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EXCHANGE: COMEX

EXCHANGE: COMEX
CONTRACT: SEPTEMBER 2022 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,626.700000000 USD
INTENT DATE: 09/27/2022 DELIVERY DATE: 09/29/2022
FIRM ORG FIRM NAME ISSUED STOPPED

435 H SCOTIA CAPITAL 50
657 C MORGAN STANLEY 35
661 C JP MORGAN 598 533
690 C ABN AMRO 10
732 C RBC CAP MARKETS 141
880 H CITIGROUP 333
905 C ADM 32

TOTAL: 866 866
MONTH TO DATE: 12,013

GOLD: NUMBER OF NOTICES FILED FOR SEPT CONTRACT:

866 NOTICES FOR 86600 OZ //2.6936 TONNES

total notices so far: 12,013 contracts for 1,201,300 oz (37.365 tonnes)

SILVER NOTICES: 43 NOTICES FILED FOR 215,000 OZ/

total number of notices filed so far this month 6784 : for 33,920,000 oz

END

Russia is a major supplier of silver to London while Mexico supplies the COMEX

With the sanctions, London has no way to obtain silver other than compete with NY.

GLD

WITH GOLD UP $32.30

WITH RESPECT TO GLD WITHDRAWALS: (OVER THE PAST FEW MONTHS):

GOLD IS “RETURNED” TO THE BANK OF ENGLAND WHEN CALLING IN THEIR LEASES: THE GOLD NEVER LEAVES THE BANK OF ENGLAND IN THE FIRST PLACE. THE BANK IS PROTECTING ITSELF IN CASE OF COMMERCIAL FAILURE

ALSO INVESTORS SWITCHING TO SPROTT PHYSICAL (PHYS) INSTEAD OF THE FRAUDULENT GLD//

BIG CHANGES IN GOLD INVENTORY AT THE GLD: //// A WITHDRAWAL OF 2.61 TONNES FROM THE GLD/

INVENTORY RESTS AT 940.86 TONNES

Silver//SLV

WITH NO SILVER AROUND AND SILVER UP 32 CENTS

AT THE SLV// ://BIG CHANGES IN SILVER INVENTORY AT THE SLV//: A WITHDRAWAL OF OF 0.645 MILLION OZ INTO THE SLV//

INVESTORS ARE SWITCHING SLV TO SPROTT’S PSLV

CLOSING INVENTORY: 480.549 MILLION OZ

Let us have a look at the data for today

SILVER//OUTLINE

SILVER COMEX OI FELL BY A STRONG SIZED 935 CONTRACTS TO 129,060 (ANOTHER ALL TIME RECORD LOW) AND FURTHER FROM THE NEW RECORD HIGH OI OF 244,710, SET FEB 25/2020 AND THE STRONG LOSS IN COMEX OI WAS ACCOMPLISHED WITH OUR $0.07 LOSS IN SILVER PRICING AT THE COMEX ON MONDAY. OUR BANKERS WERE SUCCESSFUL IN KNOCKING THE PRICE OF SILVER DOWN (IT FELL BY $0.07) AND WERE SUCCESSFUL IN KNOCKING OFF SOME SPEC SILVER LONGS AS WE HAD A STRONG LOSS OF 885 CONTRACTS ON OUR TWO EXCHANGES. WE DID HAVE CONTINUAL SHORT ADDITIONS WITH THE BANKERS ON THE BUY SIDE.

WE MUST HAVE HAD:
I) CONTINUAL SPECULATOR SHORT ADDITIONS ////CONTINUED BANKER OI COMEX ADDITIONS /. II) WE ALSO HAD SOME REDDIT RAPTOR BUYING//. iii) A SMALL ISSUANCE OF EXCHANGE FOR PHYSICALS iiii) AN INITIAL SILVER STANDING FOR COMEX SILVER MEASURING AT 3.855 MILLION OZ FOLLOWED BY TODAY’S 135,000 OZ QUEUE JUMP / // V) STRONG SIZED COMEX OI LOSS/

I AM NOW RECORDING THE DIFFERENTIAL IN OI FROM PRELIMINARY TO FINAL: –60

HISTORICAL ACCUMULATION OF EXCHANGE FOR PHYSICALS SEPT. ACCUMULATION FOR EFP’S SILVER/JPMORGAN’S HOUSE OF BRIBES/STARTING FROM FIRST DAY/MONTH OF SEPT:

TOTAL CONTRACTS for 19 days, total 13,860 contracts: 69.300 million oz OR 3.647 MILLION OZ PER DAY. (729 CONTRACTS PER DAY)

TOTAL EFP’S FOR THE MONTH SO FAR: 69.300 MILLION OZ

LAST 17 MONTHS TOTAL EFP CONTRACTS ISSUED IN MILLIONS OF OZ:

MAY 137.83 MILLION

JUNE 149.91 MILLION OZ

JULY 129.445 MILLION OZ

AUGUST: MILLION OZ 140.120

SEPT. 28.230 MILLION OZ//

OCT: 94.595 MILLION OZ

NOV: 131.925 MILLION OZ

DEC: 100.615 MILLION OZ

JAN 2022// 90.460 MILLION OZ

FEB 2022: 72.39 MILLION OZ//

MARCH: 207.430 MILLION OZ//A NEW RECORD FOR EFP ISSUANCE

APRIL: 114.52 MILLION OZ FINAL//LOW ISSUANCE

MAY: 105.635 MILLION OZ//

JUNE: 94.470 MILLION OZ

JULY : 87.110 MILLION OZ

AUGUST: 65.025 MILLION OZ

SEPT. 69.300 MILLION OZ///

RESULT: WE HAD A STRONG SIZED DECREASE IN COMEX OI SILVER COMEX CONTRACTS OF 935 WITH OUR $0.07 LOSS IN SILVER PRICING AT THE COMEX// TUESDAY.,. THE CME NOTIFIED US THAT WE HAD A SMALL SIZED EFP ISSUANCE CONTRACTS: 50 CONTRACTS ISSUED FOR DEC AND 0 CONTRACTS ISSUED FOR ALL OTHER MONTHS) WHICH EXITED OUT OF THE SILVER COMEX TO LONDON AS FORWARDS THE DOMINANT FEATURE TODAY: /GOOD BANKER ADDITIONS A// CONTINUAL NET SPEC SHORT ADDITIONS /// WE HAVE A GOOD INITIAL SILVER OZ STANDING FOR AUGUST. OF 3.855 MILLION OZ FOLLOWED BY TODAY’S 135,000 OZ QUEUE JUMP // .. WE HAD A STRONG SIZED LOSS OF 935 OI CONTRACTS ON THE TWO EXCHANGES FOR 4.425MILLION OZ..

WE HAD 43 NOTICE(S) FILED TODAY FOR 215,000 OZ

THE SILVER COMEX IS NOW BEING ATTACKED FOR METAL BY LONDONERS ET AL.

WE HAVE 2 MORE READING DAYS BEFORE FIRST DAY NOTICE

GOLD//OUTLINE

IN GOLD, THE COMEX OPEN INTEREST FELL BY A HUGE SIZED 9274 CONTRACTS TO 457,061 AND FURTHER FROM THE RECORD (SET JAN 24/2020) AT 799,541 AND PREVIOUS TO THAT: (SET JAN 6/2020) AT 797,110. WE WILL PROBABLY SEE THE COMEX OI FALL TO AROUND 380,000 AS OUR SPECS GET ANNIHILATED.

THE DIFFERENTIAL FROM PRELIMINARY OI TO FINAL OI IN GOLD TODAY: REMOVED — -151 CONTRACTS.

THE HUGE SIZED DECREASE IN COMEX OI CAME DESPITE OUR GAIN IN PRICE OF $1.75//COMEX GOLD TRADING/TUESDAY / WE HAD INITIATION OF SPREADER LIQUIDATION// SOME SPECULATOR SHORT COVERINGS ACCOMPANYING OUR FAIR SIZED EXCHANGE FOR PHYSICAL ISSUANCE./. WE HAD ZERO LONG LIQUIDATION AS ALL THE LOSS IN COMEX OI WAS DUE TO SPREADER LIQUIDATION //AND //CONTINUED ADDITIONS TO OUR BANKER LONGS!! THE COMEX WILL BLOW UP AS THE SPECS CANNOT DELIVER GOLD TO OUR BANKER LONGS.

WE ALSO HAD A HUGE INITIAL STANDING IN GOLD TONNAGE FOR SEPT. AT 8.401 TONNES ON FIRST DAY NOTICE FOLLOWED BY TODAY’S STRONG QUEUE JUMP OF 43,100 OZ //NEW STANDING 38.127 TONNES (QUEUE JUMPING = EXERCISING LONDON BASED EFP’S)

YET ALL OF..THIS HAPPENED WITH OUR GAIN IN PRICE OF $1.75 WITH RESPECT TO TUESDAY’S TRADING

WE HAD A STRONG SIZED LOSS OF 6552 OI CONTRACTS 19.922 PAPER TONNES) ON OUR TWO EXCHANGES..

E.F.P. ISSUANCE

THE CME RELEASED THE DATA FOR EFP ISSUANCE AND IT TOTALED A FAIR SIZED 2722 CONTRACTS:

The NEW COMEX OI FOR THE GOLD COMPLEX RESTS AT 457,061

IN ESSENCE WE HAVE A STRONG SIZED INCREASE IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 6552 CONTRACTS WITH 9274 CONTRACTS DECREASED AT THE COMEX AND 2722 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS TOTAL OI LOSS ON THE TWO EXCHANGES OF 6408 CONTRACTS OR 19.922 TONNES.

CALCULATIONS ON GAIN/LOSS ON OUR TWO EXCHANGES

WE HAD A FAIR SIZED ISSUANCE IN EXCHANGE FOR PHYSICALS (2722) ACCOMPANYING THE STRONG SIZED LOSS IN COMEX OI (9274): TOTAL LOSS IN THE TWO EXCHANGES 6552 CONTRACTS. WE NO DOUBT HAD 1) SMALL SPECULATOR SHORT COVERINGS// CONTINUED GOOD BANKER ADDITIONS/// ,2.) STRONG INITIAL STANDING AT THE GOLD COMEX FOR SEPT. AT 8.409 TONNES FOLLOWED BY TODAY’S MONSTROUS QUEUE JUMP OF 43,100 oz. 3) ZERO LONG LIQUIDATION (ALL THE LOST ARE SPREADERS)//// //.,4) STRONG SIZED COMEX OPEN INTEREST LOSS 5) FAIR ISSUANCE OF EXCHANGE FOR PHYSICAL/5/INITIATION OF SPREADER LIQUIDATION..TOTALLY FRAUDULENT BUT WHO IS WATCHING!!

HISTORICAL ACCUMULATION OF EXCHANGE FOR PHYSICALS IN 2022 INCLUDING TODAY

SEPT

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF SEPT. :

57,299 CONTRACTS OR 5,729,900 OZ OR 178.22 TONNES 19 TRADING DAY(S) AND THUS AVERAGING: 3015 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE SIZE OF THESE EFP TRANSFERS : THIS MONTH IN 19 TRADING DAY(S) IN TONNES: 178.22 TONNES

TOTAL ANNUAL GOLD PRODUCTION, 2021, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 3555 TONNES

THUS EFP TRANSFERS REPRESENTS 178.22/3550 x 100% TONNES .502% OF GLOBAL ANNUAL PRODUCTION

ACCUMULATION OF GOLD EFP’S YEAR 2021 TO 2022

JANUARY/2021: 265.26 TONNES (RAPIDLY INCREASING AGAIN)

FEB : 171.24 TONNES ( DEFINITELY SLOWING DOWN AGAIN)..

MARCH:. 276.50 TONNES (STRONG AGAIN/

APRIL: 189..44 TONNES ( DRAMATICALLY SLOWING DOWN AGAIN//GOLD IN BACKWARDATION)

MAY: 250.15 TONNES (NOW DRAMATICALLY INCREASING AGAIN)

JUNE: 247.54 TONNES (FINAL)

JULY: 188.73 TONNES FINAL

AUGUST: 217.89 TONNES FINAL ISSUANCE.

SEPT 142.12 TONNES FINAL ISSUANCE ( LOW ISSUANCE)_

OCT: 141.13 TONNES FINAL ISSUANCE (LOW ISSUANCE)

NOV: 312.46 TONNES FINAL ISSUANCE//NEW RECORD!! (INCREASING DRAMATICALLY)//SIGN OF REAL STRESS//SURPASSING THE MARCH 2021 RECORD OF 276.50 TONNES OF EFP

DEC. 175.62 TONNES//FINAL ISSUANCE//

JAN:2022 247.25 TONNES //FINAL

FEB: 196.04 TONNES//FINAL

MARCH: 409.30 TONNES INITIAL( THIS IS NOW A RECORD EFP ISSUANCE FOR MARCH AND FOR ANY MONTH.

APRIL: 169.55 TONNES (FINAL VERY LOW ISSUANCE MONTH)

MAY: 247,44 TONNES FINAL//

JUNE: 238.13 TONNES FINAL

JULY: 378.43 TONNES FINAL

AUGUST: 180.81 TONNES FINAL

SEPT. 178.22 TONNES (SLIGHTLY RISING THIS MONTH)

SPREADING OPERATIONS

(/NOW SWITCHING TO GOLD) FOR NEWCOMERS, HERE ARE THE DETAILS

SPREADING LIQUIDATION HAS NOW COMMENCED AS WE HEAD TOWARDS THE NEW ACTIVE FRONT MONTH OF OCT. WE ARE NOW INTO THE SPREADING OPERATION OF GOLD

HERE IS A BRIEF SYNOPSIS OF HOW THE CROOKS FLEECE UNSUSPECTING LONGS IN THE SPREADING ENDEAVOUR ;MODUS OPERANDI OF THE CORRUPT BANKERS AS TO HOW THEY HANDLE THEIR SPREAD OPEN INTERESTS:HERE IS HOW THE CROOKS USED SPREADING AS WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF SEPT HEADING TOWARDS THE ACTIVE DELIVERY MONTH OF OCT., FOR GOLD:

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

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

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

1.Today, we had the open interest at the comex, in SILVER,FELL BY A STRONG SIZED 935 CONTRACT OI TO RECORD LOW OF 129,000 AND FURTHER FROM OUR COMEX HIGH RECORD //244,710(SET FEB 25/2020). THE LAST RECORDS WERE SET IN AUG.2018 AT 244,196 WITH A SILVER PRICE OF $14.78/(AUGUST 22/2018)..THE PREVIOUS RECORD TO THAT WAS SET ON APRIL 9/2018 AT 243,411 OPEN INTEREST CONTRACTS WITH THE SILVER PRICE AT THAT DAY: $16.53). AND PREVIOUS TO THAT, THE RECORD WAS ESTABLISHED AT: 234,787 CONTRACTS, SET ON APRIL 21.2017 OVER 5 YEARS AGO.

EFP ISSUANCE 50 CONTRACTS

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

DEC 50 ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 50 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. IF WE TAKE THE COMEX OI LOSS OF 1875 CONTRACTS AND ADD TO THE 50 OI TRANSFERRED TO LONDON THROUGH EFP’S,

WE OBTAIN A STRONG SIZED LOSS OF 935 OPEN INTEREST CONTRACTS FROM OUR TWO EXCHANGES.

THUS IN OUNCES, THE LOSS ON THE TWO EXCHANGES 4.425 MILLION OZ

OCCURRED WITH OUR STRONG LOSS IN PRICE OF $0.07

OUTLINE FOR TODAY’S COMMENTARY

1/COMEX GOLD AND SILVER REPORT

(report Harvey)

2 ) Gold/silver trading overnight Europe,

(Peter Schiff,

end

3. Egon von Greyerz///Matthew Piepenburg via GoldSwitzerland.com,

4. Chris Powell of GATA provides to us very important physical commentaries

end

5. Other gold commentaries

6. Commodity commentaries//

3. ASIAN AFFAIRS

i)WEDNESDAY MORNING// TUESDAY NIGHT

SHANGHAI CLOSED DOWN 48.79 PTS OR 1.58% //Hang Sang CLOSED DOWN 609.43 PTS OR 3.41% /The Nikkei closed DOWN 397.89 PTS OR 1.50-% //Australia’s all ordinaires CLOSED DOWN 0.55% /Chinese yuan (ONSHORE) closed DOWN AT 7.2354//OFFSHORE CHINESE YUAN DOWN 7.2411// /Oil UP TO 78.93 dollars per barrel for WTI and BRENT AT 86.57 / Stocks in Europe OPENED ALL RED. ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST US DOLLAR/OFFSHORE WEAKER

a)NORTH KOREA/SOUTH KOREA

outline

b) REPORT ON JAPAN/

OUTLINE

3 C CHINA

OUTLINE

4/EUROPEAN AFFAIRS

OUTLINE

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

OUTLINE

6.Global Issues//COVID ISSUES/VACCINE ISSUES

OUTLINE

7. OIL ISSUES

OUTLINE

8 EMERGING MARKET ISSUES

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

GOLD

LET US BEGIN:

THE TOTAL COMEX GOLD OPEN INTEREST FELL BY A HUGE SIZED 9274 CONTRACTS TO 457,061 AND FURTHER FROM THE RECORD THAT WAS SET IN JANUARY/2020: {799,541 OI(SET JAN 16/2020)} AND PREVIOUS TO THAT: 797,110 (SET JAN 7/2020). AND THIS COMEX DECREASE OCCURRED DESPITE OUR RISE IN PRICE OF $1.75 IN GOLD PRICING TUESDAY’S COMEX TRADING. WE ALSO HAD A FAIR SIZED EFP (2722 CONTRACTS). . THEY WERE PAID HANDSOMELY NOT TO TAKE DELIVERY AT THE COMEX AND SETTLE FOR CASH. IT NOW SEEMS THAT THE COMMERCIALS HAVE GOADED THE SPECS TO GO MASSIVELY SHORT AND NOW THEY ARE DESPERATELY TRYING TO COVER THEIR FOLLY.

WE NORMALLY HAVE WITNESSED EXCHANGE FOR PHYSICALS ISSUED BEING SMALL AS IT JUST TOO COSTLY FOR THEM TO CONTINUE SERVICING THE COSTS OF SERIAL FORWARDS CIRCULATING IN LONDON. HOWEVER, MUCH TO THE ANNOYANCE OF OUR BANKERS, THE COMEX IS THE SCENE OF AN ASSAULT ON GOLD AS LONDONERS, NOT BEING ABLE TO FIND ANY PHYSICAL ON THAT SIDE OF THE POND, EXERCISE THESE CIRCULATING EXCHANGE FOR PHYSICALS IN LONDON AND FORCING DELIVERY OF REAL METAL OVER HERE AS THE OBLIGATION STILL RESTS WITH NEW YORK BANKERS. IT SEEMS THAT ARE BANKERS FRIENDS ARE EXERCISING EFP’S FROM LONDON AND NOW THEY ARE LOATHE TO ISSUE NEW ONES.

EXCHANGE FOR PHYSICAL ISSUANCE

WE ARE NOW IN THE NON ACTIVE DELIVERY MONTH OF SEPT.. THE CME REPORTS THAT THE BANKERS ISSUED A FAIR SIZED TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS.,

THAT IS 2722 EFP CONTRACTS WERE ISSUED: ;: , . 0 DEC :2722 & ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE: 5333 CONTRACTS

WHEN WE HAVE BACKWARDATION, EFP ISSUANCE IS VERY COSTLY BUT THE REAL PROBLEM IS THE SCARCITY OF METAL AND IT IS FAR BETTER FOR OUR BANKERS TO PAY OFF INDIVIDUALS THAN RISK INVESTORS ESPECIALLY FROM LONDON STANDING FOR DELIVERY. THE LOWER PRICES IN THE FUTURES MARKET IS A MAGNET FOR OUR LONDONERS SEEKING PHYSICAL METAL. BACKWARDATION ALWAYS EQUAL SCARCITY OF METAL!

ON A NET BASIS IN OPEN INTEREST WE LOST THE FOLLOWING TODAY ON OUR TWO EXCHANGES: A STRONG SIZED SIZED TOTAL OF 6552 CONTRACTS IN THAT 2722 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE HAD A HUGE SIZED COMEX OI LOSS OF 9274 CONTRACTS..AND THIS STRONG LOSS ON OUR TWO EXCHANGES HAPPENED DESPITE OUR RISE IN PRICE OF GOLD $1.75. ALL OF THE LOSS IN COMEX OI WILL NO DOUBT BE ATTRIBUTED TO INITIATION OF SPREADER LIQUIDATION//WE HAD CONTINUAL SHORT ADDITIONS WITH BANKERS TAKING THE BUY SIDE// WE ARE NOW WITNESSING THE SPECULATORS GOING MASSIVELY SHORT WHILE THE BANKERS WHO ARE HUGELY LONG CONTINUE TO ADD TO THEIR PURCHASES. THIS WILL NOT END WELL FOR OUR SPECS ONCE THE SIGNAL HAS BEEN GIVEN TO ANNIHILATE THE SPECS.

// WE HAVE A STRONG AMOUNT OF GOLD TONNAGE STANDING SEPT (38.127),

HERE ARE THE AMOUNTS THAT STOOD FOR DELIVERY IN THE PRECEDING 12 MONTHS OF 2021-2022:

DEC 2021: 112.217 TONNES

NOV. 8.074 TONNES

OCT. 57.707 TONNES

SEPT: 11.9160 TONNES

AUGUST: 80.489 TONNES

JULY: 7.2814 TONNES

JUNE: 72.289 TONNES

MAY 5.77 TONNES

APRIL 95.331 TONNES

MARCH 30.205 TONNES

FEB ’21. 113.424 TONNES

JAN ’21: 6.500 TONNES.

TOTAL SO FAR THIS YEAR (JAN- DEC): 601.213 TONNES

YEAR 2022:

JANUARY 2022 17.79 TONNES

FEB 2022: 59.023 TONNES

MARCH: 36.678 TONNES

APRIL: 85.340 TONNES FINAL.

MAY: 20.11 TONNES FINAL

JUNE: 74.933 TONNES FINAL

JULY 29.987 TONNES FINAL

AUGUST:104.979 TONNES//FINAL

SEPT. 38.127 TONNES

THE BANKERS WERE UNSUCCESSFUL IN LOWERING GOLD’S PRICE //// (IT ROSE $1.75) BUT WERE UNSUCCESSFUL IN KNOCKING OFF ANY SPECULATOR LONGS AS WE HAD A STRONG SIZED TOTAL LOSS ON OUR TWO EXCHANGES OF 6552 CONTRACTS // COMMERCIAL LONGS ADDED TO THE POSITIONS, AND SPECULATOR SHORTS SOMEWHAT ADDED TO THEIR POSITIONS WITH SOME SUCCESS//INITIATION OF SPREADER LIQUIDATION// WE HAVE REGISTERED A STRONG LOSS OF 6408 TONNES ON TOTAL OI FROM OUR TWO EXCHANGES, ACCOMPANYING OUR GOLD TONNAGE STANDING FOR SEPT. (38.127 TONNES)…

WE HAD -151 CONTRACTS COMEX TRADES REMOVED. THESE WERE REMOVED AFTER TRADING ENDED LAST NIGHT

NET LOSS ON THE TWO EXCHANGES 6552 CONTRACTS OR 655200 OZ OR 20.379 TONNES

Estimated gold volume 284,258/// fair//

final gold volumes/yesterday 218,762/ fair

INITIAL STANDINGS FOR SEPT ’22 COMEX GOLD //SEPT 28

Gold	Ounces
Withdrawals from Dealers* Inventory in oz*	nil oz
Withdrawals from Customer* Inventory in oz*	32,794.012 oz BRINKS includes 1020 kilobars Brinks
Deposit to the Dealer* Inventory in oz*	nil
Deposits to the Customer* Inventory, in oz*	nil oz
No of oz served (contracts) today	866 notice(s) 86,600 OZ 2.6936 TONNES
No of oz to be served (notices)	246 contracts 24,600 oz 0.7651 TONNES
Total monthly oz gold served (contracts) so far this month	12,013 notices 1,201,300 OZ 37.365 TONNES
Total accumulative withdrawals of gold from the Dealers* inventory this month*	NIL oz
Total accumulative withdrawal of gold from the Customer* inventory this month*	xxx oz

total dealer deposit 0

total dealer deposit: nil oz

No dealer withdrawals

Customer deposits: 0

total deposits nil oz

customer withdrawals: 1

i) Out of Brinks 32,794.012 oz or 1020 kilobars

total: 32,794.0123 oz

total in tonnes: 1.02 tonnes

Adjustments: 1

JPM: dealer to customer; 6655.257 0z

CALCULATIONS FOR THE AMOUNT OF GOLD STANDING FOR SEPT.

For the front month of SEPT we have an oi of 1112 contracts having GAINED 42 contracts .

We had 389 notices filed on TUESDAY so we gained a whopping 431 contracts or an additional 43,100 oz

will stand for gold in this very non active delivery month of September. This queue jump is actually the Londoners exercising efp’s and tendering them to the banks

for the physical!

October LOST a relatively small 9586 contracts LOWERING TO 31,458. Oct is generally a poor active delivery month. It WILL change…..probably around 75 85 tonnes will stand!!

WE HAVE 2 MORE READING DAYS BEFORE FIRST DAY NOTICE ( FRIDAY SEPT 30.2022)

November GAINED 96 contracts to stand at 928

December GAINED 54 contracts UP to 377,619

We had 866 notice(s) filed today for 86600 oz FOR THE SEPT. 2022 CONTRACT MONTH.

Today, 0 notice(s) were issued from J.P.Morgan dealer account and 598 notices were issued from their client or customer account. The total of all issuance by all participants equate to 866 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 533 notice(s) was (were) stopped/ Received) by J.P.Morgan//customer account and 0 notice(s) received (stopped) by the squid (Goldman Sachs)

To calculate the INITIAL total number of gold ounces standing for the SEPT /2022. contract month,

we take the total number of notices filed so far for the month (12,013) x 100 oz , to which we add the difference between the open interest for the front month of (SEPT 1112 CONTRACTS) minus the number of notices served upon today 866 x 100 oz per contract equals 1,225,800 OZ OR 38.127 TONNES the number of TONNES standing in this NON active month of SEPT.

thus the INITIAL standings for gold for the SEPT contract month:

No of notices filed so far (12,013) x 100 oz+ (1112) OI for the front month minus the number of notices served upon today (866} x 100 oz} which equals 1,225,800 oz standing OR 38.127 TONNES in this NON active delivery month of SEPTEMBER.

TOTAL COMEX GOLD STANDING: 38.127 TONNES (A HUMONGOUS STANDING FOR A SEPT ( NON ACTIVE) DELIVERY MONTH)

WE WILL INCREASE IN GOLD TONNAGE STANDING FROM THIS DAY FORTH UNTIL THE END OF THE MONTH.

SOMEBODY IS AFTER A HUGE AMOUNT OF GOLD. THE EFPS ARE NOW BEING USED TO TAKE GOLD FROM THE COMEX. THUS THE AMOUNT OF GOLD STANDING FOR SEPT. WILL RISE EXPONENTIALLY.

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

COMEX GOLD INVENTORIES/CLASSIFICATION

NEW PLEDGED GOLD:

241,794.285 oz NOW PLEDGED /HSBC 5.94 TONNES

204,937.290 PLEDGED MANFRA 3.08 TONNES

83,657.582 PLEDGED JPMorgan no 1 1.690 tonnes

265,999.054, oz JPM No 2

1,152,376.639 oz pledged Brinks/

Manfra: 33,758.550 oz

Delaware: 193.721 oz

International Delaware:: 11,188.542 o

total pledged gold: 2,235,417.759 oz 69.534 tonnes

TOTAL OF ALL GOLD ELIGIBLE AND REGISTERED: 26,524,450.883 OZ

TOTAL REGISTERED GOLD: 13,121,323.283 OZ (408.12 tonnes)

TOTAL OF ALL ELIGIBLE GOLD: 13,403,127.598 OZ

REGISTERED GOLD THAT CAN BE SERVED UPON: 10,885,906 OZ (REG GOLD- PLEDGED GOLD) 338.97 tonnes//rapidly declining

END

SILVER/COMEX/SEPT 28

Silver	Ounces
Withdrawals from Dealers* Inventory*	NIL oz
Withdrawals from Customer Inventory	1,189,451.117 oz Brinks CNT Int. Delaware Manfra
Deposits to the Dealer* Inventory*	nil OZ
Deposits to the Customer Inventory	4053.000 oz Delaware
No of oz served today (contracts)	43 CONTRACT(S) 215,000 OZ)
No of oz to be served (notices)	18 contracts (90,000 oz)
Total monthly oz silver served (contracts)	6784 contracts 33,920,000 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*

And now for the wild silver comex results

i) 0 dealer deposit

total dealer deposits: nil oz

i) We had 0 dealer withdrawal

total dealer withdrawals: oz

We have 1 deposits into the customer account

i) Into Delaware: 4053.000 oz

Total deposits: 4053.00 oz

JPMorgan has a total silver weight: 163.461 million oz/314.132million =52.02% of comex

Comex withdrawals: 4

i) Out of Brinks: 485,051.720 oz

ii)Out of CNT 23,378.170 oz

iii)Out of Int Delaware: 82,321.880 oz

iv) out of Manfra 598,699.347 oz

total withdrawals: 1,189,451.117 oz

adjustments: // 2

DEALER TO CUSTOMER:

i)JPMorgan: 195,119.310 oz

ii)out of Manfra 118,550.01 oz

iii) Out of Delaware: 76,552.692 oz

the silver comex is in stress!

TOTAL REGISTERED SILVER: 42.686 MILLION OZ (declining rapidly)

TOTAL REG + ELIG. 314.173 MILLION OZ

CALCULATION OF SILVER OZ STANDING FOR SEPT

silver open interest data:

FRONT MONTH OF SEPT OI: 61 CONTRACTS HAVING LOST 19 CONTRACTS. WE HAD

46 CONTRACTS SERVED ON TUESDAY SO WE GAINED 27 CONTRACTS OR AN ADDITIONAL

135,000 OZ WILL STAND FOR METAL IN THIS VERY ACTIVE MONTH OF SEPT.

WE WILL GAIN IN TOTAL SILVER STANDING EACH TRADING DAY UNTIL THE END OF THE MONTH

(CONTINUAL QUEUE JUMPING BY OUR BANKERS SEARCHING FOR SILVER METAL)

OCTOBER LOST 24 CONTRACTS TO STAND AT 341 CONTACTS.

NOVEMBER GAINED 19 CONTRACTS TO STAND AT 211

DECEMBER SAW A LOSS OF 932 CONTRACTS DOWN TO 113,356

TOTAL NUMBER OF NOTICES FILED FOR TODAY: 43 for 215,000 oz

Comex volumes:81,613// est. volume today// good

Comex volume: confirmed yesterday: 65,273 contracts ( fair)

To calculate the number of silver ounces that will stand for delivery in SEPT we take the total number of notices filed for the month so far at 6784 x 5,000 oz = 33,920,000 oz

to which we add the difference between the open interest for the front month of SEPT(61) and the number of notices served upon today 43 x (5000 oz) equals the number of ounces standing.

Thus the standings for silver for the SEPT./2022 contract month: 6,784 (notices served so far) x 5000 oz + OI for front month of SEPT (61) – number of notices served upon today (43) x 5000 oz of silver standing for the SEPT contract month equates 34,010,000 oz. .

We have an inventory of 42.687 million oz of registered silver at the comex so Sept delivery of 34.010 MILLION OZ represents 79.67% of that category of silver.

If we add August’s final delivery (to Sept) for silver at 5.51 million oz, we have a total of 39.52 million oz delivered upon with a REGISTERED INVENTORY of 42.6876 million oz or 92.58% of that category of silver.

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

Comex volumes:60,617// est. volume today// poor

Comex volume: confirmed yesterday: 83,937contracts ( poor)

END

GLD AND SLV INVENTORY LEVELS

SEPT 28/WITH GOLD UP $32.30: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.61 TONNES FORM THE GLD////INVENTORY RESTS AT 940.549 TONNES

SEPT 27/WITH GOLD UP $1.75: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 3.76 TONNES FROM THE GLD////INVENTORY RESTS AT 943.47 TONNES

SEPT 26/WITH GOLD DOWN $17.15: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.90 TONNES FROM THE GLD////INVENTORY RESTS AT 947.23 TONNES

SEPT 23/WITH GOLD DOWN $24.60: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWALOF 2.03 TONNES FORM THE GLD//INVENTORY RESTS AT 950.13 TONNES

SEPT 22/WITH GOLD UP $5.20; NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 952.16 TONNES

SEPT 21/WITH GOLD UP $4.70: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 5.79 TONNES FROM THE GLD///INVENTORY RESTS AT 952.16 TONNES

SEPT 20/WITH GOLD DOWN $6.65; HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.90 TONNES FROM THE GLD////INVENTORY RESTS AT 957.95 TONNES

SEPT 19/WITH GOLD DOWN $4.80: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.16 TONES FROM THE GLD//INVENTORY RESTS AT 960.85 TONNES

SEPT 16.WITH GOLD UP $5.70: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT 1,45 TONNES INTO THE GLD//INVENTORY RESTS AT 962.01 TONNES

SEPT 15/WITH GOLD DOWN $30.20: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.35 TONNES FROM THE GLD.//INVENTORY RESTS AT 960.56 TONNES

SEPT 14/WITH GOLD DOWN $7.70: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.03 TONNES FROM THE GLD////INVENTORY REST AT 962.88 TONNES

SEPT 13/WITH GOLD DOWN $22.85 : BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.73ONNES FROM THE GLD////INVENTORY RESTS AT 964.91 TONNES

SEPT 12/WITH GOLD UP $12.30: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 966.64 TONNES

SEPT 9/WITH GOLD UP $7.85: 2 BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.90 AND ANOTHER 1.51 TONNES FROM THE GLD////INVENTORY RESTS AT 966.64 TONNES

SEPT 8/WITH GOLD DOWN $6.10:NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 971.05 TONNES

SEPT 7/WITH GOLD UP $13.70: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.03 TONNES FROM THE GLD////INVENTORY RESTS AT 971.05 TONNES

SEPT 6 WITH GOLD DOWN $9.40: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 973.08 TONNES//

SEPT 2/WITH GOLD UP $7.00// SMALL CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF .29 TONNES FROM THE GLD/ //INVENTORY RESTS AT 973.08 TONNES

SEPT 1/WITH GOLD DOWN $26.70: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 973.37 TONNES

AUGUST 31.WITH GOLD DOWN $10.20:BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 7.24 TONNES FROM THE GLD////INVENTORY RESTS AT 973.37 TONNES

AUGUST 30.WITH GOLD DOWN $12.00:BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.03 TONNES FROM THE GLD////INVENTORY RESTS AT 980.61 TONNES

AUGUST 29/WITH GOLD DOWN $.50 TODAY: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.74 TONNES FORM THE GLD/////INVENTORY RESTS AT 982.64 TONNES

AUGUST 26/WITH GOLD DOWN $26.60; NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 984.38 TONNES

AUGUST 25/WITH GOLD UP $9.70 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 984.38 TONNES

AUGUST 24/WITH GOLD UP $.50 TODAY: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 3.28 TONNES FROM THE GLD//INVENTORY RESTS AT 984.38 TONNES

AUGUST 23/WITH GOLD UP $12.25 TODAY; BIG CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 1.83 TONNES INTO THE GLD///INVENTORY RESTS AT: 987.66

AUGUST 22/WITH GOLD DOWN $14.00: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 985.83 TONNES

AUGUST 19/WITH GOLD DOWN $8.00 : NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 985.83 TONNES

GLD INVENTORY: 940.549 TONNES

Now the SLV Inventory/( vehicle is a fraud as there is no physical metal behind them

SEPT 28/WITH SILVER UP $.52 TODAY: BIG CHANGES IN SILVER INVENTORY AT THE SLV A WITHDRAWAL OF 645,000 OZ FROM THE SLV.//INVENTORY RESTS AT 480.549 MILLION OZ//

SEPT 27/WITH SILVER DOWN 7 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 481.194 MILLION OZ

SEPT 26/WITH SILVER DOWN 43 CENTS : BIG CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 737.000 OZ FROM THE SLV////INVENTORY RESTS AT 481.194 MILLION OZ//

SEPT 23/WITH SILVER DOWN 68 CENTS: BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF .507 MILLION OZ INTO THE SLV////INVENTORY RESTS AT 481.931 MILLION

SEPT 22/WITH SILVER UP 10 CENTS TODAY; SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF .691 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 481.424 MILLION OZ/

SEPT 21/WITH SILVER UP 33 CENTS TODAY; BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 2.902 MILLION OZ INTO THE SLV////INVENTORY RESTS AT 482.115 MILLION OZ//

SEPT 20/WITH SILVER DOWN 18 CENTS/HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.475 MILLION OZ//INVENTORY RESTS AT 479.213 MILLION OZ//

SEPT 19/WITH SILVER DOWN 2 CENTS TODAY: GIGANTIC CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 8.108 MILLION OZ INTO THE SLV/INVENTORY RESTS AT 477.738 MILLION OZ

SEPT 16/WITH SILVER UP 8 CENTS TODAY:BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 2.58 MILLION OZ INTO THE SLV////INVENTORY RESTS AT 469.63 MILLION OZ//

SEPT 15/WITH SILVER DOWN $.25 TODAY; BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.151 MILLION OZ INTO THE SLV/////INVENTORY RESTS AT 467.050 MILLION OZ//

SEPT 14/WITH SILVER UP $0.06 TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 465.899 MILLION OZ/

SEPT 13/WITH SILVER DOWN $.31 TODAY:BIG CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 2.672 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 465.899 MILLION OZ//

SEPT 12/WITH SILVER UP 1.04 TODAY; SMALL CHANGES IN SILVER INVENTORY AT THE SLV: TWO DEPOSIT OF 553,000 OZ AND 464,000 OZ INTO THE SLV////INVENTORY REST AT 468.571 MILLION OZ///

SEPT 9/WITH SILVER UP 31 CENTS TODAY: SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 138,000 OZ INTO THE SLV////INVENTORY RESTS AT 467.557 MILLION OZ/

SEPT 8/WITH SILVER UP 16 CENTS TODAY:NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 467.419 MILLION OZ//

SEPT 7/WITH SILVER UP 34 CENTS : BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 830,000 OZINTO THE SLV////INVENTORY RESTS AT 467.419 MILLION OZ//

SEPT 6/WITH SILVER UP ONE CENT: SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 533,000 OZ FROM THE SLV//INVENTORY RESTS AT 466.589 MILLION OZ//

SEPT 2/WITH SILVER UP 13 CENTS TODAY: BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.567 MILLION OZ INTO THE SLV//INVENTORY RESTS AT 467.140 MILLION OZ//

SEPT 1/WITH SILVER DOWN 58 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 465.573 MILLION OZ//

AUGUST 31/WITH SILVER DOWN 36 CENTS TODAY: BIG CHANGES:A WITHDRAWAL OF 3.087 MILLION OZ FROM THE SLV. //INVENTORY RETS AT 465.573 MILLION OZ//

AUGUST 30/WITH SILVER DOWN 34 CENTS TODAY: BIG CHANGES:A WITHDRAWAL OF 1.478 MILLION OZ FROM THE SLV. //INVENTORY RETS AT 470.135 MILLION OZ//

AUGUST 29/WITH SILVER DOWN 7 CENTS TODAY: BIG CHANGES IN SILVER INVENTORY A THE SLV: A WITHDRAWAL OF 2.765 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 470.135 MILLION OZ//

AUGUST 26/WITH SILVER DOWN 39 CENTS : NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 472.900 MILLION OZ//

AUGUST 25/WITH SILVER UP 21 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 2.160 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 472.900 MILLION OZ//

AUGUST 24/WITH SILVER DOWN 12 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 4.424 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 475.066 MILLION OZ/

AUGUST 23/WITH SILVER UP 16 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 4.194 MILLION OZ FROM THE SLV//INVENTORY RESTS AT 479.490 MILLION OZ//

AUGUST 22/WITH SILVER DOWN 17 CENTS TODAY; NO CHANGES IN SILVER INVENTORY AT THE SLV/ INVENTORY RESTS AT 483.684 MILLION OZ

AUGUST 19/WITH SILVER DOWN 38 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 1.798 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 483.684 MILLION OZ.

CLOSING INVENTORY 480.549 MILLION OZ//

PHYSICAL GOLD/SILVER STORIES

1.PETER SCHIFF

Calling The Fed’s Bluff: They Are Holding A Losing Hand

WEDNESDAY, SEP 28, 2022 – 09:45 AM

Via SchiffGold.com,

The Fed has talked a big game lately. Many people (including me) assumed the Fed would fold a long time ago. There is a very good reason — the Fed will crush the economy and the US Treasury with higher interest rates.

In reality, the Fed is holding a losing hand and trying to bluff its way to victory.

The following analysis is by SchiffGold’s data analyst.

So far, the Fed has defied the skeptics, stuck to its guns, and pressed forward. Despite the hawkish stance, we can actually still be sure the Fed is bluffing.

Everyone knows that at some point the higher interest rates will prove catastrophic. Putting a precise timeline on it is difficult, but also not impossible. Someone can actually run the numbers and see when the Fed will be forced to show their cards. So that’s what I did.

How?

I started with data published by the Treasury that shows their entire debt schedule each month down to the Cusip level. It shows the maturity dates and the interest rates. First, I ran a mini-Monte-Carlo using different fixed rates to see the general impact. Next, I combined the Treasury data with the Fed’s own forecast. As debt rolls over, I replaced maturing debt with new debt at the Fed’s forecasted rate.

I made a few assumptions for simplicity:

The calculation was only run on Marketable debt, specifically Bills, Notes, and Bonds
I added $100B a month in new debt plus the additional interest expense
I applied the same rate to all maturity levels (the yield curve is currently inverted but also pretty flat relative to history)
When debt rolls off, I replace it with the same maturity schedule (e.g., 2-year notes roll back into 2-year notes)

Let’s start with the mini Monte Carlo using different interest rates.

Figure: 1 Comparing Different Rates

Bam! Even the most conservative case (3.5%) shows that the debt gets unruly in a hurry. Under this scenario, the treasury is paying $600B a year in interest by January 2024. That is more than double the interest expense as recently as February 2022. Yes, double! And this is the scenario if the Fed were to freeze raising rates right now!

But, noooooo. The Fed needs to show they are serious. Powell is the new Volker and he has to prove it or the Fed could lose all credibility. So, last week they doubled down on their bluff. By the end of the year, they now anticipate rates at 4.4% rising to possibly 5% next year.

OK fine, let’s actually create this exact scenario. 4% in November, 4.4% in December, 5% in March 2023 for a full year, and then slowly lower rates in mid-2024 back to 3% by 2025. This is the Fed forecast.

Figure: 2 The Current Fed Scenario

Take a minute to digest the chart above. Note how the next few months look relative to the last 20 years. This is not just a little extra strain on the economy. By Jan 2024 the Treasury will be hemorrhaging $740B in interest! That is almost $500B more than the Treasury was paying in 2021. Half a trillion dollars a year more in interest… in 15 months!! Remember when people freaked out about sending Ukraine $40B? This is 12x higher!

These are not made-up numbers or a worst-case scenario. This is using actual Treasury data against the Fed’s actual base case scenario. This is what’s going to happen if the Fed sticks to its current plan. Remember in 2018 when the Fed had to fold cause the market threw a fit? It’s marked on the plot above in case you forgot. Well, we just blew past that level in June.

The Fed is moving much faster this time, but the data is still on a lag. It’s going to take time for the Fed to notice when they have actually broken something. I’ll let you in on a secret though, they have already broken something… they just don’t know it yet (or maybe they do – just look at the currency markets). They moved slower in 2018, they had time to watch the data and see when the market started to convulse. It then took time for the interest level to peak and come back down after the pivot.

By the time they realize what they have done this time, it will probably be too late. Under this baseline scenario, debt will increase by a whopping $5T by the end of 2025. That is less than 40 months away.

Figure: 3 The Debt Forecast

But wait. At every meeting, the Fed has gotten more hawkish. What if they dial things up again? They just went “all-in” at the September meeting. What if their next move is to pull out their car keys and drop them into the pot?

Let’s run this as an alternate scenario. Let’s assume that inflation is still high in 12 months and 5% rates are not enough. Instead of lowering rates back to 3%, they have to raise them up to 6% over the following year.

This is not a low-probability scenario. This is a very real risk. In this scenario, the Treasury is paying $1.17T per year just on interest by 2025. Yes, that is about $900B a year more than they were paying in 2021, or more than 4X higher!

This is a runaway freight train that will decimate the Federal budget, not to mention the entire economy. But don’t worry, the Fed is committed and “will do whatever it takes to get inflation back to 2%”. Yeah, okay – I will take one more look at the chart below and call that bluff ALL DAY LONG.

Figure: 4 The Interest Forecast – Alternate Scenario

I know what you’re thinking “Wow, that is one ugly chart!”

Oh, but wait, it gets worse.

Remember that this calculation is done on just Bills, Bonds, and Notes. This calculation had been a good proxy for total interest owed on the debt which also includes things like I-Bonds, Tips, Non-marketable debt, etc. This can be seen in the next chart below where the black line tracked nicely with the bar chart. The black line is pulled direct from the Treasury Monthly Statement. That is the actual interest paid as reported by the Treasury.

As you can see, the black line has pulled away from the calculated interest starting with Covid. The Treasury is paying a lot more interest across many different instruments. Unfortunately, the data provided via the treasury API is not good enough to run this calculation on the other instruments.

My point is that the above scenarios are underestimates. They only consider one portion of the debt, albeit the biggest portion, but actual interest is rising even faster!

Figure: 5 Net Interest Expense

So, what’s my point?

When you are deep in a hole and your cards are terrible, you have two choices. You can fold or bluff. If you bluff, you must do it effectively enough that you scare everyone out of the hand.

Unfortunately for the Fed, they played their hand wrong. This isn’t pre-Flop anymore. Pre-flop the Fed had horrendous cards but called. They went with “average inflation targeting”. Once that blew up in their face with a brutal flop, they checked again. This time with “inflation is transitory”. Whoops.

Then the Turn came and they realized they can’t just keep calling, they actually need to get everyone else out of the hand. So, they bluffed. They bluffed big! Unfortunately, it’s too late. Everyone is pot committed and The River is coming quickly! Just look at the charts above. Look at the red bars… this is not happening in 2-3 years. This is happening right now!

Not only is the debt spiral currently underway, but the economy now faces a slew of risks:

What if falling liquidity in the bond market creates a spike in rates?
What if the recession causes tax revenues to fall and borrowing to increase?
What if the recession gets worse?
What if China invades Taiwan?
What if a corporate bankruptcy sets off a domino effect?
What if the housing market falls due to spiking mortgage rates?
What if the completely lopsided long-dollar trade unravels?
What if the long-dollar trade continues and foreign currencies start to collapse?
What if inflation doesn’t come down?
What if the financial markets freeze because there is a credit event somewhere?
What if the market cannot absorb all the new debt issuance and rates go up even more?
What if Congress responds to any of these possibilities with more spending?
What if new debt exceeds $1.2T a year?

None of these hypotheticals are far-fetched. I would argue each has a ~50% probability. That means the odds of none of these things happening is 0.02%. Said differently, there is a 99.98% chance that something besides the debt spiral also blows up. So, when one of these events does happen, the alternate scenario in Figure 4 becomes the best-case scenario. Remember that one? Where the Treasury is spending over $1T a year on interest? That’s called Game Over.

There is absolutely no way the Fed will sit by and continue raising rates, but somehow the Fed has the market convinced they are in control and will not pivot too early. The Fed has bluffed as hard as they possibly can. They have thrown the entire currency market into chaos. Even if they don’t care about foreign currencies or the economy, they cannot escape the laws of math. They have less than 6 months, 12 months tops. Either they pivot or the Treasury enters a debt spiral and the economy follows suit.

I get that Europe is a mess and China’s real estate market is falling apart. The Pound and Yen are both crashing. But just because all the boats around you are sinking faster than yours doesn’t mean you are safe. Get on board a real safe haven like gold or silver.

The physical gold and silver market can see what’s coming. That’s why deliveries are spiking and metal is flooding out of the vaults. The paper market looks depressed, but the physical market is a few steps ahead.

They don’t ring bells at the top or bottom, but right now the math is ringing the bell pretty darn loud. Are you paying attention?

US Debt interactive charts and graphs can always be found on the Exploring Finance dashboard: https://exploringfinance.shinyapps.io/USDebt/

END

2. Lawrie Williams//Pam and Russ Martens/Jim Rickards/Mathew Piepenburg/Von Greyerz

Rickards: How Far Could Stocks Fall?

WEDNESDAY, SEP 28, 2022 – 09:06 AM

Authored by James Rickards via DailyReckoning.com,

The stock market was down again yesterday, the exchanges beginning where they left off last week. But it’s the larger trend that’s really disconcerting.

Investors don’t need to be told about the stock market collapse in recent months. The Dow Jones Industrial Average is down over 20% since January. The S&P 500 is down 23% since January. And the Nasdaq Composite is down 32% since its all-time high last November.

Those falls are not as bad as the crashes in March 2020 during the pandemic or late 2008 during the global financial crisis, but those comparisons offer little comfort since they were among the worst in history.

The real problem for stock investors today is not that the crash is bad so far, but that it might just be getting started.

We may be looking at losses that more closely resemble the over-80% collapse of the Dow Jones from 1929–1932 or the 80% collapse of the Nasdaq in 2000–2001 in the wake of the dot-com bubble.

Different Causes, Same Outcome

The culprit this time will not be reckless mortgage lending, Chinese viruses or sock puppet spokespersons. The danger is the much higher interest rates needed to squash global inflation.

Rates have been going up since last spring, but inflation continues at very high levels. The question for analysts and investors is how high will rates have to go before inflation falls to levels deemed acceptable by central bankers.

Most observers have connected the interest rate hikes with the fight against inflation, but relatively few have realized the full implications. The real key to fighting inflation is to do so by increasing unemployment.

Fed Chair Jay Powell had a lot to say at a press conference following last Wednesday’s decision to raise interest rates another 75 basis points (the Fed’s third consecutive 75-basis-point increase).

Job One

Powell began by emphasizing that stopping inflation was Job One. He said, “Without price stability the economy does not work for anyone.” He noted that “Growth in consumer spending has slowed.”

His key phrase was “The labor market has remained extremely tight… Job openings are incredibly high… They need… to come down.” That’s Powell’s way of saying higher unemployment is the key to lower inflation.

Powell also said, “We think that we’ll need to bring our funds rate to a restrictive level and to keep it there for some time.” Restrictive level means a level that will cause inflation to drop toward the desired target over time.

When asked when restrictive policy levels will be reached, Powell said “There’s a ways to go.” To emphasize the point, Powell also said, “We’re committed to getting to a restrictive level… and getting there pretty quickly.”

The Endgame

What is the Fed’s target exactly?

Powell said the target was “to bring inflation down to 2%,” the Fed’s desired rate. When asked about the 2% inflation target, Powell said “We can’t fail to do that.” He went on to say, “We have got to get inflation behind us. I wish there were a painless way to do that but there isn’t.”

You get the point.

Rates will have to go to 4.75% (from the current level of 3.0%) in the hope that inflation (as measured by core PCE year over year, the Fed’s favorite gauge) drops from 4.6% to 3.5%.

At that point, real rates will be over 1.0% and the Fed will wait as long as a year for inflation to drop from 3.5% to the Fed’s target of 2.0%.

The real takeaway here is that Powell is dead serious about hitting a 2% inflation target. It seems he’ll raise rates as long as it takes to get there. He’s in a hurry to do so. And he was completely candid about the fact that there would be economic pain in the process.

Unfortunately, the cost will be a severe recession and a rise of unemployment to 5% or higher with millions of job losses, massive business failures, billions of dollars in bad debts and a continued crash in stock prices.

Will Powell Back Down?

This suggests some critically important questions for markets. Will Powell actually have the stomach to force rates up to 4.75%, about where they need to go to slow inflation?

Based on his remarks, the answer is yes. But we’ll have to wait and see.

The Fed was raising rates and reducing its balance sheet when on Dec. 24, 2018, the stock market tanked and proceeded to fall 20% in 2½ months. Powell panicked and pivoted again to monetary easing. Maybe he’ll do it again.

But there’s an important difference between then and now. There was no inflation to speak of in 2018. The Fed could therefore afford to pivot to easing without any real concern about inflation.

That’s obviously not the case in late 2022. Inflation is the Fed’s biggest concern right now, and Powell is making it clear that he’s serious about getting control of it, even if it results in a lot of economic and financial pain.

All Pain, No Gain

The problem, which I’ve addressed many times, is that the Fed has misdiagnosed the nature of today’s inflation.

The Fed is trying to crush inflation by reducing demand in the economy. They’re focusing on “demand pull” inflation where consumers are buying in anticipation of even higher inflation to come.

But the inflation we’re seeing is called “cost push” inflation. This comes from the supply side, not the demand side. It comes from global supply chain disruptions and the war in Ukraine.

Since the Fed has misdiagnosed the disease, they are applying the wrong medicine. Tight money won’t solve a supply shock. Higher prices will continue. But tight money will hurt consumers, increase savings and raise mortgage interest rates, which hurts housing among other things.

So the question is how much damage will Powell’s quest do to the economy and markets? That’s the biggest issue for investors. The answer is that Powell will do far more damage than he expects.

History shows that the Fed will overshoot. There won’t be any “soft landing.”

That damage may help Powell get to his inflation target. But it will increase unemployment and destroy stock markets along the way.

That’s if all goes according to plan. The actual scenario could be worse. Market investors are not ready for this.

But you should be.

END

3.Chris Powell of GATA provides to us very important physical commentaries

GLOBAL FINANCIAL STORM OF EPIC PROPORTIONS

Egon von Greyerz
September 28, 2022

As the dark years are approaching, the world is now approaching survival mode. Admittedly, if you go to a high class restaurant in New York, London or Zurich, there are no signs of misery but instead of incredible affluence.

What is happening to middle America or England has not yet reached Wall Street or the City of London where exquisite food is plenty and excellent wines are flowing.

This is of course no different to the end of eras with major excesses and decadence. It was the same at the peak of the Roman Empire 2000 years ago or in 1929 just before the Dow crashed 90%.

Main Street is already in survival mode with cost of living increases of a magnitude that ordinary people can’t afford. Energy, fuel, food, mortgage rates, rents and most things have gone up by 10-20% or more in the last year.

MORE ABOUT EXTREME RISK AND GLOBAL WARNING AT THE END OF THIS ARTICLE

Everything has happened so quickly that people are in shock. But it is a fact that real MISERYhas now hit ordinary people.

As Charles Dickens wrote in David Copperfield:

Annual income twenty pounds,
annual expenditure nineteen six,
result happiness. Annual income
twenty pounds, annual
expenditure twenty pound
ought and six, result misery.

For Main Street it is no longer a question of making ends meet but of economic survival.

The Fed and other so called “independent” central banks are doing all they can to exacerbate the crisis. The Fed’s official two tasks are stable inflation and full employment.

Stable inflation the Fed has in latter years defined as 2%. How did they arrive at that? They probably don’t know themselves since there is nothing good about 2%. Because an annual inflation rate of 2% means that prices double every 36 years which is highly undesirable.

Anyway, even with pumping up M1 Money supply by $19 trillion between 2006 and December 2021 and keeping interest rates at 0% they still don’t have a clue why inflation is going up.

Many of us were laughing at Powell and Lagarde when they called the increase in inflation transitory!

Whilst clueless central bank heads are transitory, current inflation certainly isn’t.

HYPERINFLATIONARY ROCKET

It is absolutely incredible that the heads of the Fed and ECB, the world’s biggest central banks, didn’t have the basic knowledge to fathom that unlimited free money for over 10 years is like a matchstick to light the biggest inflationary rocket in history.

Yes, it seemed to take a long time before the inflation rocket was set alight. The explanation is self-evident. There were different compartments in the rocket. Before the consumer prices were set alight, the inflation flame reached all the financial assets such as stocks, bonds and property.

Between 2009 and January 2021, the Nasdaq for example went up 16X, the S&P 7X and house prices went up 2X.

But conveniently for the Fed, this Hyperinflation in asset prices doesn’t count as inflation.

So the Fed could continue to fulfil its main purpose which is to make the rich richer. As the Fed was conceived by private bankers in Jekyll Island in 1910 for the main purpose of enriching the bankers and their friends, it is clear that this Elite group must be looked after first.

ZERO INFLATION AND ZERO INTEREST RATES

In the autumn of 2021, as the inflation flame reached consumers, the Fed, ECB and other central banks were stuck in their zero inflation and zero interest rates lethargy.

But as 2022 progressed, central banks around the world woke up to the fact that inflation is here to stay. Since the wealthy probably have diversified into real assets by this stage, it was then time for the bankers to start tightening without hurting their wealthy friends.

Globally the Fed and their fellow banks, are without exception always behind the curve. So they flooded markets worldwide with worthless printed money at zero cost for much too long.

And now they are waking up to the fact that the accelerated money printing (debt creation) since 2019 is not just inflationary but hyperinflationary. So the inflation rocket is now fully ignited and has just started its journey.

Powell, Lagarde and at least 32 other central bankers in the world have gone from lethargy to panic mode and are thus coordinating a series of rate increases globally.

MONEY PRINTING TO INFINITY

Since ordinary people in the world are now suffering substantially due to massive inflation of everyday expenses, they no longer can make ends meet.

The next move we will see in many countries is the resumption of money printing or QE. In the UK, the new Chancellor Kwarteng (finance minister), decided to give major support to businesses and individuals with lower taxes and social charges, energy subsidies etc. The total cost will be in the hundreds of billions of pounds over coming years. The already weak pound fell another 5% and rates surged. The pound is now down 24% since May 2021.

So the consequences of this give-away UK budget will be higher inflation and higher cost of living for people. This is a vicious cycle that will be followed by most nations as they enter the race to perdition.

THIS TIME IS DIFFERENT!

Stock market investors have for decades been so uber-confident of their banker friends saving them from any major losses that any fall in the market is a buying opportunity.

Thus we have a whole generation of investors that have never seen a sustained bear market as they have always been saved by central banks.

But this time is different! Take my word for it. Central banks are now on a course to deflate all asset markets. As usual they will go on for longer than anyone expects.

And eventually it becomes a vicious cycle with higher rates, higher inflation, still higher rates and more inflation until both central banks and markets panic as the world enters a depressionary hyperinflation.

It might be difficult to fathom that we can have a depression and hyperinflation simultaneously. But as asset prices collapse (remember they are not measured in the inflation numbers), prices of consumer products will surge.

And that is exactly what we are seeing the beginning of now.

Stocks are down around 25% so far, bonds are down, property markets under pressure and food, energy, fuel, mortgage rates are doubling or trebling for many borrowers.

IT AIN’T OVER UNTIL THE FAT LADY SINGS

This is the perfect storm. But remember it has only just started and as I have stated in numerous articles and interviews, this won’t be over until the fat lady sings.

When will she sing? Well, if this is the end of a very major cycle as I believe it could be, it might be a decade or longer before she sings.

We must of course remember that nothing goes straight down and there will be violent corrections that initially will make investors euphoric. But most reactions will be short lived so buying the dips could be very dangerous.

We should first see hyperinflation taking hold properly and stock and property markets go down by at least 75% and possibly 95%. Bonds won’t stop going down until rates are 20%+. Many bonds will go to ZERO as borrowers default, including many sovereign states.

The US or EU won’t call it a default. They will just create a new currency like a CBDC (Central Bank Digital Currency) and with a magic wand make all the debt they have created disappear.

But you can’t make debt disappear without consequences. If debt is written off or swept under the carpet, the value of the assets that the debt supported will also implode. And that is how the world goes from a depressionary hyperinflation to a deflationary depression. At that point, much of the financial system will default.

The above scenario is the inevitable consequence of a world that has lived above its means for a century and especially since 1971. Few people realise for example that the US has increased its debt for 90 years with just a handful of years exception.

GLOBAL DEBT $2.5 QUADRILLION

With global debt, contingent liabilities and derivatives of around $2.5 quadrillion, there are a lot of assets/liabilities which need to implode before the world can show healthy and debt free growth again.

EPIC MONEY PRINTING BONANZA

Before the deflationary implosion, the world will experience the most epic money printing and debt creating bonanza in history. That will mark the last desperate attempt by central banks and governments to solve a debt problem with more worthless debt.

This bonanza will be a grand finale of the fireworks which will mark the end of another era of financial and economic failure.

Boom and busts are of course a feature of economic cycles and have always happened in history. What the world is experiencing for the first time is a global event with every country and every central bank involved. So the magnitude is so much greater this time and that by a massive margin.

Like with all forecasts, we are here talking about probabilities. As we all know, there are few certainties in life. But we do know that risk is higher than at any time in history. Never before has the world experienced epic bubbles of this magnitude on a global level.

As a friend of mine states, it might happen but not in my lifetime. This attitude is part of sound human optimism that “it won’t happen on my watch”. But now is not a time to be overconfident but to be humble and prepared.

Anyway, we are talking about risk and not certainties. And when risk is high we must be prepared and protect ourselves. Remember that no one will sell you fire insurance after the fire has started.

What we do know for certain is that future historians will tell the world what really happened and when. I would love to come back down to earth for a short while to experience future experts and historians say that this was the most obvious collapse in global history. And still virtually no one sees it today.

Well, as I often say: “Hindsight is the most exact of all sciences!”

WHEN RISK IS EXTREME EXTRAORDINARY CAUTION REQUIRED

Stocks

In my articles since mid August, I have warned about Epic Collapses of Stocks, Debts, Currencies etc and 30% Stock Crash.

Well the crash is here and now. The S&P is down 15% since mid August and another fall of the same magnitude is quite probable in the next couple of weeks. But even if that fall takes place and we see a temporary pause and correction, the secular bear market has only started.

Currencies

Since 1971, the dollar and all other currencies have lost 97-99%. This is measured in real terms against the only currency which has survived in history – GOLD.

So currencies are in a race to the bottom and there is no prize for coming first in this race. All currencies can obviously not fall at the same time against each other and therefore they take turns. It has been a half century race and no currency has the stamina to be in the lead all the time.

Overall the Swiss franc has been the star performer due to probably the best managed economy in the world. When I started working in Geneva in 1969 one dollar cost me 4.30 Swiss francs. Today the same dollar costs me 0.98 Swiss francs. This means that the dollar has lost 77% against the Swiss.

To talk about a strong dollar in this case is clearly ridiculous. So for the moment the dollar is showing temporary strength. But that is likely to change relatively soon as it catches up on the downside.

When the current monetary era comes to an end within possibly 5-8 years all currencies will be worth ZERO. This is no different from any monetary era in history.

Gold

Out of laziness and convention gold is measured primarily in US dollars. Even in UK, Germany or media for example, it is always the dollar price of gold quoted.

But just as UK or German house prices are not quoted in dollars nor should gold. If the pound or euro is your base currency, you should measure gold in that currency.

The absolute correct way is of course to quote gold in grammes. What is the purpose to measure REAL money – GOLD – in a fiat currency when fiat currencies always go to ZERO over time. Yes, it might feel good to measure gold in a depreciating currency but it certainly doesn’t reflect the real value of gold.

Gold measured in dollars is temporarily weak. But has very little to do with gold but with the dollar which currently is overvalued.

If you measure gold in euros, pounds, yen, Australian dollars etc, gold is very near the highs. It will soon be in US dollars too.

The Wall Street Journal just had a major article with the title “Gold loses status as haven.”

Without exception, these articles always appear at the bottom of a market.

BANKING SYSTEM – GLOBAL WARNING

Investors’ financial health is now under serious attack.

If as I believe, stocks are entering a secular bear market and won’t stop until they are down 75-95%, most investors are in severe trouble. If also bonds and property will crash, there are few safe asset classes left.

Gold and silver stocks have major upside potential. But if held within the financial system they are subject to custodial risk. Better to hold these stocks with direct registration.

With the current problems in financial markets, combined with global debt levels, including derivatives, the heavily leveraged and fractured banking system is also extremely risky.

All banks globally are now under pressure as the debt crisis deteriorates and most debtors cannot service their debts at these higher interest rates. Next step will be that banks will experience a major increase in bad debts as well as accelerating defaults.

The strong dollar will also put a massive burden on dollar loans globally and especially emerging markets.

With the problems in Europe, most European banks are now extremely fragile.

If we add to that the $2 quadrillion derivative bubble, the world is now approaching a financial storm of historical proportions.

Personally I would not keep any major amounts of liquidity within the financial system.

WEALTH PRESERVATION

The ultimate form of wealth preservation is gold and silver.

But it serves no purpose to hold your wealth preservation assets within a risky banking system. Even worse of course to hold paper gold or silver in ETFs or other fund structures.

Substantial amounts of physical precious metals are held within the major Swiss banks. The two biggest Swiss banks are heavily leveraged and are running from one major credit or derivative loss to the next in the billions of Swiss francs. And they are changing top management almost as fast as ordinary people change their shirt. Definitely not a sign of health.

Gold and silver should be held in physical form in your own name with the facility to access it personally.

Precious metals held in banks are not insured.

Insurance companies are likely to incur major losses on their assets as their primary investments of stocks and bonds crash in value. Therefore it is essential to hold metals in vaults that are safe without insurance.

Remember that there will be shortages of many products including food and other essentials so keep some reserves.

Sadly the world is now entering the Dark Years as I have discussed in many articles.

But remember that after having prepared yourself, the most important things in life are family and friends. That is a support circle which will be the most critical in coming years.

END

Gold in GBP Jumps as UK Deficit Crisis Sees BoE Tries to Suppress Gilt Yields

Adrian Ash – Wednesday, 9/28/2022 13:31

GOLD PRICES set new 2.5-year Dollar lows on Wednesday before rebounding in terms of all major currencies as the Bank of England stepped in and bought UK government debt in a surprise intervention, calling the slump in Sterling and Gilt prices a “dysfunction” while trying to suppress Gilt yields following new Chancellor Kwasi Kwarteng’s near-universally decried deficit-tax-cutting budget of last Friday.

Crude oil ticked higher and natural gas repeated yesterday’s 5% rise for European December contracts, but other commodities fell alongside global stock markets as the Dollar pushed the Euro below $0.95 to hit fresh 2-decade highs on its trade-weighted major currency index.

With the Dollar price of gold then bouncing $15 from a new 2.5-year low of $1615 before dropping back to $1625, the Euro price of gold rose back above €1700, some 13.4% higher from this time last year.

Gold for UK investors meanwhile jumped back to £1540 following the UK central bank’s sudden news, up 20.0% from this point in September 2021 but £40 below this week’s re-touch of gold’s all-time GBP high.

The UK gold price in Pounds per ounce has now touched that record £1580 level 3 times, first during the Covid Crisis of summer 2020, then during the Russian invasion of Ukraine crisis in March 2022, and then once again this Monday during the sudden UK government debt crisis.

Chart of UK gold price in Pounds per ounce. Source:
BullionVault

Having failed to raise overnight UK rates by the 0.75 points widely expected at last Thursday’s regular policy meeting, “Were the significant repricing of…long-dated UK government debt…to continue or worsen, there would be a material risk to UK financial stability,” said the Bank of England today.

“This would lead to an unwarranted tightening of financing conditions and a reduction of the flow of credit to the real economy,” it went on, promising to detail the size of its intervention “shortly”.

Prices for 30- year UK Gilts had fallen so hard overnight that the yield demanded by new buyers jumped above 5% per annum, up more than 2 whole percentage points to the highest since 2002.

Today’s BoE announcement saw that drop 75 basis points before rising back above 4.5% – itself a fresh 11- year high when reached in Monday’s Gilt crash.

This marks “a very successful and important intervention…the right thing to do,” according to former deputy governor of the Bank, now Professor Sir Charlie Bean.

Chart from Trading Economics of 30-
year UK Gilt yields

“This is……bad,” says the Financial Times‘ economics editor, in contrast.

“It is actually incredible,” adds a Conservative MP quoted by a Sky News reporter.

“The UK central bank has had to step in to protect the UK from the actions of the UK’s own government!”

Having cut tax without cutting spending in Friday’s “mini budget” to need an additional £1 by April for every £7.65 already owed to Gilt market investors, Kwarteng himself meantime held talks with leading investment-bank and other financial-firm bosses in what the BBC calls a “crisis” meeting.

With lenders unable to price new home-loans amid the chaos in UK borrowing costs, almost 1-in-4 mortgage products were withdrawn by lenders on Tuesday according to MoneyFacts, slashing the total to just half the number available at the start of December, before the Bank of England finally raised its key overnight rate from 0% to reach 2.25% last week.

UK inflation in August ran just below 10% per year.

“Given elevated inflation pressures in many countries, including the UK, we do not recommend large and untargeted fiscal packages at this juncture,” the International Monetary Fund said overnight,, feeling it necessary to release what pundits called a “scorching” statement on Friday’s deficit announcement despite having “engaged with the [UK] authorities” on the matter and warning that household inequality will widen.

“This is the IMF self-declaring as a left-wing body,” said one pro-Government UK pundit on Wednesday.

“You really think this is about tax cuts?” said another.

“What the Sterling sell-off may have reflected…is the belief that this budget has made a Labour victory more likely.”

“[But] large unfunded tax cuts will lead to structurally higher deficits amid rising borrowing costs, a weaker growth outlook and acute public spending pressure stemming from the pandemic and a decade of austerity,” says ratings agency Moody’s, cutting its 2023 GDP growth forecast for the UK from 0.9% to 0.3% and warning it may downgrade the UK’s credit status.

“A sustained confidence shock arising from market concerns over the credibility of the government’s fiscal strategy…could more permanently weaken the UK’s debt affordability.”

With Wednesday’s rally in UK Gilt prices and the retreat in Gilt yields bucking another wide sell-off in European and other rich-world government bonds today, “Longer-dated sovereign notes in most developed markets are starting to look appealing,” Bloomberg says, quoting US investment giant J.P.Morgan and noting that “yields are at levels last seen in 2010.”

5.OTHER COMMODITIES: URANIUM

COMMODITIES IN GENERAL/EGGS

END

6.CRYPTOCURRENCIES

7. GOLD/ TRADING

Your early currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings WEDNESDAY morning 7:30 AM

ONSHORE YUAN: CLOSED DOWN 7.2354

OFFSHORE YUAN: 7.2411

SHANGHAI CLOSED: DOWN 48.79 PTS OR 1.58%

HANG SENG CLOSED DOWN 609.43 PTS OR 3.41%

2. Nikkei closed DOWN 397.89 PTS OR 1.50%

3. Europe stocks SO FAR: ALL RED

USA dollar INDEX DOWN TO 114.47/Euro FALLS TO 0.95707

3b Japan 10 YR bond yield: FALLS TO. +.242/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 144.67/JAPANESE YEN COLLAPSING AS WELL AS LONG TERM YIELDS RISING BREAKING THE JAPANESE CENTRAL BANK.

3c Nikkei now ABOVE 17,000

3d USA/Yen rate now well ABOVE the important 120 barrier this morning

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

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

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

3g Oil UP for WTI and UP FOR Brent this morning

3h European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund UP TO +2.268%***/Italian 10 Yr bond yield RISES to 4.82%*** /SPAIN 10 YR BOND YIELD RISES TO 3.46%…** DANGEROUS

3i Greek 10 year bond yield RISES TO 4.97//

3j Gold at $1635.65silver at: 18.28 7 am est) SILVER NEXT RESISTANCE LEVEL AT $30.00

3k USA vs Russian rouble;// Russian rouble UP 0 AND 20/100 roubles/dollar; ROUBLE AT 58.25//

3m oil into the 78 dollar handle for WTI and 86 handle for Brent/

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

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 144.47DESTROYING JAPANESE CITIZENS WITH HIGHER FOOD INFLATION

30 SNB (Swiss National Bank) still intervening again in the markets driving down the FRANC. It is not working: USA/SF this .9865– as the Swiss Franc is still rising against most currencies. Euro vs SF 0.9442well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.

USA 10 YR BOND YIELD: 3.919 DOWN 4 BASIS PTS…GETTING DANGEROUS

USA 30 YR BOND YIELD: 3.844 UP 2 BASIS PTS//(USA 30 YR INVERTED TO THE USA 10)

USA DOLLAR VS TURKISH LIRA: 18,54…GETTTING DANGEROUS

Overnight: Newsquawk and Zero hedge:

FIRST, ZEROHEDGE

Futures Rebound From 2022 Low After Bank Of England Panics, Restarts Unlimited QE

WEDNESDAY, SEP 28, 2022 – 07:53 AM

With everything biw breaking, including an explosive move in bond yields in the UK, 10Y yields rising above 4.00%, and Apple “suddenly” realizing there was not enough demand for the latest iteration of its iPhone 5, it was only a matter of time before some central bank somewhere capitulated and pivoted back to QE, and this morning that’s precisely what happened when the BOE delayed the launch of QT and restarted QE “on whatever scale is necessary” on a “temporary and targeted” (lol) basis to restore order, which sent UK bond surging (and yields tumbling the most on record going back to 1996 erasing an earlier jump to the the highest since 1998)…

… the pound first surged before falling back as traders realized the UK now has both rate hikes and QE at the same time, the dollar sliding then spiking, the 10Y US TSY yield dipping from 4.00%, the highest level since 1998, and stock futures spiking from fresh 2022 lows, but then fizzling as traders now demand a similar end to QT/restart of QE from the Fed or else they will similarly break the market.

Needless to say, the BOE has opened up the tap on coming central bank pivots, and while the market may be slow to grasp it, risk is cheap here with a similar QE restarted by the Fed just weeks if not days away. Indeed, look no further than the tumbling odds of a November 75bps rate hike as confirmation.

As if the BOE’s pivot wasn’t enough, there was also a barrage of company specific news: in premarket trading, the world’s biggest company, Apple tumbled 3.9% after a Bloomberg report said the company was likely to ditch its iPhone production boost, citing people familiar with the matter. Shares of suppliers to Apple also fell in premarket trading after the report, with Micron Technology (MU US) down -1.9%, Qualcomm (QCOM US) -1.8%, Skyworks Solutions (SWKS US) -1.6%. Other notable premarket movers:

Biogen shares surged as much as 71% in US premarket trading, with the drugmaker on track for its biggest gain since its 1991 IPO if the move holds, as analysts lauded results of an Alzheimer’s drug study with partner Eisai.
Lockheed drops as much as 2.3% in premarket trading as it was downgraded to underweight at Wells Fargo, which is taking a more cautious view on the defense sector on a likely difficult US budget environment into 2023.
Mind Medicine slid 35% in premarket trading after an offering of shares priced at $4.25 apiece, representing a 31% discount to last close.
Watch insurers, utilities and travel stocks as Hurricane Ian comes closer to making landfall on Florida’s Gulf coast.
Keep an eye on southeastern US utilities including NextEra Energy (NEE US), Entergy (ETR US), Duke Energy (DUK US), insurers like AIG (AIG US), Chubb (CB US), as well as airline stocks
Netflix (NFLX US) was raised to overweight from neutral at Atlantic Equities, the latest in a slew of brokers to turn bullish on the outlook for the streaming giant’s new ad- supported tier, though the stock was little changed in premarket trading

In other news, Hurricane Ian became a dangerous Category 4 storm as it roars toward Florida, threatening to batter the Gulf Coast with devastating wind gusts and floods.

European stocks dropped for a fifth day as Citigroup strategists said investors are abandoning the region at levels last seen during the euro area debt crisis. Miners underperformed as the strong dollar and concerns about demand for raw materials sent commodity prices to the lowest level since January. Retail stocks slumped, with the sector underperforming declines for the broader Stoxx 600, as concerns mount about a consumer spending crunch. UK retail stocks are particularly weak amid Britain’s market meltdown and after online clothing retailer Boohoo issued a profit warning. Boohoo cut its guidance for the year, with soaring energy and food bills stopping consumers from splashing out on clothes and shoes; peers including Asos (-7.5%) and Zalando (-3.5%) sank. Here are the biggest European movers:

Roche gains as much as 6.5% in early trading, most since March 2020 after Eisai and partner Biogen said their drug significantly slowed Alzheimer’s disease. Roche partner MorphoSys rises as much as 22%. BioArctic jumps as much as 171% in Wednesday trading, its biggest intraday rise since 2018; the Swedish biopharma company is a partner of Eisai
Sanofi shares rise as much as 2.2% after saying it sees currency impact of approximately 10%-11% on 3Q sales, according to statement.
Burberry rises as much as 4.5% as analysts welcome the appointment of Daniel Lee, formerly of Bottega Veneta, to succeed Riccardo Tisci as creative director at the luxury designer.
Retail stocks slide, with the sector underperforming declines for the broader Stoxx 600, as concerns mount about a consumer spending crunch. Boohoo slumped as much as 18% after cutting its guidance for the year, with soaring energy and food bills stopping consumers from splashing out on clothes and shoes; peers fell, with Asos down as much as 9.4% and Zalando -4.3%.
Financial sectors including banks, real estate and insurance were the worst performers in Europe on Wednesday as hawkish comments from Fed officials stoked concerns over the economic outlook. HSBC fell as much as 5.3%, Barclays 6%, and insurer Aviva 7.9%
Norway unveiled a plan to tap power and fish companies for 33 billion kroner ($3 billion) a year to cover ballooning budget expenditures, sending salmon farmers’ stocks falling. Salmar down as much as 30%, Leroy Seafood dropped as much as 26%, and Mowi slid as much as 21%
Truecaller, which offers an app to block unwanted phone calls, falls as much as 23% in Stockholm after short seller Viceroy Research says it’s betting against the stock.

Adding to concerns, Deutsche Bank CEO Christian Sewing predicted a severe downturn in the lender’s home region and said the volatility whipsawing markets will continue for another year as central banks tighten rates to fight inflation, while ECB President Christine Lagarde said borrowing costs will be raised at the next “several meetings,” with several Governing Council members favoring a 75 basis point hike in October.

Meanwhile, natural gas prices in Europe surged after Russia said it may cut off supplies via Ukraine and the German Navy was deployed to investigate the suspected sabotage to the Nord Stream pipelines. Putin moved to annex a large chunk of Ukrainian territory amid a string of military setbacks in its seven-month-old invasion.

Asian shares also fell: Japanese equities slumped after the latest hawkish comments from Fed officials on raising interest rates in order to bring inflation down. The Topix fell 1% to close at 1,855.15, while the Nikkei declined 1.5% to 26,173.98. Toyota Motor Corp. contributed the most to the Topix decline, decreasing 1.6%. Out of 2,169 stocks in the index, 943 rose and 1,137 fell, while 89 were unchanged. “From here on, U.S. CPI inflation will be the most important factor,” said Kiyoshi Ishigane, chief fund manager at Mitsubishi UFJ Kokusai Asset Management. “Now that the FOMC meeting is over, we will be getting a good amount of statements from Fed officials, and wondering what kind of statements will come out.”

Key equity gauges in India posted their longest stretch of declines in more than three months, as investors continued to sell stocks across global markets on worries over economic growth. The S&P BSE Sensex dropped 0.9% to 56,598.28 in Mumbai, while the NSE Nifty 50 Index fell by an equal measure. The indexes posted their sixth-consecutive decline, the worst losing streak since mid-June. Fourteen of the 19 sector sub-indexes compiled by BSE Ltd. declined. Metals and banking stocks were the worst performers. Healthcare and software firms gained. Reliance Industries and HDFC Bank contributed the most to the Sensex’s decline. Reliance Industries has erased its gain for the year and is headed for its lowest close since March. Out of 30 shares in the Sensex index, 12 rose, while 18 fell

In FX, the dollar’s rally brought losses to other currencies, including the euro and onshore yuan, which tumbled to its weakest level since 2008. A regulatory body guided by the People’s Bank of China urged banks to protect the authority of the yuan fixing after the onshore yuan fell to the weakest level against the dollar since the global financial crisis in 2008, amid an incessant advance in the greenback and speculation China is toning down its support for the local currency. The yen remained near the key 145 mark versus the dollar and within sight of levels that have drawn intervention from Japan. Speculation the sliding yen will compel Japan to intervene further, potentially funded by Treasuries sales, weighed on US debt.

“The fact we have such a strong increase in US yields is attracting flows into the US dollar,” said Nanette Hechler-Fayd’herbe, chief investment officer of international wealth management for Credit Suisse Group AG. “As long as monetary and fiscal policy worldwide are really not coming to strengthen their own currencies, we should be anticipating a very strong dollar.”

In rates, Treasury yields fell, following a more aggressive bull flattening move across the gilt curve, after Bank of England announced it would step into the market and buy long-dated government bonds, financed with new reserves. The Treasury curve remains steeper on the day however, with front-end yields richer by 7bp and long-end slightly cheaper. US session focus on 7-year note auction and a barrage of Fed speakers scheduled. Treasury 10-year yields around 3.93%, richer by 1.5bp on the day and underperforming gilts by around 25bp in the sector — gilts curve richer by 3bp to 50bp on the day from front-end out to long-end following Bank of England announcement. US auctions conclude with $36b 7-year note sale at 1pm, follows soft 2- and 5-year auctions so far this week

In commodities, WTI trades within Tuesday’s range, falling 0.5% to around $78.14. Spot gold falls roughly $11 to trade near $1,618/oz.

Looking to the day ahead, there are an array of central bank speakers including Fed Chair Powell, the Fed’s Bostic, Bullard, Bowman, Barkin and Evans, ECB President Lagarde, the ECB’s Kazimir, Holzmann and Elderson, as well as BoE Deputy Governor Cunliffe and the BoE’s Dhingra. In the meantime, data releases include pending home sales for August.

Market Snapshot

S&P 500 futures down 0.6% to 3,637
MXAP down 1.9% to 139.41
MXAPJ down 2.3% to 452.49
Nikkei down 1.5% to 26,173.98
Topix down 1.0% to 1,855.15
Hang Seng Index down 3.4% to 17,250.88
Shanghai Composite down 1.6% to 3,045.07
Sensex down 0.3% to 56,939.09
Australia S&P/ASX 200 down 0.5% to 6,462.03
Kospi down 2.5% to 2,169.29
STOXX Europe 600 down 1.4% to 382.97
German 10Y yield little changed at 2.31%
Euro down 0.3% to $0.9561
Brent Futures down 0.4% to $85.94/bbl
Brent Futures down 0.4% to $85.94/bbl
Gold spot down 0.6% to $1,619.74
U.S. Dollar Index up 0.36% to 114.52

Top Overnight News from Bloomberg

ECB President Christine Lagarde said borrowing costs will be raised at the next “several meetings” to ensure inflation expectations remain anchored and price gains return to the 2% target over the medium term
The ECB is on track to take interest rates to a level that no longer stimulates the economy by December, Governing Council member Olli Rehn told Reuters
Germany’s federal government will increase debt sales by €22.5 billion ($21.5 billion) in the fourth quarter compared with an original plan to help fund generous spending to offset the impact of the energy crisis
The cost of protection against European corporate debt has surpassed the pandemic peak as investors fret over the effect of central bank tightening at a time of mounting recession risk
The Federal Reserve’s delicate balance between curbing demand enough to slow inflation without causing a recession is a “struggle,” said San Francisco Fed President Mary Daly
This week a gauge of one-month volatility in the majors hit its strongest level since the pandemic mayhem of March 2020, as wide price swings in the pound lifted hedging costs across the G-10 space
Moscow declared landslide victories in the hastily organized “referendums” it held in the territories currently occupied by its forces and prepared to absorb them within days. The United Nations has condemned the voting as illegal with people at times forced at gunpoint.

US Event Calendar

07:00: Sept. MBA Mortgage Applications, prior 3.8%
08:30: Aug. Retail Inventories MoM, est. 1.0%, prior 1.1%
- Wholesale Inventories MoM, est. 0.4%, prior 0.6%
08:30: Aug. Advance Goods Trade Balance, est. -$89b, prior -$89.1b, revised – $90.2b
10:00: Aug. Pending Home Sales (MoM), est. -1.5%, prior -1.0%
- Pending Home Sales YoY, est. -24.5%, prior -22.5%

Central Bank Speakers

08:35: Fed’s Bostic Takes Part in Moderated Q&A
10:10: Fed’s Bullard Makes Welcome Remarks at Community Banking…
10:15: Powell Gives Welcoming Remarks at Community Banking Conference
11:00: Fed’s Bowman Speaks at Community Banking Conference
11:30: Fed’s Barkin Speaks at Chamber of Commerce Lunch
14:00: Fed’s Evans Speaks at the London School of Economics

DB’s Jim Reid concludes the overnight wrap

I had my worst nightmare yesterday. One of my wife’s friends, who vaguely knows I work in financial markets, urgently contacted me for mortgage advise. She needed to make a decision within hours on what mortgage to take out from a selection of unpalatable options here in the UK. I’ll be honest, when I speak to you dear readers and give advice I know you’re all big and brave enough to either ignore it or consider it. However it felt very dangerous to be giving my wife’s friend my opinion. Hopefully they’ll be no fall out at the end of the period I advised on!

After the tumultuous events of recent days, market volatility has remained very high over the last 24 hours, with plenty of negative headlines to keep investors alert. In Europe, we got a fresh reminder about the energy situation after leaks in the Nord Stream 1 and 2 pipelines, whilst Gazprom warned that sanctions on Ukraine’s Naftogaz could put flows from Russia at risk. In the meantime, investors’ jitters surrounding the UK showed few signs of abating, with 30yr gilt yields surpassing 5% in trading for the first time since 2002 and a level it hasn’t consistently been above since 1998. And even though we got some better-than-expected data releases from the US, they were also seen as giving the Fed more space to keep hiking rates over months ahead, adding to fears that they still had plenty of hawkish medicine left to deliver.

We’ll start here in the UK, since it was gilts once again that were at the epicentre of the ongoing repricing in rates, with plenty of signs that investors remain very nervous about the current economic situation. Gilt yields rose to fresh highs across the curve, with the selloff accelerating late in the session to leave the 10yr yield up by +26.1bps at a post-2008 high of 4.50%. Furthermore, the 30yr yield surged +44.8bps to a post-2007 high of 4.97%, closing just beneath the 5% mark that it had exceeded at one point right before the close. This for me is a fascinating development as recently as last December we were at 0.83% and then 2.28% in early August. For many many years the demand for long end gilts were seen as one of the most price insensitive assets in the fixed income world with huge regulatory and asset/liability buying. So the fact that even this has cracked shows the deep trouble the UK market is in at the moment. The moves have been so drastic that even the IMF announced yesterday they were closely monitoring developments in Britain and were engaged with UK authorities. Their rebuke was quite scathing.

Staying in the UK, there was an even more significant repricing of real yields, with the 10yr real yield surging by another +52.9bps on the day to 0.77%, having been at -0.84% only a week earlier, so a massive turnaround. Sterling ended a run of 5 consecutive daily losses to strengthen by +0.41% against the US Dollar, taking it back up to $1.073. However it was higher before the IMF statement and is at $1.065 this morning with their rebuke reverberating around markets.

Whilst UK assets continued to struggle, we did hear from BoE Chief Economist Pill yesterday, who sits on the 9-member Monetary Policy Committee. The main headline from his remarks was the comment that “this will require a significant monetary policy response”. Investors are still pricing in over +155bps worth of hikes by the next meeting on November 3, as well as a terminal rate above 6% next year. However, investors also continued to lower the chances of an emergency inter-meeting hike, particularly after Pill said that it was better to take a “considered” and “low-frequency” approach to monetary policy.

Elsewhere in Europe, the question of energy remained top of the agenda yesterday, with a fresh surge in natural gas futures (+19.65%) that marked a reversal to the declines over the last month. That followed the news of leaks from the Nord Stream 1 and 2 pipelines, which officials across multiple countries said could be the result of sabotage. Danish PM Frederiksen said that it was” hard to imagine that these are coincidences” and the FT reported German officials who said there was concern that a “targeted attack” had caused the sudden loss of pressure. A real nightmare scenario is if the sabotage attempts extended to other pipelines. Indeed Bloomberg reported that Norway was looking to increase security around its own infrastructure. However these pipes are long so it would take a lot of effort to protect them all.

On top of the leaks, we also heard from Gazprom, who said that there was a risk that Moscow would sanction Ukraine’s Naftogaz. That would stop them from paying transit fees, which in turn would put gas flows to Europe at risk, and led to a significant jump in prices after the news came through later in the session.

Against that unfavourable backdrop, European assets continued to suffer over the last 24 hours across multiple asset classes. Sovereign bonds didn’t do quite as badly as gilts, but it was still a very poor performance by any normal day’s standards, with yields on 10yr bunds (+11.3bps) reaching a post-2010 high of 2.22%. Peripheral spreads continued to widen as well, with the gap between 10yr Italian yields over bunds closing above 250bps for the first time since April 2020. In the meantime, equities lost ground thanks to a late session reversal, leaving the STOXX 600 (-0.13%) at its lowest level since December 2020. And there was little respite for credit either, with the iTraxx Crossover widening +15.2bps to 670bps, which is a closing level we haven’t seen since March 2020.

On top of sour risk sentiment, results from Russia’s referendum in four Ukrainian territories unsurprisingly revealed lopsided votes in favour of Russian annexation, topping 85% in each of the regions. That stoked fears that Russia will move to officially annex the territories as soon as this week, thereby claiming any attack on those territories is an attack on sovereign Russia itself and enabling yet further escalation. President Putin is scheduled to address both houses of the Russian Parliament this Friday, which British intelligence reports may be used as a venue to push through an official annexation ratification.

Over in the US, there was some better news on the data side that helped to allay fears about an imminent slide into recession. First, the Conference Board’s consumer confidence reading for September rose to 108.0 (vs. 104.6 expected), which is its highest level since April. Second, new home sales in August unexpectedly rebounded to an annualised pace of 685k (vs. 500k expected), which is their highest level since March. Third, the preliminary durable goods orders for August were roughly in line with expectations at -0.2% (vs. -0.3% expected), and core capital goods orders exceeded them with +1.3% growth (vs. +0.2% expected) and a positive revision to the previous month. Finally, the Richmond Fed’s manufacturing index for September came in at 0 (vs. -10 expected), adding to that theme of stronger-than-expected releases. A word of caution, the housing data is typically noisy and subject to revision, so despite the bounce in sales, we don’t think this marks a sea-change in housing markets, which have been battered by tightening financial conditions to date.

In the end however, those data releases didn’t manage to stop the S&P 500 (-0.21%) losing ground for a 6th consecutive session, which takes the index back to its lowest closing level since November 2020. In fact for the Dow Jones (-0.43%), yesterday’s losses left it at its lowest closing level since 6 November 2020. That was the last trading session before the news on Monday 9 November from Pfizer that their late-stage vaccine trials had been successful, thus triggering a massive global surge as the way out of the pandemic became much clearer. All-in-all though, equities were a side show to fixed income yesterday.

When it came to Treasuries, there was a notable steepening in both the nominal and real yield curves yesterday, and 10yr yields ended the session up +2.1bps at 3.95%. This morning in Asia 10yr yields did trade at 4% for the first time since 2010 before dipping to around 3.98% as I type. In terms of Fed speak yesterday, we heard from Chicago Fed President Evans, who implied that the Fed might take stock of the impact of rate hikes in the spring, saying that “By spring of next year we are going to get to a funds rate that we can sort of sit and watch how things are behaving,” In the meantime, St Louis Fed President Bullard (one of the most hawkish members of the FOMC) said that inflation was a serious problem and that the credibility of the Fed’s inflation target was at risk.

This morning Asian equity markets are extending their downtrend. As I type, The Kospi (-3.01%) is sharply lower in early trade with the Hang Seng (-2.40%), the Nikkei (-2.21%), the CSI (-0.77%) and the Shanghai Composite (-0.75%) all trading in negative territory.

After a steady start, US stock futures got caught up in the bearish mood with contracts on the S&P 500 (-0.71%) and NASDAQ 100 (-0.98%) both moving lower.Apple reversing plans for an iPhone production boost on waning demand seemed to be a catalyst. The US dollar index (+0.43%) has hit a fresh two-decade high of 114.69 this morning.

Early morning data showed that Australia’s August retail sales advanced for the eighth consecutive month, rising +0.6% m/m, faster than the +0.4% increase expected although the pace of growth slowed from the +1.3% rise seen in July.

To the day ahead now, and there are an array of central bank speakers including Fed Chair Powell, the Fed’s Bostic, Bullard, Bowman, Barkin and Evans, ECB President Lagarde, the ECB’s Kazimir, Holzmann and Elderson, as well as BoE Deputy Governor Cunliffe and the BoE’s Dhingra. In the meantime, data releases include Germany’s GfK consumer confidence reading for October, and France and Italy’s consumer confidence reading for September. In the US, there’s also pending home sales data for August.

AND NOW NEWSQUAWK

BoE intervenes to restore orderly market conditions, Gilts +350 ticks at best – Newsquawk US Market Open

WEDNESDAY, SEP 28, 2022 – 07:04 AM

BoE is to undertake temporary Gilt purchases and is pushing back the commencement of QT to restore orderly conditions.
Initial debt pressure has given way to pronounced and increasing upside following the BoE’s statement, Gilts +350ticks, Cable whipsawed but ultimately settled near pre-release.
European bourses remain softer on the session, with sectors still defensive; though, this pressure has waned in wake of BoE action.
Crude benchmarks gradually recovering as geopolitical tensions continue to simmer, EU meetings occur and as we look towards next week’s OPEC+.
DXY printed a fresh YTD peak at 114.78, to the broad detriment of peers (ex-CHF & JPY initially); though, has been easing from this peak since.
Yuan buoyed by PBoC remarks against one-way bets vs the Yuan.
Looking ahead, highlights include speeches from Fed’s Daly, Bostic, Bullard, Bowman & Barkin, ECB’s Elderson, BoE’s Dhingra, Supply from the US.

As of 11:30BST/06:30ET

View the full premarket movers and news report.

Or why not try Newsquawk’s squawk box free for 7 days?

LOOKING AHEAD

Speeches from Fed’s Daly, Bostic, Bullard, Bowman & Barkin, ECB’s Elderson, BoE’s Dhingra, Supply from the US.

CENTRAL BANKS

BOE

Bank of England says market repricing has become more significant on recent days; bank will carry out temporary purchases of longer-dated UK gov’t bonds from 28th Sept to restore orderly market conditions; purchases to be time limited.
BoE will carry out temporary purchases of long-dated UK government bonds from 28 September until 14th October. The purpose of these purchases will be to restore orderly market conditions. The purchases will be carried out on whatever scale is necessary to effect this outcome.
Thereafter, the first gilt sale operations will take place on 31 October. (previously scheduled to commence on October 3rd); MPC’s annual target of an GBP 80bln stock reduction is unaffected and unchanged.
Full details and reaction available here.

OTHER

PBoC warns against one-way bets against the Chinese Yuan; top priority is to keep Forex market stable, says Yuan is basically stable on equilibrium level this year; must prevent large fluctuations in the FX rates, via Reuters. Urges banks to conduct proprietary trading on risk neutral basis.
Fed’s Daly (2024 voter) said she wants to bring inflation down but not unnecessarily tip the economy into a downturn, while she added it is important to navigate through the high inflation environment as carefully as they can and that they are resolute and committed to doing that, according to Reuters.
ECB’s Lagarde says we need to provide a strong signal that we will not allow inflation expectations to become de-anchored, will continue to hike in the next several meetings, not at the neutral rate yet, via Reuters.
ECB’s Rehn says ECB requires a “significant” rate hike in October, be it “75 or 50bps or something else”, should reach neutral by Christmas. No qualms about restrictive policy if warranted by the inflation outlook, ECB should look at changing TLTRO terms, via Reuters.
ECB’s Kazimir says, re. October, that 75bps is a “very good candidate” to keep the pace of tightening, via Reuters.
ECB’s Holzmann says need to assess QT in nations where its begun, will discuss QT in Cyprus next week; says 75bps is a good figure for October whilst 100bps is currently too much; does not see rates being lowered in 2023, via Bloomberg.
BoJ Minutes from the July meeting stated that members shared the view that market sentiment remains cautious and global slowdown fears were heightening, while a few members said price increases were broadening in Japan. BoJ also stated it is closely monitoring the impact of COVID on the economy and won’t hesitate to add easing if necessary.
Riksbank’s Jansson says it is important to address the inflation situation now while we have the opportunity, hard to determine how much we have to raise rates, SEK weakness is not welcome, via Reuters..

GEOPOLITICS

Click here for newsquawk analysis on the potential Russian oil and gas price caps.
Ukrainian President Zelensky said the referendums were not even imitations of a referendum and that they will act to defend their people in all occupied areas, while he said there will be good news from the front and that they are advancing but offered no details, according to Reuters.
Russia’s Kremlin says the special operation must, at a minimum, continue until all of Donetsk Oblast is ‘liberated’, via Reuters.
EU Ambassadors are set to be briefed at 13:30BST today by the European Commission on a new Russian sanctions package, via Politico citing officials/diplomats; Commission will also be proposing a Russian oil price cap. Shipping/insurance firms will be banned from transporting/insuring Russian oil if the price is sold above a certain price point, a point that will be the current sale price to Asia.
Denmark’s Defence Ministry, at a press briefing, has discussed increased NATO focus on the Baltic Sea area, in talks with NATO Secretary General Stoltenberg.
Canadian PM Trudeau said Canada is actively engaging with international partners and allies to ensure a united rejection of these illegitimate votes, according to Reuters.
China’s ambassador to the UN told the Security Council meeting regarding Russia’s referendums in Ukraine, that political isolation, sanctions and pressurisation will only lead to a dead end, according to Reuters.
South Korean spy agency says, if a North Korean nuclear tests takes place, will likely be between October 7th and 16th, according to Yonhap; chances of test has increased.
North Korea fired what could be a ballistic missile, according to the Japanese coast guard cited by Reuters; South Korea said North Korea fired a missile off the East Coast. North Korean missile appears to have landed outside Japan’s Exclusive Economic Zone (EEZ), according to TV Asahi.

EUROPEAN TRADE

EQUITIES

European bourses remain softer on the session, with sectors still defensive; though, this pressure has waned in wake of BoE action.
Stateside, futures have seen similar action in that they were initially pressured but are now lifting as the BoE intervenes to restore Gilt stability.
The sectoral breakdown has Healthcare outperforming, amid an update from Eisai which is lifting European peers and the likes of Biogen (+40% pre-market) significantly.
Click here for more detail.

FX

DXY has once again extended to a fresh YTD peak at 114.78, to the broad detriment of peers; though, the move ran out of steam as US yields eased a touch – further pullback seen post BoE action.
Cable experienced a substantial move on the BoE statement, lifting to 1.0840 before paring to 1.0610 and then settling around the mid-point thereafter; overall, Cable remains softer on the session.
JPY and CHF are little changed and as such are the ‘outperformers’ against the Buck, deriving some risk-related support though domestic data dented the latter.
Yuan continues to falter lifting above 7.25 before benefitting from PBoC remarks warning against one-way bets vs the Yuan.
Click here for more detail.
Click here for OpEx for the NY Cut.

FIXED INCOME

Core debt benchmarks spent the vast majority of the session underwater, with Gilts down by circa. 200ticks and Bunds pressured amid debt updates.
However, this pressure has dissipated and been replaced by pronounced and increasing upside in Gilts of over 250ticks, with EGBs/USTs buoyed as well.
In a reaction to the BoE intervening in the Gilt market to restore orderly market conditions (details above).
More broadly, USTs are cognisant of the last leg of the week’s supply (7yr) and commentary from Fed officials including Chair Powell today.
German Debt Agency says it is to raise EUR 22.5bln more debt than previously planned in Q4 amid government measures to tackle the energy crisis, Capital market borrowing to increase by EUR 10.5bln and money markets by EUR 12bln.
Click here for more detail.

COMMODITIES

Crude benchmarks have been trimming APAC pressure throughout the morning, as geopolitical tensions continue to simmer, and we look towards next week’s OPEC+
Additionally, deriving upside from the broader market move to the BoE action.
The yield-induced USD easing (DXY still firmer) has allowed spot gold to move within reach of the unchanged mark despite pronounced initially losses, LMEs seeing similar action.
US Energy Inventory Data (bbls): Crude +4.2mln (exp. +0.4mln), Cushing +0.4mln, Gasoline -1.0mln (exp. +0.7mln), Distillate +0.4mln (exp. -0.1mln)
Denmark geological survey said it registered two tremors in the Baltic Sea which matches the times and locations of gas leaks from Nord Stream 1 and 2.
BP (BP/ LN) determined Hurricane Ian no longer poses a significant threat to its Gulf of Mexico assets, while it is looking to redeploy personnel to Na Kika and Thunder Horse platforms. It was also reported that 190,358 barrels of oil and 184mln cubic feet of gas were shut in on Tuesday in the Gulf of Mexico by Hurricane Ian.
Kazakhstan’s Energy Minister expects CPC to return to full capacity by mid-October, Kashagan to return to full capacity by end-October, via Reuters; adding, will consider proposals to supply oil to Europe.
NHC says Air Force Hurricane Hunters find Ian has strengthened into an extremely dangerous Category 4 hurricane and is expected to cause life-threatening storm surge, catastrophic winds and flooding in the Florida peninsula. Ian is rapidly intensifying.
Click here for more detail.

NOTABLE EUROPEAN HEADLINES

UK Chancellor Kwarteng, in a meeting with bankers expected later today, will ask financiers not to bet against the GBP and is expected to underline his commitment on fiscal discipline, according to Sky News’ understanding. However, UK Treasury source has dismissed reporting by Sky News that Chancellor Kwarteng will ask banks not to bet against GBP, according to Reuters.
Brussels believes a deal on the Northern Ireland protocol could be struck within a month due to economic turmoil in Britain, according to Telegraph sources.
IMF said it is closely monitoring developments in the UK and is engaged with UK authorities, while it does not recommend “large and untargeted fiscal packages” given the inflation backdrop in many countries including Britain.
German Economy Ministry said a decision on whether to extend the life of nuclear power plants based on grid stress tests should be made this year, while it added that data from France suggests they will call up and use the nuclear power reserve.
Slovakian Premier said Slovakia may suspend power exports due to the EU energy plan.

DATA RECAP

UK BRC Shop Price Index YY (Sep) 5.7% (Prev. 5.1%)
German GfK Consumer Sentiment (Oct) -42.5 vs. Exp. -39.0 (Prev. -36.5, Rev. -36.8)

NOTABLE HEADLINES

US Treasury Secretary Yellen said financial markets are functioning well and that they are not seeing liquidity issues or deleveraging, while they are also not seeing disorderly financial market conditions. It was separately reported that the White House is mulling the potential departure of Yellen after the mid-terms, according to Axios.
White House Economic Adviser Deese said a stronger dollar is a reflection of the relative strength of the US economy and that they are paying a lot of attention to the weakness in the global growth trajectory, while Deese said he does not expect the need for a global accord to adjust currency values, according to Reuters.
US Senate voted 72-23 to pass the stop-gap funding bill. This was after Senator Manchin asked Senate Majority Leader Schumer to remove the energy permitting language from the Continuing Resolution, according to Reuters.
Democrats released the text of the bill banning stock trading for Congress and judges, according to WSJ.
Apple (AAPL) reportedly abandoned its plans to increase iPhone production due to lower demand, according to Bloomberg.

CRYPTO

Bitcoin is under pressure and has dipped to an incremental fresh low for the week at USD 18.46k, however, it remains above last week’s USD 18.15k trough.

APAC TRADE

APAC stocks were lower across the board following the renewed bond selling on Wall Street and with sentiment in the region also soured by news that Apple ditched its plan to boost iPhone production due to weaker demand.
ASX 200 was subdued with underperformance in Real Estate, Tech, Healthcare and Financials, although the downside in the index was initially stemmed by strength in the commodity-related sectors and after Retail Sales data topped forecasts.
Nikkei 225 was among the worst performers and dipped below 26,000 amid weakness in large retailers.
Hang Seng and Shanghai Comp were pressured as tech and property stocks led the declines in Hong Kong and with the mainland also suffering despite the latest support measures including the cabinet’s postponement of more than CNY 53bln of fees for small companies and tax relief for some individual commercial pensions.

NOTABLE APAC HEADLINES

PBoC injected CNY 133bln via 7-day reverse repos with the rate kept at 2.00% and injected CNY 67bln via 14-day reverse repos with the rate kept at 2.15% for a CNY 198bln net injection.
Shanghai will provide subsidies to consumers to support the economy with up to CNY 1,000 of subsidies to buyers of environment-friendly smart home appliances, while Shanghai will promote the delivery of residential houses and ensure steady and sound development of the property market.

NOTABLE APAC DATA

Australian Retail Sales MM Final (Aug) 0.6% vs. Exp. 0.4% (Prev. 1.3%)

end

i)WEDNESDAY MORNING// TUESDAY NIGHT

3 a./NORTH KOREA/ SOUTH KOREA/

///NORTH KOREA/SOUTH KOREA/

3B JAPAN

end

3c CHINA

CHINA/

end

4/EUROPEAN AFFAIRS//UK AFFAIRS

BANK OF ENGLAND

The Bank of England capitulates (the first major bank to do so) as they stop QT and engage in QE (Quantitative Easing) by buying bonds. The pound drops further in value to the dollar. This will not work unless all central banks engage in QE, including the USA. The reason for the intervention was the huge margin calls issued as well as the complete collapse of the UK Gilts. The chancellor had no choice but to intervene.

(zerohedge)

Bank Of England Capitulates: Restarts QE Due To “Significant Dysfunction” In Bond Market, “Material Risk” To Financial Stability

WEDNESDAY, SEP 28, 2022 – 06:59 AM

Just a few days ago we wrote that “Something Is About To Break” and prompt a capitulation from one or more central banks, which oddly was met with mockery in the comment gallery. Also, a few week ago, we said that we are nearing a moment in time when central banks will do QE and rate hikes at the same time.

Finally, for much of the past year we have said it is only a matter of time before the coming market crash and economic collapse forces central banks everywhere, not just in one or two countries, to pivot as the price of economic collapse and tens of millions unemployed is far, far greater than simply shifting the inflation target from 2% to 3%.

And then, just moment ago, we were once again proven right on all three when – with UK 30Y gilt yields having exploded in recent days above 5% in an exponential move that can only be described as the bond market breaking…

… the BOE became the first bank to capitulate on its plans to proceed with QT on Wednesday when the central bank restarted QE in a “temporary and targeted” bond buying operation – which will be as “temporary” as “temporary” inflation was – warning of a “material risk to UK financial stability” if the turmoil in the UK government bond market were to continue. It also raised the prospect of a “tightening of financing conditions and a reduction of the flow of credit to the real economy”, but what it really meant is that QT is over before it even started, and QE is back.

According to the FT, the “break” in the bond market manifested itself in thousands of pension funds have faced urgent demands for additional cash from investment managers in recent days to meet margin calls, after the collapse in UK government bond prices blew a hole in strategies to protect them against inflation and interest-rate risks.

The BoE’s action said its action was designed to restore order. “The Bank will carry out temporary purchases of long-dated UK government bonds from 28 September,” it said. “The purchases will be carried out on whatever scale is necessary to effect this outcome,” it added, saying the Treasury would underwrite any losses.

Spoiler alert: there will be nothing temporary about the return of QE, as the moment the BOE even thinks of ending the bond buying yields will explode right back to where they were. In effect, the BOE just became the first central bank to admit that it is trapped, and the only other option left is to raise inflation targets to 3%, 4% and so on.

The bank’s Financial Policy Committee welcomed the “plans for temporary and targeted purchases in the gilt market on financial stability grounds at an urgent pace”.

The BoE added the action would be “strictly time limited” and came after market participants said there was a “proper shit show” happening in government bond markets.

In response, the UK Treasury said that the Bank of England has “identified a risk from recent dysfunction in gilt markets,” so the Bank will temporarily carry out purchases of long-dated UK government bonds from Sept. 28 in order to restore orderly market conditions, according to an emailed statement.

The Treasury blamed “significant volatility” in “global financial markets” rather than the chancellor’s unfunded tax cuts last week.

“The Chancellor is committed to the Bank of England’s independence. The Government will continue to work closely with the Bank in support of its financial stability and inflation objectives” the Treasury said.

Lots of fluff, but the bottom line is clear: we have long quoted Michael Hartnett who said that “financial markets stop panicking when officials and central banks start panicking”, and this morning the Bank of England was the first bank to panic, and the panic will soon move to every other central bank across the world simply because the cost of tightening is too much.

In response to the BOE’s pivot, 30Y gilts yields dropped by the most on record and it price soared some 16% (!) as the formerly most liquid bond market now trades like a penny stock…

… and while risk assets are still debating what this means – and let us break it down for you: pivot means that central banks can’t take any more pain and will soon do QE and rate hikes at the same time everywhere, eventually ending hiking and starting to cut rates – the bottom line is that this is the beginning of the end for the fiat system which now faces a terminal dilemma: fight inflation and suffer market collapse and economic depression with millions laid off, or push to stabilize social order and employment with higher asset prices, runaway (hyper)inflation be damned.

end

The reason for the Bank of England’s move: bailout of pension funds and margin calls!

Source: Bloomberg

CRITICALLY, the BoE is stating that these unlimited purchases in long-end Gilts are “strictly time limited” and will later be unwound, which keeps the door open to these operations being “faded” by markets:
- “They are intended to tackle a specific problem in the long-dated government bond market. Auctions will take place from today until 14 October. The purchases will be unwound in a smooth and orderly fashion once risks to market functioning are judged to have subsided.”
Why were they forced into this, and at a time where they are seemingly so keen on tightening monpol? Well…we began to hit “death spiral”—e.g. UK LDI’s / defined-benefit pension plans, who are rationally being forced to liquidate assets (selling govt bond holdings, equities, credit) in order to meet ratcheted-up margin calls on their derivatives and leveraged repo positions, due to the quantum of the collapse in Gilts and Sterling
Accordingly, today’s action from the BoE is pure and simple a PENSION FUND BAILOUT from said margin-call liquidation spiral….period, end of story, full-stop
Despite the local stabilization from the above BoE actions, we are now entering the period of this “Macro Vol” impulse where similar “un-economic” selling is a next wave, “systemic” concern for markets—i.e. not just the “pension margin call spiral,” but too, hypotheticals in the form of year-end / tax-loss selling risk >>> spiraling redemptions at mutual funds adding pressure to the already deep selloff in assets
And as these types of “second-order” unwinds begin to ripple-out into the market, the spiral of forced-selling to make cash-calls is further evidence that widespread deployment of leverage across strategies from the halcyon days of QE and the Central Bank “Vol Supression” era is no more, and that systemic de-leveraging is now at an acceleration point, particularly as “risk free” assets used as collateral turn to “meme-stocks”
From a cross-asset Vol perspective, all of this is occuring at massively important and dangerous inflection, as we are seeing Rate Vol Dealer positioning having now “flipped” in recent days, with Dealers now seemingly getting SHORTER VEGA into sell-offs
The scary thing now is that within the Equities Vol space, it “feels” like we are seeing something similar brewing—where for the longest time, Dealer “long Vega” has helped keep Vol contained despite the pervasive state of Dealer “Short Gamma vs Spot” positioning felt over much of the year
But where over the past 3 days, US Equities Vols / Skew / Crash is really beginning to firm and squeeze, as the “left-tail fattens” with Macro Rates / FX calamity increasing the likelihood of both market- and economic- “accidents” (which the BoE actions of today are deliberately now having to reverse!)

end

GOOD REASON for the Bank of England to blink

26% of all UK mortgages are variable and set for imminent repricing

The Other Reason The BOE Panicked: 26% Of All UK Mortgages Are Variable Rate And Set For Imminent Repricing

WEDNESDAY, SEP 28, 2022 – 09:05 PM

Earlier today, we described the main reason why the BOE panicked – which, with billions in pensions set to suffer catastrophic losses absent an intervention, perhaps merited the latest central bank bailout. There is another reason why the central bank stepped in.

It’s not just the US where housing affordability is the worst in history: in a note from DB’s Jim Reid, the bank’s head of thematic strategist writes that the bank’s UK Homebuilding equity research team pushed out some fascinating insights into what the recent UK issues could do to housing affordability.

The note served for Reid’s latest Chart of the Day, and shows the ratio of UK mortgage payments to take home pay.The colored lines and numbers look at where this would go if you moved rates up in 50bp increments, relative to the last published version of this chart which used an average new mortgage rate of 1.9% in Q2.

For reference, Lloyds Bank were offering a 2yr fixed rate last night at 4.95%, assuming a 60-75% loan-to-value ratio, which goes up to 5.29% for 90-95% loan-to-value.

So at these levels, this would send affordability to worse levels than that seen during the GFC and within a couple of percentage points of the peak in the late 1980s/early 90s whenthe UK saw a savage house price crash. The report (available to pro subscribers ) also shows that in aggregate, we’re already around those levels for London.

Of course, not every mortgage needs to be refinanced today so these rates have time to change before most refinance. However, unlike the US where a 30-year fixed market dominates, the FCA suggested in August that 26% of the total outstanding UK mortgages are variable rate and thus dependent on where the BoE’s bank rate is.It is currently 2.25% but markets are now pricing in a terminal rate above 6% which would be a huge shock if it got close to happening over the next 6-9 months as is priced in. 74% of mortgages are fixed (mostly between 1-2%), and half of these will need to be refinanced within the next 2 years, with half at a fixed rate beyond 2 years (but rarely beyond 5 years).

So 26% of mortgage payments are at risk of imminent increases, 37% at risk over the next two years if rates don’t rapidly fall, and 37% can ride out this storm for a few more years.

As Reid concludes, while much can change very quickly in politics and markets, if markets are correct, “the UK housing market is in for a huge amount of pain ahead,” unless the BOE were to somehow monetize all the upcoming debt issuance and sent rates back to zero.

EU/GAZPROM/RUSSIA

EU chief calls the Nordstream attack a sabotage and warns of a “strongest possible response”. Question; who is responsible?

(zerohedge)

EU Chief Calls Nord Stream Attack “Sabotage”, Warns Of “Strongest Possible Response”

TUESDAY, SEP 27, 2022 – 07:10 PM

Update (1910ET):

European Commission chief Ursula von der Leyen confirmed the Nord Stream pipeline system leaks were caused by “sabotage,” and warned of the “strongest possible response” should active European energy infrastructure be attacked.

Earlier, Danish Prime Minister Mette Frederiksen described the three separate leaks on NS1 and NS2 as “deliberate acts,” adding: “It’s hard to imagine that it’s accidental.”

On Monday, Swedish seismologists reported the detection of underwater explosions – shortly after which large patches of roiling gas could be seen on the surface in the same area.

As rumors swirl over who is responsible for the incident, one message it sent was clear – vital systems are vulnerable to attack.

“The most important message that somebody wants to send, is what one is capable of doing with an offline pipeline can also be done with active pipelines, or undersea cables, or other infrastructure,” said Julian Pawlak, a researcher at the German Institute for Defense and Strategic Studies, in a statement to the NY Times.

In response, Denmark and Norway announced increased security around their energy infrastructure, and Norway, now Europe’s most important producer of gas and oil, called for “increased vigilance by all operators and vessel owners.” In a statement, Norway’s energy minister, Terje Aasland, cited “reports of increased drone activity” around its coast, and said that much of what he had learned of the Nord Stream incidents “indicates acts of sabotage.” -NY Times

And while Poland’s former Defense Minister appeared to thank the United States for the attack (a perfectly good explanation for which we’re sure is will be offered), Poland’s PM, Mateusz Morawiecki, laid the blame on Russia for targeting the pipelines – suggesting that the attack was an attempt to escalate the Ukraine conflict.

“We do not know the details of what happened yet, but we can clearly see that it is an act of sabotage,” said Morawiecki, adding “An act that probably marks the next stage in the escalation of this situation in Ukraine.”

END

ITALY

Leftist, former Italian PM, Renzi says that the narrative that Meloni will return to Fascism is absolutely fake news.

Watson/SummitNews)

Leftist Former Italian PM Says ‘Return of Fascism’ Narrative Is “Absolutely Fake News”

WEDNESDAY, SEP 28, 2022 – 04:15 AM

Authored by Paul Joseph Watson via Summit News (emphasis ours),

The notion that right-wing candidate Georgia Meloni’s victory in Italy represents a threat to Italian democracy or the return of fascism is “absolutely fake news,” according to the country’s leftist former Prime Minister Matteo Renzi.

Whoops, narrative fail.

Meloni’s center-right coalition swept to victory in Sunday’s elections, easily defeating her left-wing opposition.

This prompted a wave of hysterical media coverage, with numerous publications warning of the “return of fascism in Italy,” due to the far-right origins of Meloni’s Brothers of Italy party.

However, such concerns were dismissed by an unexpected figure, former leftist Prime Minister Matteo Renzi.

“Personally frankly speaking, I was against Georgia Meloni, so I’m not her best friend…we were and will be rivals always,” Renzi told CNN.

“At the same time, I think that is not a danger to Italian democracy, he added.

“The idea there is a risk of fascism in Italy is absolutely fake news, she won because of populism,” the former Prime Minister asserted.

Renzi was the Prime Minister of Italy from 2014-2016 after serving as the Mayor of Florence, a traditionally left wing city, before that.

Meloni herself has repeatedly asserted that she is not a fascist and merely wants to represent the interests of Italians and not those of “nihilistic globalist elites, driven by international finance.”

Of course, merely to take that position guarantees vilification by an establishment which has repeatedly tried to create a moral panic around populism by asserting it represents a return to the 1930’s.

end

The new Norway/Poland pipeline, and the huge decline in Europe activity

a must read…

This is the new Norway/ Poland pipe that has opened. Does the timing seem a little strange?
You cannot make this stuff up.

Germany will deindustrialize to the pain of itself and Europe with Britain and America being the biggest winners. The chemical industry has to depart or die. And as it is unemployment in Germany is skyrocketing as major employers shut down due to unaffordable gas prices and the sheer lack of gas. More than 1/3 of the largest glass manufacturer’s employment of 40,000 people in Germany has been sent home. Never mind the multiplier effect of such shutdowns. As when you shut such a business you can easily throw out of work another 25-35 people as everybody from couriers to truckers are idled. Shortly, the car manufacturers will curtail production for the lack of steel and aluminum. Why? Smelters have closed to a lack of energy!
Yes, the ECB will likely try a digital Euro but to what end? There is no value in a currency when there is no functioning economy. Currency value is a function of confidence backed by industrial output. Today, the only thing Europe has is declining industrial base. Thus, it is only logical that the value of the currency must decline to achieve equilibrium to output. And while countries like Hungary pay lip service to Brussels the likelihood of Italy doing the same when Meloni comes into office is sure to add fuel to a declining Euro value, regardless of what form it is in. In several months it will be clear, the Euro no longer serves as a trade settlement currency. Europe is not alone in this reality. This pressure will be on to revert to national currencies and default on the debt that the ECB holds, especially when it is recognized that Germany no longer has the industrial might to hold up the value of the currency or even mask the true state of over hanging debt that cannot be paid.
The world has arrived at a point, where we see next year 2 trade settlement systems; the one being constructed and forming led by Russia, China, India and the SCO & BRIC and the USD. All other currencies will fall subordinate to this. Yes, 2023 will be a year of chaos as this reality forms.

https://pbs.twimg.com/media/Fdrb3fNXkAM4DgO?format=jpg&name=medium

And yes, there is a travel advisory issued for Americans not to travel to Russia and if in Russia to leave as soon as possible by any all means. A sign of worse times no doubt to come. And the scuttlebutt rumor is that a travel advisory for Europe is in the works.

Meanwhile, we may hear of a Russian defeat in Lugansk shortly, as 3000 Russians partially encircled are fighting off a Ukrainian assault on two fronts numbering 8-10 times as many participating Ukrainians who are taking more casualties than in all recent assaults. And while it may well be the Russians die there, the losses for the Ukrainians are and will be devastating. The only question is how many thousands of Ukrainians will be killed before the assault is stopped as in the end the marginal territory gained is meaningless in the bigger picture of what is underway

end.

Attachments area

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

RUSSIA//UKRAINE/USA

Strange! Americans warned to flee Russia immediately or face conscription (dual citizens)

(zerohedge)

Americans Must Flee Russia Immediately, Embassy Warns, Or Face Conscription

WEDNESDAY, SEP 28, 2022 – 09:25 AM

The American Embassy in Moscow issued an unusual warning on Tuesday, urging all US citizens still in the country to flee immediately in the wake of Vladimir Putin’s partial mobilization decree from last week. The urgent message is essentially get out while you still can as the war in Ukraine ratchets up further, even increasingly accompanied by nuclear rhetoric.

The embassy’s concern is that Moscow might not recognize that dual citizens should be exempt from military service. “Russia may refuse to acknowledge dual nationals’ U.S. citizenship, deny their access to U.S. consular assistance, prevent their departure from Russia, and conscript dual nationals for military service,” the embassy statement warned.

This also as there are widespread reports of traffic jams at key land border crossings; for example at the Georgian border there is an over 10-mile long queue of cars awaiting exit, though guards on the Russian side are said to be making the process difficult.

Airline tickets to go abroad have also been harder to come by, also as prices soar, and it remains that European airspace remains closed to all Russian carriers, though European airliners can still fly direct from Russia to Europe.

“Those residing or traveling in Russia should depart Russia immediately while limited commercial travel options remain,” the embassy statement added. Additionally, as Fox reports:

The embassy warned all Americans in Russia that the State Department has a limited ability to assist, particularly as tensions between Moscow and Washington continue to escalate to levels not seen since the Cold War, and said, “conditions, including transportation options, may suddenly become even more limited.”

Since the invasion of Ukraine kicked off just over seven months ago, the State Department has urged Americans to avoid traveling to or going through Russia, given the unpredictability of the conflict.

Russia has further recently introduced elements of martial law in its criminal code, resulting in stiff penalties for any Russian who refused to fight in Ukraine.

Interestingly, US officials have even speculated that ex-NSA employee and whistleblower Edward Snowden could possibly face conscription in the Russian military – after he was days ago granted citizenship by a decree signed by President Putin.

end

RUSSIA/UKRAINE/USA

An excellent video on Lavrov’s news conference

special thanks to Kevin for providing this for us:

Foreign Minister Sergey Lavrov’s news conference following the High-Level Week of the 77th Session of the UN General Assembly, New York

Hell is about to freeze over in Ukraine and Europe and South China Seas. Hard to imagine one without the other actively and immediately in the mix “defensively”.

The action on charts in markets controlled by AI Alladin have no

way to not eat their own tail.

No time to get cute in trading.

If there are history books or records to read it will clearly show the western countries were behind starting WW111 notice he brings up star link it is a pentagon project Musk is just a tool.One hour long-

Foreign Minister Sergey Lavrov’s news conference following the High-Level Week of the 77th Session of the UN General Assembly, New York

6.GLOBAL ISSUES////COVID ISSUES/VACCINE ISSUES

VACCINE//COVID ISSUES//GLOBAL/

General: Unvaccinated National Guardsmen Activated For Hurricane Ian

TUESDAY, SEP 27, 2022 – 06:00 PM

Authored by Jack Phillips via The Epoch Times (emphasis ours),

Ahead of Hurricane Ian’s predicted landfall in western Florida, the head of the Florida National Guard confirmed Monday that Guardsmen who are not vaccinated for COVID-19 will be activated in response to the storm.

Florida National Guard Maj. Gen. James Eifert on Monday told reporters that the Pentagon’s vaccine mandate does not impact the state’s capacity to activate unvaccinated service members to deal with a natural disaster such as a hurricane.

“The vaccine mandate does not impact our ability to bring people in on state active duty … we will be activating all of those people [who are unvaccinated],” he remarked.

Secretary of Defense Lloyd Austin mandated that all service members receive COVID-19 vaccination and that National Guardsmen who refuse to get the shots must obtain a religious or medical exemption or face repercussions. Some Guard members could face a loss of wages and cannot train, while those who continue to refuse the vaccine can be potentially discharged, according to the Department of Defense.

Numerous lawsuits have been filed against the Pentagon due to its mandate, while some lawmakers have questioned whether such orders are putting a damper on the U.S. armed forces’ recruitment efforts. And earlier this month, former Secretary of Defense Mark Esper warned that several branches of the military are severely “struggling” to find recruits.

Storm Path

The National Hurricane Center (NHC) on Monday afternoon said Ian is a Category 2 system with 100 mph winds. The storm has strengthened since Monday morning when forecasters said it was a Category 1 storm with wind speeds hovering around 85 mph.

Meanwhile, hurricane warnings have now been issued for the central western Florida coastline, including Tampa Bay, indicating the storm is going to impact the area in the next 24 to 36 hours. First, Ian is on track to hit western Cuba, according to the NHC. After impacting Cuba, the system is expected to strengthen into at least a Category 3 hurricane with 111 mph or greater wind speeds.

Futures Tumble After Report Apple Backs Off Plans To Increase iPhone Production Due To Lack Of Demand

TUESDAY, SEP 27, 2022 – 10:11 PM

So much can change in just 8 days: back on Sept 19, citing “Apple analyst” Ming-Chi Kuo, 9to5mac reported that Apple was “cranking up iPhone 14 Pro production to address higher demand.”

Well, maybe not, because moments ago, citing people familiar with the matter, late on Tuesday Bloomberg reported that contrary to expectations for a production boost, Apple is instead “backing off plans to increase production of its new iPhones this year after an anticipated surge in demand failed to materialize.

According to the report, the phone maker which hasn’t come up with a refreshingly new model in about 4 years but merely adds more megapixels and a slightly faster chip and presents it as “new”, told suppliers “to pull back from efforts to increase assembly of the iPhone 14 product family by as many as 6 million units in the second half of this year.” Instead, Apple will aim to produce 90 million handsets for the period, around the same level as the prior year and in line with Apple’s original forecast this summer.

In fairness, it’s not like outside analysts had any idea Tim Cook was about to pull a swticheroo: Apple had upgraded its sales projections in the weeks leading up to the iPhone 14 release and some of its suppliers had started making preparations for a 7% boost in orders. But just two weeks after the unveil of the new phone, Apple realized that this anticipated demand boost wasn’t coming.

And yes, while demand for higher-priced iPhone 14 Pro models may indeed be stronger than for the entry-level versions – after all the baseline model offers absolutely nothing new – at least until the market plunges another 20% and even those rich on paper have to cancel their orders, even so the overall supply will not change although in hopes of salvaging at least margins if not overall revenue, some suppliers are shifting production capacity from lower-priced iPhones to premium models… which incidentally is hardly as it was reported by MacRumors about a week ago.

Needless to say, the success – and failure – of the company’s leading device has implications for wide swathes of the tech industry, with suppliers including Taiwan Semiconductor and Hon Hai Precision Industry Co. depending on sales of iPhones and related devices as key revenue drivers.

All this is happening as China, the world’s biggest smartphone market, is in an economic slump that’s hit its domestic mobile device makers and also affected the iPhone’s sales. Purchases of the iPhone 14 series over its first three days of availability in China were 11% down on its predecessor the previous year, according to a Jefferies note on Monday.

And then there is the global recession: as Bloomberg notes, global demand for personal electronics has also been suppressed by soaring inflation, recession fears and disruption from the war in Ukraine. As a result, the smartphone market is expected to shrink by 6.5% this year to 1.27 billion units, according to data from market tracker IDC.

“The supply constraints pulling down on the market since last year have eased and the industry has shifted to a demand-constrained market,” said Nabila Popal, research director at IDC. “High inventory in channels and low demand with no signs of immediate recovery has OEMs panicking and cutting their orders drastically for 2022.”

The news that there is just not enough demand for the trinkets and beads of the world’s largest company promptly hammered futures, which not only gave up all overnight gains, but promptly tumbled back to session – and fresh 2022 – lows.

end

FORD

Interesting: Ford is running out of its trademark blue badges that they affix to every vehicle

(zerohedge)

Supply Chain Hell Continues: Ford Is Running Out Of Trademark Blue Badges It Affixes To Every Vehicle

WEDNESDAY, SEP 28, 2022 – 06:55 AM

Among the most notable supply chain hangups Ford is suffering from is one: the company is having trouble getting its hand on the signature blue “Ford” badges that grace the front of every vehicle it manufactures.

The company has said that shortages not only include the badges, but also the nameplates that the company uses to specify the make and model of the vehicle they are affixed to.

The company first reported the issue on Friday, according to a CNBC writeup. It marks the latest in a long line of supply chain issues that Ford, as well as other auto manufacturers worldwide, have suffered through since the onset of the Covid pandemic.

Tribar Technologies is the name of the company that makes the badges for Ford. It has been forced to limit its operations, effective August, because it disclosed to state regulators that it had “discharged industrial chemicals into a local sewer system.”

So much for ESG investing in electric vehicles…

The news comes just days after we reported that Ford expected $1 billion in extra costs in Q3 as a result of “inflation and supply chain issues”.

The company is in the midst of suffering through parts shortages that have affected between 40,000 and 45,000 vehicles, we wrote. Models affected are primarily “high margin trucks and SUVs” that haven’t been able to reach dealers.

According to The Detroit News, Ford “expects to have a ‘higher-than-planned’ number of vehicles assembled but awaiting parts at the end of the third quarter due to supply shortages.”

Ford says it should be able to complete and deliver the vehicles by Q4 and that it is still estimating $11.5 billion to $12.5 billion in adjusted EBIT for 2022.

The company said that the rise in costs is partially a result of negotiations with a supplier that wound up running about $1 billion more than the company expected. As such, the company says Q3 EBIT will be in the range of $1.4 billion to $1.7 billion. No word if that supplier was found dumping toxic waste into a sewage system yet…but we’ll keep you updated.

end.

Vaccine//Covid issues:

PAUL ALEXANDER…

“CDC no longer recommends universal masking in health facilities”; why? Because the CDC knows that the COVID face masks were always ineffective and harmful, never worked, see my review below

What is happening is that agencies like CDC & NIH & FDA quietly trying to walk back and reverse garbage policies & decisions because they know the public is on to them; every action CDC took was wrong

Dr. Paul AlexanderSep 27

▷ LISTEN SAVE

SOURCE:

CDC no longer recommends universal masking in health facilities

“The Centers for Disease Control and Prevention no longer recommends universal masking in health care settings, unless the facilities are in areas of high COVID-19 transmission.

The agency quietly issued the updates as part of an overhaul to its infection control guidance for health workers published late Friday afternoon. It marks a major departure from the agency’s previous recommendation for universal masking.”

end

Dr Aseem Malhotra: the current system making good people do very bad things; only interested in PROFIT, not healthcare; COVID gene injection vaccine KILLS, causes cardiac arrest

Direct link between heart attacks (sudden cardiac deaths/arrests) & mRNA vaccines, causes inflammation of coronary arteries; deaths post vaccine rollout, sudden cardiac deaths after they get vaccine

Dr. Paul AlexanderSep 27

▷ LISTEN SAVE

What you need to know is that Aseem prior called for all to be vaccinated! Now he has bailed and been red-pilled and suffered devastating loss of his father from the vaccine.

SOURCE:

Stew Peters, let me blunt, I like this guy, I like his bravery, his smarts, his love of America, freedom, borders, military, rule of law, his stance on the COVID jab, IMO, top notch, Captain Bob Snow

Pilot Captain Bob Snow went into cardiac arrest flying a plane with people on board, had to be revived & was basically dead; he is now fighting to educate the world on danger to pilots, you go Stew!

Dr. Paul AlexanderSep 28

▷ LISTEN SAVE

VACCINE IMPACT/

The Flu Disappeared in 2020, but Not the Flu Shot – 20,000 Injuries and Deaths from Flu Shot as Children are Passing Out Minutes After Receiving COVID Shot + Flu Shot Together

Inbox

VACCINE INJURY/

The latest reports from Slay NewsExcess Child Deaths Spike 755% in Europe This Year Newly published official statistics from the European Union show a staggering 755% spike in excess child deaths this year.READ MORE

end

MICHAEL EVERY//RABOBANK

Michael Every on the major topics of the day

A MUST READ

(Michael Every)

More Bad News: Weimar Or Venezuela?

WEDNESDAY, SEP 28, 2022 – 11:45 AM

By Michael Every of Rabobank

No one loves the messenger who brings bad news.” ― Sophocles

“The British nation is unique in this respect: they are the only people who like to be told how bad things are, who like to be told the worst.” ― Winston Churchill

“Good Evening! We are Bad News, and we bring you ‘More Bad News!’” ― More Bad News

It goes without saying that everywhere you look right now there is bad news. Well, I bring more of it than many want to recognize.

Nord Stream is not just shut down, but blown up. Does it matter if it was the Russians who did it or the US (as one Polish MEP alleges)? It’s gone. The really bad news is now we are in that kind of world, no pipeline is safe. Indeed, no sooner did Bloomberg carry a headline saying “Europe Gas Prices Have Peaked Despite Nord Stream-Led Volatility” than Russia said it may stop sending gas via Ukraine too. Moreover, thoughts turn to what would happen if Norway’s pipeline to Europe fell off a yacht or out of a window. So, European gas prices spiked.

Relatedly, US Senator Manchin’s legislation before Congress to speed up energy permitting and build a $6.6bn natural gas pipeline was withdrawn as it does not have the necessary votes; against that domestic backdrop, the Boston Globe is warning of the risk of rolling blackouts this winter, matching disruptions previously seen in California and Texas.

More bad news: the rollercoaster in the real economy is being reflected in the financial economy, ostensibly triggered by the UK peddling a fantasy economy as cure. 30-year Gilt yields were -20bp at the UK open, then closed +45bp at just shy of 5.0%. As our Rates Strategy Team put it, UK debt looks to now be effectively untradable, and just as there is a mountain of it to sell. That volatility is immediately flowing through to mortgage rates, where banks are pulling offers.

The really bad news is that the BOE has been forced to warn it “will not hesitate to change interest rates as necessary”; PM Truss reportedly had to be convinced to issue a statement, with her initial instinct being to stand firm and say little or nothing; and the IMF has said it is “closely monitoring” the UK, is “engaged with the authorities”, and has urged the government to “re-evaluate” its “untargeted” tax cuts. How long until it offers a loan with stringent fiscal conditions?

The even worse news is that the IMF is saying that “Given elevated inflation pressures in many countries, including the UK, we do not recommend large and untargeted fiscal packages at this juncture. It is important that fiscal policy does not work at cross purposes to monetary policy.” So, the *structural* high energy prices we face for years everywhere should be digested raw? I am sure that will play well with social stability.

‘Anarchy in the UK’ is not just reflecting its febrile politics –as rumours start of letters of no confidence in PM Truss being written by Tory MPs(!)– but of Fed tightening. On that front, yesterday saw more bad news (for you, and you, and you) with more consistent Fed messaging that US rates are going to go higher and stay higher.

Nobody watching crumbling asset markets, who works in said markets, can believe the Fed wants this to happen.

Well, never-to-be-ignored Harald Malmgren just tweeted: “My personal network warns me “Fed leadership” cannot say what it wants: hard landing to reduce asset value bubbles and bring back long forgotten mark to market ideas.” In other words, to undo the entire post-2008 (and post-1987) system of ‘central banks are there to save us from ourselves’ and restore genuine markets, presumably with much more of a focus on physical than financial assets.

As noted, many won’t believe that: but as they say, it’s hard to get someone to believe something when their income depends on them not believing it. But when you have Treasury Secretary Yellen stating she thinks financial markets are functioning well, are not seeing disorderly conditions, and are merely seeing the by-product of fighting inflation, then either she is on the same page as Malmgren, or the IMF need to give her advice too. Neither of which is good news.

But here’s the truly bad news. So bad in fact that few grasp it. The mess in the UK is a warning that there are now no good policy options. Rate hikes are a disaster. Rate cuts are a joke. Fiscal tightening is frightening. Fiscal loosening is loser-ing. Looser fiscal policy and tighter monetary policy is madness. Tighter fiscal policy and looser monetary policy is Einstein’s definition of insanity. Tighter fiscal and monetary policy repeats Brüning from Weimar Germany. Looser fiscal and monetary policy repeats Venezuela.

As I have written here many times, logically the only thing that might have worked was tighter monetary policy and looser fiscal policy into the supply side via MMT. But now it seems even the UK can’t be trusted by markets to do it; at least not unless it runs a trade surplus to prop up its currency, and perhaps sees capital controls. Yet the UK is not set up to export, but import, and the one thriving part of its economy is based on channelling and churning global capital flows – just not into its own industrial base. (And as a side note, the Indian government reportedly won’t waive capital gains taxes on its bonds in order to be included in benchmark global indices, because it is concerned foreign inflows will increase the volatility of local markets.)

If the MMT route is not something markets will now swallow then, as we argued years ago, only a tiny number of countries can hope to follow such a policy path: those with large trade surpluses and not overly-large fiscal deficits; and the US, because of the global role of the (soaring) dollar.

The bad news to Cryptonites, gold bugs, Gaullists, leftists, “strategic autonomists”, and the New World Order is that the US *can* still print money into the supply side, not demand side, and boom, while everyone else crashes. If they do that and raise rates, all the more so; and they then get to pick who they save with Fed swap-lines, and create new US-centred supply-chains to cement their role even more deeply.

Or the worst news is that if the US can’t or won’t, then we are back to red-in-tooth-and-claw zero-sum global mercantilism as the only route to national, not international, salvation. (For those who know, think ‘Warriors of Genghis Khan’.) That is what the entire global system always was: the post-1945 US-centered paradigm we all take for granted, but have to accept monetary policy tightening cycles within, is the exception.

You can heed this message, shoot the messenger, or ignore him to focus on (larger and larger!) day-to-day swings in any market of your choice: the big picture won’t change regardless.

7. OIL//OIL ISSUES//NATURAL GAS//ELECTRICITY ISSUES/USA//GLOBE

According to the Polish Minister it was the uSA that blew up Nordstream one and two.

(Shellenberger)

U.S. Blew Up Russian Gas Pipelines Nord Stream 1 & 2, Says Former Polish Defense Minister

TUESDAY, SEP 27, 2022 – 05:00 PM

Authored by Michael Shellenberger via Substack,

A former Polish Defense Minister, Radek Sikorski, has attributed to the United States the sabotage of two pipelines, Nord Stream 1 and 2, which carry natural gas from Russia to Germany. “Thank you, USA,” Sikorski wrote on Twitter. Sikorski was Minister of National Defense from 2005 – 2007 and served as Deputy Minister of National Defense and Deputy Minister of Foreign Affairs, previously. He is currently an elected member of the European parliament.

Nord Stream 1 and 2 lie on the bed of the Baltic Sea. Nord Stream 2 was finished last year but Germany never opened it because Russia invaded Ukraine on February 24.

Poland’s Secretary of State, Stanisław Żaryn, denounced Sikorki’s claim on Twitter as “Russian #propaganda,” calling it “a smear campaign against Poland, the US, and Ukraine, accusing the West of aggression against #NS1 and #NS2. Authenticating the Russian lies at this particular moment jeopardizes the security of Poland. What an act of gross irresponsibility!”

But it’s not out of the realm of the possible that the U.S. is indeed behind the attack. President Joe Biden promised on February 7 to prevent Nord Stream 2 from becoming operational if Russia invaded Ukraine. “If Russia invades,” said Biden, “then there will be no longer a Nord Stream 2. We will bring an end to it.”

Reporter: “But how will you do that, exactly, since…the project is in Germany’s control?”

Biden: “I promise you, we will be able to do that.”

Subscribers can continue reading here…

END

The following is an extremely important commentary from Michael Snyder as he discusses various aspects to the mystterious explosions that damaged 3 Nordstream one and two tubes

(Michael Snyder)

‘Forever Unusable’: 15 Things We Know About The Mysterious “Explosions” That Severely Damaged The Nord Stream 1 And 2 Pipelines

WEDNESDAY, SEP 28, 2022 – 08:10 AM

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

Something really strange just happened. On Monday, large underwater “explosions” were detected in the precise areas of the sea where the Nord Stream pipeline system is now leaking. In fact, the explosions were so large that they actually registered on the Richter scale. If someone wanted to purposely damage the Nord Stream 1 and Nord Stream 2 pipelines, very large explosions would be needed because those pipelines are extremely thick. So it appears that this was a deliberate act of sabotage, and that is what many European officials are now alleging. But if that is the case, who was behind it?

At this point we just don’t know.

But there are certain facts that we do have. The following are 15 things we know about the “mysterious explosions” that severely damaged the Nord Stream 1 and Nord Stream 2 pipelines…

#1 We are being told that the sections where the pipelines were damaged are “70-90 meters below sea level”. So someone would need to go down pretty deep to get to them.

#2 It is extremely unlikely that these pipelines could have been ruptured by accident because they are extremely thick…

The steel pipe itself has a wall of 4.1 cm (1.6 inches) and is coated with steel-reinforced concrete up to 11cm thick. Each section of the pipe weighs 11 tonnes, which goes to 24-25 tonnes after the concrete is applied.

#3 It is being reported that explosions “were heard” in the areas where gas is now leaking out of the pipelines…

Explosions were heard near the Nord Stream 1 and 2 pipes where gas is now leaking into the Baltic from three holes, scientists have confirmed, while chronic safety concerns have led to a five-mile exclusion zone being imposed around the affected area.

#4 The Swedish National Seismic Network detected one explosion that registered 1.9 on the Richter scale and another one that registered 2.3 on the Richter scale…

Two powerful underwater explosions were detected on Monday in the same area of sea as the Nord Stream gas leaks, according to the Swedish National Seismic Network.

The monitoring network said the first explosion occurred on Monday at 2:03 a.m. Swedish time with a magnitude of 1.9 on the Richter scale, followed by a second at 7:04 p.m. on the same day with a magnitude of 2.3.

#5 The largest leak is reportedly “spreading bubbles a good kilometre (3,280ft) in diameter”…

It comes after shocking footage released earlier today by the Danish military from a flyover of the affected region showed huge swathes of the sea near the Danish island of Bornholm churning as the gas bubbled to the surface.

A military statement claimed that the largest leak ‘is spreading bubbles a good kilometre (3,280ft) in diameter. The smallest is creating a circle about 200 metres (656 feet) in diameter’, while the head of Denmark’s Energy Agency said it could take up to a week for gas to stop draining into the sea.

#6 German officials are claiming that this was a deliberate act of sabotage…

Germany is reportedly far less hesitant, however, with officials believing sabotage is virtually the only plausible cause for the leaks.

“We can’t imagine a scenario that isn’t a targeted attack. Everything speaks against a coincidence,” a government official reportedly told German newspaper Der Tagesspiegel.

#6a NATO Secretary-General Jens Stoltenberg on Wednesday attributed the leaks on the Nord Stream pipelines to acts of sabotage and said he had discussed the protection of critical infrastructure in NATO countries with the Danish defense minister.

#7 Interestingly, this incident took place just one day after thousands of German protesters took to the streets and demanded the opening of the Nord Stream 2 pipeline…

Thousands of protesters took to the streets in the northeastern German seaside town of Lubmin on Sunday, urging officials to put into service the halted Nord Stream 2 pipeline project that was designed to transport fuel from Russia to Germany.

Germany had stalled the launch of the ambitious energy project for months before putting it on the back burner in the wake of Russia’s military operation in Ukraine, which is now in its eighth month.

#8 The prime minister of Denmark also believes that this was a deliberate act of sabotage…

Danish Prime Minister Mette Frederiksen has said her government believes the leaks were caused by ‘deliberate actions’, adding that the gas supply pipeline will be out of action for around a week.

She said this evening: ‘It is now the clear assessment by authorities that these are deliberate actions. It was not an accident. There is no information yet to indicate who may be behind this action.’

#9 The Ukrainians are blaming the Russians for the explosions…

It comes after Kyiv’s presidential advisor Mikhaylo Podolyak said on Twitter: ‘The large-scale gas leak is nothing more than a terrorist attack planned by Russia and an act of aggression towards the EU.’

Podolyak accused Russia of seeking to ‘destabilise the economic situation in Europe and cause pre-winter panic’.

#10 It is being reported that the CIA recently warned Germany about a potential attack on the pipelines…

German magazine Spiegel said the US Central Intelligence Agency (CIA) recently warned Berlin about the increasing signs of a possible planned attack on the Nord Stream pipeline system.

Spiegel reported, citing unnamed sources, that the CIA tipped off Berlin in the summer about possible attacks on NS1 and NS2.

#11 A Polish member of the European Parliament seems absolutely convinced that the United States was behind the attack…

A former Polish Defense Minister, Radek Sikorski, has attributed to the United States the sabotage of two pipelines, Nord Stream 1 and 2, which carry natural gas from Russia to Germany. “Thank you, USA,” Sikorski wrote on Twitter. Sikorski was Minister of National Defense from 2005 – 2007 and served as Deputy Minister of National Defense and Deputy Minister of Foreign Affairs, previously. He is currently an elected member of the European parliament.

Nord Stream 1 and 2 lie on the bed of the Baltic Sea. Nord Stream 2 was finished last year but Germany never opened it because Russia invaded Ukraine on February 24.

#12 Joe Biden previously threatened to “end” the Nord Stream 2 pipeline if Russia invaded Ukraine: “If Russia invades…then there will be no longer a Nord Stream 2. We will bring an end to it.”

#13 Victoria Nuland has also previously threatened the Nord Stream 2 pipeline: “If Russia invades Ukraine, one way or another, Nord Stream 2 will not move forward.”

#14 Meanwhile, European officials just gathered for a ceremony “to mark the opening of the new Baltic Pipe”…

Leaders from Poland, Norway and Denmark have attended a ceremony to mark the opening of the new Baltic Pipe, a key stage in the drive to wean Poland and Europe off Russian gas.

The pipeline will transport natural gas from the Norwegian shelf via Denmark and through the Baltic Sea to Poland. It is the centrepiece of a Polish strategy to diversify away from Russia that began years before Moscow’s February invasion of Ukraine triggered a global energy crisis.

The flows from Norway along with supplies via liquefied gas terminals are central to Poland’s plan. The country was cut off from Russian gas supplies in April, allegedly for refusing to pay in roubles.

#15 Germany’s Tagesspiegel reports that German security authorities assume that the three tubes of the Baltic Sea pipeline Nord Stream 1 and 2 will be forever unusable after alleged acts of sabotage.

If they are not repaired quickly, a lot of salt water will run in and corrode the pipelines, the Tagesspiegel learned from government circles.

So what does all of this mean?

I don’t know.

But this certainly is not going to be good for the rapidly growing energy crisis in Europe.

It is going to be a bitterly cold winter all over the continent, and there will be a lot of anger.

As I keep warning, the comfortable lifestyles that we are all currently enjoying will soon be rudely interrupted.

Everything is changing, and a lot of pain is on the horizon.

So I would encourage you to monitor global events very, very closely in the months ahead, because they are going to have very serious implications for every man, woman and child on the entire planet.

* * *

It is finally here! Michael’s new book entitled “7 Year Apocalypse” is now available in paperback and for the Kindle on Amazon.

end

8 EMERGING MARKET& AUSTRALIA ISSUES & OTHER EMERGING NATIONS

NEW ZEALAND

New Zealand has just had enough as they call it quits on aiding the Ukrainian military

(zerohedge)

New Zealand Calls It Quits On Aiding Ukraine’s Military

WEDNESDAY, SEP 28, 2022 – 02:00 AM

At a moment Washington continues what’s essentially an endless arms and financial aid pipeline to Ukraine, and as some defense officials express concerns over the Pentagon’s own dwindling stockpiles, one country says it’s giving up on arming Kyiv.

New Zealand, which is one of the “Five Eyes” intelligence-sharing partners which includes the US, now says it can no longer keep up with supplying what Ukraine is asking for without depleting its stockpiles.

“The New Zealand government has expanded sanctions on key Russians, but cannot provide further military assistance as it has nothing Ukraine wants,” The Canberra Times reports Tuesday.

Defense Minister Peeni Henare said his country stands “ready to provide further lethal aid if Ukraine’s needs matched its stockpiles.”

The top defense official then confirmed it is currently the case that the military cannot keep up:

Asked on Tuesday whether New Zealand had considered further military support, Mr Henare said the requests didn’t match “on our current assessment and according to the requests in the donor meetings I’ve been on”.

“On those donor calls, they’ve come asking and it’s for HIMARS, land-to-air defence systems and also land-to-sea defence systems,” he said.

So far, New Zealand’s contribution has been meager – given also it’s a tiny Pacific island nation – compared to European countries, and has been focused on defensive equipment such as body armor.

“If they were things we were to procure, they would take years but that hasn’t stopped us providing military aid,” PM Jacinda Ardern commented this week on the logistical challenges in procuring and then shipping weapons abroad.

A look at historic New Zealand military expenditures over the last half-century…

But as a major non-NATO ally of the United States and major intelligence-sharing partner, New Zealand is without doubt assisting the US mission in support of Ukrainian forces in this arena. It is also vowing more sanctions, and has typically signed off on whatever fresh US and EU anti-Russia sanctions are rolled out.

end

Your early currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings WEDNESDAY morning 7:30 AM

Euro/USA 0.95707 UP 0.0025 /EUROPE BOURSES // ALL RED

USA/ YEN 144.67 DOWN 0.030 /NOW TARGETS INTEREST RATE AT .11% AS IT WILL BUY UNLIMITED BONDS TO GETS TO THAT LEVEL…//YEN TOTALLY COLLAPSES

GBP/USA 1.0605 DOWN 0.01209

Last night Shanghai COMPOSITE CLOSED DOWN 48.78 PTS OR 1.58%

Hang Sang CLOSED DOWN 609.43 PTS OR 3.41%

AUSTRALIA CLOSED DOWN 0.55% // EUROPEAN BOURSE: ALL RED

Trading from Europe and ASIA

I) EUROPEAN BOURSES ALL RED

2/ CHINESE BOURSES / :Hang SANG CLOSED DOWN 609.43 PTS OR 3.41%

/SHANGHAI CLOSED DOWN 48.78 PTS OR 1.58%

AUSTRALIA BOURSE CLOSED DOWN 0.55%

(Nikkei (Japan) CLOSED DOWN 397.89 PTS OR 1.50%

INDIA’S SENSEX IN THE RED

Gold very early morning trading: 1629.10

silver:$18.19

USA dollar index early WEDNESDAY morning: 114.47 UP 41 CENT(S) from TUESDAY’s close.

WEDNESDAY MORNING NUMBERS ENDS

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And now your closing WEDNESDAY NUMBERS 1: 00 PM

Portuguese 10 year bond yield: 3.23% DOWN 9 in basis point(s) yield

JAPANESE BOND YIELD: +0.235% DOWN 0 AND 2/10 BASIS POINTS /JAPAN losing control of its yield curve/

SPANISH 10 YR BOND YIELD: 3.33%// DOWN 9 in basis points yield

ITALIAN 10 YR BOND YIELD 4.58 UDOWN 16 points in basis points yield ./ THE ECB IS QE ITALIAN BONDS

GERMAN 10 YR BOND YIELD: FALLS TO +2.153% UP 14 BASIS PTS

END

IMPORTANT CURRENCY CLOSES FOR WEDNESDAY

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

Euro/USA 0.9643 UP .0048 or 48 basis points

USA/Japan: 144.42 DOWN 0.287 OR YEN UP 28 basis points/

Great Britain/USA 1.0760 UP .0035 OR 35BASIS POINTS

Canadian dollar UP .0033 OR 33 BASIS pts to 1.3690

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

The USA/Yuan, CNY: closed ON SHORE (CLOSED ..DOWN 7.2005

THE USA/YUAN OFFSHORE: (YUAN CLOSED (DOWN)…. 7.2034

TURKISH LIRA: 18.52 EXTREMELY DANGEROUS LEVEL/DEATH WISH/HYPERINFLATION TO BEGIN.

the 10 yr Japanese bond yield at +0.235

Your closing 10 yr US bond yield DOWN 18 IN basis points from TUESDAY at 3.781% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic

USA 30 yr bond yield 3.704 DOWN 12 in basis points

Your closing USA dollar index, 113.56 DOWN 0.49 PTS ON THE DAY/1.00 PM/

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

London: CLOSED UP 18.27 PTS OR 0.26%

German Dax : CLOSED UP 48.81 POINTS OR 0.40%

Paris CAC CLOSED UP 15.90 PTS OR 0.28%

Spain IBEX CLOSED DOWN 5.10OR 0.07%

Italian MIB: CLOSED DOWN 85.18PTS OR 0.41%

WTI Oil price 80.70 12: EST

Brent Oil: 88.15 12:00 EST

USA /RUSSIAN /// RUBLE RISES TO: 57.59 UP 0 AND 86/100 RUBLES/DOLLAR

GERMAN 10 YR BOND YIELD; +2.153

CLOSING NUMBERS: 4 PM

Euro vs USA: 0.97250 UP .01311 OR 131 BASIS POINTS

British Pound: 1.0872 UP .01470 or 147 basis pts

USA dollar vs Japanese Yen: 144.156 DOWN .552//YEN UP 55 BASIS PTS

USA dollar vs Canadian dollar: 1.3627 DOWN 0.0096 (CDN dollar, UP 96 basis pts)

West Texas intermediate oil: 82.15

Brent OIL: 89.15

USA 10 yr bond yield DOWN 25 BASIS pts to 3.715%

USA 30 yr bond yield DOWN 15 BASIS PTS to 3.683%

USA dollar index:112.905 DOWN 1.35 basis pts

USA DOLLAR VS TURKISH LIRA: 18.52

USA DOLLAR VS RUSSIA//// ROUBLE: 57,54 UP 0 AND 92/100 ROUBLES

DOW JONES INDUSTRIAL AVERAGE: DOWN 125.82 PTS OR 0.43 %

NASDAQ 100 UP 17.64 PTS OR 0.16%

VOLATILITY INDEX: 32.72 UP 0.46 PTS (1.43)%

GLD: $151.54 UP 0.30 OR 0.20%

SLV/ $16.96 DOWN 0.02 CENTS OR 0.12%

end)

USA trading day in Graph Form

Bonds, Stocks, Bitcoin, & Bullion Soar After Brits ‘Save The World’

WEDNESDAY, SEP 28, 2022 – 04:01 PM

First one to ‘pivot’ wins?

The Bank of England’s desperate bailout of its pension funds – by pivoting back to QE (only temporarily of course) – sparked chaotic buying across global markets. Bonds were the most dramatic movers, but FX swings were sizable, and stocks, gold, crypto, and oil all ripped on the renewed easing efforts.

First the scene of the crime… UK 30Y Gilt yields collapsed (-106bps) after BoE intervention…

Source: Bloomberg

US Treasury yields followed suit with the belly of the curve plunging over 25bps, erasing all the week’s yield increase…

Source: Bloomberg

10Y yields reversed perfectly at 4.00% coincidentally, puking over 32bps from high to low intraday – this was the biggest daily drop in 10Y yields since 2009…

Source: Bloomberg

Expectations for rate-hikes are dropping (Terminal rate now down 40bps from its peak), but today saw subsequent rate-cuts on the rise once again…

Source: Bloomberg

…with EDZ2-H3 negative again (implying a rate cut in Q1 of next year)…

Source: Bloomberg

Additionally, as rate-cut expectations begin to rise again, we saw another large options trade betting on a huge rate-cut in Q1 (around 100bps).

As rate trajectory expectations shifted dovishly so the Dollar Index tumbled…

Source: Bloomberg

But cable rallied, despite BoE’s actions…

Source: Bloomberg

Crypto rallied on the day – after yesterday’s massive roller coaster – with bitcoin back above $19,000…

Source: Bloomberg

European stocks spiked on the news, then faded, then rallied into their cash close to end slightly green (FTSE-250 was unchanged after being down 3% early in the session)…

Source: Bloomberg

US futures were notably lower overnight before the Brits ‘saved the world’, then spiked green, trod water, then soared after the cash open. Small Cap rose over 3.5% on the day and were up over 5% from overnight lows. The rest of the majors rallied 3.5-4% off overnight lows. Some profit-taking at the close wiped a little lipstick off…

On the heels of a massive short squeeze today…

Source: Bloomberg

VIX crashed back from almost 35 to almost 30.00…

Spot Gold spiked back above $1660…

Source: Bloomberg

WTI surged back above $81…

Notably, US retail gas prices at the pump are up 8 straight days…

Source: Bloomberg

Finally, we note one of the market’s most important ‘stress’ indicators is flashing red…

Source: Bloomberg

This is happening as a record $2.37 trillion was lodged with The Fed for o/n repo.

END

I) / EARLY MORNING// TRADING//

Thirty year mortgage rates rise above 7%

(zerohedge)

30-Year US Mortgage Rises Above 7% For The First Time Since 2000; Fastest Surge In History

TUESDAY, SEP 27, 2022 – 09:41 PM

Less than two weeks ago we cited Freddie Mac according to which the average 30 year US mortgage just rose above 6% for the first time since 2008, with real-estate brokerage Redfin commemorating the move by saying that “This Is The Sharpest Turn In The Housing Market Since The 2008 Crash.” Well, just a few days later, Jeff Gundlach was so kind to point out this evening…

…that the national average 30 year mortgage rate just soared above 7.0%, hitting 7.08% and the highest since December 11, 2000.

This was the fastest 1% increase in mortgage rates in history; and the fact that it took place inside of a month is even more remarkable.

There is nothing we can add here that isn’t self-explanatory, and that we haven’t said already, like for example the fastest ever collapse in YoY Case-Shiller prices, as well as the first sequential drop in 112 years…

… not to mention that the typical home now sells for less than the asking price…

… but what is perhaps most remarkable is that according to the Atlanta Fed, as of a few weeks ago, the median American household would needed to spend 44.5% of their income to afford payments on a median-priced home in the US, the highest percentage on record with data going back to 2006.

That such a move can’t end in anything but tears is obvious to everyone… but the Fed, which still thinks it can somehow avoid the most destructive of hard landings.

end

AFTERNOON TRADING

ii) USA DATA/

Affordability is the reason why!

(zerohedge)

US Pending Home Sales Tumbled To 11 Year Lows (Ahead Of Recent Rate Spike)

WEDNESDAY, SEP 28, 2022 – 10:04 AM

With mortgage rates soaring (now shockingly above 7% amid the fastest rise in history), it’s no surprise that analysts expected pending home sales to slide further in August (latest data) and they were right. Pending Home Sales fell 2.0% MoM (more than the 1.5% MoM decline expected) pushing the index down 22.5% YoY…

Source: Bloomberg

This is the 9th monthly decline in the last 10 months to its lowest since May 2011 (ex-COVID lockdowns)…

Source: Bloomberg

Contract signings decreased in three of four regions while the West posted a small increase, similar to July’s data.

“The direction of mortgage rates — upward or downward — is the prime mover for home buying, and decade-high rates have deeply cut into contract signings,” Lawrence Yun, NAR’s chief economist, said in a statement.

“Only when inflation calms down will we see mortgage rates begin to steady.”

Pending home sales are often looked to as a leading indicator of existing-home purchases given properties typically go under contract a month or two before they’re sold. Sales of previously owned homes, calculated when a contract closes, fell for the seventh straight month in August.

Finally, and perhaps most notably, as we noted previously, according to the Atlanta Fed, as of a few weeks ago, the median American household would needed to spend 44.5% of their income to afford payments on a median-priced home in the US, the highest percentage on record with data going back to 2006.

Well, as of today, that number is just over 50%. That’s right: more than half of the average US household’s income goes to paying housing payments, nearly double what this number was just two years ago… and this latest move comes after today’s August pending home sales data suggesting far worse is to come from the data.

That such a move can’t end in anything but tears is obvious to everyone… but the Fed, which still thinks it can somehow avoid the most destructive of hard landings.

end

Important: one of the markets most important stress indicators is flashing red again FRA/OIS

(zerohedge)

One Of The Market’s Most Important ‘Stress’ Indicators Is Flashing Red

WEDNESDAY, SEP 28, 2022 – 11:24 AM

The all important FRA-OIS indicator of interbank funding stress (and money-market risk) is soaring once again, and at last check was above 37bps, having exploded off ‘no stress’ levels just two weeks ago…

The level of ‘stress’ is now higher than that surrounding the liquidity crisis prompted by the sanctioning of Russia following Putin’s invasion.

A very quick primer on this all important spread:

What is FRA? A forward rate agreement is a deal to swap future fixed interest payments for variable ones, or vice versa. The key rate for U.S. markets is the three-month London interbank offered rate, or Libor, in U.S. dollars. The benchmark is derived by major banks submitting rates based on transactions that are compiled to establish benchmark for five different currencies across seven different loan periods. Those benchmarks underpin interest rates on trillions of dollars of financial instruments and products from student and car loans to mortgages and credit cards.
What is OIS? The Overnight Index Swap rate is calculated from contracts in which investors swap fixed- and floating-rate cash flows. Some of the most commonly used swap rates relate to the Federal Reserve’s main interest-rate target, and those are regarded as proxies for where markets see U.S. central bank policy headed at various points in the future.

That’s the theory. But why does the FRA-OIS spread matter in practice?

Well, it’s regarded as the markets’ measure of how expensive or cheap it will be for banks to borrow in the future, as shown by Libor, relative to a risk-free rate, the kind that’s paid by highly rated sovereign borrowers such as the U.S. government. The FRA-OIS spread therefore provides another snapshot of how the market is viewing credit conditions because of the fact that traders are betting on where Libor-OIS – its underlying spread – will be.

As a further reminder, there are typically 3 reasons why it would blow out:

the risk premium for uncertainty of US monetary policy,
recently elevated credit spreads (CDS) of banks, and
demand for funds in preparation for market stress.

While FRA-OIS exploded to 80bps in March 2020, at the peak of the covid crash, and is currently at just half that level, never before has funding stress been so high with a Fed balance sheet near $9 trillion and with some $2.3 trillion in the Fed’s overnight reverse repo facility (i.e., excess liquidity).

In other words, when adjusted for the statutory level of record liquidity in the market, which we don’t need to tell readers is at an all time high, the FRA-OIS would almost certainly be at all time highs.

One can argue that while Powell and the Fed may be oblivious to the ongoing collapse in stocks, which they viewed as overvalued and as having enough buffer to drop, he is closely watching every uptick in this most critical stress indicator.

That level of stress is now at its highest since the post-Fed bailout of the systemic instability crisis surrounding COVID lockdowns in 2020.

While this is a topic we covered extensively back then (see “There Is No Liquidity” – Market Paralyzed As FRA/OIS Explodes), especially right before the Fed unleashed its monetary bazooka with trillions in QE and opening up repos to virtually unlimited amount, as well as announcing it would buy corporate bonds and ETFs, expect to hear much more about this in the days and weeks ago come.

Meanwhile, if the FRA-OIS spikes another 10-15 points, the Fed will have no choice but to emerge from its paralysis and reassure markets that the financial system isn’t about to experience another paralysis (oh, and unless the Ukraine war magically ends in the next few weeks, say goodbye to four or five more rate hikes this year).

III) USA ECONOMIC STORIES

Hurricane Ian strengthens to a powerful category 4 heading straight to Naples/Sarasota Fl. and then move into central Florida. It will cause major damage

(zerohedge)

Hurricane Ian Strengthens To Powerful Category 4 As Florida Landfall Imminent

WEDNESDAY, SEP 28, 2022 – 07:12 AM

Update (0739ET):

Hurricane Ian continues to strengthen ahead of landfall. As of 0733 ET, the National Hurricane Center said Ian’s sustained maximum winds were 155 mph, just 2 mph shy of a Cat. 5 storm.

* * *

Hurricane Ian strengthened into a powerful Category 4 storm expected to make landfall on Florida’s southwest coast today and then traverse central Florida and emerge in the Atlantic by Thursday.

At 0500 ET, the National Hurricane Center said Ian sustained maximum winds of 140 mph and gusts up to 165 mph. The storm’s center was about 75 miles west-southwest of Naples and 105 miles south-southwest of Punta Gorda, moving north-northeast at 10 mph.

“Ian is forecast to approach the west coast of Florida as an extremely dangerous major hurricane, weakening is expected after landfall.

“On the forecast track, the center of Ian is expected to approach the west coast of Florida within the hurricane warning area this morning, and move onshore later today. The center of Ian is forecast to move over central Florida tonight and Thursday morning and emerge over the western Atlantic by late Thursday,” NHC senior hurricane specialist Daniel Brown told Orlando Sentinel.

Ian’s path has shifted south of Tampa Bay, and landfall is now expected between Fort Myers and Sarasota on Wednesday morning or early afternoon before moving across the central part of the state.

NHC warned a “life-threatening storm surge is expected along the Florida west coast and the Lower Florida Keys,” with “devastating wind damage” expected near Ian’s center.

“Catastrophic flooding is expected across portions of central Florida with considerable flooding in southern Florida, northern Florida, southeastern Georgia and coastal South Carolina,” the weather agency continued.

“It’s going to be historic,” National Weather Service Melbourne meteorologist Kole Fehling in Melbourne, referring to the storm’s landfall impacts.

Fehling said Central Florida could be swamped with 15 to 20 inches of rainfall, with some areas receiving upwards of 24 inches.

“The normal value for the amount of rainfall over the entire year is about 52 inches,” he said. “So if we were to see those higher- end totals, we could be experiencing half of our total annual rainfall in a very short period of time.”

On Tuesday night, Florida Governor Ron DeSantis told residents:

“You need to evacuate now. You’re going to start feeling major impacts of this storm relatively soon.”

Millions of Floridians are under evacuation orders or advisories as DeSantis activated the National Guard earlier this week before the storm’s arrival.

There are notable economic impacts due to adverse weather conditions in the region. On Tuesday evening, US energy companies idled 190,000 barrels of daily crude production, some 11% of US Gulf of Mexico output.

Bloomberg pointed out that the “nation’s production of phosphate fertilizer” is in the storm’s path.

Chuck Watson, a disaster modeler with Enki Research, said Mosaic’s New Wales plant is “right in the middle of the damage swath,” adding the facility “could be out for weeks.”

Bloomberg said Ian could cause $45 billion in damage, which would make it one of the most costly storms in the country’s history.

By late Tuesday, over 2,000 flights to and from Florida were canceled. Flight delays and cancelations could spill over to the rest of the country.

end

III B USA COMMODITY PROBLEMS//

SWAMP STORIES

KING REPORT

The King Report September 28, 2022 Issue 6852

Independent View of the News

Nord Stream operator says three offshore gas pipelines damaged in one day http://reut.rs/3xXQbJT

The energy war: Nord Stream 1 and 2 pipelines from Russia to Europe ‘are SABOTAGED’ sending enormous churning rings of gas bubbles to Baltic Sea surface https://t.co/5iH4wOYdtk

Leaks on Russian gas pipelines raise concerns about sabotage
Seismic stations Sweden, Norway and Finland registered two explosions Monday near the leaks… the first explosion was recorded in the early hours southeast of the Danish island of Bornholm….
   “We know very well what an underwater blast looks like. And so in this case, there’s no doubt this is not an earthquake,” Lund said…
https://kstp.com/kstp-news/business-news/leaks-on-russian-gas-pipelines-raise-concerns-about-sabotage/

CIA warned Berlin about possible attacks on gas pipelines in summer – Spiegel
https://www.reuters.com/world/cia-warned-berlin-about-possible-attacks-gas-pipelines-summer-spiegel-2022-09-27/

ABC News @ABC Feb 7, 2022: Pres. Biden: “If Russia invades…then there will be no longer a Nord Stream 2. We will bring an end to it.” Reporter: “But how will you do that, exactly, since…the project is in Germany’s control?” Biden: “I promise you, we will be able to do that.” http://abcn.ws/3B5SScx

@JackPosobiec: The Danish military has released volatile footage of a mysterious, frothing disturbance in the Baltic Sea in the vicinity of the Nordstream pipelines
https://twitter.com/JackPosobiec/status/1574785592856018945

UK 30-YEAR BOND YIELD SURGES ABOVE 5%, FIRST TIME SINCE 2002 – BBG 11:54 ET

Bank of England’s Pill sees “significant” move, but only in November https://t.co/621YZSJVJZ

Fed’s Powell says real need for DeFi regulation because of ‘significant structural issues’
Federal Reserve Chairman Jerome Powell ramped up his criticism of decentralized finance on Tuesday, saying the monetary policy normalization worldwide has “revealed significant structural issues in the DeFi ecosystem” and exposed “conflict of interest,” as he called for more appropriate regulation…
https://techcrunch.com/2022/09/27/feds-powell-says-real-need-for-defi-regulation-because-of-significant-structural-issues/

St. Louis Fed President Bullard: We have a serious inflation problem in the US – BBG 10:43 ET
Bullard: Credibility of Inflation-Targeting Regime Is at Risk – BBG 10:44 ET
Bullard: Must Not Replay Volatile Era of 1970s – BBG 10:45 ET
Fed’s Kashkari Says Wages Continue to Climb, Rents Climbing… This is Stickier Inflation: Reuters
Kashkari Says Policy Stance Is Tight now, Says Not Sure Policy Is Tight Enough – BBG 13:15 ET

US Economic Data released on TuesdayAug Durable Goods -0.2%, -0.3% exp; ex-Trans 0.2% as exp; Nondef ex-Air 1.3%, 0.2% expJuly FHFA House Price Index -0.6% m/m, 0.0% expJuly S&P CoreLogic -0.44%, +0.2% exp (1^st decline since 2012), 16.06% y/y, 17/05% expSept Conf. Board Consumer Confidence 108, 104.6 exp.; Present Cond 149.6, Expectations 80.3Sept Richmond Fed Mfg Index 0, -10 exp.Aug New Home Sales 685k, 500k exp.
Russia Likely to Propose Major Output Cut at Next OPEC+ MeetingGary Ross: OPEC would have to make oil cuts between 500,000 and 1 million bpd to keep Brent above $90 per barrel.The next OPEC+ meeting will be held on October 5, which will determine the output targets for November.  https://oilprice.com/Energy/Crude-Oil/Russia-Likely-To-Propose-Major-Output-Cut-At-Next-OPEC-Meeting.html
USZs traded lower during Asian trading but rallied after China closed at 2 ET. The rally persisted until USZs topped out at 127 7/32 at 7:49 ET. They then plunged to 124 15/32 at 13:13 ET. After a rally to 124 30/32 at 14:33 ET, USZs rolled over and hit a new low of 124 13/32 at 16:03 ET. USZs then jumped to 125 2/32 at 16:35 ET because Yellen was to speak at 17:00 ET.

Yellen Says Markets Functioning Well, Conditions Not Disorderly
“We haven’t seen liquidity problems develop in markets – we’re not seeing, to the best of my knowledge, the kind of deleveraging that could signify financial stability risks…” (Just like Yellen say no inflation!)

ESZs rallied from the Asian opening until peaking at 3733.00 just 8 minutes after the NYSE open. As we noted, conditioned traders played for a Turnaround Tuesday to the upside. Alas, sellers appeared and ESZs sank to 3638.75 at 12:19 ET. After a modest rally, ESZs and stocks went inert until the rally for the last-hour upward manipulation commenced at 14:38 ET. The rally ended in 11 minutes. ESZs and stocks then rolled over until a late upward manipulation began at 14:40 ET. It ended at 15:55 ET.

Positive aspects of previous session
ESZs rallied until 9:38 ET
The DJTA rallied sharply because Ryder rallied 15.2% on a report that Apollo might take it over

Negative aspects of previous session
Bonds tumbled; equities declined sharply
The S&P 500 Index traded 13.58 (3623.29) below its June 17 intraday low (3636.87)
The S&P 500 Index closed at its lowest level (3647.30) since 11/30/20 (3621.63)
The DJIA closed at its lowest level (29,134.99) since 11/12/20 (29,080.17)
Oil and gasoline rallied sharply on Hurricane Ian and concern about the OPEC+ meeting next week

Ambiguous aspects of previous session
Who is in trouble? How many are in trouble?

First Hour/Last Hour Action [S&P 500 Index]: 1st Hour from NYSE open: Down; Last Hour: Down

Pivot Point for S&P 500 Index [above/below indicates daily trend to traders]: 3662.80
Previous session High/Low: 3717.53; 3623.29

Study confirms link between COVID-19 vaccination and temporary increase in menstrual cycle length https://t.co/U5SzL3lNa7

Fentanyl is now the leading cause of death for Americans between the ages of 18 and 45. https://t.co/DHvO7cuh81

@dwnews: The European Union’s border control agency said 66,000 Russians entered the bloc in the past week, a 30% increase.  https://www.dw.com/en/russia-ukraine-updates-russians-pour-into-eu-amid-military-call-up/a-63258933

Today – Traders and trapped bulls could not engineer a Turnaround Tuesday to the upside because there are forces in the market that have not been present for many years. We must reiterate that when historic or black swan moves appear, there is a high probability that some levered entities are ‘in trouble.’ It would be extremely unusual if no one is ‘in trouble’ now. Eventually, the problems will be revealed.

Given the chance, the usual suspects will commence Q3 performance gaming this afternoon. USZs are +3/32; ESZs are +8.50; and the pound is 1.0732 at 20:10 ET.

Expected economic data: Aug Wholesale Inventories 0.4% m/m, Retail Inventories 1.0%; Aug Pending Home Sales -1.5% m/m, -24.54% y/y; Atlanta Fed Pres Bostic 8:35 ET, St. Louis Fed Pres Bullard 10:10 ET, Powell 10:15 ET at Community Banking Conference, Fed Gov Bowman 11 ET, Richmond Fed Pres Barkin 11:30 ET, Chicago Fed Pres Evans 14 ET at London School of Economics

S&P 500 Index 50-day MA: 4031; 100-day MA: 3979; 150-day MA: 4111; 200-day MA: 4228
DJIA 50-day MA: 32,084; 100-day MA: 31,860; 150-day MA: 33,597; 200-day MA: 33,306

S&P 500 Index – Trender trading model and MACD for key time frames
Monthly: Trender and MACD are negative – a close above 4739.37 triggers a buy signal
Weekly: Trender and MACD are negative – a close above 4180.10 triggers a buy signal
Daily: Trender and MACD are negative – a close above 3855.62 triggers a buy signal
Hourly: Trender and MACD are negative– a close above 3855.62 triggers a buy signal

Biden: “A vital part of preparing for hurricane season is to get vaccinated now.  Everything is more complicated if you’re not vaccinated…” (10% for TBG?) https://twitter.com/aginnt/status/1574900359960502272

(Dem Sen.) Manchin drops pipeline permit push, easing government shutdown threat
Schumer had promised Manchin his proposal would be included in the bill as a reward for his support in passing President Biden’s $740 billion Inflation Reduction Act last month. However, the amendment faced criticism from both progressive Democrats who said it gives too much away to energy companies, and Republicans bitter over Manchin’s support for the Inflation Reduction Act.
https://nypost.com/2022/09/27/manchin-pulls-permitting-proposal-from-stopgap-bill-to-avoid-gov-shutdown/

Secret Service took the cellphones of 24 agents involved in Jan. 6 response and gave them to investigators – The revelation that Cuffari’s office has had access to the phones since late July or August raises new questions about the progress of his criminal investigation into the missing text messages and what, if anything, the public may be able to learn about communications between agents on Jan. 6, 2021.
https://www.nbcnews.com/politics/national-security/secret-service-took-cellphones-24-agents-involved-agencys-jan-6-riot-r-rcna49476

@ColumbiaBugle: Tucker on why the left wants to destroy the family – “If you want absolute obedience, you have to sever family ties. That’s why state schools brainwash your children with values that you despise & then instruct your children to turn you in as a thought criminal if you object.” https://t.co/QvklvpL6k6

Webb Telescope Builders “are questioning previous science”     (But ‘the science’ is settled!)
Webb astronomer Garth Illingworth shares how the new findings are shaking up what we think we know about the universe  https://mindmatters.ai/2022/09/webb-telescope-builders-are-questioning-previous-science/

Joe Biden Won’t Talk to the Governor of Florida with a Hurricane Coming
Picture the media reaction if a Republican president refused to talk to a Democratic governor who was facing a major hurricane… Now, with Florida under threat from Hurricane Ian, the director of FEMA has spoken with Florida governor Ron DeSantis but confirms that Joe Biden hasn’t — even though Biden has spoken to two Democratic mayors… this makes Biden look petty and small. Then again, perhaps this is really just an implicit concession that Biden isn’t up to the call or is incapable of being of assistance.
https://www.nationalreview.com/corner/joe-biden-wont-talk-to-the-governor-of-florida-with-a-hurricane-coming/

Op-ed WSJ: General-election victories don’t appear to be the priority for Mr. Trump. More important than getting his own people in is getting his enemies out… herein lies a lesson for Republicans who want their party to move past Mr. Trump… To be successful, a candidate must take the policies that worked under Mr. Trump—tax cuts, deregulation, solid judicial picks, pulling out of the Iran deal—update the agenda for today, and then explain to GOP voters why he is a better choice than the former president to get it done…
    Republican voters are well aware of Mr. Trump’s shortcomings. But they are skeptical of moral denunciations about norms and insurrection from people who winked when our intelligence and law enforcement agencies ran with a Hillary Clinton campaign dossier falsely accusing Mr Trump of being a Russian agent.  Trump voters may be prickly, but they aren’t stupid. They sense that the attacks on Mr. Trump are ultimately attacks on them…
    Florida Gov. Ron DeSantis’s re-election is giving voters a taste of this. At least for now, he is the Republican alternative to Trump who is most likely to lead the GOP into 2024. Even Democrats can see that, which is why a New York Times columnist criticized Mr. DeSantis for—of all things—lacking Mr. Trump’s “soft edges.”… In the 2024 presidential contest, that will require a GOP nominee who sells Republicans on the idea that he is better than Mr. Trump without insulting—and alienating—the Trump voters he will need to win that November.  https://www.wsj.com/articles/how-not-to-beat-trump-judicial-record-school-choice-jobs-winning-voters-norms-maga-republicanism-florida-desantis-11664219712

Greg Hunter interviewing Ed Dowd

Unpayable Debt & Vax Causing Hell on Earth – Ed Dowd

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Unpayable Debt & Vax Causing Hell on Earth – Ed Dowd

By Greg Hunter On September 27, 2022 In Market Analysis92 Comments

By Greg Hunter’s USAWatchdog.com

Wall Street money manager Edward Dowd made billions of dollars in part by being a skillful number cruncher. When he applied his skills to the vax, he saw massive fraud, death and economy killing disability everywhere he looked. Add the vax genocide to the popping debt bubble, and a nightmarish perfect storm is clearly taking shape. Dowd explains, “It’s my thesis that the vaccines are not only deadly but cause massive amounts of disability. We had 220 million people in this country take the jab. Globally, it’s even worse because some countries had higher vaccination rates. What we are seeing now, 91 or 92 weeks since the vaccination program started, is rising disability. Everyone focuses on the deaths, and that’s bad, but disability is multiples of the deaths, and these are disabilities where people can’t work. They are incapacitated. Three million people disappeared from the labor force from death and disability. That number will cause labor shortages. That number will cause supply chain breaks, and we are seeing that. Here on Maui, my car got injured in an accident, and I am not going to get it fixed for six months because of parts and labor shortages on Maui. . . . There are some predictions I make that I hope I am dead wrong. This is not one I want to be right on. I think, personally, that Hell on Earth has already started, and it’s going to start to accelerate. What I mean by that is we are going to be overwhelmed by people being disabled and dying at such a rate we have a breakdown in the supply chain and basic necessities that we used to take for granted. They just won’t be there because there are not enough people to deliver goods and services. This is where I hope I am dead wrong, but my own anecdotal situations is I see a lot of people who took the vax a year ago and the problems are just now starting to show up. This makes me very, very frightened.”

On the economic front, Dowd says, “I have talked about this extensively, and a sovereign debt collapse is inevitable. The way you know it’s occurring is watching the U.S. dollar index. That is accelerating to the upside, and the dollar is going to fail up. They will eventually try to introduce a new currency. It will be central bank digital currency or something. The dollar is 113 on the U.S. dollar index, and it was 104 this summer. So, this is a big, big problem. It’s causing debt defaults globally. It’s causing margin calls. I think we are seeing the greatest ever margin call ever seen in the history of the world unfolding before our eyes. What I have been telling people since January and February is we are going into a global economic death spiral. I told people to raise cash in their portfolio . . . I also think gold should be a good part of your portfolio, but don’t have all your eggs in one basket.”

In closing, Dowd warns, “80% of the country thinks everything is fine. It’s not fine, and the global crash is already in progress.”

There is much more in the 42 min. interview.

Join Greg Hunter of USAWatchdog.com as he as he goes One-on-One with money manager and investment expert Edward Dowd, author of the upcoming book called “Cause Unknown” The Epidemic of Sudden Deaths in 2021 and 2022 for 9.27.22.

(https://usawatchdog.com/unpayable-debt-vax-causing-hell-on-earth-ed-dowd)

After the Interview:

Ed Dowd’s website is called TheyLiedPeopleDied.com. There, you can pre-order Dowd’s book called “Cause Unknown” The Epidemic of Sudden Deaths in 2021 and 2022.

There is also free information on TheyLiedPeopleDied.com, and Dowd will be adding to the site as information and new data rolls in. Bookmark it.

Follow Edward Dowd on Twitter by clicking here.

Follow Edward Dowd on Gettr by clicking here.

See you on TOMORROW

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