Value Index.

Hertz is not the only rental car company slammed because of coronavirus related shutdowns, Avis and Enterprise are also suffering, seeking help from the Treasury Department for loans, tax breaks and other types of support.

As for the “tidal wave of supply” that could drown the used car market — we noted last week rental car fleets are piling up in parking lots across the US:

 

About 2,200 Enterprise rental cars are parked at the Wells Fargo Center in South Philadelphia

 

Aloha Stadium’s parking lot has become the temporary home to 1,000 to 1,500 rental vehicles on Oahu that have become idle because of the novel coronavirus pandemic.

 

Hundreds of rental cars are being temporarily parked at Dodger Stadium as travel continues to constrict amid the coronavirus pandemic.

And the unpleasant truth is that distressed rental car companies dumping vehicles onto the market could result in a further collapse in used car prices.

end

the high unemployment coupled with retail bankruptcies and shale is now causing huge defaults in the leveraged loan category

(zerohedge)

 

Here Comes The Wave: Loan Defaults Hit 6 Years High

Two weeks ago, when looking at the recent flurry of chapter 11 filings and a striking correlation between the unemployment rate and loan delinquencies, we said that a “biblical” wave of bankruptcies is about to flood the US economy.

It now appears that the wave is starting to coming because according to Fitch, the monthly tally of defaults in the U.S. leveraged loan market has hit a six-year high, as companies are either missing payments or filing for bankruptcy because of the fallout from the coronavirus pandemic.

According to the latest Fitch Leveraged Loan Default Index data, the total amount of defaults in this high-risk, high-yielding area of the debt markets at $12.6 billion in May so far, the highest since April 2014, bringing the leveraged loan default total for the year to date is $33.3 billion.

At the end of April, the trailing 12-month default rate jumped to 2.8%, compared to just 1.8% at the end of last year. Fitch forecast that U.S. leveraged loan defaults would reach $80 billion in 2020, surpassing the previous high of $78 billion in 2009.

While many expect the US shale sector to lead in the coming default spike, US retailers have accounted for the bulk of defaults over the past two months, as they were forced to temporarily close stores in response to the COVID-19 pandemic. For now, energy remains in 5th spot after the telecom, services, and manufacturing sectors.

Retailers Neiman Marcus Group, J.Crew and J.C. Penney all filed for Chapter 11 bankruptcy protection this month in the United States, while Chesapeake Energy said this month it was unable to access financing and was considering a bankruptcy court restructuring of its over $9 billion debt if oil prices did not recover from the sharp fall caused by the COVID-19 pandemic.

What’s coming will be far worse, with none other than the CEO of the world’s biggest asset manager confirming as much: speaking on a call with clients, Larry Fink who runs the $7.5 trillion Blackrock, said that bankers told him they expect a cascade of bankruptcies to hit the American economy.”

 

end

The USA’s largest mall, the  Mall of America, owned by the Ghermezians is on the verge of default after missing two loan payments

This will start an avalanche of defaults in the commercial real estate sector.

(zerohedge)

 

 

America’s Largest Mall On Verge Of Default After Missing Two Loan Payments

Even before the coronavirus pandemic, US malls were in a crisis, with vacancies in January hitting a record high.

However, in the post-corona world, commercial real estate has emerged as one of the most adversely impacted sectors (perhaps because the Fed has so far refused to bail it out), with the number of new delinquencies soaring to a record high in recent weeks.

The gloom facing malls has also helped push the Big Short trade, which was the CMBX Series 6 BBB- tranche (the one with the most exposure to malls), to a fresh all time low last week.

And now, the implosion of the US retail sector has reached the very top, because according to Bloomberg The Mall of America, the largest US shopping center, has missed two months of payments for a $1.4 billion commercial mortgage-backed security, in confirmation that no business is immune to the devastating consequences of the coronavirus.

“The loan is currently due for the April and May payments,” according to a report filed by the trustee of the debt, Wells Fargo & Co., which is also the master servicer for the loan. “Borrower has notified master servicer of Covid-19 related hardships.”

Mall owners reported rock-bottom April rent collections, including about 12% for Tanger Factory Outlet Centers Inc., roughly 20% for Brookfield Property Partners LP and 26% for Macerich. Retailers and their landlords, hurt by competition from online stores before coronavirus-spurred shutdowns made things worse, are struggling to make rent and mortgage payments.

The 5.6 million-square-foot (520,000-square-meter) mall was ordered closed on March 17, and has announced plans to begin reopening on June 1, starting with retailers, followed later by food services and attractions, such as the mega-mall’s aquarium, cinema, miniature golf course and indoor theme park.

“Reopening a building the size of Mall of America is no small task, but we are confident taking the necessary time to reopen will help us create the safest environment possible,” the mall said in a statement on its website.

The Mall of America is owned by members of the Ghermezian family, whose holdings also include the West Edmonton Mall, a 5.3 million-square-foot complex in their Canadian hometown, and American Dream, a 3 million-square-foot mall in East Rutherford, New Jersey.

end
More death and destruction causes by the coronavirus: it is killing the hospitality industry, New York City Hotels and an implosion on CMBS  (the big short of the century)
(zerohedge)

COVID Kills Hospitality Industry, Crushes NYC Hotels, Triggers CMBS Implosion

The global hospitality industry is facing one of the worst crashes in history, and New York City, the epicenter of COVID-19 in the US, has seen its tourism industry decimated. With no rebound in sight, the second great depression for commercial real estate is ahead and could lead to a massive default wave of shopping malls and luxury hotels.

Judging by the ongoing collapse in commercial real estate, as we recently noted, CMBX 6, which track 25 commercial-mortgage-backed securities with high exposure to 2012 shopping mall loans, has tumbled during lockdowns, resulting in a handsome payout for the likes of Carl Icahn, McNamara and others who were short the tranche.

Last week we said, “keep a close eye on CMBX 9” with its “outlier exposure to hotels which have quickly emerged as the most impacted sector from the pandemic, this may well be the next big short.”

The various CMBX series are shown in the chart below, with CMBX 9 most notable for its 17% exposure to hotels.

While the broader market has rebounded, CMBX 9 has experienced a swan dive.

Several key observations in the Manhattan hotel industry have been seen this month, suggest the tide is turning for the industry. Let’s start with the newest piece of information is that The Times Square Edition, a newly constructed multi-million dollar hotel located in Midtown Manhattan, is set to pull the plug on operations by late summer.

Marriott International Inc. operates the hotel under the Edition brand, says it “has provided advance notice to employees, government officials and union officials” that all operations on the property will grind to a halt on August 13.

This suggests Marriot doesn’t see a V-shaped recovery in the tourism industry this year. Maybe Marriot is taking advice from Scott Minerd, the CIO of Guggenheim Investments, who recently said a recovery in the economy could take upwards of “four years.”

Bloomberg reviewed new documents in the ongoing foreclosure proceeding show Marriot informed owner Maefield Development in March that “a cash shortfall due to the outbreak could put the developer in default on its contract with the lodging giant.”

Moody’s Investors Service valued the mixed-use property at more than $2.4 billion in 2018 — considering the economic crash and commercial real estate implosion, the value of the property is likely much lower.

Even when New York City reopens, hotels in Manhattan generally rely on international travel and large conferences, which are several things that may not return to 2019 activity trends for several years. This has made it challenging for hotel operators to cover debt payments and labor costs, suggesting defaults and closures could be dead ahead.

Jonathan Falik, CEO at JF Capital Advisors, recently told Bloomberg that too many rooms are empty in the city and warns not all hotels will survive.

ReadNYC Hotel Loans Defaulting At Alarming Rate As Room-Rates Plunge, Tourism Tumbles

Last week, Sunstone Hotel Investors Inc. wrote down its Hilton Times Square hotel to less than its $77 million mortgage. Sunstone is currently in discussions with lenders to either restructure or handover the property.

Data firm Trepp said $1 billion dollars in late payments were seen in CMBSs used to finance New York hotels. The second great depression in commercial real estate has arrived, many shopping malls and hotels may not survive.

iv) Swamp commentaries)

Now we are getting the truth behind all of that unmasking.  This is what really happened during the last days of the Presidency of Obama

(League of Power)

special thanks to Robert H for sending us this important commentary.

In our last update we started to unpack a whistleblower report from a former Treasury Department official who alleges that spying on candidate Donald Trump and other Americans kicked into high gear in December of 2015. If you missed that initial report, it’s here.

A lot of Deep State co-conspirators now know they’ve been caught, so they want to limit the blowback damage to the FBI under James Comey. But there was a lot more spying going on in the ObamaGate conspiracy and it involved much more than the FBI.

When it came to using government agencies to spy on his political enemies, Barack Obama was like J. Edgar Hoover on steroids (but in a much slimmer cocktail dress). Think about how many government agencies have sensitive personal information of yours, which is supposed to have all sorts of privacy protections around it. Obama was using each and every agency available to spy on his enemies. Whether it was blackmail dirt or simply knowing what his opponents were going to do ahead of time, Obama gave his cabinet members and agency leaders blanket permission to ignore the civil liberties of Americans.

America’s allies were not off limits to this practice, either. Remember German Chancellor Angela Merkel’s furious phone call to Barack Obama back in 2013? WikiLeaks published proof that Obama had authorized the NSA to surveil the phone calls and emails of hundreds of leaders and employees in allied NATO countries, including Merkel. Obama had been spying on Merkel’s personal cellphone calls for three years when she finally found out about it. She accused Obama of using the NSA like his own personal Stasi. I’ll bet that would have been a fun phone call to listen in on!

The point is that Obama had his lackies spying on everyone and he wasn’t exactly shy about it.

 

President Trump just held a closed-door meeting with GOP Senators and told them to finally take the gloves off on this ObamaGate scandal. Acting Director of National Intelligence Rick Grenell shared a bombshell with President Trump – and Trump dropped it on the GOP in this meeting. Here it is:

A bunch of Obama administration losers unmasked Eric Trump, Ivanka Trump and Donald Trump Jr. on inauguration day in 2017. The very last day that the Obama administration was in power, they dug through Eric, Ivanka and Don Jr.’s phone calls to try to find something – anything – that they could use against President Trump and his family. Team Obama knew that their “case” against Gen. Mike Flynn had already fallen apart, so they were trying to find something else before they left power. We know they failed to find anything actionable because they ran with the Russian collusion fairytale for the next three years.

Which brings us back to this Treasury Department whistleblower. She alleges that Treasury Department wonks were unmasking the Trump campaign, Members of Congress “and other US citizens.” There was no legitimate reason for this.

In the paperwork, she claims that Treasury nerds were accessing and unmasking individuals in an unauthorized location – something she calls “the black box.” Then, they would take the information (unmasked names) that they found in the black box and use that to access information in the Treasury Department’s authorized intelligence source – “the white box.”

By skirting around the rules in this way, Treasure Department employees were able to spy on the Trump campaign through a backdoor method that left no paper trail. They didn’t have to apply for FISA warrants or anything, because they were sneaking into an intelligence resource they didn’t have permission to be in (the black box) and then making it look like a legitimate inquiry in the white box.

This is why there are so many Treasury Department bureaucrats on the list of people who unmasked Gen. Flynn. We’re supposed to believe that a bunch of government nerds with master’s degrees in accounting were hunting Russian spies, I guess? Really?

Obama’s Treasury Secretary Jacob Lew unmasked Flynn, and so did Acting Assistant Secretary Danny McGlynn, Acting Deputy Assistant Mike Neufeld, Deputy Secretary of the Treasury Sarah Raskin, Under-Secretary of Treasury Nathan Sheets, and Acting Under-Secretary of Treasury Adam Szubin.

Oh, and if you’re connecting any dots here, Sarah Raskin at the Treasury Department is the wife of Democrat Congressman Jamie Raskin of Maryland, who was a member of Nancy Pelosi’s House impeachment team.

That’s pretty weird in itself. All of those Treasury Department wonks unmasked Gen. Mike Flynn in his phone call with the Russian ambassador. But according to the whistleblower, they were unmasking a bunch of other folks, too.

Who were the “Members of Congress” that the Treasury Department was spying on? Well, that’s easy. I haven’t seen proof of this yet, but here’s my best guess:

  • Rand Paul
  • Ted Cruz
  • Marco Rubio
  • Lindsey Graham

They were the four Members of Congress who were running for the GOP nomination for president in December of 2015 when the ObamaGate spying originated, according to Rep. Devin Nunes (R-CA). Come to think of it, they were probably spying on Sen. Bernie Sanders to help Hillary out as well.

I’m certain that Obama’s media protectors will end up claiming that there were legitimate reasons for a laundry list of Treasury Department bureaucrats to spy on US Senators, the Trump family and others. (They were looking for checks signed, “V. Putin!”) If you buy into that argument, keep in mind that we haven’t even begun to talk about why people in the Department of Energy were unmasking campaign workers and Trump family members!

But this is inexcusable. It makes the Watergate burglary look like a historical non-event. Historians will owe Richard Nixon an apology if ObamaGate is brushed under the rug without consequences. Obama was spying on everyone. He had every federal agency subverted and spying on his political opponents to subvert the 2016 election. He wanted Hillary to win in order to keep his legacy intact.

“Russian collusion” was the smokescreen that they threw up to distract Americans from the fact that the Democrats were spying on all of the rival political campaigns, so they could stay in power. Trump wasn’t the main original target, but one of more than a dozen targets that they were spying on. They had to finally zero in on him with the Russian collusion BS when it dawned on them that he might actually be able to beat Hillary.

end

Kayleigh stuns the Journalists with an interactive “Obamagate’ presentation.  She instructs them how to do their job

(zerohedge)

White House Press Secretary Stuns Journos With Interactive ‘Obamagate’ Presentation On How To Do Their Jobs

Shortly before wrapping up an impromptu press conference in which President Trump declared places of worship essential during the pandemic, White House Press Secretary Kayleigh McEnany delivered a scorching presentation to the White House Press Corps on Friday – after accusing them of failing to do their jobs regarding ‘Obamagate.’

Did anyone take it upon themselves to pose any questions about Michael Flynn and unmasking to President Obama’s spokesperson?” she asked.

One journalist stammers, “but buh but Flynn’s name wasn’t mas–”

To which McEnany cut back in, continuing “So I would like to lay out a series of questions and perhaps, if I write them out in a slide format – maybe we’re visual learners and you guys will follow up with journalistic curiosity.”

She then played four slides with questions to ask:

  • “Why did the Obama Admin use opposition research, funded by a political organization and filled with foreign dirt to SPY ON MEMBERS OF THE TRUMP CAMPAIGN?
  • “Why was Lt. Gen. Micahel Flynn UNMASKED by Obama’s Chief of Staff, Joe Biden, Susan Rice, and others?”
  • “Why was Flynn’s identity leaked – A CRIMINAL ACT – to the press?”
  • “Why did the DOJ learn about the FBI’s interest in Flynn’s conversations with the Russian Amb. from a CONVERSATION WITH OBAMA in the Oval Office?”

Watch:

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

US

US Initial Jobless Claims: 2.438m, 2.4m expected, prior week revised to 2.687m from 2.981m

Continuing Claims: 25.073m, 24.350m expected, prior week revised to 22.548m from 22.873m

If trillions of dollars of fiscal spending and trillions of dollars of Fed largesse are not enough: 1) How severe is the economic problem; and 2) how many more trillions of dollars are needed?

The Clarida spurt ended quickly.  Saner traders realized the negativity in Clarida’s assertion.  The Fed Vice Chair also said the economic news has been “unremittingly awful” and Covid-19 is the most serious economic threat of our lifetimes.  Actually, it’s the shutdowns that are the most serious economic threat.

End New York City’s lockdown now!

By prolonging the coronavirus shutdown long after its core mission was accomplished, Gov. Andrew Cuomo and Mayor Bill de Blasio have plunged tens of thousands of New Yorkers into poverty…

The Big Apple is ­dying. Its streets are empty. The bars and jazz clubs, restaurants and coffeehouses sit barren. Beloved haunts, storied rooms, perfect-slice joints are shuttered, many for good. The sweat equity of countless small-business owners is evaporating. Instead of getting people back to work… our mayor talks about a fantasyland New Dealfor the post-coronavirus era

     In late April, Georgia Gov. Brian Kemp defied experts by opening his state… Instead of the predicted spike in deaths, the number of cases of coronavirus and associated deaths declined… We flattened the freakin’ curve. There is no longer any reasonable justification for the government to deprive us of our livelihoods. And our rights aren’t the government’s to grant or take away. They belong to us…  https://nypost.com/2020/05/20/end-new-york-citys-lockdown-now/

In mid-March, experts and politicians told Americans that the next 15 days were critical for the US.  Shutdowns and social distancing were necessary to ‘flatten the curve’.  Models showed that a surge of Covid-19 infections was imminent.  That was two months ago.  Articles are proliferating that proffer reasons that big-blue state politicians are maintaining shutdowns.  We’ll spare you the articles for the Readers’ Digest version: 1) hurt Trump politically, 2) get the feds to bailout big-blue cities and states’ humongous debt; and 3) increase government-dependent (feudalism) constituents.

Why California Is In Trouble: Despite California’s $54 billion budget deficit and $1 trillion unfunded pension liability, there are 340,390 government employees bringing home six-figure salary and pension checks. Recently, though, Gov. Gavin Newsom asked U.S. taxpayers for a bailout…

https://www.zerohedge.com/markets/why-california-trouble-340000-public-employees-100000-paychecks-cost-taxpayers-45-billion

Young Join the Rich Fleeing America’s Big Cities for Suburbs

Millennials returning home as lockdowns strip cities of allure

    “The draw of the city is the social life”… Without those attractions, “it makes a lot of sense to just abandon ship and go back to your parents.”… A survey Goss conducted of 352 San Francisco landlords found that 17% — an unusually large amount — have had tenants break leases or give 30-day notice to vacate over the past month…Young people have been a major force in the back-to-the-city movement in recent decades, helping revive moribund neighborhoods and nourish new businesses…

https://www.bloomberg.com/news/articles/2020-05-20/young-join-the-rich-fleeing-america-s-big-cities-for-suburbs

Numerous clients and acquaintances tell us that their firms will continue to allow employees to work at home for the foreseeable future, some will be allowed to work-at-home permanently.  This will kill an unfathomable amount of city businesses.

The Mall of America hasn’t paid its mortgage in two months

Next to hotel owners, retailers have been the hardest hit by the Covid-19 crisis,”…

https://www.cnbc.com/2020/05/21/the-mall-of-america-hasnt-paid-its-mortgage-in-two-months.html

Bloomberg QuickTake @QuickTake: 1 in every 4 U.S. restaurants will permanently close due to the #coronavirus, according to OpenTable.

An astounding number of Americans do NOT realize, or choose not to realize, that the US is close to an economic catastrophe.  It will be led by large cities that remain shut down – some are under orders to remain shut into or through June!  This is why Elon Musk tweeted: “Take the red pill”; Buffett unloaded beaucoup stocks and Fed officials are issuing gloomy comments.  A similar insouciance exists in regard to the criminality, corruption and malfeasance of the political class/Swamp.

The Fed’s balance sheet grew by $103.031B, to $7.037 Trillion for the week ended Wednesday.  The Fed bought $1.5 billion in ETFs.  https://www.federalreserve.gov/releases/h41/current/

he WSJ’s @KThomasDC: Andrew Weissmann, former lead prosecutor on Mueller’s special counsel team, is headlining a June 2nd virtual fundraiser for Biden.  [Where is the MSM on this outrage?]

     @ByronYork: This is the prosecutor who also attended Hillary Clinton’s tear-filled election night event in 2016. Doing his best to discredit the investigation.

     Actor @RealJamesWoods: They don’t even bother to hide it anymore. They know the Republicans are such weak sisters, they’ll never fight back, regardless what shenanigans the Democrats… are up to.

How Russiagate Began With Obama’s Iran Deal Domestic Spying Campaign

Michael Flynn posed a threat to the former president’s legacy and was made to pay for it

   They smeared Flynn through the press as an agent of a foreign power, spied on him, and leaked classified intercepts of his conversations to reliable echo chamber allies… Flynn not only made it clear that he wanted to undo the Iran Deal, he also broadcast his determination to find the documents detailing the secret deals between Obama and Iran, and to publicize them

    That Obama has publicly criticized the Justice Department’s decision to withdraw its case against the retired general shows how personal the anti-Flynn campaign still is for the former president…

Flynn knew how and where to find the documentary evidence of the FBI’s illegal spying operation buried in the agency’s classified files—and the FBI had reason to be terrified of the new president’s anger… Why Obama would choose the Islamic Republic as a partner and encourage tactics typically employed by third-world police states remain a mystery.

https://www.tabletmag.com/sections/news/articles/russiagate-obama-iran

@nytimes: Federal regulators warned for years that a dam in Michigan could rupture. On Tuesday, the dam gave way, sending a torrent of water gushing into streets, houses and businesses.  https://nyti.ms/2AF2AYb

South Carolina election ballots reportedly found in Maryland this week – after mail-in voting forthe Palmetto State’s June 9 primary has already begun, according to local news reports…

https://www.foxnews.com/politics/south-carolina-election-ballots-reportedly-found-in-maryland-this-week

Corruption Allegations Keep Growing in Paterson Vote-By-Mail Election

One woman said there are eight relatives and immediate neighbors she knows of listed as having voted — but who insist they never even received ballots, including one relative who she says has been in Florida for weeks…  Videos are surfacing online of a single voter carrying numerous ballots. Postal workers were seen leaving some ballots sitting out in building lobbies. And hundreds of filled out ballots were found by postal workers in single mailboxes in Paterson, suggesting a possible vote bundling operation which election experts say is a crime. In one case, officials said more than 300 Paterson city ballots were found in a single mailbox in an entirely different town: Haledon

https://www.nbcnewyork.com/news/local/corruption-allegations-keep-growing-in-paterson-vote-by-mail-election/2416111/

DOJ Announces Charges against Philadelphia Election Official for Stuffing Ballot Box with Fraudulent Votes to Help Democrat Candidates… for specific Democratic candidates in the 2014, 2015, and 2016 primary election…     https://www.thegatewaypundit.com/2020/05/doj-announces-charges-philadelphia-election-official-stuffing-ballot-box-fraudulent-votes-help-democrat-candidates/

Detroit police make arrest after video of elder abuse goes viral – Police made an arrest Thursday after a video circulating on social media appeared to show a man punching elderly victims lying in bed…[How many Covid nursing home deaths are due to malfeasance?] https://amp.detroitnews.com/amp/5237271002

Unhinged Michigan AG Jumps on CNN Outraged after President Trump Did Not Wear Mask at Ford Plant — Says He’s Not Welcome Here — THREATENS CHARGES AGAINST FORD!

https://www.thegatewaypundit.com/2020/05/unhinged-michigan-ag-jumps-cnn-outraged-president-trump-not-wear-mask-ford-plant-says-not-welcome-threatens-charges-ford/

@KelemenCari: Trump wore a face mask in the area of the Ford Plant that recommended one, and he chose to remove it in the area that didn’t. Michigan’s AG wants to bring charges against him for this?

https://twitter.com/KelemenCari/status/1263619608965263362

Well that is all for today

Let us close out the week with this offering courtesy of Greg Hunter…

Obama Made Me Do It, Trump Taking HCQ, Economic Update

By Greg Hunter On May 22, 2020

Susan Rice, the Obama Administration National Security Advisor, is saying it was Obama who was behind the takedown of General Flynn. This also implies Obama was behind the soft coup to remove President Trump with the Russia hoax. This is going to get very ugly as the coup plotting rats start to turn on each other in order to stay out of jail.

President Trump announced this week he was taking Hydroxychloroquine (HCQ) as a preventative measure. This while the mainstream media (MSM) is engaging in a relentless disinformation campaign to tell the public that HCQ is ineffective and does not work against Covid 19. In both cases, science says it’s provably false. The MSM should be ashamed for having blood on its hands. It looks like the MSM wants people to die, unless it’s someone like CNN’s Chris Cuomo, who admitted this week he took a form of HCQ to get over his Covid 19 infection.

The U.S. economy is severely damaged, and nowhere is that more evident than the commercial real estate market. The biggest mall in America is in big financial trouble, and that is just the tip of the iceberg. The Covid shutdown has bankrupted many businesses, and that is going to be a lingering trend while America tries to get back to work.

Join Greg Hunter of USAWatchdog.com as he talks about these stories and more in the Weekly News Wrap-Up.

-END-

I will see you TUESDAY night.

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