GOLD:$1890.10 UP $2.00 The quote is London spot price
Silver:$23.83 UP 2 CENTS London spot price ( cash market)
your data…
Closing access prices: London spot
i)Gold : $1893.40 LONDON SPOT 4:30 pm
ii)SILVER: $23.84//LONDON SPOT 4:30 pm
2 ) Gold/silver trading overnight Europe, Goldcore
(Mark O’Byrne/zerohedge
and in NY: Bloomberg
3. ASIAN AFFAIRS
i)THURSDAY MORNING/ WEDNESDAY NIGHT:
SHANGHAI CLOSED //Hang Sang CLOSED DOWN 49.51 OR .20% /The Nikkei closed UP 224.25 POINTS OR 0.96%//Australia’s all ordinaires CLOSED UP 1.06%
/Chinese yuan (ONSHORE) closed /Oil UP TO 40.67 dollars per barrel for WTI and 42/73 for Brent. Stocks in Europe OPENED ALL GREEN// ONSHORE YUAN CLOSED AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.73359 TRADE TALKS STALL//YUAN LEVELS //TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS HUAWEI/CFOARRESTED//CORONAVIRUS/PANDEMIC/TRUMP TESTS POSITIVE FOR COVID 19 : /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:
total withdrawals; 152,854.760 oz
We had 1 kilobar transactions +
ADJUSTMENTS: 2 //
The front month of OCT registered a total of 10,362 contracts for a LOSS of 2272 contracts. We had 2283 notices filed on Wednesday so we gained 11 contracts or 1100 additional oz will stand for delivery in this active delivery month of October. In gold we have not seen queue jumping start so early in the month. As I have stated previously: ” you can bet the farm that throughout October, the total number of gold oz standing will increase from this level.” So far it seems that I am right. Gold must be secured for comex contracts standing for metal as well as exercised EFP’s.
November lost 42 contracts to stand at 1347.
The big December contract LOST 4,389 contracts DOWN to 444,189 contracts..
THE BIG STORY AGAIN TODAY IS THE HIGH OI STANDING FOR OCTOBER (100.846 tonnes). GENERALLY OCTOBER IS A POOR DELIVERY MONTH AS MOST INVESTORS PREFER TO SKIP THIS MONTH AND MOVE STRAIGHT TO DECEMBER. IT LOOKS LIKE SOME MAJOR ENTITY(GOLDMAN SACHS) JUST CANNOT WAIT FOR DECEMBER AS THEY ARE MAKING THEIR MOVE ON OCTOBER FOR PHYSICAL METAL. GOLDMAN SACHS ONE OF THE LEADERS OF THE NEW LONDON LME EXCHANGE NEEDS THE GOLD INVENTORY FOR LIQUIDITY AND INITIAL CONTRIBUTION WITH OTHER MAJOR PLAYERS. THE MAJOR DIFFERENCE BETWEEN THIS MONTH AND OTHER MONTHS IS THAT THIS GOLD STANDING IN OCTOBER WILL LEAVE THE COMEX AND HEAD FOR LONDON.
We had 3105 notices filed today for 310,500 oz OR 79.6812 TONNES.
To calculate the INITIAL total number of gold ounces standing for the OCT /2020. contract month, we take the total number of notices filed so far for the month (25,165) x 100 oz , to which we add the difference between the open interest for the front month of OCT (10,362 CONTRACTS ) minus the number of notices served upon today (3105 x 100 oz per contract) equals 3,241,100 OZ OR 100.818 TONNES) the number of ounces standing in this active month of Oct
thus the INITIAL standings for gold for the OCT/2020 contract month:
No of notices filed so far (25,165, x 100 oz +10,362 OI) for the front month minus the number of notices served upon today (3105) x 100 oz which equals 3,242,200 oz standing OR 100.846 TONNES in this active delivery month. This is a HUGE amount for gold standing for a OCT delivery month (a poor active delivery month).
We gained 11 contracts or an additional 1100 oz will stand on this side of the pond searching for metal.
NEW PLEDGED GOLD: BRINKS
592,648.822 oz NOW PLEDGED SEPT 15.2020/HSBC 18.433 TONNES ( A HUGE INCREASE FROM 10.6)
42,548.308.00 PLEDGED APRIL 3/2020: SCOTIA: 1.3234 tonnes
deleted Int. Delaware pledge July 7 (600 tonnes)
277,934.09 oz (some deleted august 3) JPM 8.644 TONNES
610,238.285 oz pledged June 12/2020 Brinks/ July 2/July 21 19.017 tonnes
51,084.609 oz Pledged August 21/regular account 1.588 tonnes JPM
total pledged gold: 1,574,454.119 oz 48.97 tonnes
total registered, pledged and eligible (customer) gold 37,248,581.384 oz 1,158.58 tonnes (INCLUDES 4 GC GOLD)
total 4 GC gold: 126.34 tonnes
total gold net of 4 GC: 1032.24 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 July 2018. and it continues to present day.
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.
THE GOLD COMEX SEEMS TO BE UNDER SEVERE ASSAULT FOR PHYSICAL
END
And now for the wild silver comex results
And now for the wild silver comex results
INITIAL STANDINGS
OCT. SILVER COMEX CONTRACT MONTH//INITIAL STANDING
| Silver | Ounces |
| Withdrawals from Dealers Inventory | NIL oz |
| Withdrawals from Customer Inventory |
1,161,171.540 oz
Brinks
|
| Deposits to the Dealer Inventory |
5175,600 oz
Brinks
|
| Deposits to the Customer Inventory |
1960.300 oz
Delaware
|
| No of oz served today (contracts) |
30
CONTRACT(S)
(150,000 OZ)
|
| No of oz to be served (notices) |
176 contracts
880,000 oz)
|
| Total monthly oz silver served (contracts) | 1719 contracts
8,595,000 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 |
|
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.
CNBC.com
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.
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.
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-
Global Markets Rise On Continued “Stimulus Optimism”
“Explanations” for overnight market moves have drifted from the merely comical and veered into the surreal. Case in point, this morning Bloomberg writes that “futures contracts on U.S. equity indexes rose, suggesting gains on Wall Street will be extended to a second day on stimulus optimism” and Reuters chimes in that “futures rose for a second straight day on Thursday as bets of a piecemeal fiscal stimulus deal lifted sentiment” while just hours earlier the Financial Times led with this:
In short, whichever direction stocks drift, that’s where one can find “stimulus sentiment” at any given moment. The only question we have is what is the direction of causality.
In any case, S&P futures rose for a second straight day after yesterday’s 1.7% surge because “there were more buyers than sellers” or whatever, with the S&P now back above the level where the S&P puked on Trump’s infamous “no more talks” tweet.
As noted earlier, Regeneron shares rose 4.9% in pre-market trading after Trump said its antibody cocktail was the “key” to his quick recovery. The president said he would authorize its emergency use. Shares of Delta Air Lines, American Airlines, United Airlines and JetBlue Airways were up between 0.8% and 1.7% in early pre-market trading. Coty jumped 5.1% after the cosmetics maker announced the launch of direct-to-consumer websites for Kylie Skin brand in the UK, France, Germany and Australia.
In Europe, the Stoxx 600 Index was up 0.5% as of 10:40 a.m. in London after paring earlier gains of as much as 0.8%. Travel and leisure stocks, and the shares of real estate companies led the advance with gains in the sector gauges of 1.5% and 1.2%, respectively.
Earlier, the MSCI Asia Pacific Index notched a fourth day of gains led by IT and materials, after rising in the last session. Most markets in the region were up, with Taiwan’s Taiex Index gaining 1.1% and Australia’s S&P/ASX 200 rising 1.1%, while Hong Kong’s Hang Seng Index dropped 0.2%. The Topix gained 0.5%, with Saxa Holdings and Meiji Shipping rising the most.
According to the prevailing narrative, the hot new thing now is for markets to “digest” the prospect of Democratic presidential nominee Joe Biden winning the election, coupled with a blue sweep, despite an unexpectedly strong performance by VP Mike Pence last night, where an elusive Kamala Harris repeatedly refused to answer the question whether the Harris-Biden administration would pack the Supreme Court, arguably one of the biggest policy variables for the next four years.
According to Bloomberg, the “blue sweep” scenario seems to be quelling volatility even as risks from a split in government to a resurgence of coronavirus cases threaten the economic rebound.
“The market is now almost treating Trump’s actions as a sideshow, and is much more firmly pricing Biden in the White House,” Mizuho strategists including Peter Chatwell wrote in a note. We wonder if Peter said the same thing in 2016 about Hillary “in the White House.” Still, they warned investors against “getting bulled-up on Biden” and the possibility of Democrats winning in the November election, including the Senate. “Recent price action suggests that the market is starting to get ahead of itself, and prematurely becoming too optimistic,” they wrote hedging their bets because nobody wants another reputation-crushing repeat of Nov 3, 2016.
Meanwhile, and as the fiscal stimulus charade continues in Congress, Fed central bankers sought further debate on the future of the Federal Reserve’s asset-purchase program, according to the minutes of the Federal Open Market Committee’s Sept. 15-16 meeting.
Elsewhere, European countries are grappling with a jump in coronavirus infections as concerns mount that some countries may be losing control. France, Spain and the Czech Republic posted record increases in cases, while the U.K. government has drawn up rescue measures for companies struggling to cope in areas forced into local lockdowns.
In rates, Treasuries were firm despite the ramp in S&P 500 E-mini futures, with long-end yields lower by about 2bp. Focus remains on progress toward an economic stimulus agreement, while in Asia, strong appetite for Japan and New Zealand bond sales helped underpin Treasuries. Treasuries 5s30s curve, which approached its YTD high on Oct. 6, is 1.5bp flatter on the day; 10-year yields around 0.77%, richer by less than 2bp on the day and outperforming bunds and gilts. Later today we have the last coupon auction of the week with a $23BN 30-year reopening, bringing the CUSIP’s total size to $72b; Wednesday’s 10-year reopening stopped even with the WI yield at the bidding deadline. European peripheral spreads tightened and Greek bonds yields dropped to a record low as support from the ECB and the EU quells investor concerns about the health of the region’s most indebted nation in the face of the coronavirus.
In FX, the Bloomberg Dollar Spot Index pared some of its Asia session losses in European trading but was still lower against most of its G-10 peers though it hovered around 1.1750 per euro. Risk-sensitive currencies led by the Australian dollar had the best performance; the pound rose for a second day helped by signs that U.K. and EU officials may be optimistic on their prospects for securing a Brexit trade deal. The Aussie outperformed the kiwi after New Zealand’s Reserve Bank Chief Economist Yuong Ha said that the bank would rather be aggressive in adding stimulus than do too little too late; the kiwi subsequently fell to a session low versus the U.S. dollar before bouncing back. Yen was steady, holding near a three-week low against the dollar.
In commodities, WTI and Brent maintain an upward trajectory with the former eyeing $40.50/bbl to the upside vs. a low of $39.76/bbl, and the latter north of $42.50/bbl, with the market pricing in supply risk premia as Hurricane Delta looks to make landfall on the Gulf of Mexico tomorrow, whilst Norwegian oil strikes could escalate on Saturday. Regarding the Gulf developments, NHC stated that Hurricane Delta has restrengthened into a Catergory 2 hurricane with hurricane conditions and life-threatening surges expected to begin along portions of the Northern Gulf coast on Friday, whilst BSEE’s estimations yesterday suggest that Hurricane Delta has shut-in 80% offshore crude oil production (prev. 29%) and 49% of natural gas output (prev. 9%) in the Gulf of Mexico – with Shell and Chevron the latest companies to all halt operations in the vicinity. Elsewhere, precious metals stand as beneficiaries of the softer Dollar, with spot gold inching closer towards $1900/oz having while spot silver makes headway above $24/oz.
Looking at today’s calendar, expected data include jobless claims. Domino’s Pizza is reporting earnings. There is also an array of central bank officials will be speaking today, including Bank of England Governor Bailey, the Fed’s Rosengren and Bostic, ECB Vice President de Guindos, and the ECB’s Schnabel, Hernandez de Cos and Mersch.
Market Snapshot
- S&P 500 futures up 0.3% to 3,417.25
- STOXX Europe 600 up 0.3% to 366.46
- MXAP up 0.7% to 174.98
- MXAPJ up 0.7% to 577.58
- Nikkei up 1% to 23,647.07
- Topix up 0.6% to 1,655.47
- Hang Seng Index down 0.2% to 24,193.35
- Shanghai Composite down 0.2% to 3,218.05
- Sensex up 1% to 40,294.79
- Australia S&P/ASX 200 up 1.1% to 6,102.04
- Kospi up 0.2% to 2,391.96
- Brent futures up 1.1% to $42.43/bbl
- Gold spot up 0.2% to $1,891.64
- U.S. Dollar Index little changed at 93.57
- German 10Y yield fell 1.4 bps to -0.507%
- Euro unchanged at $1.1763
- Italian 10Y yield rose 0.9 bps to 0.582%
- Spanish 10Y yield fell 3.3 bps to 0.209%
Top Overnight News from Bloomberg:
- The Trump administration plans to impose sanctions as soon as Thursday on Iran’s financial sector to further choke off its economy from the outside world, according to people familiar with the matter
- The approach of Brexit has London confronting the loss of its role as Europe’s undisputed stock-trading hub and, with it, billions of euros in daily trading
- Spain lowered its target for net debt issuance this year by 12% in an effort to maintain fiscal discipline amid a surge in spending to counter the impact of the coronavirus, Economy Minister Nadia Calvino said
- Japanese investors bought a record amount of Italian bonds for a second month in August, underscoring the growing appeal of what was once regarded as Europe’s riskiest debt
- France, Spain and the Czech Republic posted record increases in coronavirus cases, underscoring growing alarm in Europe as it struggles to control the pandemic; Boris Johnson’s government has drawn up rescue measures for U.K. businesses struggling to cope in areas forced into local Covid lockdowns, as ministers prepare to impose tighter rules within days
- French economic output is plateauing at 5% below pre-crisis levels, according to the Bank of France, adding to signs the country’s recovery from lockdown is faltering
Courtesy of NewsSquawk, here is a quick look at global markets:
Asian equity markets traded mostly positive as the region took its cue from the rebound in the US where all major indices reclaimed the losses triggered by President Trump’s recent announcement to walk away from COVID-19 relief negotiations, as investors found solace from President Trump’s calls for piecemeal measures including airline aid, PPP and stimulus checks. ASX 200 (+1.1%) and Nikkei 225 (+1.0%) were higher as Australia extended on its post-budget outperformance with healthcare, tech and materials frontrunning the broad-based gains in the index, while the Tokyo benchmark coat-tailed on the recent favourable currency moves after USD/JPY briefly reclaimed the 106.00 handle. Elsewhere, the KOSPI was kept afloat but with upside capped after shares in index heavyweight Samsung Electronics failed to capitalize on stronger than expected preliminary results for Q3 despite flagging a 58% increase in operating profits, and the Hang Seng (-0.2%) was the laggard in which it breached the 24,000 level to the downside with notable weakness seen in gambling names after underwhelming early gaming revenue numbers from Golden Week holidays with JPMorgan also neutralizing its bullish view on Macau gaming due to poor re-opening trends. Finally, 10yr JGBs were lacklustre following spillover selling from T-notes and amid the mostly positive tone in stocks, although stronger results at the 5yr JGB auction provided some mild support in late trade.
Top Asian News
- Amazon Says Indian Partner Broke Pact After Ambani Sale Deal
- Thailand Adds Fresh Tax Breaks to Stimulus to Spur Growth
- Singapore Scales Up Virus Screening Centers for Migrant Workers
Stocks in Europe have waned off best levels but mostly hold onto mild gains (Euro Stoxx 50 +0.5%), with somewhat choppy price action experienced since the cash open despite a distinct lack of fresh catalysts. US equity futures also dipped in tandem but remain in positive territory, with NQ narrowly outperforming ES and YM. On the fiscal front State-side, US House Speaker Pelosi and Treasury Secretary Mnuchin are poised for more stimulus discussions, this time on a narrower deal, with White House Chief of Staff Meadows remarking the administration believes there is broad base of support to reach a limited deal on coronavirus relief, while he added that House Speaker Pelosi is sticking to a USD 2.2tln stimulus bill and Senate Majority McConnell is willing to consider a separate airline bill. Meanwhile in Europe, negotiations are to continue regarding the legality of the EU budget and Recovery Fund, which threatens a delay to the swift rollout of the package by the touted January 2021 target. Back to bourses, Spain’s IBEX (+1.0%) outperforms as it’s propped up by its heavy-weight banking sector amid tailwinds from the banking consolidation in the region, whilst the FTSE 100 (+0.1%) resides on the other end of the spectrum on currency dynamics. Sectors are mostly in the green with no real risk profile to be derived; the breakdown sees Travel & Leisure outpacing, but Basic Resources and Autos lag. Meanwhile, the Real Estate sector is supported by British home builders after the UK RICS Housing Survey topped forecasts (61 vs Exp. 40); thus translating to gains in Taylor Whimpey (+3.0%), Barratt Developments (+3.0%), British Land (+2.0%), Ashtead (+2.0%). Moving to earnings, GVS (+3.5%) opened higher by ~7% after posting a 12% increase in Q3 revenue and raising core earnings outlook. Elsewhere, ams (-1.1%) clambered off lows after opening lower by 4.5% amid a 13% decline in revenue and plans to issue new bonds. Finally, easyJet (-0.4%) reversed earlier gains as it expects to report a group headline loss before tax of GBP 815-845mln for FY20, whilst sources stated the group informed the government of the potential need for state loans or finance, although just to keep a prudent approach on finances
Top European News
- Spain Cuts 2020 Net Debt Sales Target 12% to 115 Billion Euros
- Europe Battles to Contain Virus as Cases Spike in Spain, France
- Sexual Harassment Scandal Forces Danish Party Leader to Quit
- Greek Bonds Rally to Send 10-Year Yields to an All-Time Low
In FX, the Aussie has maintained some post-RBA momentum and is deriving some external impetus from onshore YUAN gains beyond 6.7250 at one stage in the ongoing absence of official PBoC midpoint fixings during China’s Golden Week holidays. Coupled with the Greenback easing from its peaks prompted by US President Trump calling for a suspension of fiscal stimulus talks and the DXY rotating around 93.500, Aud/Usd has rebounded through 0.7150 to 0.7170 ahead of the RBA’s FSR on Friday. Meanwhile, Sterling has also benefited from the Buck’s pull-back with Cable bouncing firmly from just above 1.2900 to 1.2970, but Eur/Gbp is back below 0.9100 on the back of UK Government reports suggesting a little progress on state aid in discussions with the EU, albeit still some distance between the 2 sides on the issue of fishing.
- NZD/NOK – The next best majors, and perhaps surprisingly given dovish rhetoric from the RNBZ overnight as chief economist Young Ha said the Bank would rather do too much too early than vice-versa and assistant Governor Hawkesby promised more on the FLF in November’s MPS, adding that inflation is expected to be under target for the following 3 years. Elsewhere, Norwegian mainland GDP missed consensus, but Eur/Nok is softer near 10.9000 against the back drop of firm crude prices and Nzd/Usd is hovering close to 0.6600 in wake of improvements in ANZ business sentiment and activity outlooks.
- SEK/CAD/EUR/CHF/JPY – All narrowly mixed in headline US Dollar reference or Euro cross terms as the Swedish Krona pivots 10.4450, Loonie straddles 1.3250 with some traction from oil awaiting Canadian housing starts and jobs data later today and tomorrow respectively, and Euro roams between 1.1781-56 parameters in advance of ECB minutes. Note also, Eur/Usd looks underpinned by decent option expiry interest from 1.1745 to 1.1735 (1.8 bn) before even bigger expiries on Friday, while comments from de Guindos merely underline the heightened attention on currency developments, but again provide no specifics on tolerance limits. Similarly, the SNB keeps its lines in the sand under wraps, albeit actively intervening as the Franc holds firmly above 0.9200 and a few pips over 1.0800 against the Greenback and Euro respectively. Indeed, latest from chair Jordan simply refers to the fact that monetary accommodation has not really dampened demand for the Chf even though it has not been behaving like a traditional safe haven for some time in contrast to the Yen that is tightly bound around 106.00 vs its US rival as a go to destination for investors seeking a refuge from risk.
- EM – After bouts of consolidation and respite, it’s back to all too familiar shaky ground for the Lira due to conflicts and incursions involving Turkey in the Middle East and beyond, with Usd/Try resuming its seemingly relentless course to at least test the resistance and psychological defences at 8.0000.
In commodities, WTI and Brent front month futures maintain an upward trajectory with the former eyeing USD 40.50/bbl to the upside (vs. low USD 39.76/bbl) and the latter north of USD 42.50/bbl (vs. low USD 41.86/bbl), with the market pricing in supply risk premia as Hurricane Delta looks to make landfall on the Gulf of Mexico tomorrow, whilst Norwegian oil strikes could escalate on Saturday. Regarding the Gulf developments, NHC stated that Hurricane Delta has restrengthened into a Catergory 2 hurricane with hurricane conditions and life-threatening surges expected to begin along portions of the Northern Gulf coast on Friday, whilst BSEE’s estimations yesterday suggest that Hurricane Delta has shut-in 80% offshore crude oil production (prev. 29%) and 49% of natural gas output (prev. 9%) in the Gulf of Mexico – with Shell and Chevron the latest companies to all halt operations in the vicinity. Over to Norway, the Lederne Union said it has exchanged proposals with associations of oil companies and are planning to continue dialogue today, with 330k BOEPD of production currently shuttered out of the countries ~1.7mln BOEPD total. The Norwegian Oil & Gas Association also said the oil strike is set to impact 966k BOEPD unless conflict with union is resolved by October 14th. Looking ahead, the OPEC World Oil Outlook will be released at 1300BST, with little influence expected in the crude markets given the ever-shifting dynamics possibly proving the release to be stale. Elsewhere, precious metals stand as beneficiaries of the softer Dollar, with spot gold inching closer towards USD 1900/oz having had currently notched a range of USD 1883-1895/oz, whilst spot silver makes headway above USD 24/oz (vs. low 23.72/oz). In terms of base metals, LME copper trades flat within a tight range with eyes on Chilean strikes after two out of five labour at the Candelaria mine rejecting offers, with the mine the first of six mines in the country to have labour talks in the coming months.
Event Calendar
- 8:30am: Initial Jobless Claims, est. 820,000, prior 837,000
- 8:30am: Continuing Claims, est. 11.4m, prior 11.8m
- 9:45am: Bloomberg Consumer Comfort, prior 49.3
Central Bank speakers:
- 9:15am: Fed’s George Gives Speech on Economic and Policy Outlook
- 12:10pm: Fed’s Rosengren to Speak at Virtual Event on Economic Recovery
- 2pm: Fed’s Bostic to Speak on Panel to Rework America Alliance
DB’s Jim Reid concludes the overnight wrap
Feeling a bit melancholy this morning. At the end of reading my 5 year old daughter a fairly plotless bedtime story about a Vet and lots of minor and silly animal accidents, my daughter suddenly turned to me and said “Daddy am I going to die one day? I don’t want to die”. Before I could think of an answer she said “Are you and mummy going to die one day?” She then got a bit tearful. All that was going through my head was US Open Bryson DeChambeau’s claim that he is going to live to 120-130 years old so I said that I wasn’t sure but whatever happens we’ve hopefully all got a long long way to go and lots of fun first. That seemed to placate her a bit but I can see we’re reaching the age where the first difficult questions start arising. Next stop “Is Santa made up?”.
Talking of the great man (Santa not Bryson), Christmas came early for markets last night after a strong session that more than compensated for the previous day’s declines. Before that let’s review the VP debate overnight. It was a far more civil and traditional debate with supporters from each side likely to be relatively happy with their candidate’s performance. It is unlikely that either Senator Harris or Vice President Pence did anything to alter the trajectory of the race though. President Trump entered the debate down 9.5pts to former Vice President Biden in fivethirtyeighty.com’s national polling averages. In other bad polling news for Trump, overnight a Quinnipiac poll shows the president trailing Mr Biden by 13 and 11 points in Pennsylvania and Florida respectively.
Ahead of the debate, US equities rebounded from Tuesday’s selloff when President Trump called off the stimulus negotiations, with the S&P 500 up +1.74% to its highest level in just over a month. The tweet in the Asian session that we discussed yesterday hinting that Trump remains open to skinny stimulus deals kick started the market back on its upward path. This was given a further boost when Speaker Pelosi signaled that she too would be open to some form of partial measures, notably for the airline industry. To that end the Transportation industry (+2.75%) and Autos (+4.14%) were among the best performers. It was a broad-based advance that saw every industry higher on the day and with cyclicals leading the way. The NASDAQ only performed slightly better than the broader index, rising +1.88%.
Equity volatility also subsided, with the VIX index ending a run of 6 successive moves higher, though futures continued to indicate higher volatility heading into November and the election period. Although the polls are clearer now risk still is elevated around the election period. On this, Henry on my team put out a note yesterday looking at contested presidential elections through history, examining what happened, the market reaction, and the implications for this year. You can see the note here.
Over in Europe, equities held steady, though this mainly reflected the fact they hadn’t sold off the previous day when the negative stimulus news came through, with the STOXX 600 posting a modest loss of -0.12%. Similar to the US, Autos (+1.39%) and Travel & Leisure (+0.82%) were among the sectors up on the day even as the broader index fell.
Asian markets are mostly following Wall Street’s lead this morning with the Nikkei (+1.01%), Asx (+0.93%), Kospi (+0.21%) and India’s Nifty (+1.07%) all up along with S&P 500 futures (+0.23%). The Hang Seng (-0.78%) is trading down likely on overnight news that the US might restrict the expansion of Ant Group’s Alipay and Tencent Holdings WeChat Pay over concerns that the digital payment platforms threaten national security. In other overnight news, Bloomberg has reported that Japan’s PM Suga could call a general election either at the beginning of 2021, or after the Tokyo Olympics and Paralympics end in early September.
On the coronavirus, further negative news came through on case numbers as restrictions continued to ramp up across Europe. Starting with the UK, a further 14,173 cases were reported yesterday, while the number of patients in hospital in England rose to 2,944. In Scotland, further restrictions were imposed, including an order that pubs shut for all except takeaway customers in central Scotland until October 25, an area which covers nearly two-thirds of the Scottish population. People living in those areas have also been told to avoid public transport “unless absolutely necessary”. Furthermore, with cases rising in northern England, ITV’s political editor Robert Peston reported that ministers were “likely” to close all hospitality venues there for a period, with the new restrictions likely to be announced on Monday. All the wires are now confirming that fresh measures will be coming on that day. Elsewhere, Italy reported a further 3,677 cases, which is the first time since April that the daily case count has been above the 3,000 mark (albeit on higher testing now), and in Brussels it was announced that all bars would be shut for a month. France saw a record number of new infections, after new cases had levelled off over the last week. Cases are now rising at their fastest rate of the pandemic at over 12,800 per day on average over the last 7 days. See the table below for more signs of this second wave.
Over in the US, schools in Boston paused reopening after the positivity rate rose above 4%, meaning that the next phase of students who were due to return to in-person teaching on October 15 will see that date postponed. The 7-day rolling sum of new cases in the US has remained over 300k for over two weeks now and looks set to continue rising after a pause in September. On the pharmaceutical front, the US FDA has been approached by Eli Lilly for emergency authorisation for a covid-19 treatment it’s developing with Canadian biotech AbCellera Biologics Inc. As the public waits for a vaccine, treatments will be essential to keeping hospital numbers low and thus decreasing the need for mobility restrictions. Meanwhile, President Trump said overnight that an antibody cocktail made by Regeneron was the “key” to his recovery. The company has applied to the US FDA for gaining emergency use authorisation. The company traded up +3.53% in after-hours trading on this.
On the topic of vaccines, President Trump accused the FDA of playing politics with their more stringent vaccine regulations that will make it unlikely for a vaccine to be approved before election day. Given that voting has already started in parts of the country, the window for Trump to receive a polling boost from a completed vaccine is surely closing.
The September FOMC minutes continued to show how much the committee members assumed additional fiscal stimulus would be coming when building their outlooks. With near consensus that if future fiscal support was significantly smaller or arrived significantly later than they expected, the pace of the recovery could be slower than anticipated. The main highlight was the discussion of changes to their asset purchases. “Some participants” indicated their want to assess purchases in order to have them support the central bank’s full employment goals, this would imply either outright increases or possibly longer duration purchases. The minutes did not seem to change the trajectory of markets.
In the fixed income sphere, sovereign bonds sold off, with yields on 10yr Treasuries rising +5.2bps to 0.788% (are back down -1.4bps this morning) after trading in the 0.725-0.790% range the previous day on the volatile stimulus headlines. Ahead of the Fed minutes, European sovereign debt similarly lost ground, with yields on 10yr bunds (+1.4bps), OATs (+1.7bps) and gilts (+1.6bps) also moving higher. Peripheral spreads continued to tighten though, and the spread of Italian 10yr yields over bunds fell a further -0.5bps to a fresh 2-year low.
Moving on, and yesterday saw a number of Brexit headlines once again, though overall they didn’t really add much new information to where we were already at. The main one that sent sterling lower initially was a Bloomberg report saying that the UK planned to quit the trade talks next week if a deal weren’t in sight by then. However, this simply echoed what UK Prime Minister Johnson had said back in early September, in that next week’s European Council meeting on October 15 was the deadline for reaching an agreement, and sterling swiftly clawed back most of its losses. Later on in the session, European Council President Charles Michel tweeted that “The EU prefers a deal, but not at any cost. Time for the UK to put its cards on the table.” And an FT report also tweeted that the EU’s chief negotiator Michel Barnier had told EU ambassadors that he expected Brexit talks to continue after the EU summit on October 15-16. We think if progress is being made both parties will agree to extend talks beyond this point. As I said on Monday I continue to think the positive headlines are increasing and stand by my thesis that it’s moving forward on a 7 steps forward, 5 back type framework.
Just on this, Bloomberg has reported overnight that officials in the EU with knowledge of the negotiations suggest an elaborate choreography is being worked out, in which, despite some level of differences remaining, both sides will find a way to carry on discussions into the second half of October. The report also suggested that both sides are now softening their stance on the two key sticking point of fisheries and state aid.
In terms of data yesterday, there weren’t a great deal of releases, though we did get German industrial production for August, which unexpectedly fell by -0.2% (vs. +1.5% expected), which ended a run of 3 successive monthly gains.
To the day ahead now, and an array of central bank officials will be speaking today, including Bank of England Governor Bailey, the Fed’s Rosengren and Bostic, ECB Vice President de Guindos, and the ECB’s Schnabel, Hernandez de Cos and Mersch. The ECB will also be releasing the account of their September monetary policy meeting. Data releases include the weekly initial jobless claims from the US, Canadian housing starts for September, and the German current account balance for August.
end
3A/ASIAN AFFAIRS
i)THURSDAY MORNING/ WEDNESDAY NIGHT:
SHANGHAI CLOSED //Hang Sang CLOSED DOWN 49.51 OR .20% /The Nikkei closed UP 224.25 POINTS OR 0.96%//Australia’s all ordinaires CLOSED UP 1.06%
/Chinese yuan (ONSHORE) closed /Oil UP TO 40.67 dollars per barrel for WTI and 42/73 for Brent. Stocks in Europe OPENED ALL GREEN// ONSHORE YUAN CLOSED AGAINST THE DOLLAR. OFFSHORE YUAN CLOSED DOWN ON THE DOLLAR AT 6.73359 TRADE TALKS STALL//YUAN LEVELS //TRUMP INITIATES A NEW 25% TARIFFS FRIDAY/MAY 10/MAJOR PROBLEMS HUAWEI/CFOARRESTED//CORONAVIRUS/PANDEMIC/TRUMP TESTS POSITIVE FOR COVID 19 : /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//ASIAN AFFAIRS
Pompeo seeks an “ASIAN NATO” to counterbalance the strength of China. In this alliance will be Japan India and Australia
(zerohedge)
Pompeo Seeks ‘Asian NATO’ To Counter China In Talks With Japan, India & Australia
Amid Secretary of State Mike Pompeo’s trip to Tokyo this week where he’s meeting with representatives from Japan, India, and Australia, he and top State State Department officials are actually floating plans for a NATO-type anti-China alliance in Asia.
Beijing sees this as ‘shots fired across the bow’ from within the heart of its sphere of influence, given these very nations are so reliant on China for trade.
“As partners in this Quad, it is more critical now than ever that we collaborate to protect our people and partners from the CCP’s exploitation, corruption and coercion,” Pompeo said Tuesday referring to China’s ruling communists. “We see it in the South and East China Seas, the Mekong, the Himalayas, the Taiwan Strait.”
He later added while speaking to Japan’s Nikkei newspaper:
“Once we’ve institutionalized what we’re doing – the four of us together – we can begin to build out a true security framework,” Pompeo told the Nikkei, suggesting other countries could be added to that “fabric” at “the appropriate time.”
The US has already over the past months been shoring up international support for such an “Asian NATO” as it’s being provocatively called:
China’s growing military prowess and increasingly aggressive foreign policy have revived talk among U.S. and European officials of creating an “Asian NATO” of regional powers to contain communist Beijing’s expansionist ambitions.
Past efforts for an East Asian security alliance, such as the post-World War II Southeast Asia Treaty Organization (SEATO) to guard against Cold War-era communism, failed to gain lasting traction.
But such an initiative will no doubt prove much easier said than done, given last year Australia’s number one trade partner where it exported the majority of its goods was China.
Also the number two destination for Japanese exports is China, while China is also India’s third top customer, according to IMF figures.
However, US allies in the region do seem to be on board in identifying China’s growing military might and expansionist vision as a global economic powerhouse as a major long term threat.
3 C CHINA
CHINA/USA
Yan releases a powerful paper showing not only the COV 19 virus as man made but also BatWoman’s “natural” extracted virus RaTG13 is also a fraud and man made. She claims that these two viruses are bioweapons and purposely released on the world.
(zerohedge)
COVID-19 Is ‘Unrestricted Bioweapon’: Whistleblower Releases Second Paper Alleging ‘Large-Scale, Organized Scientific Fraud’
Li-Meng Yan, A Chinese virologist (MD, PhD) who worked in a WHO reference lab and fled her position at the University of Hong Kong, has published a second co-authored report, alleging that SARS-CoV-2, the virus which causes COVID-19, was not only created in a Wuhan lab, it’s an “unrestricted bioweapon” which was intentionally released.
“We used biological evidence and in-depth analyses to show that SARS-CoV-2 must be a laboratory product, which was created by using a template virus (ZC45/ZXC21) owned by military research laboratories under the control of the Chinese Communist Party (CCP) government,” reads the paper.
SARS-CoV2 is a product of laboratory modification, which can be created in approximately six months using a template virus owned by a laboratory of the People’s Liberation Army (PLA). The fact that data fabrications were used to cover up the true origin of SARS-CoV2 further implicates that the laboratory modification here is beyond simple gain-of-function research.
The scale and the coordinated nature of this scientific fraud signifies the degree of corruption in the fields of academic research and public health. As a result of such corruption, damages have been made both to the reputation of the scientific community and to the well-being of the global community.
The report also claims that the RaTG13 virus which Wuhan “Batwoman” Dr. Zhengli Shi and colleagues say they obtained in bat feces in 2013 (and which is 96% identical to SARS-CoV-2), is fraudulent and also man made.
Since its publication, the RaTG13 virus has served as the founding evidence for the theory that SARS-CoV-2 must have a natural origin. However, no live virus or an intact genome of RaTG13 have ever been isolated or recovered. Therefore, the only proof for the “existence” of RaTG13 in nature is its genomic sequence published on GenBank.
The report goes on to say that the RaTG13 genome could easily be fabricated, and that “an entry on GenBank, which in this case is equivalent to the existence of an assembled viral genomic sequence and its associated sequencing reads, is not a definitive proof that this viral genome is correct or real,” and that the process for sequencing DNA itself “leaves room for potential fraud.”
If one intends to fabricate an RNA viral genome on GenBank, he or she could do so by following these steps: create its genomic sequence on a computer, have segments of the genome synthesized based on the sequence, amplify each DNA segment through PCR, and then send the PCR products (may also be mixed with genetic material derived from the alleged host of the virus to mimic an authentic sequencing sample) for sequencing.The resulted raw sequencing reads would be used, together with the created genomic sequence, for establishing an entry on GenBank. Once accomplished, this entry would be accepted as the evidence for the natural existence of the corresponding virus. Clearly, a viral genomic sequence and its GenBank entry can be fabricated if well-planned.
RaTG13 has ‘multiple abnormal features,’ according to the report. For starters, it’s claimed that it was a fecal sample – yet just 1.7% of the raw sequencing reads are bacterial, when fecal swab samples are typically 70-90% bacterial. Second, the genomic sequence for RaTG13 contains segments of non-bat origin, including fox, flying fox, squirrels and other animals.
What’s more, China destroyed all evidence of RaTG13. “No independent verification of the RaTG13 sequence seems possible because, according to Dr. Zhengli Shi,the raw sample has been exhausted and no live virus was ever isolated or recovered. Notably, this information was known to a core circle of virologists early on and apparently accepted by them.”
Meanwhile, another coronavirus which shares a ‘100% nucleotide sequence identity with RaTG13’ – RaBtCoV/4991 – on a ‘short, 440-bp RNA-dependent RNA polymerase gene segment.’
RaBtCoV/4991 was allegedly discovered by Shi and colleagues in 2012 and published in 2016, and colleagues have been asking if it’s the same virus as RaTG13.
Given the 100% identity on this short gene segment between RaBtCoV/4991 and RaTG13,the field has demanded clarification of whether or not these two names refer to the same virus. However,Dr. Shi did not respond to the requestor address this question for months. The answer finally came from Peter Daszak, president of EcoHealth Alliance and long-term collaborator of Shi, who claimed that RaBtCoV/4991 was RaTG1327.
Three suspicious facts
First, it makes no sense that ‘Batwoman’ Shi and her team wouldn’t have conducted whole genome sequencing of RaBtCoV/4991 before 2020, as it was suspected in the deaths of miners who suffered from severe pneumonia after clearing out bat droppings in a Chinese mineshaft.
Given the Shi group’s consistent interests in studying SARS-like bat coronaviruses and the fact that RaBtCoV/4991 is a SARS-like coronavirus with a possible connection to the deaths of the miners, it is highly unlikely that the Shi group would be content with sequencing only a 440-bp segment of RdRpand not pursue the sequencing of the receptor-binding motif (RBM)-encoding region of the spike gene. In fact, sequencing of the spike gene is routinely attempted by the Shi group once the presence of a SARS-like bat coronavirus is confirmed by the sequencing of the 440-bp RdRpsegment25,32, although the success of such efforts is often hindered by the poor quality of the sample.
“Clearly, the perceivable motivation of the Shi group to study this RaBtCoV/4991 virus and the fact that no genome sequencing of it was done for a period of seven years (2013-2020) are hard to reconcile and explain.“
Meanwhile, genomic sequencing of RaTG13 was conducted in 2018.
Second, why did Shi delay publication on RaTG13 until 2020 when it’s got a Spike protein that can bind with human ACE2 receptors?
…if the genomic sequence of RaTG13 had been available since 2018, it is unlikely that this virus, which has a possible connection to miners’ deaths in 2012 and has an alarming SARS-like RBM, would be shelfed for two years without publication. Consistent with this analysis, a recent study indeed proved that the RBD of RaTG13(produced via gene synthesis based on its published sequence) was capable of binding hACE2
Third, there has been no follow-up work on RaTG13 by Shi’s group.
Upon obtaining the genomic sequence of a SARS-like bat coronavirus, the Shi group routinely investigate whether or not the virus is capable of infecting human cells. This pattern of research activities has been shown repeatedly. However, such a pattern is not seen here despite that RaTG13 has an interesting RBM and is allegedly the closest match evolutionarily to SARS-CoV-2
Direct genetic evidence proving RaTG13 is fraudulent
Yan’s group closely examined the sequences of specific spike proteins for relevant viruses – specifically comparing mutations, and found that the spike genes of SARS-CoV-2 and RaTG13 do not contain evidence of natural evolution when compared to other coronaviruses which naturally evolved.
A logical interpretation of this observation is that SARS-CoV-2 and RaTG13 could not relate to each other through natural evolution and at least one must be artificial.If one is a product of natural evolution, then the other one must be not. It is also possible that neither of them exists naturally. If RaTG13 is a real virus that truly exists in nature, then SARS-CoV-2 must be artificial.
More:
It is highly likely that the sequence of the RaTG13 genome was fabricated by lightly modifying the SARS-CoV-2 sequence to achieve an overall 96.2% sequence identity. During this process, much editing must have been done for the RBM region of the S1/spike because the encoded RBM determines the interaction with ACE2 and therefore would be heavily scrutinized by others.
The paper concludes: All fabricated coronaviruses share a 100% amino acid sequence identity on the E protein with ZC45 and ZXC21
Unrestricted bioweapon?
Yan notes that while it’s not easy for the public to accept that SARS-CoV-2 is a bioweapon due to its relatively low lethality, it indeed meets the criteria of a bioweapon.
In 2005, Dr. Yang specified the criteria for a pathogen to qualify as a bioweapon:
- It is significantly virulent and can cause large scale casualty.
- It is highly contagious and transmits easily, often through respiratory routes in the form of aerosols. The most dangerous scenario would be that it allows human-to-human transmission.
- It is relatively resistant to environmental changes, can sustain transportation, and is capable of supporting targeted release.
All of the above have been met bySARS-CoV-2: it has taken hundreds of thousands lives, led to numerous hospitalizations, and left many with sequela and various complications; it spreads easily by contact, droplets, and aerosols via respiratory routes and is capable of transmitting from human to human, the latter of which was initially covered up by the CCP government and the WHO and was first revealed by Dr. Li-Meng Yan on January 19th, 2020 on Lude Press; it is temperature-insensitive (unlike seasonal flu) and remains viable for a long period of time on many surfaces and at 4°C (e.g. the ice/water mixture).
What’s more, COVID-19 spreads asymptomatically, which “renders the control of SARS-CoV-2 extremely challenging.”
“In addition, the transmissibility, morbidity, and mortality of SARS-CoV-2 also resulted in panic in the global community, disruption of social orders, and decimation of the world’s economy. The range and destructive power of SARS-CoV-2 are both unprecedented.“
“Clearly,SARS-CoV-2 not only meets but also surpasses the standards of a traditional bioweapon. Therefore, it should be defined as an Unrestricted Bioweapon.”
4/EUROPEAN AFFAIRS
EU//Globe/Coronavirus update
EU Warns COVID-19 Vaccine Before New Year “Very Unlikely”; Another Titans Player Tests Positive: Live Updates
Where we left off Wednesday evening, health authorities in Brazil announced that the number of confirmed COVID-19 cases in Latin America’s most populous country had finally surpassed 5 million cases as the outbreak starts to accelerate once again. Brazil reported 31,553 new cases last night, along with 734 new deaths, which pushed Brazil’s death toll to just under 150k.
In other news, South Korea has just sentenced a man accused of lying to authorities about his job and whereabouts during a coronavirus-tracing investigation to jail for six months. The case was the most high-profile investigation yet as SK authorities continue their aggressive efforts to track, trace and quarantine, Yonhap reports.
After declaring that he wouldn’t participate in a remote debate, President Trump said during his first interview after returning to the White House from Walter Reed that he expected Eli Lilly’s antibody treatment to be approved shortly, along with the Regeneron cocktail that Trump was treated with during his stay at Walter Reed, which Trump hailed as a “cure” in a video published yesterday.
After declaring last night that Regeneron’s treatment would be made available to all who need it, Trump said on Fox Business Thursday morning that the therapeutics from Eli Lilly and Regeneron – or their equivalents – will be sent out “for free”.
Late last night, the FT published an exclusive report after obtaining a memorandum of understanding between AstraZeneca and a Brazilian manufacturer which exposed AZ’s pledge to provide its vaccine “at cost” until the pandemic is over as a misleading promise. Because in the memorandum, AZ stipulates that the pandemic will “end” on July 1 of 2021. Since the vaccine has yet to be approved, that should leave a very narrow window where the company is selling their vaccine “at cost”. The “pandemic period” can only be extended if “AstraZeneca acting in good faith considers that the SARS-COV-2 pandemic is not over”.
Finally, the head of the EU’s medicine regulator, which has already struck deals with AstraZeneca and other vaccine developers to expedite their evaluation (the so-called “rolling reviews”) said Thursday that a COVID-19 vaccine is “looking unlikely by year end.”
“Technically, of course it’s possible. Practically it’s very difficult – it’s very unlikely,” said Guido Rasi, executive director of the European Medicines Agency, in an interview Thursday. Even if drugmakers “submit the data in a few weeks, we are already approaching middle of October, so if we wait a few weeks and we take a minimum time of evaluation, more or less we are at the end of the year.”
It’s still possible that EU member states could use national emergency powers to distribute a vaccine, especially as deaths start to climb as the ‘second wave’ takes hold. Already, the UK has set out plans in August to amend legislation and clarify its powers so that an unlicensed COVID jab could be temporarily authorized in Britain. However, Rasi discouraged this behavior, and said countries would be better served by focusing on building out their distribution infrastructure, rather than approving an experimental vaccine “a few days before” everyone else.
Perhaps the biggest story in the US right now, the cluster that has gripped the Tennessee Titans, saw a new development just minutes ago as the team announced another player had tested positive, bringing the team’s total for players and staff who have tested positive to more than 20.
Circling back to Europe, as more countries ramp up social distancing restrictions and ‘localized lockdowns’, DB has published its latest weekly update, showing that the European countries seeing the biggest surge in new cases are the Netherlands, Belgium, Spain and France.
ITV’s Robert Peston reported last night that as cases climb in northern England, ministers are “likely” to close all hospitality venues in the region for a period until the outbreak cools.
In its latest weekly update, analysts at Goldman Sachs placed gave the US a reopening score of 67 out of 100 as Texas preparations to lift more restrictions were partly offset by another round of school and potentially business closures in NYC.
Here’s some more news from Thursday morning, as well as the overnight session.
India reports 78,524 cases in the last 24 hours, up from 72,049 the previous day, bringing the total to over 6.83 million. The death toll jumped by 971 to 105,526 (Source: Nikkei).
China reports 11 new cases for Wednesday, up from seven a day earlier. The new cases all were imported infections involving travelers from overseas. The number of new asymptomatic cases, which China does not count as confirmed cases, fell to eight from 24 a day earlier (Source: Nikkei).
Indonesia’s infections reach a new daily high of 4,850 cases, with 108 deaths in the past 24 hours. Indonesia has now reported a total of 320,564 cases and 11,580 deaths. Health officials express concerns over potential further increases in the coming weeks, with labor unions and student groups taking to the streets over the past few days in protests against a contentious omnibus law on job creation (Source: Nikkei).
The next phase of the Boston Public Schools reopening plan was delayed Wednesday because the city’s coronavirus positivity rate has climbed higher than 4% (Source: AP).
end
5. RUSSIAN AND MIDDLE EASTERN AFFAIRS
Armenians Fight Back Against Azerbaijani Advance, Strike Key Oil Pipeline
Submitted by SouthFront,
Armenian forces launched a missile attack on the Baku-Tbilisi-Ceyhan (BTC) oil pipeline, according to Azerbaijan. The country’s prosecutors said that Armenian forces had carried out the attack, which was prevented by the Azerbaijani military, on the pipeline in Yevlah at around 9 p.m. local time on October 6. The incident was described as a “terrorist act”.
The BTC pipeline delivers Azeri light crude oil (mainly from the Azeri-Chirag-Guneshli field) through Georgia to Turkey’s Mediterranean port of Ceyhan for export via tankers. Another crucial Azerbaijani energy infrastructure object, which could become a potential target of Armenian attacks is the Trans-Anatolian Natural Gas Pipeline, which connects the giant Shah Deniz gas field with Europe through Georgia and Turkey. The Armenian side denounced the Azerbaijani report as fake news. Both Azerbaijan and Armenia regularly accuse each other of striking civilian and infrastructure objects on their sovereign territory and denounce the opponent’s claims as propaganda and fakes.
It is interesting to note that just a few hours earlier Vahram Poghosyan, the press secretary of the Nagorno-Karabakh (Artsakh) President, claimed that Armenian forces had delivered powerful missile and rocket strikes on military objects in large Azerbaijani towns destroying multiple pieces of equipment and eliminating the enemy. The Azerbaijani official narrative provides a similar position that Azerbaijani forces are pulverizing Armenian military targets.
Meanwhile, Azerbaijani Defense Minister Zakir Hasanov threatened Armenia with “using the weapons with great destructive power” to deliver strikes on “the military-strategic infrastructure” of Armenia if it employs its Iskander operational-tactical missile systems against Azerbaijani forces.
However, it does not seem that the Armenian political leadership is ready to employ all the variety of its means and forces to fight back in the contested Nagorno-Karabakh region. Instead, the government of Nikol Pashinyan is now mostly focused on the diplomatic campaign in Western media in an attempt to convince the so-called international community to help it to keep control over Karabakh. Mr. Pashinyan, who just a few days ago was promising to inflict a military defeat on what he called the Azerbaijani-Turkish terror alliance even declared that Armenia is ready for mutual concessions. Nonetheless, Baku and Ankara do not seem to be ready for a new ceasefire and the resumption of negotiations at the present time.
On the frontline in the contested Nagorno-Karabakh region itself, the main hot point is the district of Jabrayil. Using the worsening weather conditions (fog and thick clouds), which complicate the work of Azerbaijani combat drones, Armenian forces were able to stabilize the frontline and prevent further gains of the Azerbaijani military in this part of Karabakh. On October 7, Armenia even claimed that a large-scale Azerbaijani attack had been repelled in the area. The Defense Ministry claimed that over 60 dead and multiple equipment pieces were left by Azerbaijan on the battlefield.
Meanwhile, Armenian forces and cities of the region are still subjected to intense artillery bombardment by the Azerbaijani military. Heavy destruction was inflicted on the city of Stepanakert. As soon as the weather improves, Azerbaijan with help from Turkey will likely resume active drone strikes and launch a new phase of the ground offensive along the contact line.
US Treasury Imposes Crushing Sanctions On 18 Major Iranian Banks
No matter what level of emergency crisis is unfolding at the White House, there’s always room for more sanctions on Iran, apparently, and ‘maximum pressure’ is always on.
On Thursday the US Treasury announced fresh sanctions on 18 more Iranian banks, according to the department’s website, in order to “stop illicit access to U.S. dollars.”
This after last month the Trump administration was reportedly mulling aggressive sanctions on the entirety of Iran’s financial system, essentially seeking to cut the Islamic Republic off entirely from the outside world. Thus it now appears Washington is moving to effectively blacklist the entire Iranian financial system in this latest devastating blow.
“As part of this action, OFAC sanctioned sixteen Iranian banks for operating in Iran’s financial sector and one bank for being owned or controlled by a sanctioned Iranian bank,” US Treasury announced. “Additionally, today’s action includes the designation of an Iranian military-affiliated bank under Treasury’s counter-proliferation authority.”
The names of the eighteen newly sanctioned banks, including Hekmat Iranian Bank, the key institution said to be servicing Iran’s armed forces and the Islamic Revolutionary Guard Corps, are listed on the US Treasury website.
“Our sanctions programs will continue until Iran stops its support of terrorist activities and ends its nuclear programs,” the Treasury statement continued. It further addressed the controversy behind Washington cutting off humanitarian aid and transactions, explicitly saying the action against the banks will “continue to allow for humanitarian transactions to support the Iranian people.”
But there have been growing complaints that Western companies which are already skittish about doing any level of humanitarian goods transactions in Iran are over-complying, for fear of US repercussions.
European allies have been warning the US-led actions are taking Iran to the brink of total economic collapse, which will be felt most by the common populace, while failing to dislodge the regime.
Not only are the new bank sanctions in defiance of these warnings, but appear to be part of a big pre-election foreign policy push to appear “tough” on Iran, also as the Biden campaign has signaled it would reverse much of the Trump administration’s punitive policies.
In the case of a Biden victory in November, this would include the likelihood that the 2015 nuclear deal (JCPOA) brokered under Obama will be restored, assuming Iran comes back into compliance after its recent moves to increase uranium enrichment.
6.Global Issues
CANADA
Toronto supply surges while rental prices crash. Citizens are moving to the suburbs to avoid high city rental costs.
(zerohedge)
Toronto Condo Supply Surges, Listings Skyrocket 215%, While Rental Prices Crash
The exodus out of major cities as a result of the pandemic and the civil unrest of months past looks to be very real in Toronto. The city, which was in the midst of a multi-year boom, has now seen massive condo supply hit the market with new listings surging in September.
The Toronto Regional Real Estate Board and research firm Urbanation Inc. have shown a surge in units for sale and a sharp decline in rents, foreshadowing a gloomy future for the city’s real estate market, according to Bloomberg. The glut comes at the same time the city is seeing a boom in single family homes.
Active condo listings in the city hit a record at the end of September and were up 215% – a massive delta from the 5.3% rise in total housing listings across the city. This shows that condo prices are likely to fall on an annual basis.
“Demand is just not keeping up with new supply right now,” said Urbanation President Shaun Hildebrand.
6,480 condos were listed for sale in September, which was up from 5,599 in August and 3,403 the year prior. Prices fell for the second sequential month and are now down 1.8% since May. Rental units are now sitting on the market for 26 days in August, up from 14 days a year prior. The sales to new listings ratio for condos downtown has been below 40% for the past few months.
At the same time, values for detached homes “have surged” and rents have seen a “dramatic” decline. The cost of leasing unfurnished units is down 11% year over year, which marks the biggest YOY decline on record.
Much of the weakness is focused on downtown, where it was spurred by the pandemic halting immigration and people leaving the city center to seek out more living space. This happened at a time when new supply was hitting the market and dramatically increasing inventory.
Hildebrand commented: “The ratio of sales to new listings for condos in downtown Toronto fell to 24% in September, the lowest level since the early 1990s.”
Simeon Papailias, co-founder of the Real Estate Center, said: “It’s simply because of all the new construction completions and absolutely no new blood of tenants coming in. We’re going to see people move to get cheaper rents.”
Over 7,000 Scientists, Doctors Call For COVID Herd Immunity, End To Lockdowns
Authored by Steve Watson via Summit News,
Over six thousand scientists and doctors have signed a petition against coronavirus lockdown measures, urging that those not in the at risk category should be able to get on with their lives as normal, and that lockdown rules in both the US and UK are causing ‘irreparable damage’.
Those who have signed include professors from the world’s leading universities.
Oxford University professor Dr Sunetra Gupta was one of the authors of the open letter that was sent with the petition, along with Harvard University’s Dr Martin Kulldorff and Stanford’s Dr Jay Bhattacharya.
It declares that social distancing and mask mandates are causing ‘damaging physical and mental health impacts.’
The petition, dubbed the Great Barrington Declaration after the town in Massachusetts where it was written, has been signed by close to 73,000 members of the public at time of writing, as well as over 4,700 medical and public health scientists and around 3,200 medical practitioners.
“Those who are not vulnerable should immediately be allowed to resume life as normal,” it notes, adding “Keeping these [lockdown] measures in place until a vaccine is available will cause irreparable damage, with the underprivileged disproportionately harmed.”
“Current lockdown policies are producing devastating effects on short and long-term public health,” the declaration also declares.
It continues, “The results (to name a few) include lower childhood vaccination rates, worsening cardiovascular [heart] disease outcomes, fewer cancer screenings and deteriorating mental health – leading to greater excess mortality in years to come, with the working class and younger members of society carrying the heaviest burden.”
“Keeping students out of school is a grave injustice,” the declaration adds.
“Those who are not vulnerable should immediately be allowed to resume life as normal, it concludes, explaining that “Simple hygiene measures, such as hand washing and staying home when sick should be practiced by everyone to reduce the herd immunity threshold.”
“Schools and universities should be open for in-person teaching. Extracurricular activities, such as sports, should be resumed. Young low-risk adults should work normally, rather than from home,” it emphasises.
Finally, the declaration demands that normal life should resume, stating that “Restaurants and other businesses should open. Arts, music, sport and other cultural activities should resume. People who are more at risk may participate if they wish, while society as a whole enjoys the protection conferred upon the vulnerable by those who have built up herd immunity.”
The declaration echoes President Trump’s words earlier this week when he returned to the White House and asked Americans not to live in fear or let let the virus dominate their everyday lives:
The declaration dovetails with other research that has concluded lockdowns will conservatively “destroy at least seven times more years of human life” than they save.
Germany’s Minister of Economic Cooperation and Development, Gerd Muller, has warned that lockdown measures throughout the globe will end up killing more people than the Coronavirus itself.
In an interview with German newspaper Handelsblatt, Muller warned that the response to the global pandemic has resulted in “one of the biggest” hunger and poverty crises in history.
Muller’s comments come five months after a leaked study from inside the German Ministry of the Interior revealed that the impact of the country’s lockdown could end up killing more people than the coronavirus due to victims of other serious illnesses not receiving treatment.
As we have previously highlighted, in the UK there have already been up to 10,000 excess deaths as a result of seriously ill people avoiding hospitals due to COVID-19 or not having their hospital treatments cancelled.
Professor Richard Sullivan also warned that there will be more excess cancer deaths in the UK than total coronavirus deaths due to people’s access to screenings and treatment being restricted as a result of the lockdown.
His comments were echoed by Peter Nilsson, a Swedish professor of internal medicine and epidemiology at Lund University, who said, “It’s so important to understand that the deaths of COVID-19 will be far less than the deaths caused by societal lockdown when the economy is ruined.”
According to Professor Karol Sikora, an NHS consultant oncologist, there could be 50,000 excess deaths from cancer as a result of routine screenings being suspended during the lockdown in the UK.
In addition, a study published in The Lancet that notes “physical distancing, school closures, trade restrictions, and country lockdowns” are worsening global child malnutrition.
Experts have also warned that there will be 1.4 million deaths globally from untreated TB infections due to the lockdown.
Hundreds of doctors are also on record as opposing lockdown measures, warning that they will cause more death than the coronavirus itself.
Despite citizens across the world being told to observe the lockdown to “save lives,” numerous experts who are now warning that the lockdown could end up costing more lives are being ignored or smeared by the media.
* * *
The Great Barrington Declaration
As infectious disease epidemiologists and public health scientists we have grave concerns about the damaging physical and mental health impacts of the prevailing COVID-19 policies, and recommend an approach we call Focused Protection.
Coming from both the left and right, and around the world, we have devoted our careers to protecting people. Current lockdown policies are producing devastating effects on short and long-term public health. The results (to name a few) include lower childhood vaccination rates, worsening cardiovascular disease outcomes, fewer cancer screenings and deteriorating mental health – leading to greater excess mortality in years to come, with the working class and younger members of society carrying the heaviest burden. Keeping students out of school is a grave injustice.
Keeping these measures in place until a vaccine is available will cause irreparable damage, with the underprivileged disproportionately harmed.
Fortunately, our understanding of the virus is growing. We know that vulnerability to death from COVID-19 is more than a thousand-fold higher in the old and infirm than the young. Indeed, for children, COVID-19 is less dangerous than many other harms, including influenza.
As immunity builds in the population, the risk of infection to all – including the vulnerable – falls. We know that all populations will eventually reach herd immunity – i.e. the point at which the rate of new infections is stable – and that this can be assisted by (but is not dependent upon) a vaccine. Our goal should therefore be to minimize mortality and social harm until we reach herd immunity.
The most compassionate approach that balances the risks and benefits of reaching herd immunity, is to allow those who are at minimal risk of death to live their lives normally to build up immunity to the virus through natural infection, while better protecting those who are at highest risk. We call this Focused Protection.
Adopting measures to protect the vulnerable should be the central aim of public health responses to COVID-19. By way of example, nursing homes should use staff with acquired immunity and perform frequent PCR testing of other staff and all visitors. Staff rotation should be minimized. Retired people living at home should have groceries and other essentials delivered to their home. When possible, they should meet family members outside rather than inside. A comprehensive and detailed list of measures, including approaches to multi-generational households, can be implemented, and is well within the scope and capability of public health professionals.
Those who are not vulnerable should immediately be allowed to resume life as normal. Simple hygiene measures, such as hand washing and staying home when sick should be practiced by everyone to reduce the herd immunity threshold. Schools and universities should be open for in-person teaching. Extracurricular activities, such as sports, should be resumed. Young low-risk adults should work normally, rather than from home. Restaurants and other businesses should open. Arts, music, sport and other cultural activities should resume. People who are more at risk may participate if they wish, while society as a whole enjoys the protection conferred upon the vulnerable by those who have built up herd immunity.
Rabo: “We Live More And More In A World In Which Facts No Longer Matter”
By Michael Every of Rabobank
Day by day, we live more and more in a world in which facts no longer matter. Social media, a bitterly-bipartisan mainstream media, and socio-economic and cultural polarization all mean we can inhabit the world of facts we find most comfortable and convenient. Indeed, as the economy becomes more Dickensian in terms of income and wealth equality it also becomes more *literally* Dickensian:
“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way—in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.”
And that’s just the US Vice-Presidential debate from last night, which offered up generous helpings of political pound(ing)s, shillings, and (Mike) Pence. Which for those who don’t know, was the old British Imperial money system until 1971 when, as my late grandmother referred to it, the UK joined the “decimal diddle dum dee club”. And one wonders how people ever wondered how Brexit could happen…
Of course, the VP debate also saw vast quantities of question-dodging over key issues, or answers that seemed to be to entirely different questions – to no response from the moderator-bot, which only seemed to be programmed to worry if people over-ran, rather than running over facts. It was still a vast improvement last week, however, in that there was actually some debate in it.
Who ‘won’? See the various polls from different sides of the political aisle: CNN said Harris 59% – 38%; Telemundo said Pence 76% – 24%. But the key point is that nowadays whomever *you* like won – after all, it is the ‘epoch of belief’. Likewise, whomever *you* like is comfortably winning the election. That is the meme both sides can cling to until 3 November. (And then, political risk analysts fear, it may be time for either loser to embrace a conspiracy theory as to why they didn’t actually lose.) Yet if we wanted to pretend actual facts mattered for a fleeting moment, the key question would be which side’s base feels more enthused after having sat through the VP debate: who got more policy red (or blue) meat thrown their way?
Talking of the (overdone) red meat side of things, the Heavenly side (as shall be explained), the conspiracy-theory side, and the ‘best of times, worst of times’ side, yet again we also see a Tweet from Trump trumping other news. Trump announced he believes the drug he was treated with is a “cure”; more important than the vaccine (which is coming “very, very shortly….right after the election”); and Regeneron will be shortly be freely available *and free* to those who need it. Indeed, Trump said he wants everybody to be given the same treatment he got without payment as “It wasn’t your fault…, it was China’s fault, and China is going to pay a big price.”
Is that related to the Bloomberg story yesterday talking about a possible looming US crackdown on Tencent and Ant Financial to stop China expanding its digital payments platforms? Or is it related to Mike Pompeo busily trying to form an Asian version of NATO? Or is it something else equally world-splitting if carried out in full?
Another good question that wasn’t asked at all at the VP debate that happened after that Trump video: is free Regeneron socialised medicine? The media aren’t asking either, instead running with the Trumpian phrase it was “a blessing from God” he caught Covid-19 (which he instantly qualified to “a blessing in disguise,” which itself is disguised in all those exegesis-esque headlines).
Meanwhile, preceding both the VP debate and the Trump video we had the FOMC minutes, a body which has played as large a role in our drift into all forms of Dickensianism as anyone. As Philip Marey notes, these represent “The quiet before the storm”. In particular, he points out that the minutes revealed quite some disagreement within the FOMC regarding the forward guidance on rates: a Dickensian dichotomy, one might say. As long as we are in a pandemic environment this may not matter very much. However, he believes that “by the time we get closer to the exit, the practice of flexible average inflation targeting may become a cacophony”. There’s something to look forward to.
The minutes also showed that the economic outlook (and thus the FOMC’s projections) assumed additional fiscal support, and that if future fiscal support was significantly smaller or arrived later than expected the FOMC thinks the pace of the recovery could be slower than anticipated. “Send more money now,” in short. This could still happen before the election in one form or another, even if Larry Kudlow isn’t in the loop. After all, if you are giving away Regeneron free now, why not?
Philip concludes that several headwinds are converging in Q4 that could upset the economic recovery, and that the next time the Fed meets will be in the stormy environment after Election Day.
Which is what Nicola Sturgeon must be thinking of as she closes down central Scotland’s pubs (and restaurants) for over two weeks(?)
7. OIL ISSUES
Phillips 66 went against the grain and ordered all of its white collar workers to work at its Houston HQ.
(courtesy zerohedge)
Gazprom Blasts $7.6BN Polish Antitrust Fine On NS2 Pipeline As Move To Kill It “By All Means”
Polish authorities have fined Russia’s Gazprom a whopping and unprecedented $7.6 billion (or 6.5 billion euros) for constructing the controversial Nord Stream 2 pipeline to Germany.
While Poland anti-trust authorities have claimed Nord Stream 2 is fundamentally a politically motivated attempt to punish Polish consumers while increasing European dependence on on Russian imports, Germany has stood by the project even amid the Navalny poisoning affair which has strained its relations with Russia over the past month.
Poland’s Office of Competition and Consumer Protection decisionseeks to legally force the six companies jointly building and financing the project to cancel their contracts, despite the gas pipeline being in its final phase of development. This includes European investors OMV, Wintershall, Engie, Shell and Uniper.
“Carrying out the project is tantamount to breaking the rules of law and of fair competition that will lead to an increased dependence of gas recipients on the internal market on one supplier – Gazprom,” the Polish antitrust office said.
It charged that if allowed to go live it will result in “serious consequences for Poland’s and the EU’s economy,” by restricting the range of supplies while inevitably increasing gas prices for consumers.
But no doubt defenders of NS2 also see this as part of Washington’s broader war on the project, which has included past sanctions on executive heads of European companies involved, given recent deepening US military ties to Poland.
State-owned Gazprom, meanwhile has denounced the “unprecendented fine” as unlawful and unjustified. The fine’s “unprecedented amount evidences the decision to oppose implementation of the Nord Stream 2 project by all means,” the statement said, according to TASS.
Gazprom said flatly the project “did not breach anti-monopoly laws of Poland,” while Kremlin spokesperson Dmitry Peskov separately underscored Gazprom would “do everything that is possible” to legally oppose the decision.
8 EMERGING MARKET ISSUES
Your early morning currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings THURSDAY morning 7:00 AM….
Euro/USA 1.1756 DOWN .0009 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/TRUMP POSITIVE WITH VIRUS /AND NOW ECB TAPERING BOND PURCHASES/JAPAN TAPERING BOND PURCHASES /USA RISING INTEREST RATES /FLOODING/EUROPE BOURSES /RED
USA/JAPAN YEN 106.00 UP 0.035 (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 1.2900 DOWN 0.0015 (Brexit March 29/ 2019/ARTICLE 50 SIGNED/BREXIT FEES WILL BE CAPPED/
USA/CAN 1.3247 DOWN .0012 CANADA WORRIED ABOUT TRADE WITH THE USA WITH TRUMP ELECTION/ITALIAN EXIT AND GREXIT FROM EU/(TRUMP INITIATES LUMBER TARIFFS ON CANADA/CANADA HAS A HUGE HOUSEHOLD DEBT/GDP PROBLEM)
Early THIS THURSDAY morning in Europe, the Euro FELL BY 9 basis points, trading now ABOVE the important 1.08 level FALLING to 1.1756 Last night Shanghai COMPOSITE CLOSED
//Hang Sang CLOSED DOWN 49.51 POINTS OR .20%
/AUSTRALIA CLOSED UP 1,06%// EUROPEAN BOURSES ALL GREEN
Trading from Europe and Asia
EUROPEAN BOURSES ALL GREEN
2/ CHINESE BOURSES / :Hang Sang CLOSED DOWN 49.51 PTS OR .20%
/SHANGHAI CLOSED
Australia BOURSE CLOSED UP 1.06%
Nikkei (Japan) CLOSED UP 224.25 POINTS OR 0.96%
INDIA’S SENSEX IN THE GREEN
Gold very early morning trading: 1891.90
silver:$23.93-
Early THURSDAY morning USA 10 year bond yield: 0.774% !!! DOWN 2 IN POINTS from WEDNESDAY’S night in basis points and it is trading WELL BELOW resistance at 2.27-2.32%.
The 30 yr bond yield 1.566 DOWN 2 IN BASIS POINTS from WEDNESDAY night.
USA dollar index early THURSDAY morning: 93.67 UP 4 CENT(S) from THURSDAY’s close.
This ends early morning numbers THURSDAY MORNING
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And now your closing THURSDAY NUMBERS \1: 00 PM
Portuguese 10 year bond yield: 0.20% DOWN 3 in basis point(s) yield from YESTERDAY/
JAPANESE BOND YIELD: +.04.% DOWN 0 BASIS POINTS from YESTERDAY/JAPAN losing control of its yield curve/56
SPANISH 10 YR BOND YIELD: 0.21%//DOWN 1 in basis point yield from yesterday.
ITALIAN 10 YR BOND YIELD:0.76 DOWN 3 points in basis points yield from yesterday./
the Italian 10 yr bond yield is trading 55 points higher than Spain.
GERMAN 10 YR BOND YIELD: FALLS TO –.52% IN BASIS POINTS ON THE DAY//
THE IMPORTANT SPREAD BETWEEN ITALIAN 10 YR BOND AND GERMAN 10 YEAR BOND IS 1.87% AND NOW ABOVE THE THE 3.00% LEVEL WHICH WILL IMPLODE THE ENTIRE ITALIAN BANKING SYSTEM. AT 4% SPREAD THERE WILL BE A HUGE BANK RUN…
END
IMPORTANT CURRENCY CLOSES FOR THURSDAY
Closing currency crosses for THURSDAY night/USA DOLLAR INDEX/USA 10 YR BOND YIELD/1:00 PM
Euro/USA 1.1754 DOWN .0011 or 11 basis points
USA/Japan: 105.99 up .020 OR YEN down 2 basis points/
Great Britain/USA 1.2937 UP .0021` POUND UP 21 BASIS POINTS)
Canadian dollar DOWN 36 basis points to 1.3223
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The USA/Yuan,CNY: closed ON SHORE (x)..
THE USA/YUAN OFFSHORE: 6.740 (YUAN down)..
TURKISH LIRA: 7.94 EXTREMELY DANGEROUS LEVEL/DEATH WISH.
the 10 yr Japanese bond yield at +0.04%
Your closing 10 yr US bond yield down 3 IN basis points from WEDNESDAY at 0.769 % //trading well ABOVE the resistance level of 2.27-2.32%) very problematic USA 30 yr bond yield: 1.564 down 3 in basis points on the day
Your closing USA dollar index, 93.67 down 0 CENT(S) ON THE DAY/1.00 PM/
Your closing bourses for Europe and the Dow along with the USA dollar index closing and interest rates for THURSDAY: 12:00 PM
London: CLOSED UP 31.78 0.53%
German Dax : CLOSED UP 113.64 POINTS OR .88%
Paris Cac CLOSED UP 29.94 POINTS 0.61%
Spain IBEX CLOSED UP 82.70 POINTS or 1.20%
Italian MIB: CLOSED UP 147.35 POINTS OR 0.76%
WTI Oil price; 40.73 12:00 PM EST
Brent Oil: 42.85 12:00 EST
USA /RUSSIAN / RUBLE RISES: 77.42 THE CROSS LOWER BY 0.10 RUBLES/DOLLAR (RUBLE HIGHER BY 10 BASIS PTS)
TODAY THE GERMAN YIELD FALLS TO –.52 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 f0r Oil, 4:00 pm/and 10 year USA interest rate:
WTI CRUDE OIL PRICE 4:30 PM : 41.23//
BRENT : 43.42
USA 10 YR BOND YIELD: … 0.771..down 2 basis points…
USA 30 YR BOND YIELD: 1.567 down 2 basis points..
EURO/USA 1.1760 ( DOWN 5 BASIS POINTS)
USA/JAPANESE YEN:106.00 UP .033 (YEN DOWN 3 BASIS POINTS/..
USA DOLLAR INDEX: 93.62 UP 1 cent(s)/
The British pound at 4 pm Britain Pound/USA:1.2933 UP 17 POINTS
the Turkish lira close: 7.94
the Russian rouble 77.34 UP 0.69 Roubles against the uSA dollar. (UP 69 BASIS POINTS)
Canadian dollar: 1.32000 UP 61 BASIS pts
German 10 yr bond yield at 5 pm: ,-0.51%
The Dow closed UP 122.05 POINTS OR 0.43%
NASDAQ closed UP 56.38 POINTS OR 0.50%
VOLATILITY INDEX: 26.44 CLOSED DOWN 1.62
LIBOR 3 MONTH DURATION: 0.229%//libor dropping like a stone
USA trading today in Graph Form
Stocks, Bonds, Bitcoin, Gold, & Oil Pop Despite Stimulus Slop
Large stimulus, small stimulus, skinny stimulus, pre-election stimulus, post-election stimulus, state stimulus, airline stimulus, no stimulus… today had everything (well nothing)…
…but it seems the algos are exhausted as stocks generally shrugged along ignoring the headlines and tweets, hovering at the pre-Trump ‘no-deal’ Tweet levels all day…
Small Caps (once again) outperformed with Nasdaq lagging…
Nasdaq 100 is at 2-month lows relative to Small Caps…
Source: Bloomberg
One glance at the S&P 500 futures’ intraday price action and you could be mistaken for thinking its just another Robinhood-sponsored penny stock party…
Utter chaos in the VIX complex today…
Airline stocks showed where the highest beta is…
Source: Bloomberg
Bond yields drifted very gently lower all day…
Source: Bloomberg
Real yields tumbled today…
Source: Bloomberg
The dollar also fell very modestly…
Source: Bloomberg
Bitcoin bounced – thanks to news that Square had invested heavily in the cryptocurrency…
Source: Bloomberg
And oil prices jumped on Saudi/OPEC optimistic jawboning (WTI topped $41)…
Gold futures rallied back up near $1900 once again…
Finally, you just have to laugh at the run on “Most Shorted” stocks (squeezing higher for 9 of the last 10 days)…
Source: Bloomberg
We’ll leave you with Boston Fed President Rosengren’s warning today:
“Abnormally low rates for a long period during times when economic slack is no longer a concern can result in excessive risk-taking, as businesses and firms take on additional debt and accumulate more risky assets in search of better returns – potentially bidding up asset prices to unsustainable levels. The financial pressures associated with such behavior build gradually, and only become clear in the next economic downturn.”
“In the United States, we do not have a cohesive set of regulatory and supervisory tools to moderate risk build-ups. And while we do have the Financial Stability Oversight Council, we do not have a regulatory and supervisory body endowed with tools and structures that can be deployed to limit financial stability risks.”
So we should probably ignore this…
source: Bloomberg
END
And now your more important USA stories which will influence the price of gold/silver
MARKET TRADING//USA
a)Market trading/LAST THIS MORNING/USA
Stocks Jump On Trump COVID-Aid Comments
President Trump said that “stimulus talks are starting to be productive,” this morning and added that “it looks like there is a really good chance to reach a deal on COVID aid.”
This pushed stocks higher once again, well above the pre-Trump ‘no-deal’ levels..
We can’t imagine Pelosi giving up her opportunity to bail out profligate states and agreeing to any piecemeal bailouts this close to the election… especially after last night’s disappointing performance by Harris.
END
b)MARKET TRADING/USA//Non farm payrolls
ii)Market data/USA
We note another 840 first time Americans filed for unemployment benefits.Also continuous claims drops back below 11 million but still high
(zerohedge)
840,000 Americans Filed For First-Time Unemployment Benefits Last Week
840,000 Americans filed for first time unemployment benefits last week – worse than the 820k expectation, but slightly better than the upwardly revised 849k the priod week.
Source: Bloomberg
This is still over four times higher than the pre-COVID levels.
We also note that while aggregate jobless claims fell, Pandemic Emergency Claims (blue region) increased last week…
Source: Bloomberg
Florida, Illinois, and Virginia saw the biggest jump in jobless claims. New Jersey, Michigan, and Pennsylvania saw the biggest improvement.
Continuing Claims dropped back below 11 million – the lowest (best level since March)…
iii) Important USA Economic Stories
Yesterday’s debate post mortem
(zerohedge)
VP Debate Post-Mortem: Pence Trounces “Gaffe Machine” Harris
55-year-old Kamala Harris (22 years the junior of Joe Biden) faced off across a 12-foot void of ‘potentially-deadly-air’ and ‘plexiglass’ against 61-year-old Mike Pence (13 years younger than President Trump) with USA Today’s (and Nancy Pelosi biographer) Susan Page as the ‘moderator’ at the University of Utah in Salt Lake City… all without wearing masks!
Ahead of the debate, despite media’s constant crowing about Biden’s double-digit lead in national polls, Trump is slightly outperforming against Biden relative to Hillary in the battleground states…
Following a similar pattern – but with a notably higher probability of winning in November – relative to his performance against Hillary…
* * *
It was not pretty!
* * *
Summary (of the nine discussion topics):
1. COVID Response – Pence won – a body-blow slamming Kamala on vaccines: “stop playing politics with people’s lives.”
2. Health Of Candidates – Tie – neither candidate answered but if we had to pick, Pence shaded it as Kamala discussed herself.
3. The Economy – Pence won – the vice-president crushed Harris on Biden taxes (briefly silencing her over Trump tax cut repeal).
4. Climate Change – Pence won – perhaps surprisingly but Harris was unable to recover from being cornered on her sponsorship of the Green New Deal
5. China – Pence won – Harris facts all over the place and Pence closed with Biden’s “cheerleading” for China.
6. Foreign Relations – Tie – both candidates parried each other’s running mate’s performance
7. The Supreme Court – Pence won – Harris refused to answer the question of packing the court and Pence was frank about being “pro-life.”
8. Racial Justice – Pence won – again rather stunningly, Pence crushed Harris on misleading quotes and soundbites
9. Transfer Of Power – Pence won – while Harris went “vote now”, Pence reminded the audience that Harris party spent the last four years trying to overturn the previous election
Pence dominated Harris as finally, questions were asked and answered and facts were checked!
Pence dominated Harris as finally, questions were asked and answered and facts were checked!
* * *
Perhaps President Trump summed the first half best:
And WSJ’s Kimberley Strassel, the second half…
Harris spoke more (38:48 to Pence’s 35:22) but said less…
* * *
Moderator Susan Page reminded the audience that attendees were all wearing masks and that she hoped for a better behaved debate.
An awkward moment as they both walked and didn’t want to sit down first…
The first question was about the coronavirus “not being under control.”
Harris began on the offense, noting that
“The American people have witnessed what is the greatest failure of any presidential administration in the history of our country,” and adding a line about “sacrificial workers.”
Harris accused Trump of “covering it up,” and “frankly this administration has forfeited their right to re-election because of this.”
Harris said the Biden-Harris plan is testing, contact-tracing, and free vaccines.
Pence’s response was heartfelt and factful as he explained the timeline of airline shutdowns “which Biden called xenophobic.”
And the vice-president mocked that Biden had “plagiarised” their plan – as it is exactly the same as they have been doing.
“It looks a little like plagiarism, which Joe Biden knows a little something about.”
Pence slams Harris for claiming that the plan “hasn’t worked” was a great misjustice, pinning the decisions on Fauci and Birx.
Pence framed the plan as the American people fighting and being brave, forcing any counter to appear as Kamala is attacking Americans.
Harris got frustrated and tilted back at Pence: “I’m speaking”:
The moderator went on to discuss the Trump administration following health protocols and the vaccines, with Pence slamming Harris for “politicizing the vaccine” after she said she would not take it if Trump said it was safe:
“stop playing politics with people’s lives”
Pence also pointed out the failure of the Obama-Biden plan to cope with the swine flu when 60 million people contracted it (and 2million Americans would have died).
* * *
The second question was on the health and age of the presidential candidates
Page asked “Have you had a conversation or reached an agreement on issues of presidential disability considering Trump/Biden’s age?”
Neither of the candidates responded directly to any questions about the health of their running mates, but Harris listed off her credentials, and Pence smoothly congratulated Harris on being the first black woman on the ticket.
Harris claims that Biden has been very transparent and that Trump has done nothing but cover things up. Pence says he respects Biden’s “47 years in public life,” a subtle dig at an opponent the Trump campaign has tried to portray as a Washington insider.
* * *
Topic three was the economy
“There couldn’t be a more fundamental difference” between Trump and Biden, according to Harris who said Biden measures the health of the economy based on the average American worker.
Pence says that Trump is a “job creator,” but he added that “you just heard Harris say on day one Joe Biden’s going to raise your taxes.”
Pence totally shut Harris down on repealing Trump’s tax cuts.
Harris’ response was to try and paint the economic downturn from COVID lockdowns:
“They rode the coattails of Joe Biden’s success,” Harris says of the economy. “Of course now the economy is a complete disaster, but Donald Trump did that.”
Harris also tried to pivot to healthcare but Pence punched back that Harris said she would ban fracking and abolish fossil fuels.
“More taxes, more regulation, banning fracking, abolishing fossil fuel, crushing American energy and economic surrender to China is a prescription for economic decline.”
* * *
The fourth topic was on climate change.
Page asked: “Do you believe that man made climate change has made wildfires and hurricanes worse?”
Pence responded by questioning the cause but not the fact that climates are changing, adding that
“The US has reduced CO2 more than the countries that are in The Paris Accord.”
The Paris accord and the Green New Deal “would crush” American energy, Pence says.
Page noted that Harris cosponsored “The Green New Deal” while Biden flatly rejected that during last week’s debate.
Harris said “Joe Biden will not ban fracking.”
Which is awkward…
“We’ve seen a pattern in this administration — they don’t believe in science,” Harris says. “Joe believes in science.”
Pence cornered Harris once again on the Green New Deal cosponsorship and lack of consistency.
* * *
The fifth discussion topic was on China
Harris tried to bring up the China trade war – “Lost the trade war with China? Joe Biden never fought it” – and Pence destroyed her with fact bombs about Biden being “a cheerleader for communist China.”
“You said Trump lost a trade war with China, Joe Biden never fought one”
Pence says China has been hurting the U.S. “for decades.”
“We’re going to hold China accountable for what they did to American with the coronavirus,” Pence says.
Harris claims that “The Trump administration’s perspective and approach to China has resulted in the loss of American lives, American jobs and America’s standing.”
Harris went on to claim that Xi was more respected (according to Pew) and China more respected – sadly that’s a lie:
Well that’s awkward!
Pence added that China and the World Health Organization were not straight with the American people.
Sadly, neither candidate answered the moderator’s question about how to define China: friend, competitor, enemy, or something else, but it’s pretty clear from their track records.
* * *
Foreign Relations dominated the sixth topic.
Harris went straight for the Russia, Russia, Russia topic:
“Donald Trump, the commander-in-chief of the United States of America prefers to take the word of Vladimir Putin than the word of the American intelligence community.”
Furthermore Harris attempted to bring up the story about Trump’s disane for the military
Harris says Trump has “betrayed our friends and embraced dictators around the world.”
She cites Russia, says Trump “prefers to take the word of Vladimir Putin” than the U.S. intelligence community — and says that Trump’s pulling out of the Iran nuclear deal has made the U.S. less safe.
Pence (as furiously as he gets) punched back:
“President Trump reveres those who serve in our armed forces.”
Pence cites Trump’s accomplishments, including defeating ISIS.
* * *
The seventh topic was The Supreme Court
“President Trump and I could not be more enthusiastic about seeing Judge Amy Coney Barrett become Justice Amy Coney Barret,” Pence says.
“We hope she gets a fair hearing.”
Harris pivoted to Obamacare:
“The contrast couldn’t be more clear: they’re trying to get rid of the Affordable Care Act. Joe Biden is trying to expand it.”
Pence pivoted back to abortion and said “I am pro-life and make no apologies for it.”
Then Pence cornered Harris with the “pack the court” question?
Once again she refused to answer and Pence came out swinging.
Then this happened…
Pence: “Will you and Biden pack the Supreme Court?”
Harris: “Trump packed the district courts with white people!”
Moderator: “Thank you, let’s move on.”
Pence:
“If you haven’t figured it out yet, the straight answer is they are going to pack the Supreme Court if they somehow win this election.”
Trump Jr summed it perfectly:
* * *
Racial Justice was the controversial eighth topic
“There’s no excuse for what happened to George Floyd and justice will be served,” Pence says.
“Our heart breaks for the loss of any innocent American life,” Pence says of Taylor. “But I trust our justice system.”
“I will not sit here and be lectured by the vice president on what it means to enforce the laws of this country,” Harris says.
Pence hit back with comments on Harris’ track record…
Harris tried to bring up the Charlottesville comments by Trump again, adding that:
the idea that America is systemically racist is “a great insult to the men and women who serve in law enforcement.”
Pence says that Trump “has Jewish grandchildren” and “respects and cherishes all of the people.”
Harris:
“Joe Biden and I recognize that implicit bias does exist, Mr. Vice President contrary to what you believe. … I will not be lectured by the vice president on our record in what we have done in terms of law enforcement.”
The moderator did a great job of controlling Harris as she kept repeating debunked media bites…
* * *
Finally, the topic of the Transfer of Power was discussed.
But Harris decided to shift to an infomercial:
“here’s what I’d like to say to everybody: vote. Please vote. Vote early.”
Pence came out swinging by bringing up the facts that the previous campaign spied on his campaign and has spent the last few years trying to overturn the last election:
“Your party has spent the last three and a half years trying to overturn the results of the last election,” Pence says, bringing up the Mueller investigation and impeachment.
* * *
And finally – bravo to Susan Page! A moderator who asked tough questions on both sides, politely stopped the candidates when their time was up and forced them to respond.
* * *
Oh, and there was a flay that ‘trended’ on Twitter briefly…
Jews are celebrating the holiday of Succoth. De Blasio in his great wisdom decided to break up the festivities in New York
(Hoft/Gateway Pundit)
De Blasio Sends in Police to Break Up Religious Jews Celebrating in New York City (VIDEO)
Under the direction of communist Mayor Bill DeBlasio New York Police rounded up Jews on Monday night during Sukkot holiday.
The New York Jews were celebrating in the street.
DeBlasio sent in the police to shut down the religious celebration.
But Trump is a nazi?
2nd Top General Tests Positive For Virus As Pentagon Scrambles To Trace Contacts
Following Monday’s announcement that the vice commandant of the US Coast Guard Admiral Charles Ray tested positive for COVID-19 after exhibiting mild symptoms, almost all generals of the Joint Chiefs of Staff began quarantining at home, while ensuring the public their working from home will not fundamentally impact military readiness.
The Pentagon thereupon initiated careful contact tracing given that Adm. Ray had in the days prior to his positive test attended “several” meetings with generals and staff in “secure areas” of the Pentagon.
And now another top commander has become infected. Assistant Commandant of the Marine Corps Gary Thomas tested positive for the virus on Wednesday, after reporting that he came into contact with Adm. Ray in at least two military events.
The Marines’ second-in-command said he’s experiencing “mild symptoms” but is generally “feeling well,” according to a Marine Corps statement.
“The Marine Corps has started contact tracing and any Marines who were in close contact with Thomas will enter quarantine,” the statement underscored.
The only one among the Joint Chiefs to not be under home quarantine is General David H. Berger, the commandant of the Marine Corps, who was not present for any of the recent meetings involving the Coast Guard #2.
Ray had attended two large events, now subject of contact tracing, including a Sept.27 event with a Gold Star family at the White House, and a meeting of the Joint Chiefs on Oct.2.
At this point at least 10 commanders from among the Pentagon’s top brass are in voluntary home quarantine.
This includes the Chairman of the Joint Chiefs of Staff Mark Milley, the heads of the Army, Navy, Air Force, and Space Force, as well as the infected Coast Guard vice commander.
“It’s A Civil War”: Decade Of Covenant-Lite Deals Leads To Leveraged Loan “Panic”
It was a little over two years ago that we last looked at the “covenant lite” insanity sweeping the loan market for the past decade, where as a result of a buying frenzy among yield-starved investors, corporations had managed to get away with selling “secured” debt that was anything but secured, and offered only the slimmest – if any – protections to investors. In fact, by early 2018, the amount of covenant-lite loans hit an unprecedented 75%…
… which meant that Moody’s Loan Covenant Quality Indicator (LCQI) dropped to its record-worst level in the first quarter of 2018.
“While the rate of deterioration in covenant quality has slowed, protections remain distressingly weak on average,” said Derek Gluckman, Moody’s VP-Senior Covenant Officer. “Investors should remain wary given the risks presented by most loan documents and the likelihood that any steadying of covenant protections is temporary.”
But it wasn’t just the sheer volume of cov-lite outstandings that mattered: an analysis by LCD looked at the debt cushion of outstanding loans – the amount of debt in a borrower’s capital structure that is subordinated to the senior loan – and found that most cov-lite deals have little or no debt cushion beneath them. Consider that by mid-2018, an all time high 23% of all cov-lite loans did not have any debt, such as a mezzanine tranche, high yield bond, or other, below the cov-lite facility. That number was up from 18% in 2013 and from just 10% at the end of 2007, shortly before the financial crisis.
This is also why we explicitly warned that “the lack of a debt cushion significantly lessens what an investor will recover on a loan, if that credit defaults” and left readers with the following:
In other words, during the next default cycle, whenever the business cycle finally turns, loan investors not only will have virtually no “secured” protection, but are now the de facto equity tranche in numerous deals, or said otherwise, for the first time in history, loan investors are looking at 0 recoveries in default.
Well, fast forward to today when the chickens from the covenant-lite euphoria of the past decade have come home… for the slaughter.
In a transaction which has terminally tilted the “landscape in favor of distressed borrowers and pitted creditors against each other” a $120 million loan to cash-strapped restaurant supplier TriMark USA has “not only unilaterally placed the new lenders above everyone else in the repayment pecking order, but it also stripped some of the older creditors of safeguards they had written into the contracts to protect their investments” according to Bloomberg, which notes that when word of the deal spearheaded by Howard Marks and his distressed debt giant, Oaktree, first hit the market in mid-September, “it sparked a panic“, prompting investors to puke the old loan so fast it cratered 20 cents in days, an unheard of move in the world of secured finance where underlying assets never reprice so fast, even in bankruptcy.
Of course, for those who had been following the degradation of creditor protections and the ascent of cov-lite deals over the past decade, what just took place is hardly a surprise: as investors bargained away most of their legal rights in hopes of getting a modest allocation in the latest “high yielding” note, they now find themselves with virtually no protection for their investments just as the pandemic is causing a wave of corporate bankruptcies across the country.
And just to underscore that “anything goes” in the brave new world of leveraged (and unsecured) loans, the presence of Marks – who had long been seen as one of the more staid voices in a distressed-debt world full of pugnacious vultures – served to upend the market only further and spark fears about what is coming next as tens of billions of other “secured” loans are about to see their investors crammed down or otherwise wiped out, just as we warned in 2018.
“It’s a civil war between lenders, and we’re going to see more of this,” said Thomas Majewski, managing partner and founder at Eagle Point Credit Management. “Nearly every company restructuring debt is looking at these possibilities.”
So what exactly happened?
The TriMark transaction, which according to Bloomberg was similar to another loan that surf-clothing maker Boardriders entered recently, followed in the “priming” footsteps of a divisive financing by Serta Simmons Bedding earlier this year. The mattress maker got $200 million of fresh capital from existing lenders including Eaton Vance Corp. and Invesco Ltd. Those lenders jumped to the top of the capital stack meaning they would be repaid first if the company defaulted, pushing Serta Simmons’ other lenders further back, in a process known as priming.
There’s nothing new about priming – in fact it happens all the time in bankruptcy when a company issues what is known as a “priming DIP” – but the way lenders did it in the Serta Simmons deal resulted in litigation. The new investor group led by Eaton Vance and Invesco didn’t give all other lenders the right to participate in the new loan, a move that is allowed by many deals’ documents, but hadn’t really been done before. Lenders who were left out, including Apollo Global Management, sued the company but a state court let the deal go ahead, ushering in a new precedent in the market where existing “secured” creditors hiding behind the thin defense of non-existent covenants, realize they are in fact, unsecured.
“Serta did open the floodgates in that regard,” said Tim Sullivan, an analyst at Xtract Research, “because it showed how provisions which are very common in agreements today can be used to incur priming debt.”
Of course, creditors have only themselves to fault: nobody put a gun to their heads in 2010-2018 when they signed the dotted line on yet another high-yielding loan that offered no covenant protection. Yet they just had to do it. Well, now that the catastrophic event that nobody thought could possibly happen happened, and as investors pore through their covenant term sheets, they finally realize why all those warnings over the past decade hit home.
The catalyst for this realization, of course, is the covid crisis, as a result of which countless companies in the U.S. are going broke as the pandemic saps their revenues. Fitch Ratings projects 7% to 8% of leveraged loans will default by the end of 2021, compared with 1.8% in 2019, a cataclysmic event for the $1.2 trillion loan market. Making matters worse, after years of the loan market growing rapidly, failing corporations that issued debt and pledged assets now have less in the way of income or assets to fork over to creditors, which is making fights among all parties more acrimonious.
It also means that those investors with fresh capital can trample over the gullible ones who received a couple of years of interest payments and are now facing near complete losses on principal.
In the case of Boardriders, Oaktree was one of the equity owners: as Bloomberg details, the company negotiated a $135 million financing including a $45 million loan that has priority over all others. The debt came from Boardriders’ bigger lenders, a group that included Brigade Capital Management, Canyon Capital and MidOcean Credit Partners, according to people with knowledge of the situation.
The $45 million loan, which is effectively a pre-petition DIP, ranks ahead of all investors that didn’t participate in the new financing. Just as a secured bankruptcy loan does. The minority lenders that were primed argue that was unfair because they weren’t given a chance to participate in the deal, the people said. Good luck to them: meanwhile, the new loan which is secured by all the assets, is trading around 100 cents on the dollar; the old loan that was primed? About a third of that, or around 35 cents.
The situation was similar for TriMark. The company saw its revenue falling and hired advisers to help it consider its options. It ultimately picked a transaction to raise $120 million from lenders including Oaktree and Ares Management Corp. The group of existing lenders also included Blackstone’s credit arm GSO Capital Partners, Sculptor Capital Management, and BlackRock. Their new loan is trading around face value, about 40 cents on the dollar higher than the loan that was primed. TriMark is owned by Centerbridge, which is about to get a big fat doughnut on its investment.
So how did the new investors prime existing lenders? In both Boardriders and TriMark, minority lenders had covenants including limits on future company borrowings removed, while the debt amortization schedule was slowed down.
According to Etract’s Sullivan, the additional step of removing covenants is highly unusual in the loan world and is a big loss for investors. On the other hand, such covenant stripping would never had been possible if the loans were not covenant-lite to begin with.
“It’s gone beyond Serta — now it’s worse. By stripping it down to the ultra bare bones, all that leaves you with is just a promise to pay,” he said.
* * *
To be sure the primed lenders are fighting back, and some companies are deciding not to embrace these transactions (they can of course do that, but one way or another a priming loan will come, the only difference is that if it is in bankruptcy, it is called a DIP Loan). Meanwhile, covenant lite deals have resulted in even more ingenious instances of asset stripping. In May debtholders rebelled against Elliott Management and Siris Capital Group, the owners of global travel reservation company Travelport, after those two firms tried to move assets out of the reach of creditors. And when Oaktree proposed a priming transaction for PSAV, the borrower elected to raise new capital through a loan that was in the same class as the existing facility.
“Priming transactions such as those executed by Serta and Boardriders are still the exception and the priming play is not the ‘new normal,’” said Judah Gross, a director at Fitch Ratings. “That being said, the higher degree of frequency with which such deals get done may indicate that priming transactions are not as taboo as once assumed.”
He is right, and the real kicker will take place some time in 2021 if there is no new fiscal stimulus, and a default wave washes over the leveraged loan market: only then will our warning from 2018 become clear – years of issuance of loans that were “secured” only in name, has ensured that recoveries for these unsecured creditors will be the lowest in history; in fact depending on the severity of the coming double dip, it is likely that “secured” lenders are looking at the unthinkable – a total wipeout on principal.
“Not Going To Waste My Time” – Trump Rejects ‘Virtual’ Debate With Biden, Will Hold Rally Instead
Update (0805ET): Well that didn’t take long – as we suspected – President Trump said on Fox that the decision to change the format for the next presidential debate to virtual “is not acceptable to us,” adding that “I’m not going to waste my time on a virtual debate, that’s not what debating is all about. You sit behind a computer and do a debate, it’s ridiculous.”
Trump has decided to hold a rally instead…
* * *
According to a statement released minutes ago by the Commission on Presidential Debates, the second presidential debate, set for Oct. 15, will be held remotely, taking the form of a town hall meeting with both candidates participating remotely.’
Moderator Steve Scully will still be located at the Miami venue where the debate was supposed to take place, but instead, both candidates will participate remotely, while the participants in the audience and the moderator ask questions from the main location.
“In order to protect the health and safety of all involved with the second presidential debate, scheduled for October 15, 2020, the Commission on Presidential Debates (CPD) announced the following today: The second presidential debate will take the form of a town meeting, in which the candidates would participate from separate remote locations. The town meeting participants and the moderator, Steve Scully, Senior Executive Producer & Political Editor, C-SPAN Networks, will be located at the Adrienne Arsht Center for the Performing Arts of Miami-Dade County in Miami, Fla. The White House Pool will provide coverage of the second presidential debate.”
Yesterday, Joe Biden opined that there shouldn’t be a second debate if Trump still has COVID-19.
Of course, the remote format could create serious problems for Trump, who was able to wrest control of the first debate thanks to his pugnacious approach, which included frequent interruptions and jabs lobbed at Biden. Afterwards, the Commission promised to change up the format and give moderators new “tools” to help manage the flow of conversation.
The remote format will allow Scully, who once interned in Joe Biden’s Senate office, unprecedented control over the debate. if Trump is being piped in remotely, the moderator can simply mute the president’s feed to prevent him from talking out of turn. At any rate, expect the next debate to be a much more staid affair than the “sh*tshow” – as CNN described it – that tool place last time.
Fortunately for Mike Pence, the one and only VP debate vs. “gaffe machine” Kamala Harris is already over.
The decision comes after Trump’s team said earlier this week that he intended to participate in person during the next debate (the 2nd of three). The decision was made to “protect the safety of all involved” now that a White House COVID-19 outbreak has sickened dozens, including Trump and First Lady Melania Trump.
Meanwhile, Trump is set to appear on Fox Business Network at 0800ET for his first TV interview since the announcement on Friday.
Amidst Historic Ratings Plunge, NBA Commissioner Says League Likely To Pull ‘Black Lives Matter’ Messaging Next Year
It’s amazing how when ratings plunge and ad revenue starts to dry up, moral crusades go right back out the window…
Such is the case for the NBA, which has spent the better part of its shortened season on a political crusade on behalf of Black Lives Matter, leading to a sharp plunge in ratings that we have documented here on Zero Hedge.
NBA Commissioner Adam Silver appeared to confirm early this week that Black Lives Matter messaging will be pulled from the court and from players jerseys next year. According to The Blaze, Silver alluded to the messaging being removed despite the league being “completely committed to standing for social justice and racial equality.”
He said implementing the change is “something we’re gonna have to sit down with the players and discuss.”
He told Rachel Nichols of ESPN: “I would say, in terms of the messages you see on the court and our jerseys, this was an extraordinary moment in time when we began these discussions with the players and what we all lived through this summer. My sense is there’ll be somewhat a return to normalcy — that those messages will largely be left to be delivered off the floor.”
The NBA has seen its ratings (and likely its ad revenue) plunge to historic lows this year amidst the league’s decision to focus more on politics.
It appears that viewers are no longer interested in the political and social justice messages of the NBA but rather were tuning in for (believe it or not) actual basketball. As the balance of the league has tipped from less sport to more activism, viewers are tuning out.
We noted days ago that Game 2 of the NBA Finals saw a major collapse in viewers, with just 4.5 million people tuning in. This is down 68% from last year’s game two, which Outkick notes, “featured a team in Canada”.
In fact, the ratings made Game 2 the least watched NBA Finals game on record, dropping below the 7.41 Game 1, which was the lowest viewed finals opener in history.
We have not only been documenting the NBA, but also documenting the recent ratings collapse that the NFL has suffered in the midst of also turning its league into a political movement over the last few months.
end
iv) Swamp commentaries)
Trump’s big mistake is hiring Wray to replace Comey..a big deep stater
(zerohedge)
FBI Stonewalls Over Hunter Biden; Refuses To Provide Congress Answers On Burisma, China
The FBI is stonewalling a congressional inquiry into Hunter Biden’s overseas business activity described in a Senate report last month which chronicles the Biden family’s international conflicts of interest, as well as potentially criminal business activity, according to TheFederalist.
The Senate report detailed Hunter’s financial dealings with Ukrainian, Chinese and Russian businesses created potential “criminal financial, counterintelligence and extortion concerns,” and alarmed US officials who perceived an ethical conflict of interest and flagged potential crimes ranging from sex trafficking to bribery.
Last week, in response to the report, Ohio Rep. Jim Jordan (R) – the ranking member on the House Judiciary Committee, demanded answers from the FBI over what actions it’s taken, if any, regarding 2015 reports from the DOJ, that the owner of Ukrainian energy giant Burisma paid a $7 million bribe to government officials to shut down an investigation while Hunter sat on its board.
“The report by Chairman Johnson and Chairman Grassley shows that the FBI has been aware of some alleged misconduct for years,” Jordan wrote to FBI Director Christopher Wray.
Jordan also highlighted concerns raised within the Obama State Department regarding Biden’s lucrative board position with Burisma. He raked in upwards of $50,000 a month despite his lack of experience while his father, Joe Biden, served as the administration’s “public face” of White House policy towards the Eastern European ally.
“The report detailed widespread concern within the Obama-Biden Administration about Hunter Biden’s role on the board of Burisma Holdings, a Ukrainian company founded by Mykola Zlochevsky,” Jordan wrote. “The Chairmen noted that they had asked the FBI about its actions in response to these allegations, but have received no answer from you.” –The Federalist
The FBI, meanwhile, is stonewalling. In response to Jordan’s letter demanding answers obtained by The Federalist, the agency has refused to acknowledge any investigation of Hunter Biden’s overseas conduct.
“Consistent with longstanding Department of Justice and FBI policy and practice, however, the FBI can neither confirm nor deny the existence of any ongoing investigation or persons or entities under investigation,” reads the letter, adding that Sens. Jordan and Grassley, the authors of the Senate report, received the same non-answer.
And as The Federalist‘s Triastan Justice notes, the FBI was happy to weigh in on the Russiagate scandal when former Director James Comey confirmed that President Trump was under investigation for suspected ties to the Kremlin – a smear campaign which Hillary Clinton allegedly approved and US intelligence agencies willingly participated in.
What’s more, CIA Director Gina Haspel has reportedly been stonewalling as well – as senior US intelligence tell The Federalist that she’s deliberately blocking the release of central Russiagate documents in the hope that Trump loses the November election.
In a Wednesday letter, Johnson and Grassley demanded that Haspel comply with their request for records following a two-month delay.
“The American people have a right to know the full extent of official action taken by federal officials during the 2016 campaign, the presidential transition, and into the Trump administration,” wrote the Senators. “The information that has already been made public reveals what might be the most outrageous abuse of power in U.S. history against a presidential candidate and sitting president. Unfortunately, many of the puzzle pieces remain hidden, and some of that information rests within your agency.”
v) King report/Courtesy of Chris Powell of GATA which includes the major swamp stories.
@realDonaldTrump late on Tuesday night: The House & Senate should IMMEDIATELY Approve 25 Billion Dollars for Airline Payroll Support, & 135 Billion Dollars for Paycheck Protection Program for Small Business. Both of these will be fully paid for with unused funds from the Cares Act. Have this money. I will sign now! If I am sent a Stand Alone Bill for Stimulus Checks ($1,200), they will go out to our great people IMMEDIATELY. I am ready to sign right now. Are you listening Nancy?
MSM, Dem and financial media types that immediately went into pearl-clutch mode when Trump abruptly ended stimulus negotiations once again underestimated DJT’s political and theatrical savvy. Trump broadcasted to the country that he is eager to sign ‘standalone bills’ to help Americans. This maneuver circumvents Pelosi’s attempt to stuff a stimulus bill with social schemes.
White House says ‘not optimistic’ about COVID-19 aid, talks with Congress are off
“The stimulus negotiations are off,” Meadows later told reporters at the White House on Tuesday. “Obviously we’re looking at the potential for stand-alone bills. There’s about 10 things that we agree on and if the Speaker is willing to look at it on a piece-by-piece basis then we’re willing to look at it,” he said referring to U.S. House Speaker Nancy Pelosi… https://news.trust.org/item/20201007123816-sbejz/
@RepLeeZeldin: Obviously House Dems are going to have to drop some very absurd demands for there to be another coronavirus response bill, such as:
-cashless bail
-mass prison release, including violent criminals
-nationwide ballot harvesting
-Voter ID ban
-stimulus checks to illegal immigrants
Pelosi attacked Trump and questioned his mental health. She said his medications are addling him.
Trump made ‘terrible mistake’ calling for stop to stimulus talks: Pelosi
She pointed to his “erratic behavior” and speculated about his medications.
Pelosi Says People near Trump Should Intervene – Bloomberg
Pelosi Says No Doubt Trump Will Lie to Win Election – BBG [‘accuse others of what you are doing’]
Pelosi: “When the President just popped off and made that announcement without even informing us, that was the case. He insulted the Constitution of the United States…” [Pelosi said she has not interacted with Trump since the State of the Union Speech!]
Obviously, Trump’s standalone gambit unhinged Pelosi, who made the insanity accusation in 2019.
Pelosi says Trump’s family or staff should do ‘an intervention for the good of the country’ 5/23/19
https://www.cnbc.com/2019/05/23/house-speaker-pelosi-says-trump-staff-should-do-an-intervention.html
White House Security Official Contracted Covid-19 in September
Crede Bailey, is gravely ill with Covid-19 and has been hospitalized since September… He became sick before the Sept. 26 Rose Garden event President Donald Trump held to announce his Supreme Court nominee Amy Coney Barrett that has been connected to more than a dozen cases of the disease.
A White House spokesman declined to comment on Bailey. He is in charge of the White House security office, which handles credentialing for access to the White House and works closely with the U.S. Secret Service on security measures throughout the compound… [The genesis of the WH Covid outbreak?]
Trump says Regeneron drug cocktail for coronavirus made him feel good ‘immediately’
The president also said he wants Americans to be able to get the treatment for free.
https://www.yahoo.com/news/trump-says-regeneron-drug-cocktail-223857225.html
After the close, the OCC fined Citigroup $400m for risk-management issues and stated Citi acquisitions need OCC approval. Citi fell 1.1% in after-hour trading.
Today – Jobless Claims could dictate pre-NYSE open trading. Barring news, the market is likely to be listless. Traders and operators are in control of the stock market. Ergo, the usual intraday patterns are more likely to occur. Astute traders try to ascertain ASAP if the session is a range day or a trend day. Unless one is Miss Cleo, it is difficult to guess if there will be a significant and lasting trend today.
Support Grows for Confirming Amy Coney Barrett to the Supreme Court
46% of voters back Trump’s nominee, up 9 points from late last month [31% oppose]
https://morningconsult.com/2020/10/07/amy-coney-barrett-supreme-court-polling/
McConnell: Attacks on Barrett’s faith by Dems, media ‘are a disgrace’
Barrett has faced accusations that her faith makes her unfit to serve
https://www.foxnews.com/politics/mcconnell-attacks-on-barretts-faith-by-dems-media-are-a-disgrace
Trump mocks Joe Biden for awkward remark about young girls
“He’s been a wacko for years, and everyone knows it,” Trump wrote on Twitter. “The Lamestream Media is stuck with him and they are just now trying to clean up his act. Notice how all of the bad things, like his very low IQ, are no longer reported? Fake News!”… “I’m coming back, I’m coming back. And I want to see these beautiful young ladies, I want to see them dancing when they’re four years older, too,” Biden said… https://nypost.com/2020/10/07/trump-mocks-joe-biden-for-awkward-remark-about-young-girls/
@swamp_nugget: Prior to the 2016 Election CNN Ran This Segment on Joe Biden. Hoping It Would Make Him Not Run against Hillary. Sometimes Things Come Back to HAUNT You, Watch Before They Find It Offensive. https://twitter.com/swamp_nugget/status/1313984318751072257
@paulsperry_: Tonight’s VP debate moderator, Susan Page, is working on Pelosi’s bio, “Madam Speaker: Nancy Pelosi and the Lessons of Power,” due out 2021. Her agent is anti-Trump Javelin. Records show Page’s son & stepson have given hundreds of dollars to support Joe Biden’s campaign
@Rasmussen_Poll: 32% of black voters say @KamalaHarris makes them more likely to vote for the presumptive Democratic nominee in November, but just as many (32%) say it makes them less likely to vote for them. 28% of these voters say it will have no impact on their vote.
@ABCPolitics: The DNC is trying to reach Black voters in battleground states with a new six-figure ad buy in Black publications, with less than a month left before Election Day. [This reveals much about what valid polls are showing. If Biden is winning by double digits, why is he spending money to get blacks to turn out? After spending months in hibernation, why is Joe now campaigning in swing states and states that were thought to be locks for him (NV, MN, WI, etc?]
Fox’s latest poll shows Biden with a 10-point lead. The same poll shows that 49% believe their neighbors will vote for Trump and only 39% will vote for Biden.
https://www.foxnews.com/politics/fox-news-poll-biden-gains-ground-over-trump
Cuomo Uses 14-Year-Old Photo to Accuse Orthodox Jews of Violating Coronavirus Restrictions
“These are pictures from the past couple of weeks and these are just emblematic,” Cuomo said. “You’ve all seen pictures like this for weeks. What did you think was going to happen? What did you think was going to happen? Religious institutions are mass gatherings and raise the greatest potential.”
A reporter quickly pointed out the governor’s error on Twitter, sharing a screenshot of a 2007 Jerusalem Post article that included the same photo Cuomo included in his slide show. The Associated Press took the photo at a 2006 funeral for a rabbi in Orange County, New York…
Well that is all for today
I will see you FRIDAY night.
harveyorganblog.com 