OCT 17//GOLD CLOSED UP $14.55 TO $1658.25//SILVER WAS UP 53 CENTS TO $18.73//PLATINUM WAS UP $17.55 TO $919.25//PALLADIUM WAS DOWN 35 CENTS TO $2006.45//BIDEN’S BAN ON CHIP EXPORTS PLAYING HAVOC TO CHINA’S ECONOMY//AS PER UK, BAILEY HAS STOPPED FUNDING BRITISH GILTS AS YIELDS RISE TESTING HIS FORTITUDE//KIEV POUNDED BY DRONES//BRANDON SMITH, A MUST READ DISCUSSES WHERE WE ARE AT WITH RESPECT TO UKRAINE VS RUSSIA//COVID UPDATES/DR PAUL ALEXANDER//VACCINE IMPACT//SWAMP STORIES FOR YOU TONIGHT//
Due to the huge rise in the dollar, we must look at gold and silver in currencies other than the dollar to understand where we are heading
I will now provide gold in Canadian dollars, British pounds and Euros/4: 15 PM ACCESS
CANADIAN GOLD $2262.60 CDN DOLLARS PER OZ DOWN $15.55 CDN DOLLARS
BRITISH GOLD IN POUNDS: 1452.39 POUNDS PER OZ DOWN 16.38 BRITISH POUNDS PER OZ/
EURO GOLD: 1676.38 EUROS PER OZ// DOWN 14.40 EUROS PER OZ///
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EXCHANGE: COMEX
NIL
JPMORGAN STOPPED 0/0
GOLD: NUMBER OF NOTICES FILED FOR OCT CONTRACT: 0 NOTICES FOR NIL OZ or NIL TONNES
total notices so far: 22,205 contracts for 2,220,500 oz (69.066 tonnes)
SILVER NOTICES: 9 NOTICE(S) FILED FOR 4,500 OZ/
total number of notices filed so far this month 427 : for 2,135,000 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 $14.55
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 3.28 TONNES INTO THE GLD//
INVENTORY RESTS AT 941.13 TONNES
Silver//SLV
WITH NO SILVER AROUND AND SILVER UP 53 CENTS
AT THE SLV// :/BIG CHANGES IN SILVER INVENTORY AT THE SLV//: A HUGE DEPOSIT OF 1.151 MILLION OZ INTO THE SLV
INVESTORS ARE SWITCHING SLV TO SPROTT’S PSLV
CLOSING INVENTORY: 486.071 MILLION OZ
Let us have a look at the data for today
SILVER//OUTLINE
SILVER COMEX OI ROSE BY A STAGGERING SIZED 5168 CONTRACTS TO 136,325 AND CLOSER TO THE RECORD HIGH OI OF 244,710, SET FEB 25/2020 AND THE GIGANTIC GAIN IN COMEX OI WAS ACCOMPLISHED DESPITE OUR $0.77 LOSS IN SILVER PRICING AT THE COMEX ON FRIDAY. OUR BANKERS/HFT WERE SUCCESSFUL IN KNOCKING THE PRICE OF SILVER DOWN (IT FELL BY $0.77)., BUT UNSUCCESSFUL IN KNOCKING OFF ANY SPEC LONGS. HUGE NUMBERS OF SPECS CONTINUE TO ADD TO THEIR SHORTFALLS FROM WHICH OUR BANKERS CONTINUE TO BE PURCHASERS OF NET COMEX LONGS.
WE MUST HAVE HAD: I) MINIMAL SPECULATOR SHORT COVERINGS ////CONTINUED BANKER OI COMEX ADDITIONS /// CONSIDERABLE NEWBIE SPEC SHORT ADDITIONS. II) WE ALSO HAD SOME REDDIT RAPTOR BUYING//. iii) A STRONG ISSUANCE OF EXCHANGE FOR PHYSICALS iiii) AN INITIAL SILVER STANDING FOR COMEX SILVER MEASURING AT 1.580 MILLION OZ FOLLOWING A 290,000 OZ QUEUE JUMP / // V) GIGANTIC SIZED COMEX OI GAIN/
I AM NOW RECORDING THE DIFFERENTIAL IN OI FROM PRELIMINARY TO FINAL: — 31
HISTORICAL ACCUMULATION OF EXCHANGE FOR PHYSICALS OCT. ACCUMULATION FOR EFP’S SILVER/JPMORGAN’S HOUSE OF BRIBES/STARTING FROM FIRST DAY/MONTH OF OCT:
TOTAL CONTRACTS for 13 days, total 53,247 contracts: 26.623 million oz OR 2.046MILLION OZ PER DAY. (409 CONTRACTS PER DAY)
TOTAL EFP’S FOR THE MONTH SO FAR: 26.623 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. 74.025 MILLION OZ///FINAL
OCT. 26.623 MILLION OZ INITIAL
RESULT: WE HAD A GIGANTIC SIZED INCREASE IN COMEX OI SILVER COMEX CONTRACTS OF 5169 DESPITE OUR HUGE $0.77 LOSS IN SILVER PRICING AT THE COMEX// FRIDAY.,. THE CME NOTIFIED US THAT WE HAD A STRONG SIZED EFP ISSUANCE CONTRACTS: 945 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: /STRONG BANKER ADDITIONS // STRONG SHORT ADDITIONS//CONSIDERABLE NEWBIE SPEC LONG ADDITIONS// /// WE HAVE A GOOD INITIAL SILVER OZ STANDING FOR OCT. OF 1.580 MILLION OZ FOLLOWED BY TODAY’S 290,000 QUEUE JUMP .. WE HAD AN ATMOSPHERIC SIZED GAIN OF 6113 OI CONTRACTS ON THE TWO EXCHANGES FOR 30.720 MILLION OZ..
WE HAD 9 NOTICE(S) FILED TODAY FOR 45,000 OZ
THE SILVER COMEX IS NOW BEING ATTACKED FOR METAL BY LONDONERS ET AL.
GOLD//OUTLINE
IN GOLD, THE COMEX OPEN INTEREST ROSE BY A SMALL SIZED 1371 CONTRACTS TO 437,368 AND CLOSER TO 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 — -19 CONTRACTS.
.
THE SMALL SIZED INCREASE IN COMEX OI CAME DESPITE OUR LOSS IN PRICE OF $26.50//COMEX GOLD TRADING/FRIDAY // MINIMAL SPECULATOR SHORT COVERINGS ACCOMPANYING OUR FAIR SIZED EXCHANGE FOR PHYSICAL ISSUANCE./. WE HAD ZERO LONG 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 OCT. AT 66.099 TONNES ON FIRST DAY NOTICE FOLLOWED BY TODAY’S QUEUE. JUMP OF 3600 OZ//NEW STANDING 70.905 TONNES (QUEUE JUMPING = EXERCISING LONDON BASED EFP’S WILL CONTINUE UNTIL MONTH’S END)
YET ALL OF..THIS HAPPENED WITH OUR LOSS IN PRICE OF $26.50 WITH RESPECT TO FRIDAY’S TRADING
WE HAD A GOOD SIZED GAIN OF 4867 OI CONTRACTS 15.138 PAPER TONNES) ON OUR TWO EXCHANGES..
E.F.P. ISSUANCE
THE CME RELEASED THE DATA FOR EFP ISSUANCE AND IT TOTALED A FAIR SIZED 3496 CONTRACTS:
The NEW COMEX OI FOR THE GOLD COMPLEX RESTS AT 437,368
IN ESSENCE WE HAVE A GOOD SIZED INCREASE IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 4867 CONTRACTS WITH 1371 CONTRACTS INCREASED AT THE COMEX AND 3496 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS TOTAL OI GAIN ON THE TWO EXCHANGES OF 4867 CONTRACTS OR 15.138 TONNES.
CALCULATIONS ON GAIN/LOSS ON OUR TWO EXCHANGES
WE HAD A FAIR SIZED ISSUANCE IN EXCHANGE FOR PHYSICALS (3496) ACCOMPANYING THE SMALL SIZED GAIN IN COMEX OI (1371): TOTAL GAIN IN THE TWO EXCHANGES 4867 CONTRACTS. WE NO DOUBT HAD 1) ZERO SPECULATOR SHORT COVERINGS// CONTINUED GOOD BANKER ADDITIONS/// STRONG NEWBIE SPEC SHORT ADDITIONS ,2.) STRONG INITIAL STANDING AT THE GOLD COMEX FOR OCT. AT 66.099 TONNES FOLLOWED BY TODAY’S 3600 OZ QUEUE. JUMP ///NEW STANDING 70.905 TONNES//. 3) ZERO LONG LIQUIDATION //// //.,4) SMALL SIZED COMEX OPEN INTEREST GAIN 5) FAIR ISSUANCE OF EXCHANGE FOR PHYSICAL/
HISTORICAL ACCUMULATION OF EXCHANGE FOR PHYSICALS IN 2022 INCLUDING TODAY
OCT
ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF OCT. :
30,357 CONTRACTS OR 3,035,700 OZ OR 94.423 TONNES 13 TRADING DAY(S) AND THUS AVERAGING: 2335 EFP CONTRACTS PER TRADING DAY
TO GIVE YOU AN IDEA AS TO THE SIZE OF THESE EFP TRANSFERS : THIS MONTH IN 13 TRADING DAY(S) IN TONNES: 94.423 TONNES
TOTAL ANNUAL GOLD PRODUCTION, 2021, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 3555 TONNES
THUS EFP TRANSFERS REPRESENTS 94.423/3550 x 100% TONNES 2.64% OF GLOBAL ANNUAL PRODUCTION
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. 193.16 TONNES FINAL
OCT: 94.423 TONNES INITIAL ( MUCH SMALLER THAN LAST MONTH)
SPREADING OPERATIONS
(/NOW SWITCHING TO GOLD) FOR NEWCOMERS, HERE ARE THE DETAILS
SPREADING LIQUIDATION HAS NOW COMMENCED AS WE HEAD TOWARDS THE NEW NON ACTIVE FRONT MONTH OF NOV. WE ARE NOW INTO THE SPREADING OPERATION OF BOTH SILVER AND GOLD (WILL BE SMALL AS SPREADERS DO NOT PAY ATTENTION TO NOVEMBER)
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 OCT HEADING TOWARDS THE NON ACTIVE DELIVERY MONTH OF NOV., FOR BOTH GOLD AND SILVER:
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 (NOV), 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, ROSE BY A GIGANTIC SIZED 5168 CONTRACT OI TO 136,326 AND CLOSER TO 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 945 CONTRACTS
OUR CUSTOMARY MIGRATION OF COMEX LONGS CONTINUE TO MORPH INTO LONDON FORWARDS AS OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE:
DEC 945 ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 945 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. IF WE TAKE THE COMEX OI GAIN OF 5168 CONTRACTS AND ADD TO THE 945 OI TRANSFERRED TO LONDON THROUGH EFP’S,
WE OBTAIN AN ATMOSPHERIC SIZED GAIN OF 6113 OPEN INTEREST CONTRACTS FROM OUR TWO EXCHANGES.
THUS IN OUNCES, THE GAIN ON THE TWO EXCHANGES 30.565
4. Chris Powell of GATA provides to us very important physical commentaries
end
5. Other gold commentaries
6. Commodity commentaries//
3. ASIAN AFFAIRS
i)MONDAY MORNING// SUNDAY NIGHT
SHANGHAI CLOSED UP 12.96 PTS OR 0.42% //Hang Seng CLOSED UP 25.21 OR 0.15% /The Nikkei closed DOWN 314.97PTS OR 1.16% //Australia’s all ordinaires CLOSED DOWN 1.36% /Chinese yuan (ONSHORE) closed DOWN TO 7.2010 //OFFSHORE CHINESE YUAN UP 7.2092// /Oil DOWN TO 85.61 dollars per barrel for WTI and BRENT AT 90.89 / Stocks in Europe OPENED ALL GREEN. ONSHORE YUAN TRADING BELOW LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST US DOLLAR/OFFSHORE STRONGER
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 ROSE BY A SMALL SIZED 1371 CONTRACTS TO 437,368 AND CLOSER TO 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 SMALL COMEX INCREASE OCCURRED DESPITE OUR HUGE FALL IN PRICE OF $26.50 IN GOLD PRICING FRIDAY’S COMEX TRADING. WE ALSO HAD A FAIR SIZED EFP (3496 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 ACTIVE DELIVERY MONTH OF OCT.. 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 3496EFP CONTRACTS WERE ISSUED: ;: , . 0 DEC :3496 & ZERO FOR ALL OTHER MONTHS:
TOTAL EFP ISSUANCE: 3496 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 GAINED THE FOLLOWING TODAY ON OUR TWO EXCHANGES: A GOOD SIZED TOTAL OF 4854 CONTRACTS IN THAT 3496LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE HAD A SMALL SIZED COMEX OI GAIN OF 1388 CONTRACTS..AND THIS GOOD GAIN ON OUR TWO EXCHANGES HAPPENED DESPITE OUR FALL IN PRICE OF GOLD $26.50//WE HAD SPEC SHORTS ADDING TO THEIR POSITIONS WITH BANKERS TAKING THE OTHER SIDE AS BUYERS OF COMEX GOLD CONTRACTS. WE ALSO HAD SOME ADDITIONAL NEWBIE SPECS GOING LONG DUE TO THE ATTRACTIVE PRICE
// WE HAVE A STRONG AMOUNT OF GOLD TONNAGE STANDING OCT (70.905),
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. 38.1158 TONNES
OCT: 70.905 TONNES
THE SPECS/HFT WERE SUCCESSFUL IN LOWERING GOLD’S PRICE //// (IT FELL $26.50) BUT WERE UNSUCCESSFUL IN KNOCKING OFF ANY SPECULATOR LONGS (THEY ADDED TO THEIR POSITIONS) AS WE HAD A GOOD SIZED TOTAL GAIN ON OUR TWO EXCHANGES OF 4854 CONTRACTS // WE HAVE REGISTERED A GOOD GAIN OF 15.097 PAPER TONNES ON TOTAL OI FROM OUR TWO EXCHANGES, ACCOMPANYING OUR GOLD TONNAGE STANDING FOR OCT. (70.905 TONNES)…THIS WAS ACCOMPLISHED WITH A FALL IN PRICE OF $26.50
WE HAD -19 CONTRACTS COMEX TRADES REMOVED. THESE WERE REMOVED AFTER TRADING ENDED LAST NIGHT
NET GAIN ON THE TWO EXCHANGES 4867 CONTRACTS OR 486700 OZ OR 15.138 TONNES
Total monthly oz gold served (contracts) so far this month
22,205 notices 2,220,500 69.066 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: 1
i) Into Brinks: 1101.154 oz
total deposits 1101.54 oz
customer withdrawals:2
i) Out of JPMorgan: 17,361.540 oz (540 kilobars)
ii) Out of Manfra: 1101.154 oz
total: 18,462.694 oz
total in tonnes: 0.574 tonnes
Adjustments: 4// all dealer to customer
i)HSBC 31,568.761 oz
ii) JPMorgan 19,772.862 oz
iii) Malca 3,568.761 oz
iv) Brinks 54,383.756 oz
CALCULATIONS FOR THE AMOUNT OF GOLD STANDING FOR OCT.
For the front month of OCT we have an oi of 591 contracts having LOST 480 contracts . We had 516 contracts
filed on FRIDAY, so we GAINED A STRONG 36 contracts or an additional 3600 oz will stand in this active delivery month of Oct. From this point
we should gain in total gold standing through to the end of Oct.( This is queue jumping and in reality it is the exercising of London based EFP;s for gold at the comex)
November LOST 19 contracts to stand at 3122
December GAINED 843 contracts up to 361,986
We had0 notice(s) filed today for NIL oz FOR THE OCT. 2022 CONTRACT MONTH.
Today, 0 notice(s) were issued from J.P.Morgan dealer account and 0 notices were issued from their client or customer account. The total of all issuance by all participants equate to 0 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 0 notice(s) was (were) stopped/ Received) by J.P.Morgan//customer account and 0 notice(s) received (stopped) by the squid (Goldman Sachs)
To calculate the INITIAL total number of gold ounces standing for the OCT /2022. contract month,
we take the total number of notices filed so far for the month (22,205) x 100 oz , to which we add the difference between the open interest for the front month of (OCT 591 CONTRACTS) minus the number of notices served upon today 0 x 100 oz per contract equals 2,279,600 OZ OR 70.905 TONNES the number of TONNES standing in this active month of OCT.
thus the INITIAL standings for gold for the OCT contract month:
No of notices filed so far (22,205) x 100 oz+ (591) OI for the front month minus the number of notices served upon today (0} x 100 oz} which equals 2,279,600, oz standing OR 70.905 TONNES in this NON active delivery month of OCTOBER.
TOTAL COMEX GOLD STANDING: 70.905 TONNES (A HUMONGOUS STANDING FOR OCT (GENERALLY THE POOREST DELIVERY MONTHS FOR AN ACTIVE 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.
To calculate the number of silver ounces that will stand for delivery in OCT we take the total number of notices filed for the month so far at 427 x 5,000 oz = 2,135,000 oz
to which we add the difference between the open interest for the front month of OCT(163) and the number of notices served upon today 9 x (5000 oz) equals the number of ounces standing.
Thus the standings for silver for the OCT./2022 contract month: 427 (notices served so far) x 5000 oz + OI for front month of OCT (163) – number of notices served upon today (9) x 5000 oz of silver standing for the OCT contract month equates 2,905,000 oz. .
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
OCT 17/WITH GOLD UP $14.55: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 3.28 TONNES FROM THE GLD///INVENTORY RESTS AT 941.13 TONNES
OCT 14/WITH GOLD DOWN $26.50 TODAY: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.16 TONNES FROM THE GLD///INVENTORY RESTS AT 944.31 TONNES
OCT 13/WITH GOLD DOWN $0.40 TODAY: A DEPOSIT OF 1.16 TONNES INTO THE GLD// CHANGE IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 945.47 TONNES
OCT 12/WITH GOLD UP $4.00 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 944.31 TONNES
OCT 11/WITH GOLD UP $10.30 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 944.31 TONNES
OCT 10//WITH GOLD DOWN $33.50 TODAY: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.03 TONNES OF GOLD FROM THE GLD////INVENTORY RESTS AT 944.31 TONNES
OCT 7/WITH GOLD DOWN $10.70: NO CHANGES IN GOLD INVENTORY AT THE GLD///INVENTORY RESTS AT 946.34 TONNES
OCT 6/WITH GOLD UP $.70 TODAY: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 3.45 TONNES INTO THE GLD//INVENTORY RESTS AT 946.34 TONNES
OCT 4/WITH GOLD UP $28.65 TODAY: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 3.19 TONNES INTO THE GLD//INVENTORY RESTS AT 942.89 TONNES
OCT 3.WITH GOLD UP $29.30 TODAY: BIG CHANGES IN GOLD INVENTORY AT THE GLD AND A BIG SURPRISE: A WITHDRAWAL OF 1.45 TONNES FROM THE GLD////INVENTORY RESTS AT 939.70 TONNES
SEPT 30 WITH GOLD UP $3.75 TODAY : BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.01 TONNES FROM THE GLD////INVENTORY RESTS AT 941.15 TONNES
SEPT 29/WITH GOLD DOWN $.85 TODAY: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 3.3 TONNES INTO THE GLD//INVENTORY RESTS AT 943.16 TONNES
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
GLD INVENTORY: 941.13 TONNES
Now the SLV Inventory/( vehicle is a fraud as there is no physical metal behind them
OCT 17/WITH SILVER UP 53 CENTS TODAY: BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.151 MILLION OZ INTO THE SLV////INVENTORY REST AT 486.071 MILLIONOZ//
OCT 14/WITH SILVER DOWN 77 CENTS TODAY: BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 2.211 MILLION OZ INTO THE SLV//INVENTORY RESTS AT 484.920 MILLION OZ//
OCT 13/WITH SILVER DOWN 2 CENTS TODAY: BIG CHANGE IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 4.513 MILLION OZ INTO THE SLV//INVENTORY RESTS AT 482.709 MILLION OZ//
Oct 12/WITH SILVER DOWN 18 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 478.196 MILLION OZ
OCT 11/WITH SILVER DOWN 11 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 5.066 MILLION OZ INTO THE SLV///INVENTORY RESTS AT 478.196 MILLION OZ
OCT 10//WITH SILVER DOWN 65 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 473.130 MILLION OZ/
OCT 7/WITH SILVER DOWN 37 CENTS TODAY: BIG CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 2.447 MILLION OZ FROM THE SLV///INVENTORY RESTS AT 473.130 MILLION OZ/
OCT 6/WITH SILVER UP 11 CENTS TODAY: BIG CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY: A WITHDRAWAL OF 5.3 MILLION OZ FROM THE SLV//INVENTORY RESTS AT 475.617 MILLION OZ//
OCT 4WITH SILVER UP $.51 TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 480.917 MILLION OZ
OCT 3/WITH SILVER UP $1.46 : NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 480.917 MILLION OZ//
SEPT 30/WITH SILVER UP 31 CENTS TODAY: SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.013 MILLION OZ FROM THE SLV//INVENTORY RESTS AT 480.917 MILLION OZ//
SEPT 29/WITH SILVER DOWN 15 CENTS: BIG CHANGES IN SILVER INVENTORY AT THE SLV//A WITHDRAWAL OF 645,000 OZ FROM THE SLV//INVENTORY RESTS AT 479.904 MILLION OZ//
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/
As Peter Schiff put it in a recent podcast, the inflation insanity continues.
We got the September Consumer Price Index (CPI) data and it once again came in hotter than expected. Month-on-month, CPI was up 0.4%. That was double the 0.2% expectation. On an annual basis, the CPI was 8.2%.
By the way, the month-on-month CPI in September 2021 was also 0.4%. So, prices continue to increase at the same clip they were a year ago. In other words, inflation is still running rampant, despite all the Fed has done to try to stop it.
Core CPI excluding more volatile food and energy prices was up 0.6% from last month and charted a 6.6% year-on-year increase. That was the highest jump in annual core inflation since August 1982.
Peter said it makes no sense that people keep expecting better inflation numbers and continue to be surprised when they come out worse than expected.
The classic definition of insanity – doing the same thing over and over again, yet expecting a different result. In fact, the insanity goes all the way back to the days when everybody just said inflation was transitory. I remember — we’d keep getting a hotter-than-expected inflation number and everybody said, ‘Don’t worry about it. It’s going to go away. It’s transitory,’ and so each time we got a new report, everybody thought that the number would be lower, and everybody would be surprised when it wasn’t lower, or it went higher. In fact, when they kind of went from transitory inflation to peak inflation, every time we got a number that made a new high, they kept repeating the same phrase. ‘OK, now inflation is peaked. Oh, no, now inflation has peaked.’ And now, they just keep expecting inflation to go lower because the Fed has raised interest rates.”
In fact, the Fed has hiked rates significantly since last March, with four 75 basis point increases. The rate now stands at 3.25%. And we’ve seen the impact of these hikes on the economy. It is demonstrably slowing.
So, everybody expects lower inflation, yet every month, investors are surprised by higher-than-expected inflation. This high inflation is not going to go away. It’s not going to go away anytime soon. In fact, it’s not going to go away anytime in this decade.”
A lot of people think the current inflation problem is solely the result of the monetary policy mistakes made after COVID. But as Peter talked about in a previous podcast, this inflation problem was decades in the making.
We are paying for monetary mistakes going back into the early 1990s, or even late 1980s. It’s not simply the mistakes that were made after 2020. It was all the mistakes that were made prior to 2020.”
And despite all of the Fed hiking, we still have negative real interest rates. That means we still have a stimulative monetary policy.
Even when the Fed hikes rates to 4% in November, you’re still half the inflation rate. You’re still discouraging people from saving and encouraging people to take on more debt. You are stoking inflation’s fires. You’re not putting it out.”
Peter noted that Pepsi recently announced price increases of 17%. He said that’s more indicative of inflation than the CPI.
Pepsi’s prices are real prices. There’s no hedonics. There’s no substitution. They are what they are. And they’ve raised prices by 17%. That probably reflects what’s going on with inflation. Because, remember, Pepsi doesn’t want to raise prices. It’s trying not to. In fact, remember the early days in the inflation. All of these companies were eating these price hikes. They thought it was transitory. So, they were absorbing the higher costs. They weren’t raising prices.”
At the time, Peter said these companies would eventually realize inflation wasn’t transitory, and they would throw in the towel and raise prices to recover their higher costs.
So, a 17% inflation rate, to me, is more believable than the government’s 8.5%. And what Pepsi is selling is what America is buying. This is what’s going on with prices.”
Peter pointed out that even after Paul Volker hiked rates to 20% to get inflation under control, the CPI was rarely under 2% during the 1980s and 1990s. What makes anybody think the Fed can quickly get CPI back down to that level today?
The problem is we have printed so much money since then, the debts are so much larger, that bringing an inflation rate down to the level we had in the 1980s, and 1990s, or 2000s, is nearly impossible.”
Peter said, “We’re not going down to 2%.”
The aberration was the inflation of 2% or less that we got following the 2008 financial crisis. … Now, what we are going to have is a lot of high inflation to make up for all those years of low inflation. It’s a reversion to the mean. Except we’re really not going to revert to the mean. We’re going to revert to something much higher than the mean because of massive and unprecedented money printing that has gone on – not just since COVID, but before COVID.”
In this podcast, Peter also talked about the market reaction to the CPI data, how the increase in Social Security benefits will stoke the inflation fire, the impact of rate hikes on the national debt, bitcoin, and how gold is holding up better than stocks.
2. Lawrie Williams//Pam and Russ Martens/Jim Rickards/Mathew Piepenburg/Von Greyerz
LAWRIE WILLIAMS: Blip in China September gold demand y-o- y?
Anecdotal accounts have Chinese gold demand riding high already this year with talk of price premiums and bullion shortages developing, but this does not seem to be being confirmed by the latest data from the Shanghai Gold Exchange (SGE). This suggests that gold demand actually slipped a little in the September month and that the cumulative total for the first nine months of the current year may be slightly below that of the corresponding nine month period of 2021. Not by enough perhaps to worry about yet, but sufficient to generate further close attention to figures that may arise month by month for the remainder of the year. That would be sufficient to make our earlier prediction of an overall Chinese annual gold consumption figure for the current year of around 1,800 tonnes perhaps a little on the optimistic side. The occasional draconian lockdowns in key cities to prevent any spread of the Covid virus may be having and undue effect on overall earnings and gold demand.
The SGE withdrawal figures on a month by month basis year to date are set out in the table below. Assuming similar withdrawal levels to last year for the final quarter of the year, Chinese gold consumption for 2022 looks perhaps more likely to end up around 1,700 tonnes, which would still make the nation comfortably the world’s largest gold consumer.
Of course the big unknown here remains Russia – the world’s second or third largest gold producer depending on whose figures one takes. U.S. and European imposed economic sanctions have cut off the Russian-produced gold from its normal markets and it will have been searching for ‘friendly’ outlets for its gold production, in part at least to help it finance its ongoing military incursions into Ukraine. China is an obvious outlet for this Russian gold and is certainly receiving some of it, although the figures that have been forthcoming in official announcements so far do not account for very much of it.
Both nations have histories of being extremely secretive about what they may consider to be strategic matters and this could well cover gold flows between these two neighbouring countries which are supposedly allies. Russia mines over 300 tonnes of gold annually and China is believed by many to be surreptitiously building up its gold reserves to match, or exceed those of the U.S., and secret Russian gold imports could well be a means to this end. This is all speculation of course, but could provide an answer that would seem to meet both nations’ assumed needs.
16 Oct 2022
end
END
3.Chris Powell of GATA provides to us very important physical commentaries
Wary of U.S. dollar hegemony, Chinese state researchers float idea of a pan-Asian digital currency
Submitted by admin on Fri, 2022-10-14 09:53Section: Daily Dispatches
By Frank Tang South China Morning Post, Hong Kong Thursday, October 13, 2022
The conditions are right for the establishment of a pan-Asian digital currency that could enhance regional monetary cooperation and loosen reliance on the U.S. dollar, Chinese state researchers say.
The idea of an Asia-wide digital token comes as Beijing tries to consolidate its economic influence in the region and its position as a global leader in digital currency development.
China is also working studiously to reduce its reliance on the U.S. dollar system amid threats of financial decoupling from Washington.
“More than 20 years of deepened economic integration in East Asia has laid a good foundation for regional currency cooperation. The conditions for setting up the Asian yuan have gradually formed,” said researchers Song Shuang, Liu Dongmin, and Zhou Xuezhi, from the Institute of World Economics and Politics under the Chinese Academy of Social Sciences.
The digital token would be pegged to a basket of 13 currencies, including the yuan, Japanese yen, South Korean won, and those of the 10 member countries in the Association of Southeast Asian Nations, the researchers wrote in an article. Weighting for each could be similar to that of the International Monetary Fund’s special drawing rights, an international reserve asset. …
Jan Nieuwenhuijs: Europe has been preparing a gold standard since the 1970s
Submitted by admin on Fri, 2022-10-14 11:22Section: Daily Dispatches
By Jan Nieuwenhuijs Gainesville Coins, Lutz, Florida Friday, October 14, 2022
There is more evidence of how European central banks are equalizing their monetary gold reserves proportionally to Gross Domestic Product.
Secret agreements make countries sell or buy gold to balance gold reserves within Europe, and relative to large economies abroad.
Evenly distributed gold reserves are a requirement for a stable transition toward a gold standard whereby concurrently the debt overhang can be extinguished. Europe has been preparing for this reset. …
Ted Butler: Stand up against market manipulation and make a difference
Submitted by admin on Fri, 2022-10-14 23:44Section: Daily Dispatches
By Ted Butler SilverSeek.com Friday, October 14, 2022
If you are tired of witnessing silver (and gold) continuing to be manipulated in price, here’s a no-cost, no-risk, high-potential return action you can take that will only involve a few minutes of your time. Quite literally, there’s absolutely nothing to lose and quite a lot of potential good to be had.
The Commodity Futures Trading Commission is the taxpayer-funded federal commodities regulator whose main mission is to prevent and root out manipulation and protect the public. Four of the five commissioners have been in office for little more than six months and it’s not clear that they are even aware that silver has been manipulated in price on the Comex.
Here is your opportunity to ensure that this is an issue they should be concerned about. Please take the time to copy and paste the letter below and email it to addresses listed. If you would prefer using your own name and not mine, you have my permission to do so. …
If you are tired of witnessing silver (and gold) continuing to be manipulated in price, here’s a no-cost, no-risk, high potential return action you can take that will only involve a few minutes of your time. Quite literally, there’s absolutely nothing to lose and quite a lot of potential good to be had.
The Commodity Futures Trading Commission (CFTC) is the taxpayer-funded federal commodities regulator whose main mission is to prevent and root out manipulation and protect the public. Four of the five commissioners have only been in office for little more than six months and it’s not clear that they are even aware that silver has been manipulated in price on the COMEX. Here is your opportunity to ensure that this is an issue they should be concerned about. Please take the time to copy and paste the enclosed letter and email it to addresses listed. If you would prefer using your own name and not mine, you have my permission to do so.
US citizens might also consider forwarding the same to your local congressman or woman, and senators, asking them to send it on the CFTC, which will guarantee the agency will respond.
Commodity Futures Trading Commission Three Lafayette Centre 1155 21st Street, NW Washington, DC 20581
The evidence has become overwhelming that the price of silver does not reflect developments in the physical world of supply and demand. There has developed a physical shortage in both the retail and wholesale silver market accompanied by declining inventories. Nevertheless, the price has fallen. Increasingly, there has developed among the public a conviction that the culprit for this mispricing is trading by a handful of large traders in silver futures on the Commodities Exchange, Inc. (COMEX), owned and operated by the CME Group, Inc.
The Commission has considered the question of a silver price manipulation in the past. I would call on the Commission to explain why such large and concentrated dealings, particularly on the short side of COMEX silver futures, are not artificially depressing the price. I would also call on the Commission to end what many believe to be an ongoing price manipulation. Thanks for your consideration and attention to this matter.
Sincerely,
Theodore Butler
4. OTHER PHYSICAL SILVER/GOLD
5.OTHER COMMODITIES:
end
COMMODITIES IN GENERAL/
END
END
6.CRYPTOCURRENCIES
7. GOLD/ TRADING
Your early currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings MONDAY morning 7:30 AM
ONSHORE YUAN: CLOSED DOWN 7.2019
OFFSHORE YUAN: 7.20920
SHANGHAI CLOSED UP 12.96 PTS OR 0.42%
HANG SENG CLOSED UP 25.21 OR 0.15%
2. Nikkei closed DOWN 314.97 PTS OR 1.16%
3. Europe stocks SO FAR: ALL GREEN
USA dollar INDEX DOWN TO 112.89/Euro RISES TO 0.9737
3b Japan 10 YR bond yield: RISES TO. +.249/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 148.88/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 DOWN CHINESE YUAN: DOWN -// OFF- SHORE: UP
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 DOWN for WTI and DOWN FOR Brent this morning
3h European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund UP TO +2.252%***/Italian 10 Yr bond yield RISES to 4.698%*** /SPAIN 10 YR BOND YIELD RISES TO 3.429%…** DANGEROUS//
3i Greek 10 year bond yield FALLS TO 4.921//
3j Gold at $1664.90//silver at: 18.80 7 am est) SILVER NEXT RESISTANCE LEVEL AT $30.00
3k USA vs Russian rouble;// Russian rouble UP 0 AND 18/100 roubles/dollar; ROUBLE AT 61.93//
3m oil into the 85 dollar handle for WTI and 90 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 148.88DESTROYING 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 1.0022–as the Swiss Franc is still rising against most currencies. Euro vs SF 0.9757well 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: 3.949 DOWN 6 BASIS PTS…GETTING DANGEROUS
USA 30 YR BOND YIELD: 3.944 DOWN 3 BASIS PTS//(USA 30 YR INVERTED TO THE USA 10)
USA DOLLAR VS TURKISH LIRA: 18,59…GETTTING DANGEROUS
end
Overnight: Newsquawk and Zero hedge:
FIRST, ZEROHEDGE
Futures Jump, Squeezed By Reversal In UK Fiscal Plans And Apocalyptic Trader Sentiment
MONDAY, OCT 17, 2022 – 07:49 AM
As we discussed and previewed over the weekend in “Behind Friday’s Market Massacre: A Huge Burst Of Hedge Funds Shorting, Setting Up Another Squeeze“, futures are indeed sharply higher to start the week as Treasury yields slumped and the dollar eased as the British peso (also called Britcoin) rallied and UK bonds surged as the new Chancellor Jeremy Hunt scrapped plans to cut taxes and signaled consumers would shoulder more of the increase in energy prices from next April as he set out a package of measures to get a grip on the public finances, effectively reversing pretty much all UK tax cut measures announced just a few weeks ago. Sentiment was also boosted by company results after Bank of America reported beats on the top and bottom line, rising in premarket trading while utilities and auto stocks led gains in Europe. That was indeed enough to spark a modest (for now) squeeze and as of 730am, S&P 500 futures trade higher by 1.3% and Nasdasq 100 futs rose 1.5% bouncing back from a selloff on Friday that left the technology-heavy gauge at its lowest since July 2020; Europe’s Estoxx50 rose 0.7% in early London session, which sees cable higher by 1%. The BBG Dollar index was down 0.2% and the 10Y traded at 3.95%.
And if all those record retail puts purchased in recent days get monetized, expect another epic meltup today.
Among notable premarket movers, Splunk rose after a Wall Street Journal report about activist investor Starboard Value building a stake of just under 5% in the application software company. Opendoor Technologies Inc. slipped after Goldman Sachs downgraded the stock to sell. US-listed Chinese stocks gained as President Xi Jinping reiterated that economic development is the party’s top priority in his speech at the Communist Party Congress, although he signaled little change in the Covid Zero strategy and housing market policies. Alibaba (BABA US) +1.9%, Pinduoduo (PDD US) +2.8%, JD.com (JD US) +3.3%, Nio (NIO US) +2.7%, Li Auto (LI US) +2%. Here are some other notable premarket movers:
Opendoor Technologies (OPEN US) slides 1.8% in premarket trading after Goldman Sachs downgrades stock to sell, saying it sees the ongoing weakness in housing through next year to “depress” the online real estate platform’s earnings power and in turn limit upside in shares.
Keep an eye on Fox Corp. (FOXA US) and News Corp. (NWSA US) shares after the companies said on Friday they were exploring options to recombine, while analysts suggested a deal is unlikely to solve the valuation problem for the pair.
Watch PPG Industries (PPG US) shares as KeyBanc Capital Markets initiated coverage of the stock with an overweight recommendation, saying there’s probably going to be a sharp decline in costs in 1H23 that will help offset cyclical volume pressure.
Keep an eye on household products stocks as Morgan Stanley is starting to warm to the sector with margins seen rebounding in 2023, while toning down its preference for beverage stocks.
The broker upgrades Church & Dwight (CHD US) and Clorox (CLX US) to equal-weight from underweight, while cutting Edgewell Personal Care (EPC US) to underweight from equal-weight.
Investors are focused on results due this week — including from Bank of America which just reported stronger than expected revenues and EPS, Goldman Sachs and Tesla — for clues about how company earnings are holding up. They’re also monitoring the possibility of more aggressive rate hikes in the US after Federal Reserve Bank of St. Louis President James Bullard on Friday left open the possibility that the central bank would raise interest rates by 75 basis points at each of its next two meetings.
“I think the likelihood of them doing 75bps and more is definitely higher after the University of Michigan survey last week, reason being is that they’re late to the party of inflation control and the world economy is paying the price,” said Sunaina Sinha Haldea, global head of private capital advisory at Raymond James. “The risk is that they break growth, but what is much more concerning is that they’re risking financial stability in parts of the market, which is a risk that needs to be priced in,” she said on Bloomberg TV.
In major corporate reorganization news, the WSJ reported that Goldman Sachs plans to recombine the bank’s asset management and private wealth businesses into one unit in yet another overhaul.
Morgan Stanley’s in-house permabear, Michael Wilson, echoed precisely what we said on Saturday, namely that technicals may now take the upper hand over fundamentals, with the 200-week moving average acting as a strong support to equities, while inflation expectations peak. They see a tactical rally looking likely until earnings estimates are cut or a full-blown recession arrives.
Meanwhile, the outlook for consumer prices in the US continues to fuel bets that the Federal Reserve may make jumbo rate hikes at its next two meetings, weighing broadly on the outlook for global economic growth and markets. Fed officials in their latest comments suggested they were ready to hike rates higher than previously planned. Kansas City Fed President Esther George said the terminal rate may need to be higher to cool prices. San Francisco Fed’s Mary Daly said she’s “very supportive” of raising to restrictive levels and to between 4.5% and 5% “is the most likely outcome.”
In European stocks, utilities, autos and insurance are the strongest performing sectors. Euro Stoxx 50 rises 0.3%. IBEX outperforms peers, adding 1.1%. Here are the most notable European movers:
ITV shares jump as much as 9.7%, the most since March, after the Financial Times reported that the company is exploring options for its production arm ITV Studios, including a stake sale.
Nel shares rise as much as 10%, the most since late July, after the company won a NOK600m contract to provide alkaline electrolyser equipment to Woodside Energy.
Made.com shares soared as much as 35% after the online furniture seller said it has received several “non-binding indicative proposals,” including possible offers for the company.
Sulzer shares climb as much as 4.4% after the Swiss company announced Suzanne Thoma will replace CEO Frédéric Lalanne, who is stepping down at the end of the month. Thoma’s experience and continuation of the company’s strategic review is viewed as a positive, according to analysts.
Hargreaves Lansdown shares fall as much as 7.9% after its 1Q trading update, with its CEO announcing his intention to retire amid a lawsuit relating to a failed equity fund run by Neil Woodford.
Asos shares drop as much as 13% after the online fast fashion retailer said it was in talks with banks to boost its financial flexibility, following a Sky News report that the firm’s lenders were hiring restructuring advisers, including AlixPartners.
Draegerwerk shares tumble as much as 7.5% after company withdrew FY22 guidance following market close on Friday, based on its preliminary 9-month figures.
Shares in bike helmet maker Mips plunge as much as 27%, the most in three years, as Handelsbanken said lower-than-expected 3Q sales from the company show the bike boom of the past years turning “into a bust” while 2023 risks becoming a “lost year.”
European luxury stocks drop after Chinese President Xi Jinping signaled no change in China’s strict Covid rules at the country’s Communist Party congress in Beijing on Sunday. LVMH shares decline as much as 1.8%.
As noted above, the yield on 10-year gilts fell 36 basis points to 3.97% and the pound traded 1.1% higher at $1.1293 after new Chancellor Jeremy Hunt scrapped plans to cut taxes and signaled consumers would shoulder more of the increase in energy prices as he set out a package of measures to get a grip on public finances in a televised statement on Monday. It’s the start of what may be a particularly torrid week for British assets, with the beleaguered Truss battling to rescue her premiership after the Bank of England ended its emergency bond-buying program on Friday and as mutinous backbenchers plot to oust her.
“I think we’re in for a period where UK credibility is continually questioned and UK assets remain incredibly volatile for a significant period of time,” Benjamin Jones, Invesco Director of Macro Research, said on Bloomberg Television. “Watching the gilt market will be absolutely key in understanding if the market does believe Hunt to be more stable and if he will be able to push these policies through.”
Hunt will also speak to the House of Commons at 3:30 p.m. London time and Truss is due to host a reception for the Cabinet at 10 Downing Street on Monday evening. U-turns on the government’s “mini budget” now total £32 billion, however that may not be enough as the official estimate of the black hole in the public finances is believed around £70 billion.
Earlier in the session, Asian equities resumed their decline, led by tech stocks, as investors analyzed Chinese President Xi Jinping’s speech at Party Congress, in which he ruled out changes to strict Covid rules. The MSCI Asia Pacific Index retreated as much as 1.4% before paring the drop, with TSMC and Keyence among the biggest drags after a broader US tech selloff last week. All sectors but real estate were in the red. Taiwan’s benchmark was a notable regional loser, ending 1.2% lower as the local currency weakened following comments by Xi’s about the island. Stock gauges in Japan fell about 1% after the Bank of Japan vowed to continue with monetary easing as the yen approached a key level. Benchmarks in Hong Kong erased losses, while gains in defense and tech stocks helped gauges in mainland China close moderately higher after Xi’s Sunday speech emphasized national security and self-reliance in core technologies. Planned steps by Chinese regulators to stem a slump in equities also buoyed sentiment. Asian stocks have underperformed US and European peers this year as the region struggles with challenges in China in addition to aggressive rate hikes by the Federal Reserve, prompting an exodus of foreign funds from emerging countries.
“The work report made no reference to future policy changes on Covid containment,” Nomura economists including Ting Lu wrote in a note, adding that they expect Chinese markets to suffer regardless due to disappointment about either no real opening or a surge in Covid infection numbers. Concerns of aggressive tightening by the Fed were reinforced after a survey Friday showed US year-ahead inflation expectations rose in early October for the first time in seven months. “More bad news is baked into Asia, which might suggest that the risk reward is a little bit better if we can see overall the Fed starts to stabilize at some point, perhaps early next year,” Timothy Moe, chief Asia equity strategist at Goldman Sachs, said in an interview with Bloomberg TV, citing Asia’s “excessive discounting particularly in valuations.”
Japanese stocks dropped, with electronics makers the biggest drag, following US peers lower after a report showed American year-ahead inflation expectations rose for the first time in seven months. The Topix fell 1% to close at 1,879.56, while the Nikkei declined 1.2% to 26,775.79. Keyence Corp. contributed the most to the Topix Index decline, decreasing 2.9%. Out of 2,167 stocks in the index, 476 rose and 1,603 fell, while 88 were unchanged
Australia stocks slid, the S&P/ASX 200 index falling 1.4% to close at 6,664.40, tracking a decline in US shares last week after inflation expectations rose. All sub-gauges slid, with energy and materials companies the worst performers. In New Zealand, the S&P/NZX 50 index fell 0.8% to 10,785.92.
In FX, the dollar weakened against all of its G-10 peers apart from the yen, as the Bloomberg dollar spot index fell 0.2%. SEK and JPY are the weakest performers in G-10 FX, GBP and AUD outperform; the pound topped the leaderboard and UK government bonds surged on the fiscal policy u-turn. Yields on 10-year gilts fell 26 basis points to 4.05%, while sterling advanced up to 1.2% higher on the day to touch $1.1305 after the BOE confirmed it terminated its emergency bond-buying program. Hedging the pound overnight remains a costly exercise after UK Chancellor of the Exchequer Jeremy Hunt announced measures to “support fiscal sustainability”. Commodity currencies also outperformed. The Australian and New Zealand dollars rose as traders covered shorts after Chinese President Xi warning of “dangerous storms” ahead failed to spur broader selling. The euro traded in a narrow $0.9711-57 range. Bunds and Italian bonds rose alongside Treasuries as central bank tightening bets were pared. Japan’s Yen traded in a narrow range, close to 32-year lows, as traders await fresh impetus to drive it lower and assess potential action from Japanese authorities. Japan’s 30-year bond yield rose to a seven-year high.
In rates, Treasuries rallied, led by the belly and richer by 5bp to 8bp across the curve with gains led by front-end and belly, richening the 2s5s30s fly by almost 5bp on the day; 10-year yields around 3.945%, richer by 7.5bp on the day and lagging gilts by additional 27bp in the sector, following a surge across gilts as BOE rate-hike premium is pared after Chancellor Hunt scraps vast portions of the expansive fiscal stimulus plan that had plunged the market into turmoil. UK yields off lows of the day, although remain richer by 35bp to 40bp across the curve into early US session. UK bonds rally across the curve, led by the long-end, as the new Chancellor is expected to make a statement on the government’s fiscal plans, with the yield on 10-year gilts falling 36 basis points to 3.97% and the pound traded 1.1% higher at $1.1293.
In commodities, WTI drifts 0.2% lower to trade near $85.41 as it fluctuated after a weekly slump as fears over an economic slowdown continue to weigh on the outlook for demand. French PM Borne said about 30% of the country’s petrol stations face supply issues due to a slight worsening of strikes at refineries, while Borne also stated that TotalEnergies ( TTE FP) CEO agreed to extend the fuel discount, according to Reuters. Spot gold is propped up by a softer Dollar, with the yellow metal back above USD 1,650/oz and eyeing its 21 DMA at USD 1,670.10/oz. LME metals are mixed with 3M copper losing some ground and just about holding onto USD 7,500/t+ status, whilst LME aluminium underperforms following an enormous LME stockpile increase of over 65k tonnes.
Bitcoin was rangebound and holding just above the USD 19k mark at present.
Looking at the day today, it’s a quiet day with just the Empire Manufacturing index on deck (exp. -4.3).
Market Snapshot
S&P 500 futures up 0.9% to 3,630.00
STOXX Europe 600 up 0.3% to 392.36
MXAP down 0.8% to 136.71
MXAPJ down 0.6% to 442.50
Nikkei down 1.2% to 26,775.79
Topix down 1.0% to 1,879.56
Hang Seng Index up 0.2% to 16,612.90
Shanghai Composite up 0.4% to 3,084.94
Sensex up 0.6% to 58,280.17
Australia S&P/ASX 200 down 1.4% to 6,664.44
Kospi up 0.3% to 2,219.71
German 10Y yield little changed at 2.27%
Euro little changed at $0.9728
Brent Futures down 0.2% to $91.45/bbl
Gold spot up 0.63% to $1,654,87
U.S. Dollar Index down 0.17% to 113.12
Top Overnight News from Bloomberg
UK Chancellor of the Exchequer Jeremy Hunt will accelerate plans on Monday to try to bring order to the UK’s public finances and reassure markets, after Liz Truss’s economic program triggered weeks of turmoil
Chinese President Xi Jinping signaled no change in direction for two main risk factors dragging down China’s economy — strict Covid rules and housing market policies — providing little lift to a worsening growth outlook
Double-digit inflation is set to return in the UK and linger through the end of this year despite the government’s effort to cap energy bills, a survey of economists shows
Speculation intensified among Tokyo’s yen watchers that Japan may be using subtle ways to slow the currency’s decline, zeroing in on the volatility seen after Thursday’s surprise US inflation data. By one estimate, authorities may have spent around 1 trillion yen ($6.7 billion) to support the currency
Further rate hikes are costs without benefits, Polish Monetary Policy member Ireneusz Dabrowski says in interview with Parkiet newspaper
ECB Governing Council member Martins Kazaks said interest rates should be raised beyond year- end — a time when economists increasingly expect the euro zone to be in the midst of a recession
ECB Governing Council member Olli Rehn said financial stability risks on the international markets are “clearly increasing”
EU natural gas prices fell to the lowest level in more than three months as the European Commission plans to propose a temporary mechanism to prevent extreme price spikes in derivatives trading through a dynamic limit for transactions on the Dutch Title Transfer Facility, according to a draft document seen by Bloomberg News.
A more detailed look at global markets courtesy of Newsquawk
Asia-Pac stocks were negative as the region took its cue from last Friday’s declines on Wall St where risk assets were pressured by inflationary concerns, while the region also digested hawkish global central bank rhetoric and China sticking to its strict zero-COVID policy. ASX 200 was led lower by the commodity-related sectors and with Australian Treasurer Chalmers flagging an increase in the cost of living due to floods in the primary food growing areas. Nikkei 225 weakened with Japan said to consider a rise in corporation tax as an option to fund the nation’s defence budget which could double in the next few years. Hang Seng and Shanghai Comp. were lower following Chinese President Xi’s speech to kick-start the Communist Party Congress in which he defended the zero-Covid policy and reaffirmed intentions for the reunification of Taiwan, while attention was also on the PBoC which rolled over CNY 500bln of MLF loans and kept the rate at 2.75% which suggests a likely pause in its benchmark rates later this week.
Top Asian News
Chinese will delay the release of Q3 economic indicators including GDP, according to the Stats Bureau; no new date mentioned.
PBoC injected CNY 500bln via 1-year MLF with the rate kept at 2.75%, as expected.
China locked down nearly 1mln people near an Apple (AAPL) iPhone factory in which Zhengzhou city ordered residents in one district to stay home, according to Bloomberg.
BoJ Governor Kuroda said the BoJ is continuing with monetary easing since Japan’s headline inflation is likely to fall below 2% next fiscal year, while he added it is appropriate to continue monetary easing to ensure a shift in the deflationary norm and achieve the inflation target in a sustainable and stable manner, according to Reuters.
BoJ Deputy Governor Wakatabe said it is up to the Finance Ministry to decide on whether or not to intervene in the FX market and that current FX fluctuations are clearly too rapid and too one-sided.
Japanese top currency diplomat Kanda said they are ready to take decisive action if excess FX moves continue and are backed by speculative trading, while Kanda reiterated that recent JPY moves were somewhat rapid, according to Reuters.
BoK Governor Rhee said he does not see interest among US officials in pursuing a plaza accord to stem the dollar strength, while Rhee also stated that the BoK needs a little bit more experience and technical capacity for forward guidance, according to Reuters.
South Korean Finance Minister Choo said the government will scrap taxes on foreigners’ income from Korean treasury bonds and monetary stabilisation bonds from Monday, according to Reuters.
China Delays Release of GBP Data Due Tuesday, No Reason Given
Xi Says China’s Power Has Increased, Warns of ‘Dangerous Storms’
EU Agrees to New Iran Sanctions Over Human-Rights Issues
Mizuho CEO Eyes Expanding Investment Banking in US: Nikkei
European bourses see a choppy session but have tilted towards the green after experiencing a mixed cash open. Sectors are mostly firmer with no overaching theme – Insurance, Autos, and Utilties lead the gains whilst Chemicals, Retail and Consumer Products lag. US equity futures see gains across the board following the steep losses on Friday – with the NQ and RTY narrowly outperforming
Top European News
BoE Governor Bailey said they will not hesitate to raise interest rates to meet the inflation target and that the Bank had to intervene to deal with the threat to the stability of the financial system, while they think inflation should peak at around 11% and his best guess is that inflationary pressures will require a stronger response than perhaps thought in August, according to Reuters.
BoE Governor Bailey said he does not comment on fiscal policy but has to emphasise sustainability, while he spoke with UK Chancellor Hunt and said that there is a meeting of minds on sustainability. Furthermore, Bailey said they are going to have to stay very focused on the risks of second-round effects on inflation, according to Reuters.
UK Chancellor Hunt said taking difficult decisions now is the best way to stop interest rates from rising and that the PM hasn’t changed the destination, she has changed the way we are going to get there. Hunt also commented that the PM is in charge and the last thing they need is another Conservative leadership campaign, according to Reuters.
UK Chancellor Hunt said ‘yes’ when asked if he can change the mini-Budget plans and noted that the priority will be to help struggling businesses and families, while he is leaving all possibilities open when asked about government spending and stated that tax will not be cut as quickly and some taxes will go up, according to Reuters.
UK Chancellor Hunt is to make a statement later today, bringing forward measures from the Medium-Term Fiscal Plan that will support fiscal sustainability, via Treasury. Hunt will deliver the full medium-term fiscal plan, to be published with OBR forecasts, on 31st October. Chancellor Hunt met with BoE Governor Bailey and the DMO head on Sunday night, to brief them on these plans.
UK Chancellor Hunt is to delay plans to reduce the basic rate of income tax by a year and it was also reported that the draft forecast by the OBR fiscal watchdog sees the UK will have a black hole in public finances of up to GBP 72bln by 2027/28, according to The Sunday Times.
Senior Tories will hold talks this week on a “rescue mission” that could see the swift removal of Liz Truss as leader, after the new Chancellor Hunt tore up her economic package and signalled a new era of austerity, according to The Observer. Furthermore, The Times reported that Tories held secret talks on installing a new leader and Daily Mail also reported that UK lawmakers will attempt to oust UK PM Truss this week despite warnings from Downing Street that it could trigger a general election.
Reportedly almost all of Kwarteng’s GBP 45bln of unfunded tax reductions is set to be scrapped by Chancellor Hunt, via FT’s Parker; “including income tax cut and stuff on dividends, stamp duty, foreign shoppers and IR35.”
US President Biden said he wasn’t the only one who thought that UK PM Truss’s original economic plan was a mistake, according to Reuters. It was also separately reported that Goldman Sachs downgraded its UK growth outlook after the government tax U-turn.
Head of UK’s Unison union warned the largest nationwide strike of NHS workers since the early 1980s could occur this winter if ministers ignore calls to match pay with inflation, according to FT.
BoE is publishing a market notice which sets out how energy firms and commercial lenders can apply to participate in the energy markets financing scheme; open to applications today; alongside this the UK Gov’t has published a release, outlining the financing scheme and specifying that the gov’t will only be liable if a firm defaults on their repayment; scheme is designed to help firms facing temporary shot-term financing problems.
Europe Gas Drops to 3-Month Low as EU Plans More Crisis Measures
Germany Faces $85 Billion Hit as Labor Shortages Intensify
Dominant Hunt Refuses to Rule Out New U-Turn on Truss Taxes
ITV Jumps as Report Says It’s Exploring Options for Studios Unit
FX
Pound perkier on premise that new UK Chancellor will be more frugal with public finances, Cable comfortable on 1.1200 handle and EUR/GBP probing 50 DMA just shy of 0.8650.
Aussie and Kiwi recover amidst less risk-off environment ahead of RBA minutes and NZ Q3 CPI; AUD/USD hovering around 0.6250 and NZD/USD just under 0.5600.
Loonie, Franc and Euro all firmer vs Greenback as DXY slips from Friday’s peak to pivot 113.000, USD/CAD eyeing 1.3800, USD/CHF close to parity and EUR/USD above 0.9750.
Yen propped ahead of 149.00 vs Dollar as Japanese officials turn up volume of verbal intervention.
PBoC set USD/CNY mid-point at 7.1095 vs exp. 7.1331 (prev. 7.1088)
Major Chinese state-owned banks were seen swapping yuan for dollars in the forwards market and selling dollars in the spot market to stabilise the local currency, according to sources cited by Reuters.
Fixed Income
Gilts gap-up and lead the way ahead of a potential “mini-Budget” U-turn from new Chancellor Hunt, peers buoyed in turn.
Specifically, Gilt Dec’22 posts upside of over 300 ticks around the 97.00 mark with the associated 10yr yield down to near 4.0%.
Amidst this, SONIA is taking a dovish-turn despite the weekend’s remarks from Bailey, with pricing dipping to ‘just’ a ~75% chance of a 100bp increase in November.
Stateside, USTs are firmer by around 15ticks with the US-specific docket comparably sparse after last week’s key inputs.
BoE Gilt statement: As previously announced, the Bank terminated these operations and ceased all bond purchases on Friday 14 October. As intended, these operations have enabled a significant increase in the resilience of the sector.
Commodities
WTI and Brent futures trimmed earlier gains in downside that was exacerbated after reports China is to delay is Q3 GDP release.
French PM Borne said about 30% of the country’s petrol stations face supply issues due to a slight worsening of strikes at refineries, while Borne also stated that TotalEnergies ( TTE FP) CEO agreed to extend the fuel discount, according to Reuters.
Spot gold is propped up by a softer Dollar, with the yellow metal back above USD 1,650/oz and eyeing its 21 DMA at USD 1,670.10/oz.
LME metals are mixed with 3M copper losing some ground and just about holding onto USD 7,500/t+ status, whilst LME aluminium underperforms following an enormous LME stockpile increase of over 65k tonnes.
CCP National Congress
Chinese President Xi declared the new core mission of the party is to lead China united in the challenge to be a powerful, modern socialist nation by 2049. Chinese President Xi said they will promote a high level of opening to the outside world and will maintain pluralistic and stable economic relations with other countries. Furthermore, Xi said they will strengthen the ability to prevent and control the epidemic, while he also commented that the next five years will be crucial for building a modern socialist power and will aim for high-quality growth, as well as support the private economy unwaveringly, according to Reuters.
China Communist Party spokesman Sun said China is capable of greater miracles going forward but noted China has entered a new normal of slower growth and is more focused on fixing long-term issues than growth. Sun also stated that they all hope the pandemic will end soon but what they see now is that the pandemic is still on and that their Covid prevention policy is the best and most economically efficient, according to Reuters.
Chinese government officials are backpedalling on efforts to organise a meeting between US President Biden and Chinese President Xi on the sidelines of the G20 summit next month, according to Politico.
Chinese President Xi said they will firmly promote reunification efforts with Taiwan and it is up to the Chinese people to resolve the Taiwan issue, while he added they will never renounce the right to use force and said reunification of the motherland must and will certainly be achieved.
Chinese Communist Party spokesman Sun said achieving reunification with Taiwan by peaceful means best meets the interest of all and the use of force is the last resort under compelling circumstances, while he added that Taiwan will plunge into a disaster if pro-independence Taiwan and external forces are left unchecked, according to Reuters.
OPEC Headlines
OPEC Secretary-General al-Ghais said slow economic growth reflects on oil demand and that OPEC+ took the pre-emptive decision, while he added OPEC doesn’t target a specific price but targets a balance between supply and demand. Al Ghais also stated that they do not control oil prices and that their decisions are purely technical, as well as noted that there is always space for flexibility in OPEC when asked about reviewing this month’s oil output cut. Furthermore, he commented that oil markets are going through a stage of great fluctuations, according to Reuters.
Iraq said OPEC+ decisions are based on economic indicators and there is consensus in OPEC+ to be pre-emptive to deal with the current uncertainty in oil markets, while it added that the OPEC+ latest decision is based on market inputs and it is essential to achieve market stability, according to a SOMO statement cited by Reuters.
UAE Energy Minister said the OPEC decision was purely technical and unanimous not political as some described, according to Reuters.
Kuwait said it welcomes the recent decision by OPEC+ to cut output and said it is keen to maintain balance in the oil markets for the benefit of consumers and producers, while it added that expected slow global economic growth led to more disturbance in the balance of supply and demand in oil markets, according to Reuters. Furthermore, Kuwait appointed Badr Al Mulla as its new Oil Minister and appointed Wahab Al Rasheed as Finance Minister, according to a tweet.
Oman’s Energy Ministry said OPEC+ decisions are based on purely economic considerations, as well as realities of supply and demand in the market, while the decision was important and necessary to reassure the market and support its stability, according to a Tweet.
Bahrain’s Oil Minister said the OPEC+ decision was reached by consensus among all member states and that OPEC+ will study any economic developments in the future to ensure the stability of markets and global supply, according to the state news agency cited by Reuters.
ECB Headlines
ECB’s Knot said he is increasingly convinced that rates need to rise above neutral and once rates hit a neutral level, it makes sense to consider running off APP stock, according to Reuters.
ECB’s Rehn said the threat of stagflation has intensified. The stability risks of international financial markets are clearly increasing. Although the global financial crisis has been avoided for now, it is not time to breathe a sigh of relief.
ECB’s Lane expected to propose a 75bps hike at the upcoming ECB meeting, according to an ECB insider cited by Econostream.
ECB’s de Guindos expects FX rate to stabilise in the coming months, via Reuters.
Some ECB officials are seeing legal basis to toughen bank TLTRO terms, according to Bloomberg sources.
Geopolitics
Ukrainian President Zelensky said Bakhmut and Soledar in eastern Donbas are hotspots at the front with heavy fighting, while it was separately reported that that Kyiv’s Mayor Klitschko said blasts hit Kyiv’s city centre, according to Reuters.
Russian Defence Ministry said Russia destroyed three US-made M777 Howitzers in Ukraine’s Kharkiv region and that Russian troops repelled Ukrainian attempts to advance in the regions of Donetsk, Kherson and Mykolaiv, according to Reuters.
Russian Defence Ministry said 11 people were killed and 15 were wounded after two Tajikistan citizens committed an act of terrorism at a training ground in Russia’s Belgorod.
08:30: Oct. Empire Manufacturing, est. -4.2, prior -1.5
DB’s Jim Reid concludes the overnight wrap
After numerous weeks of immense volatility, will the fact that US payrolls and CPI are out the way and the fact that the UK has sacked its Chancellor, and is gradually backtracking, bit by bit, on its recent fiscal giveaway, lead to calmer markets? We shouldn’t underestimate how much the relatively small UK market has buffeted global markets in recent weeks. The politics are slowly moving in a more market friendly direction but a very sharp sell-off in Gilts on Friday afternoon left a nasty taste as we ended the week. 30yr Gilts closed +24bps on Friday to 4.79% but were around +55bps higher from the lunchtime lows. The Bank of England won’t be buying today for the first time in this mini-crisis so we’ll soon have a decent idea if there are still pension fund liquidity problems.
Part of the reason Gilts sold off late on Friday was a global related sell-off but part of it was a buy the fact sell the rumour trade after news leaked in the morning that the Chancellor was to be sacked. PM Truss’s subsequent afternoon press conference seemed to leave the market wanting more climb downs. In fact new Chancellor Hunt did extensive media rounds over the weekend saying that nothing is off the table in terms of reviewing the mini budget and that some taxes may have to rise. Several media reports suggest that the planned 1p income tax cut next April will be delayed by a year. So it’ll be fascinating to see how UK yields open up. Over the weekend, the Bank of England (BOE) Governor Andrew Bailey stated that the central bank will not hesitate to increase interest rates to meet its inflation target as it believes that the current inflationary pressures demand a stronger policy action than announced in August. In early Asia trading, the pound (+0.52%) is rallying rising to $1.1230 on the weekend’s tighter fiscal commentary. Literally as we go to print, a headline has come through saying that the UK Chancellor will make a statement today on the medium-term fiscal plan. So things are accelerating rapidly.
For this week China’s Party Congress that started yesterday could generate plenty of headlines, with key leadership roles and priorities for the next five years in focus (see latest below). The country’s Q3 GDP and key economic activity indicators will be released tomorrow.
Elsewhere, housing market indicators from the US, inflation data in the UK and economic sentiment indicators from Europe will be released. Netflix, IBM, Tesla, Bank of America, and Johnson & Johnson will be among the corporates reporting as earnings season starts to gather momentum. This could be key to sentiment in the coming weeks.
Let’s go through the key economic data in a little more detail now. Starting with the US, this week will feature industrial activity indicators such as industrial production (Tues) and the Empire manufacturing index (today). For the former, our US economists expect a -0.4% print (-0.2% in August). The housing market will be in focus too, with fears over a big softening on one hand but balanced in the short-term by last week’s CPI print that showed strong momentum in rents. The releases will include housing starts, building permits (both Weds) and existing home sales (Thurs).
Over in Europe, the UK will continue to be in the spotlight with CPI, RPI and PPI to be released on Wednesday with the first expected at 10.1% (August CPI printed at 9.9% YoY and below July’s 10.1%). Staying in the UK, October GfK consumer confidence figures will be released as well as September retail sales on Friday.
Elsewhere in the region, sentiment indicators will include the ZEW survey for Germany and the Eurozone tomorrow and business and manufacturing confidence for France on Thursday. We will get the PPI for Germany on the same day. In politics, the European Council’s two-day meeting will start on Thursday with topics of Ukraine, energy and the economy on the agenda.
In Asia, China’s Q3 GDP, industrial production and retail sales, along with other indicators, will be released tomorrow. The median estimate on Bloomberg points to a +3.4% YoY reading, up from +0.4% in Q2. On Friday we will also get the nationwide CPI from Japan and our Chief Japan economist expects core inflation excluding fresh food to show a +2.9% YoY increase (+2.8% in August) and core-core inflation excluding fresh food and energy to rise by +1.8% (+1.6% in August). Durable goods and food prices are seen as the core inflation drivers.
Finally, this week will be packed with corporate Q3 results from key American and European firms as this earnings season ramps up. The tech names we will hear from include Netflix, ASML, IBM and Lam Research, with hardware makers particularly in focus amid slowing demand concerns. Other notable reporters will include Johnson & Johnson, Lockheed Martin, Tesla, Bank of America (today), Procter & Gamble, and Goldman Sachs. The day by day week ahead guide at the end has which days each report.
Asian equity markets are trading in negative territory at the start of the week, following a weak close to the week in the DM world, although US futures are up as we start the week. Across the region, the Nikkei (-1.43%) is leading losses with the Hang Seng (-1.16%), the CSI (-0.45%) and the Shanghai Composite (-0.10%) also trading lower. The KOSPI is flat. Contracts on the S&P 500 (+0.43%) and the NASDAQ 100 (+0.39%) are both edging up.
Over the weekend, Chinese President Xi Jinping, in his speech at the opening ceremony of the ruling Communist Party of China’s 20th National Congress, gave a defiant message to the world as he warned against “interference by outside forces” in Taiwan. At the same time, he reiterated the validity of the Zero-Covid policy while signaling that there would be no immediate loosening in restrictions despite the social and economic pain caused by the policy.
Staying on China, The People’s Bank of China (PBOC) announced that it will maintain its 1-yr Medium-Term Lending Facility (MLF) interest rate at 2.75% for the second consecutive month while injecting liquidity worth 500 billion yuan into the banking system through MLF operations. So far in 2022, the MLF rate has been cut by 20bps with 10bps moves in January and August.
In FX, the Japanese Yen dropped to 148.77 against the US dollar, a fresh 32-year low, before easing to settle at 148.70. Meanwhile, yields on 10yr USTs are trading just below 4% level (-2.5bps) as we go to press.
Looking back on last week now, yet another upside CPI surprise ruined any chance of a near-term Fed policy pivot, driving yields higher and the curve flatter. All told 2yr Treasury yields were +19.0bps higher on the week (+3.5bps Friday) while the 10yr climbed +13.5bps (+7.3bps Friday). That left the 2s10s curve at -48bps, near its most inverted levels of the cycle, as additional tightening and a harder landing was priced in. By the end of trading, markets were pricing +142bps of tightening through the next two FOMC meetings. That’s close to our updated US Economic call of +75bp hikes in November and December, but markets are pricing some risk of +100bps in November following the blockbuster CPI, with +78.6bps priced at the end of last week.
The S&P 500 staged a befuddling rally the day of the print (with a 5.5% turnaround) but ultimately retreated -1.55% (-2.37% Friday) on the week. In line with tighter expected policy, the NASDAQ underperformed, falling -3.11% (-3.08% Friday). The moves came with huge intraday swings, which had the Vix index of volatility close above 30 every day, closing the week at 32.02, just beneath the year’s high of 36.45 reached when Russia invaded Ukraine. US banks kicked earnings off in earnest on Friday. As you might expect, FICC revenues have held up given the heightened volatility, and net interest income improved with the blistering pace of Fed rate hikes, while deal making revenue has slowed given the gloomy economic outlook. All told, the S&P 500 banks advanced +2.43% on the week (+0.03% Friday), outperforming the broader index.
In Europe, yields also took another leg higher, with 10yr bunds +15.2bps higher over the week (+5.9bps Friday). However, the curve steepened, with 2yr bunds gaining +9.0bps (+3.5bps Friday). The biggest story was of course in the UK, with the Chancellor gone and the partial u-turn on the budget. That led gilts to outperform bunds, where 10yr gilts gained +9.7bps (+13.7bps Friday) and 2yr gilts fell -25.4bps (+11.6bps) as some near-term crisis management hikes were priced out of the market. However as mentioned at the top 30yr Gilts were still an issue, climbing +39bps in a volatile week (+24hrs Friday).
European equities fared much better than the US. The STOXX 600 pulled back just -0.09% (+0.56% Friday), with the DAX (+1.34%, +0.67% Friday) and CAC (+1.11%, +0.90% Friday) both out-performing.
AND NOW NEWSQUAWK
Risk recovers from APAC pressure, UK assets buoyed pre-Hunt – Newsquawk US Market Open
MONDAY, OCT 17, 2022 – 05:59 AM
European bourses see a choppy session but have tilted towards the green after experiencing a mixed cash open.
US equity futures see gains across the board following the steep losses on Friday – with the NQ and RTY narrowly outperforming.
Gilts gap-up and lead the way ahead of a potential “mini-Budget” U-turn from new Chancellor Hunt, peers buoyed in turn.
Pound perkier in turn with the DXY modestly pressured to the benefit of peers across the board.
WTI and Brent futures trimmed earlier gains in downside that was exacerbated after reports China is to delay its Q3 GDP release.
Looking ahead, UK Chancellor Hunt, ECB’s Lane, BoC’s Rogers
Pound perkier on premise that new UK Chancellor will be more frugal with public finances, Cable comfortable on 1.1200 handle and EUR/GBP probing 50 DMA just shy of 0.8650.
Aussie and Kiwi recover amidst less risk-off environment ahead of RBA minutes and NZ Q3 CPI; AUD/USD hovering around 0.6250 and NZD/USD just under 0.5600.
Loonie, Franc and Euro all firmer vs Greenback as DXY slips from Friday’s peak to pivot 113.000, USD/CAD eyeing 1.3800, USD/CHF close to parity and EUR/USD above 0.9750.
Yen propped ahead of 149.00 vs Dollar as Japanese officials turn up volume of verbal intervention.
PBoC set USD/CNY mid-point at 7.1095 vs exp. 7.1331 (prev. 7.1088)
Major Chinese state-owned banks were seen swapping yuan for dollars in the forwards market and selling dollars in the spot market to stabilise the local currency, according to sources cited by Reuters.
Gilts gap-up and lead the way ahead of a potential “mini-Budget” U-turn from new Chancellor Hunt, peers buoyed in turn.
Specifically, Gilt Dec’22 posts upside of over 300 ticks around the 97.00 mark with the associated 10yr yield down to near 4.0%.
Amidst this, SONIA is taking a dovish-turn despite the weekend’s remarks from Bailey, with pricing dipping to ‘just’ a ~75% chance of a 100bp increase in November.
Stateside, USTs are firmer by around 15ticks with the US-specific docket comparably sparse after last week’s key inputs.
BoE Gilt statement: As previously announced, the Bank terminated these operations and ceased all bond purchases on Friday 14 October. As intended, these operations have enabled a significant increase in the resilience of the sector.
WTI and Brent futures trimmed earlier gains in downside that was exacerbated after reports China is to delay is Q3 GDP release.
French PM Borne said about 30% of the country’s petrol stations face supply issues due to a slight worsening of strikes at refineries, while Borne also stated that TotalEnergies ( TTE FP) CEO agreed to extend the fuel discount, according to Reuters.
Spot gold is propped up by a softer Dollar, with the yellow metal back above USD 1,650/oz and eyeing its 21 DMA at USD 1,670.10/oz.
LME metals are mixed with 3M copper losing some ground and just about holding onto USD 7,500/t+ status, whilst LME aluminium underperforms following an enormous LME stockpile increase of over 65k tonnes.
OPEC Secretary-General al-Ghais said slow economic growth reflects on oil demand and that OPEC+ took the pre-emptive decision, while he added OPEC doesn’t target a specific price but targets a balance between supply and demand. Al Ghais also stated that they do not control oil prices and that their decisions are purely technical, as well as noted that there is always space for flexibility in OPEC when asked about reviewing this month’s oil output cut. Furthermore, he commented that oil markets are going through a stage of great fluctuations, according to Reuters.
Iraq said OPEC+ decisions are based on economic indicators and there is consensus in OPEC+ to be pre-emptive to deal with the current uncertainty in oil markets, while it added that the OPEC+ latest decision is based on market inputs and it is essential to achieve market stability, according to a SOMO statement cited by Reuters.
UAE Energy Minister said the OPEC decision was purely technical and unanimous not political as some described, according to Reuters.
Kuwait said it welcomes the recent decision by OPEC+ to cut output and said it is keen to maintain balance in the oil markets for the benefit of consumers and producers, while it added that expected slow global economic growth led to more disturbance in the balance of supply and demand in oil markets, according to Reuters. Furthermore, Kuwait appointed Badr Al Mulla as its new Oil Minister and appointed Wahab Al Rasheed as Finance Minister, according to a tweet.
Oman’s Energy Ministry said OPEC+ decisions are based on purely economic considerations, as well as realities of supply and demand in the market, while the decision was important and necessary to reassure the market and support its stability, according to a Tweet.
Bahrain’s Oil Minister said the OPEC+ decision was reached by consensus among all member states and that OPEC+ will study any economic developments in the future to ensure the stability of markets and global supply, according to the state news agency cited by Reuters.
NOTABLE EUROPEAN HEADLINES
UK
BoE Governor Bailey said they will not hesitate to raise interest rates to meet the inflation target and that the Bank had to intervene to deal with the threat to the stability of the financial system, while they think inflation should peak at around 11% and his best guess is that inflationary pressures will require a stronger response than perhaps thought in August, according to Reuters.
BoE Governor Bailey said he does not comment on fiscal policy but has to emphasise sustainability, while he spoke with UK Chancellor Hunt and said that there is a meeting of minds on sustainability. Furthermore, Bailey said they are going to have to stay very focused on the risks of second-round effects on inflation, according to Reuters.
UK Chancellor Hunt said taking difficult decisions now is the best way to stop interest rates from rising and that the PM hasn’t changed the destination, she has changed the way we are going to get there. Hunt also commented that the PM is in charge and the last thing they need is another Conservative leadership campaign, according to Reuters.
UK Chancellor Hunt said ‘yes’ when asked if he can change the mini-Budget plans and noted that the priority will be to help struggling businesses and families, while he is leaving all possibilities open when asked about government spending and stated that tax will not be cut as quickly and some taxes will go up, according to Reuters.
UK Chancellor Hunt is to make a statement later today, bringing forward measures from the Medium-Term Fiscal Plan that will support fiscal sustainability, via Treasury. Hunt will deliver the full medium-term fiscal plan, to be published with OBR forecasts, on 31st October. Chancellor Hunt met with BoE Governor Bailey and the DMO head on Sunday night, to brief them on these plans.
UK Chancellor Hunt is to delay plans to reduce the basic rate of income tax by a year and it was also reported that the draft forecast by the OBR fiscal watchdog sees the UK will have a black hole in public finances of up to GBP 72bln by 2027/28, according to The Sunday Times.
Senior Tories will hold talks this week on a “rescue mission” that could see the swift removal of Liz Truss as leader, after the new Chancellor Hunt tore up her economic package and signalled a new era of austerity, according to The Observer. Furthermore, The Times reported that Tories held secret talks on installing a new leader and Daily Mail also reported that UK lawmakers will attempt to oust UK PM Truss this week despite warnings from Downing Street that it could trigger a general election.
Reportedly almost all of Kwarteng’s GBP 45bln of unfunded tax reductions is set to be scrapped by Chancellor Hunt, via FT’s Parker; “including income tax cut and stuff on dividends, stamp duty, foreign shoppers and IR35.”
US President Biden said he wasn’t the only one who thought that UK PM Truss’s original economic plan was a mistake, according to Reuters. It was also separately reported that Goldman Sachs downgraded its UK growth outlook after the government tax U-turn.
Head of UK’s Unison union warned the largest nationwide strike of NHS workers since the early 1980s could occur this winter if ministers ignore calls to match pay with inflation, according to FT.
BoE is publishing a market notice which sets out how energy firms and commercial lenders can apply to participate in the energy markets financing scheme; open to applications today; alongside this the UK Gov’t has published a release, outlining the financing scheme and specifying that the gov’t will only be liable if a firm defaults on their repayment; scheme is designed to help firms facing temporary shot-term financing problems.
ECB
ECB’s Knot said he is increasingly convinced that rates need to rise above neutral and once rates hit a neutral level, it makes sense to consider running off APP stock, according to Reuters.
ECB’s Rehn said the threat of stagflation has intensified. The stability risks of international financial markets are clearly increasing. Although the global financial crisis has been avoided for now, it is not time to breathe a sigh of relief.
ECB’s Lane expected to propose a 75bps hike at the upcoming ECB meeting, according to an ECB insider cited by Econostream.
ECB’s de Guindos expects FX rate to stabilise in the coming months, via Reuters.
Some ECB officials are seeing legal basis to toughen bank TLTRO terms, according to Bloomberg sources.
NOTABLE EUROPEAN DATA
UK Rightmove House Prices MM (Oct) 0.9% (Prev. 0.7%); YY (Oct) 7.8% (Prev. 8.7%)
NOTABLE US HEADLINES
White House Economic Adviser Rouse said Fed actions are beginning to cool the red-hot US economy, especially the housing and labour markets, but added that inflation was still too high, according to Reuters.
Goldman Sachs (GS) plans a major overhaul to combine its units, according to Reuters sources; an announcement is due on Tuesday, October 18th.
CRYPTO
Bitcoin is rangebound and holding just above the USD 19k mark at present.
GEOPOLITICS
RUSSIA-UKRAINE
Ukrainian President Zelensky said Bakhmut and Soledar in eastern Donbas are hotspots at the front with heavy fighting, while it was separately reported that that Kyiv’s Mayor Klitschko said blasts hit Kyiv’s city centre, according to Reuters.
Russian Defence Ministry said Russia destroyed three US-made M777 Howitzers in Ukraine’s Kharkiv region and that Russian troops repelled Ukrainian attempts to advance in the regions of Donetsk, Kherson and Mykolaiv, according to Reuters.
Russian Defence Ministry said 11 people were killed and 15 were wounded after two Tajikistan citizens committed an act of terrorism at a training ground in Russia’s Belgorod.
OTHER
Lebanon said Israeli gunboats violated Lebanese territorial waters opposite Ras Al Naqoura, while the Israeli military denied any crossing of the Lebanese maritime borer by its forces, according to Reuters.
Iranian President Raisi blamed US President Biden for inciting chaos and terror in Iran through his comments, according to IRNA.
White House National Security Adviser Sullivan said US President Biden will act methodically in re-evaluating the US relationship with Saudi Arabia and said President Biden has no plans to meet with the Saudi Crown Prince at the G20 next month, while he added that countries including China need to send the message to Russia that Moscow should not contemplate the use of nuclear weapons in the Ukraine conflict, according to CNN.
Saudi Defence Minister said they are astonished by the accusations that the kingdom is standing with Russia in its war with Ukraine, while it added that although the OPEC+ decision was taken unanimously and was due to purely economic reasons, some accused the kingdom of standing with Russia, according to Reuters.
EU ministers advised to take a tougher stance on China and work more closely with the US, strengthen its cyber and hybrid threat defences and diversify supply chains away from China, according to FT.
Taiwan Presidential Office said Taiwan’s mainstream public opinion opposes the ‘one country, two systems’ and Taiwan will not back down on its sovereignty, while it will not compromise on freedom and democracy. Furthermore, it stated that meeting on the battlefield is not an option and that maintaining peace and stability in the Taiwan Strait and the region is the common responsibility of both sides, according to Reuters.
EU’s Borrell said do no expect any move on the nuclear deal with Iran.
APAC TRADE
EQUITIES
APAC stocks were negative as the region took its cue from last Friday’s declines on Wall St where risk assets were pressured by inflationary concerns, while the region also digested hawkish global central bank rhetoric and China sticking to its strict zero-COVID policy.
ASX 200 was led lower by the commodity-related sectors and with Australian Treasurer Chalmers flagging an increase in the cost of living due to floods in the primary food growing areas.
Nikkei 225 weakened with Japan said to consider a rise in corporation tax as an option to fund the nation’s defence budget which could double in the next few years.
Hang Seng and Shanghai Comp. were lower following Chinese President Xi’s speech to kick-start the Communist Party Congress in which he defended the zero-Covid policy and reaffirmed intentions for the reunification of Taiwan, while attention was also on the PBoC which rolled over CNY 500bln of MLF loans and kept the rate at 2.75% which suggests a likely pause in its benchmark rates later this week.
CCP NATIONAL CONGRESS
Chinese President Xi declared the new core mission of the party is to lead China united in the challenge to be a powerful, modern socialist nation by 2049. Chinese President Xi said they will promote a high level of opening to the outside world and will maintain pluralistic and stable economic relations with other countries. Furthermore, Xi said they will strengthen the ability to prevent and control the epidemic, while he also commented that the next five years will be crucial for building a modern socialist power and will aim for high-quality growth, as well as support the private economy unwaveringly, according to Reuters.
China Communist Party spokesman Sun said China is capable of greater miracles going forward but noted China has entered a new normal of slower growth and is more focused on fixing long-term issues than growth. Sun also stated that they all hope the pandemic will end soon but what they see now is that the pandemic is still on and that their Covid prevention policy is the best and most economically efficient, according to Reuters.
Chinese government officials are backpedalling on efforts to organise a meeting between US President Biden and Chinese President Xi on the sidelines of the G20 summit next month, according to Politico.
Chinese President Xi said they will firmly promote reunification efforts with Taiwan and it is up to the Chinese people to resolve the Taiwan issue, while he added they will never renounce the right to use force and said reunification of the motherland must and will certainly be achieved.
Chinese Communist Party spokesman Sun said achieving reunification with Taiwan by peaceful means best meets the interest of all and the use of force is the last resort under compelling circumstances, while he added that Taiwan will plunge into a disaster if pro-independence Taiwan and external forces are left unchecked, according to Reuters.
NOTABLE APAC HEADLINES
Chinese will delay the release of Q3 economic indicators including GDP, according to the Stats Bureau; no new date mentioned.
PBoC injected CNY 500bln via 1-year MLF with the rate kept at 2.75%, as expected.
China locked down nearly 1mln people near an Apple (AAPL) iPhone factory in which Zhengzhou city ordered residents in one district to stay home, according to Bloomberg.
BoJ Governor Kuroda said the BoJ is continuing with monetary easing since Japan’s headline inflation is likely to fall below 2% next fiscal year, while he added it is appropriate to continue monetary easing to ensure a shift in the deflationary norm and achieve the inflation target in a sustainable and stable manner, according to Reuters.
BoJ Deputy Governor Wakatabe said it is up to the Finance Ministry to decide on whether or not to intervene in the FX market and that current FX fluctuations are clearly too rapid and too one-sided.
Japanese top currency diplomat Kanda said they are ready to take decisive action if excess FX moves continue and are backed by speculative trading, while Kanda reiterated that recent JPY moves were somewhat rapid, according to Reuters.
BoK Governor Rhee said he does not see interest among US officials in pursuing a plaza accord to stem the dollar strength, while Rhee also stated that the BoK needs a little bit more experience and technical capacity for forward guidance, according to Reuters.
South Korean Finance Minister Choo said the government will scrap taxes on foreigners’ income from Korean treasury bonds and monetary stabilisation bonds from Monday, according to Reuters.
DATA RECAP
Singapore Non-Oil Exports MM (Sep) -4.0% vs. Exp. -2.1% (Prev. -3.9%)
SHANGHAI CLOSED UP 12.96 PTS OR 0.42% //Hang Seng CLOSED UP 25.21 OR 0.15% /The Nikkei closed DOWN 314.97PTS OR 1.16% //Australia’s all ordinaires CLOSED DOWN 1.36% /Chinese yuan (ONSHORE) closed DOWN TO 7.2010 //OFFSHORE CHINESE YUAN UP 7.2092// /Oil DOWN TO 85.61 dollars per barrel for WTI and BRENT AT 90.89 / Stocks in Europe OPENED ALL GREEN. ONSHORE YUAN TRADING BELOW LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING WEAKER AGAINST US DOLLAR/OFFSHORE STRONGER
2 a./NORTH KOREA/ SOUTH KOREA/
///NORTH KOREA/SOUTH KOREA/
end
2B JAPAN
Japanese Jawboning Won’t Stop Yen’s “Explosive” Downward Spiral From Testing 150/Dollar
MONDAY, OCT 17, 2022 – 04:50 PM
Japanese Prime Minister Fumio Kishida is stepping up the rhetoric against a weaker yen, suggesting that policy makers may be willing to step into the markets yet again. Japan’s “yentervention” is doomed to failure.
As Bloomberg’s Ven Ram notes, it is important to prepare appropriate action on the yen, Kishida has told parliament, as USD/JPY hovers not too far away from the psychologically significant 150 level. In fact, into the close the USDJPY spiked above 149, a new post-1990 high for the pair.
And while another bout of intervention can’t be ruled out – and may offer some short-term salve to the yen – longer-term support is another matter. After all, the yen is now well below where it was when policy makers intervened last month – meaning traders aren’t respecting the earlier line in the sand.
The choices before Japanese policy makers are stark: either relax the yield-curve control framework or be willing to yen the weaken. Until then, as we discussed last month, further interventions are doomed to failure and is why this morning, Japan’s Finance Minister Shunichi Suzuki told reporters he won’t comment, when asked whether the government has conducted any stealth interventions in the foreign exchange market since Sept. 22. Because while there clearly have been interventions, their half-lives are measured in hours if not minutes.
Indeed, as Ram notes, “there is no third choice really at a time when inflationary pressures in the US are likely to compel the Fed to keep going and causing inflation-adjusted yield differentials to move in favor of the dollar against the yen. “
As the Bloomberg strategist concluded:
The yen has declined more than 8% since I noted back in June that the currency is likely to approach 150 per dollar should those differentials widen — which is precisely what has happened.
Biden’s export controls over semi conductor chips is creating havoc for China’s chip industry and their economy
(zerohedge)
“This Is What Annihilation Looks Like”: Biden Export Controls ‘Wreaking Havoc’ On China’s Chip Industry
SUNDAY, OCT 16, 2022 – 05:00 PM
A Twitter thread translated by Rhodium Group China expert Jordan Schneider – whose blog, China Talk, can be found here, provides keen insight into the effects of the Biden administration’s new export controls on the chip industry.
To review, the Biden administration last week laid out new rules on chip exports based on US concerns that China will use AI to improve military capabilities, support surveillance for human rights abuses and “disrupt or manufacture outcomes that undermine democratic governance and sow social unrest,” according to Assistant Secretary of Commerce for Export Administration Thea D. Rozman Kendler.
The sweeping regulations will curb the sale of semiconductors and chipmaking equipment to its #1 geopolitical rival – which, as Bloomberg puts it, is “sending shockwaves through the $440 billion industry.“
In a Friday Twitter thread which he translated from Hedgehog Computing Group founder Xinran Wang (@lidangzzz), Schneider lays out the carnage in English:
“To put it simply, Biden has forced all Americans working in China to pick between quitting their jobs and losing American citizenship,” Schneider writes, adding “One round of sanctions from Biden did more damage than all four years of performative sanctioning under Trump.”
Continued (emphasis ours):
Although American semiconductor exporters had to apply for licenses during the Trump years, licenses were approved within a month. With the new Biden sanctions, all American suppliers of IP blocks, components, and services departed overnight —— thus cutting off all service [to China].
Long story short, every advanced node semiconductor company is currently facing comprehensive supply cut-off, resignations from all American staff, and immediate operations paralysis.
This is what annihilation looks like: China’s semiconductor manufacturing industry was reduced to zero overnight. Complete collapse. No chance of survival.
According to Schneider, “The level of embarrassment is on par with Pelosi’s Taiwan visit.“
end
CHINA/UKRAINE
China and Russia are joined at the hip: so we must be cognizant of this: China orders the evacuation of all citizens still in Ukraine and this sparks of escalation
(zerohedge)
China Orders Evacuation Of All Citizens Still In Ukraine, Sparking Escalation Fears
SUNDAY, OCT 16, 2022 – 09:00 PM
China’s foreign ministry on Saturday issued an urgent call for any Chinese nationals still in Ukraine to exit immediately, kicking off speculation over what’s behind the unspecified appeal and scramble.
The notification is being widely seen as the most forceful evacuation order yet, and suggests that Beijing might be aware of Russian plans for possibly imminent bigger, sweeping airstrikes against Ukrainian cities, such as the widespread escalatory strikes conducted last Monday into Tuesday.
The first big evacuation of Chinese citizens took place starting last March, in which some 6,000 Chinese nationals left the country amid the Russian invasion. But now, as state media Global Times writes, “Some Chinese nationals still in Ukraine have signed up for evacuation from the country, with most registering for organized evacuations, while others are preparing to leave Ukraine on their own, the Global Times learned on Sunday, after the Chinese Foreign Ministry urged Chinese citizens to leave Ukraine, citing the grave security situation.”
The foreign ministry and embassy warned of the “grave security situation” and ordered an immediate departure, citing the need “to enhance safety precautions and evacuate.” The statement indicated that “the embassy will assist in organizing the evacuation of people in need.” Russian state sources also on Sunday began publicizing the new alert notification.
GT is reporting that an evacuation is now in progress:
As of press time on Sunday, 161 people had registered on the form the embassy sent out for organized evacuation, and another 27 people registered on the form for self-evacuation, according to a Global Times’ count of the registration on the embassy’s WeChat account.
It additionally comes at a moment of stepped-up cross-border attacks on the Russian city of Belgorod, which lies just north of the Ukrainian border opposite Kharkiv.
While it’s yet unknown precisely what triggered the heightened, urgent appeal for all remaining Chinese nationals to exit Ukraine, it’s possible the answer could come Monday or in the following days. Does this signal that greater Russian escalation on the horizon?
end
Strange!
(zerohedge)
China Indefinitely Delays Reporting Key Economic Data Amid National Congress
MONDAY, OCT 17, 2022 – 12:21 PM
The world’s second largest economy announced overnight – with no explanation – that is will be indefinitely delaying the release of a slew of economic data including the much-anticipated GDP growth data that has occurred during a period when the much-vaunted Zero-COVID policy has dominated Chinese life.
“I’ve not come across before a situation where a whole raft of statistical reporting has just been postponed, in nearly half a century of monitoring data releases — not even in times of pestilence and conflict,” said George Magnus, a former chief economist of UBS who is now an associate at the China Center at Oxford University.
The timing is interesting since it comes as as the country’s ruling elite has gathered in Beijing for the twice-a-decade national congress of the Communist Party, and the expected miss (+3.4% expected vs +5.5% plan) of the party’s planned growth targets would have been embarrassing for the party, coming just two days after newly re-crowned Chinese leader Xi Jinping gave a rousing and confident address at the opening of the week-long 20th Communist Party Congress.
The unexplained delay is all the more surprising because Zhao Chenxin, the deputy director of the National Development and Reform Commission, had taken an upbeat tone about the Chinese economy during a news conference on Monday morning at the media center of the party congress.
“Judging from the current situation, the economy rebounded significantly in the third quarter — from a global perspective, China’s economic performance is still outstanding,” he said.
Another agency, the General Administration of Customs, had separately failed last Friday to follow its own previously issued schedule for the release of export and import statistics for September. The release of those numbers has also been delayed indefinitely.
Mr. Zhao said on Monday morning that because of the government’s pandemic policies and emphasis on economic development, “China’s economic stabilization and improvement will be further consolidated.”
AsiaFinancial reports that a person answering the telephone in the media office at the National Bureau of Statistics (NBS) said the change was “due to adjustment to work arrangements” but gave no further details.
As a reminder, China’s economy grew at just 0.4% in Q2…
The Economist Intelligence Unit’s Nick Marro summed things up very succinctly…
To illustrate just how dire things look, QZ reports that Robin Brooks, chief economist at the Institute of International Finance, recently made a quick calculation: if China manages zero GDP growth in its third and fourth quarters, it would be in some economically unenviable company; only Russia, Sri Lanka, and Ukraine would have seen weaker annual growth for 2022.
END
CHINA/RUSSIA EUROPE//LNG
A huge blow to Europe: China halts its resale of Russian LNG (zerohedge)
China Halts Resales Of Russian LNG To European Buyers
MONDAY, OCT 17, 2022 – 05:00 PM
A month and a half ago, we made a startling discovery: Russia was aggressively reselling LNG imports from Russia, the country’s fourth-largest supplier of LNG so far in 2022 having surpassed both Indonesia and the US, to Europe and thanks to the continent’s unprecedented desperation for gas, it was charging pretty much whatever markup it wanted.
But maybe not any more. According to Bloomberg, Chinese state-owned energy giants have been recently told by authorities to stop reselling liquefied natural gas cargoes (certainly those from Russia) to gas-starved Europe, in what could be a blow to the European hopes of continuous high inflows of LNG as the winter approaches.
China’s National Development and Reform Commission (NDRC), the country’s top planning body, told the country’s state-held LNG importers including Sinopec, PetroChina, and CNOOC, that they should stop reselling LNG cargoes and keep them to ensure Chinese gas supply this winter, Oilprice reported citing Bloomberg sources.
In recent months, as we reported first in August, Chinese LNG importers have been selling their excess inventories to Europe and reaping substantial profits from the sales because of lackluster demand in China. Chinese domestic demand has been squashed by rolling waves of city-wide Covid lockdowns and a slowdown in economic growth.
As a result, Chinese sales of LNG have been a relief to the European market so far this year. But as China now moves to cater to its own energy security this winter, Europe’s precarious LNG supply – much of which was a function of continued Chinese reselling of embargoed Russian gas – could dwindle just ahead of the winter heating season.
Gas prices in Europe have dropped from record highs and hit on Monday the lowest level in three months after the EU was reportedly looking to introduce measures to limit the market volatility of the benchmark European natural gas prices at the Dutch TTF hub. According to a draft document that Bloomberg News has seen, the European Commission is set to propose measures to limit extreme price spikes in derivatives trading; it isn’t exactly clear how Europe – which is desperately short any and all commodities heading into the winter – will actually enforce any price or volatility caps.
European gas storage sites were 92% full as of October 16, according to data from Gas Infrastructure Europe. The storage sites were filled faster than the EU and many individual members had initially planned. Although gas in storage alone will not be enough to see an economy such as Germany’s through the winter, the faster-than-planned gas storage filling has eased somewhat supply concerns, for now. Also, as most industry watchers have realized, the big risk is not this winter but that of 2023.
4.EUROPEAN AFFAIRS//UK AFFAIRS
UK
This is an excellent commentary were Andrew Sheets describes the escalating troubles inside the K
(Sheets/Morgan Stanley)
Morgan Stanley: Trouble In The Kingdom Is Just Starting
SUNDAY, OCT 16, 2022 – 06:30 PM
By Andrew Sheets, Chief Cross-Asset Strategist for Morgan Stanley, as excerpted from the bank’s Sunday Start.
At the west end of the new rail station in Canary Wharf, up the escalators and to the right, is a coffee shop. It’s full of wooden panelling and a big chalkboard above the tills with the price of the drinks. Faint markings on the chalkboard make something very clear. The prices have been changing.
The United Kingdom is the world’s sixth-largest economy and faces a complicated, interwoven set of challenges. It is a volatile and fascinating cross-asset story.
First among these challenges is inflation. High UK inflation is partly due to global factors like commodity prices, but even excluding food and energy core inflation in the UK is 6.3%Y. Since the UK runs a large current account deficit (5.5% of GDP), a weak currency is driving higher costs on imported items. Meanwhile, Brexit has reduced the supply of labor and increased the costs of trade, boosting inflation and reducing the benefit that a weaker currency would otherwise bring.
The circularity here is unmissable; high inflation drives currency weakness, and vice versa. High inflation has depressed UK real rates, making the currency less attractive to hold. And high inflation relative to other countries undermines valuations: on an inflation-adjusted basis (i.e., purchasing power parity) the British pound has ‘cheapened’ by a similar percentage as the Swiss franc over the last year, and much less than, say, the Norwegian krone. That’s hardly irrational.
If inflation is high, why doesn’t the Bank of England simply raise rates to slow demand? The BoE is moving, but as our UK economist Bruna Skarica notes, it has raised rates by less than the market expected in six of its last eight meetings. That’s left investors anticipating ~320bp of BoE hikes between now and May 2023, ~140bp more than expected from the Federal Reserve over the same period; if the UK underdelivers and the Fed does not, it could drive more FX weakness.
The BoE’s hesitation is understandable; my colleague Vasundhara Goel notes that most UK mortgage debt is only fixed for 2-5 years, with roughly 100k loans resetting every month (see “UK Mortgage Repayments Poised To Soar To Financial Crisis Levels“). The impact of higher rates can therefore flow through to the economy quickly, especially as UK households are also facing an unusually large year-on-year increase to utility costs.
Another path to slow inflation would be tighter fiscal policy. But the UK government announced a budget to loosen fiscal policy, which was followed by further increases to UK rates and more currency weakness, which in turn put historical pressure on the country’s pension sector and contributed to UK 30-year inflation-linked bonds falling 67% from last December. To give it some context, the S&P 500 is down about 25% year to date. If the S&P 500 fell 25% three more times…it would be down about much as that 30-year UK inflation-linked bond.
Then on Friday, the government announced that the Chancellor of the Exchequer was stepping down and recent plans to cut corporate taxes would be shelved in an attempt to reassure markets. But questions remain; the UK Prime Minister stated that she still desires a “low tax” economy, and fiscal policy will still be loosened under the government’s proposals. Immediately following the press conference Friday afternoon announcing these changes, GBP fell and yields rose.
The UK’s problems are not insurmountable. But for the moment, they remain daunting. My colleague Wanting Low in FX strategy expects GBP to weaken to parity with USD. My colleague Theo Chapsalis, our UK rates strategist, likes being long UK 5-year inflation (RPI) and is negative on duration, expecting gilts to underperform swaps as issuance increases and the balance sheet becomes more valuable. Sterling IG credit, at a ~7.0% yield, is increasingly competitive versus UK equities, but it is also a much smaller credit market than its global peers.
A weak GBP may help UK stocks outperform EU equities, but with my colleague Graham Secker well below consensus for EPS in the region, that’s a low bar. For investors looking for deep value, we believe that the better opportunity is in emerging market equities, which we’ve just upgraded to overweight after a long period of skepticism. That upgrade is a function of both a top-down view that EM can bottom before DM markets (it has repeatedly in the past), and bottom-up work by our sector teams. Within EM, our strategists like Korea, Taiwan and Brazil.
The UK is an evolving story and essential macro viewing, but for now, we see better opportunities elsewhere.
END
Daniel Lacalle describes perfectly that Liz Truss is not to blame for the uK market turmoil. It has been the mis-management of years of low interest rates and massive spending.
(Dr Lacalle)
Liz Truss Is Not To Blame For UK’s Market Turmoil. The Bank Of England Is
We live in strange times. The same people that vehemently defended massive deficit spending and money printing as the solution to the global economy now blame the turmoil of the UK bond and currency markets on a deficit-increasing budget.
I find it astonishing that no one of the so-called experts that have immediately placed the cause of the British market volatility on Liz Truss’ budget have said anything about the collapse of the yen and the need for Bank of Japan intervention, which has been ongoing for two weeks.
US dollar and main currencies via Bloomberg
Why did so many people assume the Truss mini budget was the cause of volatility when the euro, the yen, the Norwegian krone, and most emerging market currencies have suffered a similar or worse depreciation versus the US dollar this year? What about the bond market? This is the worst year since 1931 for bonds all over the world, and the collapse in prices of sovereign and private bonds in developed and emerging market economies is strikingly similar as those of the UK fixed income peers.
The same economists that say deficits do not matter and sovereign nations can spend and print currency as they please (“expansionary policies” they call them) now say that a UK Keynesian budget that increases spending, but cuts taxes, may destroy the economy. Yet they forget Japan had to massively intervene the yen as well without any tax cut and keeping its misguided fiscal policy of spending and borrowing.
British pension funds are not selling sovereign bonds because of lack of trust in this or another government’s budget. They are selling negative-yielding sovereign bonds because they jumped wholeheartedly into the debt bubble created by artificially cheap money believing that central banks would keep fixed income prices elevated with constant repurchases.
British pension funds’ unfunded liabilities are not a problem caused by the mini budget nor solely a UK problem. It was an enormous problem in 2019-2020 disguised by insane currency printing. Unfunded global liabilities for state pension funds in the U.S. were already $783 billion in 2021 and rose to $1.3 trillion in 2022 according to Reason Foundation. The funded ratio of state pensions was just 85% in 2021 and has fallen below 75% in 2022.
What happened in the years of negative rates and massive currency printing? Pension funds used liability-driven investing (LDI) strategies. Most LDI mandates used derivatives to hedge inflation and interest rate risk. And what happens when inflation kicks in and rates rise?
“As interest rates have risen, the notional value of some of the derivatives held in LDI portfolios has fallen. The result: increased collateral calls. The speed at which rates have risen means some pension plans have had to liquidate portfolios to meet collateral calls” according to the Investment Association’s latest report in September and Brian Croce at Pensions & Investment.
The total assets in LDI strategies almost quadrupled to £1.6 trillion ($1.8 trillion) in the 10 years through 2021.
Nearly two-thirds of Britain’s defined benefit pension schemes use LDI funds, according to TPR and Reuters.
Liz Truss and Kwasi Kwarteng are not to blame for this insanity. The policy of negative real rates and massive liquidity injection of the Bank of England is.
Kwarteng and Truss are only to blame for believing that the party of policies of spending and printing defended by almost all mainstream Keynesian economists should work even when the music stopped.
In these past years, British and developed nations’ governments did not pay any attention to fiscal imbalances because money was cheap and abundant. Deficits soared, spending was uncontrolled, and the problem was hidden in the balance sheet of central banks that, like the Bank of England, purchased more than 100% of net issuances of government debt. After years of printing money and increasing debt to new all-time highs, persistent high inflation appeared, and now central banks need to hike rates and reduce money supply growth just when fixed income funds are loaded with toxic debt at negative nominal and real yields… And the rate hikes mean margin calls are more expensive and losses are unbearable.
UK pension funds need to get rid of the liquid assets they own as margin calls rise. Inflation arrived after years of massive currency printing and debt monetization and investment funds all over the world, but especially in the euro area, UK, and Japan, are seeing their portfolios melt down with massive nominal and real losses. When margin calls kick in, many need to sell their most liquid assets, Gilts in the UK, or government bonds elsewhere.
Euro area systemic stress indicator via Bloomberg
Liz Truss and Kwasi Kwarteng are not to blame for the insanity of the past years or Rishi Sunak’s ultra-Keynesian budgets. They are only to blame for believing that another dose of Keynesian deficit insanity would not harm.
Mr Kwarteng’s demise is just a casualty delivered by the modern monetary theory crowd and the monetary laughing gas city to justify that the problem was a ludicrous tax cut not years of currency printing and deficit increases.
What has happened in the UK or Japan is likely to happen soon in the eurozone, which accumulated more than twelve billion euro of negative-yielding bonds in the years of cheap money and reckless stimulus plans.
Liz Truss is not to blame for 20 years of monetary insanity and fiscal irresponsibility. She is to blame for a budget that increases spending without cutting unnecessary expenses.
The irony of it all is that the defenders of monster deficits and borrowing if it comes from bloating the size of government feel vindicated. It was the evil tax cuts!
The political analysis of the mini budget is astonishing. No one in the UK parliament sees any need to cut spending it seems, yet those expenses are consolidated and annualized, which means that any change in the economic cycle leads to larger fiscal imbalances as receipts are cyclical and, with it, more currency printing. The assumption that raising taxes will generate perennial annual increases in receipts no matter what happens to the economic cycle can only be defended by a bureaucrat.
Deficits are always a spending problem. Bloomberg Economics’ analysis shows that if a U-turn in tax cuts had no impact on economic growth, if it generated the receipts they estimate and borrowing costs ease, three enormous and impossible “ifs,” the financial hole in the UK budget would still be twenty-four billion pounds only to keep debt to GDP stable.
Every time a UK government buys the argument that higher tax rates finance higher annual and consolidated spending, they get one step away from being a leading global economy and closer to bringing the UK back to the seventies.
Even assuming no impact on the economy, “keeping the planned rise in corporation tax to 25% from 19% from April 2023, which Hunt’s predecessor Kwasi Kwarteng intended to cancel in the mini-budget, saves about £19 billion”, writes Jamie Rush at Bloomberg. However, that saving figure may be optimistic as it considers a level of earnings and profits in the United Kingdom that are more than debatable as we see consensus corporate earnings estimates fall month after month.
Jeremy Hunt, the new chancellor of the exchequer, seems to believe that raising taxes and massively increasing spending will calm markets. Why? Following the Japan and eurozone model of fiscal consolidation via receipts does not work. More taxes and more spending mean less growth, less employment, weaker real wages, and more debt. Furthermore, it is not calming markets in their own nations either, because the turmoil comes from the hangover of cheap money excess, not a modest tax cut. More importantly, increasing the tax wedge and spending burden perennially damages the UK’s possibilities of becoming a country that attracts investment and capital from the rest of the world.
Truss should have presented the budget she believes in, not the one that she thought that consensus would buy. By presenting an “expansionary” spending budget that she probably did not even believe in sprinkled with a few modest tax cuts she handed her opponents the axe to use against her, and the opportunity to attack came from a global market collapse and blaming it all on minuscule tax incentives.
Meanwhile, labour in the UK demands more monetary and fiscal insanity with an economic program that aims to increase spending even more and finance the deficits with monetization of debt. And some call that “calming the market.”
The only lesson for the United Kingdom is to remember that if you follow Greece’s economic policies, you get Greek debt, unemployment, and growth. The UK government should do everything to avoid the seventies’ elevated inflation and economic stagnation, not try to replicate them vigorously.
END
UK
Just how long will Truss be in office: Bailey stops bond buying and Jeremy Hunt cancels almost all of Truss’s economic tax cuts
(zerohedge)
Cable, Gilts Bid As BoE Ends Bond-Buying, Hunt Does Total U-Turn On Truss Tax Plan
MONDAY, OCT 17, 2022 – 08:00 AM
With the Bank of England having – as promised – ended its “temporary” bond-buying bailout of the UK’s pension funds, freshly-crowned Chancellor of the Exchequer Jeremy Hunt set to work tearing up what was left of PM Truss’s market-chaos-inducing economic program, scrapping tax cuts and removing support for household energy bills to restore order to the public finances.
In a statement Monday, the BOE confirmed that its bond purchases had ended as planned and said it had helped pension funds adjust to higher interest rates.
“As previously announced, the Bank terminated these operations and ceased all bond purchases on Friday 14 October,” it said.
“As intended, these operations have enabled a significant increase in the resilience of the sector.”
More importantly for the markets, Mr. Hunt, speaking ahead of an emergency statement to parliament on the economy, said “the most important objective for our country right now is stability,” as he announced a revised plan he said would raise around £32 billion a year, equivalent to $36 billion, for the government exchequer.
As Bloomberg reports, Hunt’s statement this morning included:
maintaining the basic rate of income tax at 20% indefinitely instead of reducing it as planned, saving £5 billion
scrapping planned cuts in dividend taxes, saving £1 billion
maintaining alcohol duties instead of making cuts
The current price freeze, capping the average bill at £2,500 a year, will be reviewed in April, when it will be redesigned so that it’s more targeted
reinstating rules on contract workers, saving £2 billion
removing a tax-free shopping break at a savings of £2 billion
Together with earlier U-turns, the decisions reverse almost all of the £45 billion in tax cuts and giveaways Truss announced in early September, raising questions about whether she can survive in office.
Hunt signaled he’s likely to make more severe spending cuts in the weeks ahead.
“There will be more difficult decisions, I’m afraid, on both tax and spending as we deliver our commitment to get debt falling as a share of the economy over the medium term,” Hunt said, adding that the priority will be on protecting “the most vulnerable.”
For now, Hunt’s efforts to reassure markets are working with cable bid (or as some witty twitterers have begun calling it… BRITCOIN)…
…and 30Y gilt yield erasing much of Friday’s chaotic selloff (10Y Linkers are down a stunning and record smashing 63bps on the day)…
“Clearly the market likes the fact that Jeremy Hunt has the sense to bring forward the statement and that shows that he does have an understanding of the importance of financial markets and speaking to investors,” said Jane Foley, senior foreign-exchange strategist at Rabobank.
“That’s a move in the right direction but there’s still a lot of uncertainty as to whether Truss can remain in her job.”
“I think we’re in for a period where UK credibility is continually questioned and UK assets remain incredibly volatile for a significant period of time,” Benjamin Jones, Invesco Director of Macro Research, said on Bloomberg Television.
“Watching the gilt market will be absolutely key in understanding if the market does believe Hunt to be more stable and if he will be able to push these policies through.”
The question many have this morning is – who is really running the government, Truss or Hunt (or The Market)? (as the resignations from the former’s party have already begun).
end
FRANCE/RUSSIA/GLOBE
Backlash After Macron Says France Won’t Respond To A Nuclear Strike On Ukraine | ZeroHedge
This is amusing if it were not so serious.
Of course Macron was read in not just on the use of dirty nuclear artillery but also the timing. He knows what the Russian response will be. And in so doing he has broken away from NATO to let it suffer the consequences.
the dead give away was Macron stating that France would not go nuclear to a Russian use of a tactical Nuke .. Russian doctrine rules out a 1st strike and it has been stated that no Nukes are needed to finish what was started so one knew right away the Ukies were going to use a dirty missile and likely artillery ( himars)
This is why there is panic in DC recently as they know what is coming … do not rule out a strike on DC and Brussels.. things are going to get a lot worse and publicly little will be said until a war is started. No one will win and Russians know that only too well.
Months ago the real clue to these unfolding events was the grain shipments to Europe and not to 3rd world countries by Ukraine in violation of the agreement made to allow such shipments. Europe was going to build food supplies at the expense of everyone else.
French President Emmanuel Macron answered questions about Paris’s nuclear weapons policy in a television interview this past week. He indicated that Moscow detonating a nuclear weapon in Ukraine would not cause Paris to use its nukes. Macron is facing criticism for his remarks.
Paris’s current nuclear policy only allows for the deployment of its ultimate weapons in self-defense. In the interview, Marcon expressed a nuclear attack on Ukraine would not directly threaten France.
On France 2, Macron was asked “Would France consider a tactical strike by Russia as a nuclear strike?” He replied: “France has a nuclear doctrine. It lies in the nation’s fundamental interests that are clearly defined. They wouldn’t be questioned should there be a ballistic nuclear attack.”
Kasja Ollongren, defense minister of the Netherlands, criticized Macron, Saying “[p]art of our deterrence is also not to speculate publicly on what kind of response, in what kind of situation, they would get.” She continued, “I would not comment on different possibilities and say ‘yes’ or ‘no’.”
The Financial Timesreported that NATO officials were unwilling to give a public statement on Marcon’s remarks. However, speaking privately they said it was alliance policy not to spell out when nuclear weapons would be used. An official added that a conventional strike on Russia was a likely response to Moscow using nuclear weapons in Ukraine.
Marcon was also attacked by politicians at home. Former French President François Hollande said on FranceInfo radio, Marcon should “say as little as possible and be prepared to do as much as possible.” He added, “[nuclear] dissuasion’s credibility relies on not saying anything about what we would have to do.”
Jean-Louis Thiériot, vice president of the National Assembly’s armed forces committee issued a sharper rebuke. “When I heard him speak, I almost fell off my chair. It’s a political mistake. One of the principles of nuclear dissuasion is that there’s an uncertainty as to what is considered a vital interest,” he said.
Marcon Tweeted Thursday, “We do not want a World War.” When asked about the president’s remarks, Macron’s office said Paris’s nuclear policy has not changed. “Nuclear deterrence is the prerogative of the head of state and his appreciation in a given moment of what is necessary to preserve our vital interests,” the official said.
end
5. RUSSIAN AND MIDDLE EASTERN AFFAIRS
RUSSIA//UKRAINE
Kiev Pummeled By ‘Kamikaze Drone’ Strikes
MONDAY, OCT 17, 2022 – 08:40 AM
On Monday Kiev was pummeled by Iranian ‘Kamikaze’ drones, reportedly killing at least three people, according to Ukrainian officials. The drones have been controversially deployed by Russian forces in Ukraine over the past few months, amid outcry in the West over alleged arms transfers between Tehran and Moscow.
“As of now, the number of people killed as a result of a kamikaze drone attack on a residential building has increased to three. Nineteen people have been rescued. [Rescue] work is ongoing,” a Ukrainian government statement said of attacks on the capital.
Ukrainian President Volodymyr Zelensky announced Monday that kamikaze drones and missiles were “attacking all of Ukraine“. In addition to the attacks on the capital, three more were reported killed in the eastern Sumy region, bringing the total of deceased to six.
Russia has drastically stepped up these airstrikes on major cities beyond the eastern and southern front since last Monday. “All night and all morning, the enemy terrorizes the civilian population,” Zelensky said in his newest statement. “The enemy can attack our cities, but it won’t be able to break us.”
Ukraine has renewed its urgent appeal for the West to send “more air defense systems and as soon as possible,” according to Zelensky’s chief of staff Andriy Yermak. “We have no time for slow actions. More weapons to defend the sky and destroy the enemy,” he stressed. Russia expanded its strikes in the wake of the Kerch Strait Bridge bombing.
Interestingly, a fresh statement Monday by Iran’s foreign ministry has denied widespread international reports of the drone transfers, which The Washington Post and others says is expected to continue.
Iran’s Foreign Ministry Spokesperson Nasser Kanaani said over the weekend, “The published news about Iran providing Russia with drones has political ambitions and it’s circulated by western sources. We have not provided weaponry to any side of the countries at war.”
Complicating matters further is that there are reports Israel is poised to “answer” Iranian weapons transfers with its own ramped up support to Ukraine.
Former Russian president Dmitry Medvedev warned Israel against supplying weapons to Ukraine on Monday, saying that any move to bolster Kyiv’s forces would severely damage bilateral ties.
“Israel appears to be getting ready to supply weapons to the Kyiv regime. A very reckless move. It would destroy all bilateral relations between our countries,” the former president wrote on Telegram.
Israel has thus far remained reluctant to to jump in too firmly on Ukraine’s side, for example in its persistent refusal to provide the ‘Iron Dome’ defense system, as it must maintain a delicate strategic balance with Russia in Syria.
END
A must read: Brandon Smith. He has been quite accurate on the Russian-Ukraine conflict for the past 8 months or so
(Brandon Smith)
Robert H for the Brandon Smith commentary
He is spot on. With the exception that the Ukies have already crossed a line into no mans’ land. While Putin may be able to hold off his hard liners briefly but it will not last long and we should anticipate rapid escalation early in November.. although who knows how crazy Ukies can be? There is faction there that even the DC crowd cannot control as they march to another master using DC as a convenient scapegoat. The “dirty “ shell fired into the Donbas has killed a number of militia troops with radiation poison. However, these insane Ukies are still in perfection mode of these shells to make them more effective in killing. No question they will be used on the civilian population and Russian troop concentrations in the future. This will result in untold consequences and Russian reaction will be swift and harsh. The endearment Russians feel for the Slavic cousins will vanish. The real question is when Slavic people wake to the fact they are disposable to the DC crowd who sees Russians as “snow niggers”. That is why Ukrainians will be used to the last one and everyone knows that except them. Poles are no different, as they will be sacrificed as readily if the opportunity presents.
Macron may be smarter than given credit in recognizing once the Bear is aroused in anger fury will result. However there is a greater game being played as many other nations will be sacrificed as to DC they are all expendable and that includes allies like the Brits, who should have recognized this back in ‘71 when they were given the finger.
Global Tensions Rise Over Russia And Ukraine – What Happens Next?
There comes a point in the lifespan of any economic or political analysis when most of your observations or predictions either become mostly wrong, or mostly right. If you have done your job properly through due diligence, research and applied practical insight, then you will be in a position to point out why the dominoes are falling. People have to understand how these events were predictable so that they can prepare better in the future.
The mainstream media, politicians and global banks will tell the public that “no one could have seen these events coming.” This is a lie. Some of us in the alternative fields did see them coming and with considerable clarity. The establishment and their defenders don’t want you to know that. They will deny up and down that we predicted anything; they’ll claim that we don’t exist, that our analysis never happened, or as a last ditch effort they’ll claim that they saw it all coming before we did.
The mainstream officials and analysts have to maintain their image of public authority, and they can’t do that if “upstarts” in the alternative arena are constantly right while they are constantly wrong. They have all the fancy Ivy League degrees, after all.
In my article ‘The Globalist Reset Agenda Has Failed – Is Ukraine Plan B?’, published in January of this year, I outlined why I believed that a war between Ukraine and Russia was the most likely crisis to follow after the hype of the covid pandemic faded away.
In my article ‘Ukraine Learns The Value Of An Armed Citizenry, But Far Too Late’ I argued the high probability that NATO troops were already on the ground in the region and not just as advisors. According to mounting evidence it is clear that western troops are active in Ukraine and that US and European intel are essentially running the war. In some cases this has been openly admitted. And why wouldn’t they be running the war? It’s being fought entirely with NATO money and NATO weapons.
Then, recently I predicted that the Kremlin was poised to shift strategies, rather than trying to hold larger swaths of territory I believed they would instead seek to use a “tenderizing” strategy and destroy the bulk of Ukrainian infrastructure, specifically electricity and water grids. In my article ‘Escalation: Recent Events Suggest Mounting Economic Danger’ published a month ago I stated that:
“With the amount of propaganda coming from Ukrainian Intelligence and NATO, it’s hard to say what is actually happening, but I suspect Russia is changing strategies and repositioning to deploy missile and artillery bombardment of infrastructure, including power grids and water.”
“This is a tactic that Russia has avoided for months, which is surprising because one of the first measures usually taken by the US during an invasion is to eliminate most key infrastructure (as we did in Iraq). You would think Russia would have done the same, but perhaps they were saving that scenario for winter when it is harder for Ukraine to cope…This would make Ukraine essentially unlivable in the coming winter for most of the population.”
This past week my latest prediction came true, with Russia now striking multiple infrastructure targets using cruise missiles and drones and taking down at least 60% of Ukraine’s electrical grids. These grids are now rerouted to provide SOME power to the affected regions, but in the best case scenario they are only able to be active for 5 hours a day. Kyiv city authorities called on residents and businesses to limit electricity consumption from 5pm until 10pm and urged owners of advertising signs to turn off their lights during this time.
Ukraine has halted all energy exports to Europe in response to the grid damage. Meaning, the EU just lost even more of their primary energy resources on top of the loss of Russian gas and oil.
Some people might claim that the missile attacks were impromptu and were only triggered by the partial destruction of the Kerch Bridge by a Ukrainian truck bomb. This is false. According to Ben Hodges, a retired U.S. general, the intensity and volume of the attacks indicated they were planned well in advance of the weekend’s explosion on a bridge linking Russia and annexed Crimea. Meaning, Russia was going to strike Ukraine infrastructure regardless.
But what does all this mean, and what happens next?
My track record on the crisis has been accurate so far, but you don’t need a crystal ball to see where this situation is headed. First and foremost, the propaganda war is going to go into high gear, with Russia widely condemned for “genocide” as Ukraine civilians face a long winter with little to no electricity and minimal clean water.
To put this in perspective, however, when the US invaded Iraq for the second time during Operation Iraqi Freedom, we annihilated most vital grid resources and left millions of Iraqis without power or water. Hundreds of thousands of civilians died during the war, many of them due to lack of basic necessities. So, we need to be careful about how we throw around the word “genocide,” our glass house breaks just as easily as any other.
I would remind readers that I have no personal interest in either side of this conflict, I’m only interested in the facts on the ground and how they affect the rest of the world and America in particular. I don’t trust Vladimir Putin with his long running ties to globalists in the WEF and his friendship with Henry Kissinger, and I certainly don’t trust the puppet government in Ukraine. I suspect this conflict has been instigated to the benefit of global elitists, and I gave all my reasons why at the very beginning of the war.
I would also remind readers that not long ago there was an aggressive push by Democrats and some GOP Neo-cons to get the American public to support deep US involvement and possibly open troop deployments to Ukraine. This attempt failed for the most part, but they will try again as the conflict escalates. Words like “genocide” are used liberally by propagandists to induce emotional outrage, but these people are rarely honest.
That’s not to say Ukraine isn’t facing disaster, far from it. Until now, they have enjoyed amenities which are rarely available to a country in the midst of invasion, including power and internet communications. This is now changing. As grid systems continue to fail or be destroyed by targeted strikes it is inevitable that millions more Ukrainians will seek to leave the region as refugees to neighboring countries. The influx will definitely create a humanitarian crisis.
Furthermore, the calls by NATO governments for direct intervention will increase to a constant roar and the mainstream media will try to amplify the saber rattling as much as possible.
Ukraine will turn to more asymmetric strikes within Russia, using multiple guerrilla or terrorist actions, more so to elicit a wider response from Russia that might lure America and the EU into open engagement.
Russia will simply bide their time. They are facing minimal economic pressure given they are enjoying an explosion in energy profits and their close trade ties with China and India. All Putin has to do is wait for the NATO weapons and money to run out, which they will, sooner rather than later. From a strategic perspective, it makes sense for Russia to continue targeted strikes rather than trying to grab more territory. That said, a prolonged conflict also helps the establishment as a distraction from the economic crisis that they have caused.
Putin would never admit it, but the Russian presence in Ukraine serves many globalist interests.
The biggest question on everyone’s mind is of course if this will lead to a nuclear event? If we are talking about a global nuclear war, then I think not. If we are talking about a limited regional strike, such as one or two weapons, then yes, the chances are high.
The automatic assumption people will make is that if one nuclear bomb goes off, then ALL the nuclear bombs will go off. This is not necessarily true. A regional strike, most likely by Russia or at least blamed on Russia, would actually be beneficial to globalist interests who could use the image of a mushroom cloud over Ukraine as a tool of ultimate fear and panic. The public might be more malleable and controllable if they thought evil Russians with nukes are about to erase them.
An actual global nuke exchange would NOT be so advantageous for the establishment, as the outcome would be completely unpredictable and the vast infrastructure they have spent generations building would be eliminated in the blink of an eye. I think the globalists will do everything in their power to avoid a worldwide nuclear calamity, but they would certainly try to use the threat to their advantage.
Ukraine’s energy crisis will dovetail with Europe’s impending energy crisis this winter and I doubt there will be many countries in the EU that will avoid economic and supply chain breakdowns. The extent of the crisis will be determined by the harshness of the winter.
As far as America is concerned, I continue to worry most about political optics. I am already seeing a narrative floating around social media platforms that conservatives are complicit with Russia and that in some cases groups that stand against the draconian policies of the establishment and the Biden Administration are actually “Russian agents.”
The strategy here is so transparent it’s almost laughable. As Biden continues to overstep and continues to beat his war drums against half the US population, the claim will be that those of us who respond or resist are not “freedom fighters,” but paid Russian saboteurs. Even those of us that have been fighting this fight for decades will be accused of “treason” and “insurrection” instead of simply defending ourselves against tyranny.
The time is coming for the ultimate gaslighting of the American citizenry – They will try to take away our freedoms and everything we have and accuse us of being villains and foreign agents at the same time. This IS the endgame of the East/West paradigm, at least for Americans. But, if we can see it coming then we can at least prepare for it and warn as many people as possible before it happens.
end
SAUDI ARABIA/USA/UKRAINE
Saudis announce $400 million in aid to Ukraine.
(zerohedge)
Saudis Announce $400M In Ukraine Aid After Biden Said US ‘Re-Evaluating’ Ties With Kingdom
SUNDAY, OCT 16, 2022 – 06:00 PM
Saudi state media announced Saturday that the kingdom will provide $400 million in humanitarian aid to Ukraine, following a Friday phone call between Crown Prince Mohammed bin Salman and President Volodymyr Zelensky.
SPA stated of the call, “The crown prince expressed the kingdom’s readiness to continue efforts of mediation and support everything that contributes to de-escalation,” in reference to the over seven-month long invasion of Ukraine.
The timing of the new aid is raising eyebrows at a moment there are growing calls in US Congress to freeze all new military arms and equipment sales to Riyadh, and after the White House just days ago confirmed President Biden will re-evaluate ties with Saudi Arabia.
“We are reviewing where we are; we’ll be watching very closely, talking to partners and stakeholders,” State Department spokesman Ned Price price said Tuesday, following the Saudis having led the way in getting major oil producers to cut petroleum output, crucially also ahead of mid-term elections in the US.
As reported previously by Al Jazeera of Price’s press briefing:
He added that President Joe Biden had previously spoken of the need to “recalibrate” ties with Saudi Arabia to better serve the US – a position that Price said was underscored by the recently announced oil cuts.
“Our guiding principle will be to see to it that we have a relationship that serves our interests. This is not a bilateral relationship that has always served our interests,” Price said.
Price went so far as to charge the OPEC is essentially supporting Russia’s aggression in Ukraine “against the interests of the American people” in this latest move.
Chart via Al Jazeera: OPEC members’ oil reserves
Currently Senator Chris Murphy and Rep. Ro Khanna are leading a Congressional move to get advanced anti-air missile systems which the Pentagon has stationed in Saudi Arabia removed and transferred to Ukraine.
Murphy announced in a Thursday statement,“For several years, the US military has deployed Patriot missile defense batteries to Saudi Arabia to help defend oil infrastructure against missile and drone attacks. These advanced air and missile defense systems should be re-deployed to bolster the defenses of eastern flank NATO allies like Poland and Romania — or transferred to our Ukrainian partners.”
As a member of the Senate Foreign Relations Committee, Murphy also lent his voice to ongoing calls to “freeze new military aid to Saudi Arabia” – which would possibly impact the pending sale and transfer of Advanced Medium Range Air-to-Air Missiles (AMRAAM) to Riyadh based on a previously approved contract of $650 million
end
RUSSIA/EURASIA
Russia courts Muslim countries as strategic Eurasian partners
Robert Hryniak
Fri, Oct 14, 6:59 PM (14 hours ago)
to
I encourage you to read this article and absorb what is being said here.
The post Western world is definitely under way and no amount of puff and huff from the West is going to change that. This is what was put in motion by the going show masquerading as a government without realizing the consequences of removing Russia from Swift. All the under currents were well under way and a hegemony that was hollowed out by a thieving culture was laid bare. Today, as you see Swap lines extended from Switzerland to South Korea by the Fed, you are seeing a system feeding on itself as things fall apart. And like the boy trying to stop the leaks in the dike, it will not work. Nor will climate control crowd see their utopian dream as their dreams are simply that and no more. However, do not count them to accept this as they attempt to change society causing great upheavals. And it is why we have started to see people back tracking from the ESG narrative.
The challenge while there is time, is to understand everything about the west taken for granted will change and new markets will exist in this new order occurring before us in plain view. Whether the West chooses to reinvent itself or not will determine the role it plays in this new world being formed and defined. Failure to change and accept reality is and will not be easy. However, failure to change will leave the Western world cut off and out of the post Western World ushering in a much more diminished existence as prosperity shifts away. As it is going forward the West is already being shut out of food related influence, rendering some institutions irrelevant reducing western hegemony. Big stick threats are falling on deaf ears. Even when you have such power the need to threaten to use it denies the threat making the threatening a choice of using it, or go home. It is the noise of nuclear threat that gives it away. The whole nonsense of the use of tactical nukes first by Russia is a joke as their doctrine is well documented in writing for all to see and there is no need to use nukes to win objectives in Ukraine as the recent barrage of missiles demonstrated. The power grid in the Ukraine can be easily destroyed causing the people there to return to the Stone Age. However, that would cause at least 10-12 million to flow Westward overwhelming Eastern Europe into a crisis of mass proportions. So a different approach is applied no matter how awful for the innocent people there. In any case, this conflict will be resolved and Ukraine will be stripped of its’ capacity to wage war. Even now, its’ value as a producing nation is being reduced to making it a secondary thought process. And it really is a sideshow in the big picture as tragic as it is.
And you can be sure that old established patterns of settlement in trade will change in the course of this because new hands are reaching for their share of a pie being baked. This will change banking because the levers of USD hegemony control are being severed and creating new pockets of power at its’ expense.
Perhaps, people tomorrow will look to creating things as a means of prosperity over the diminishing western financial world which is losing its’ charm and ability to produce lifestyle.
What has happening is Serious and a dangerous beyond belief
Robert Hryniak
10:17 AM (27 minutes ago)
to
In the past, I have told you that the Ukraine still possesses five nuclear weapons, that were reduced to four in the SMO. One of these tactical nuclear weapons was found by the Russians on a airbase outside of Kyiv very early on, in this conflict. The reason that the Russians actually move towards Kyiv to take this airbase at some serious cost of manpower to gain control of the weapon and have it physically removed from the Ukraine.
Over the last several days the Ukraine has used radioactive shells and hitting Frontline troops in the Donbas. This has been publicly reported on certain internet channels and ignored by mass media. I cannot underscore the significance of this action taken by the Ukrainians. It is in effect, a nuclear strike on Russians on Russian soil. There is a well documented doctrine for the kind of response to comes when Russia is attacked by nuclear shells or missiles. It should equally be clear to those who have allowed and enabled do Ukrainians to do this what happens next after the threat to Russia is eliminated in the Ukraine.
I’m sure\, it will not be reported however China has issued a bulletin to all of its personnel in the Ukraine no matter the position either on a diplomatic front or on an industry front to leave and leave immediately. This came last night. No doubt you can be sure the Russia has shared the information that I have seen as to the writing on the shells, the factory they were made in, and the nature of the radioactive content held within. In reality it is what is commonly referred to as a dirty bomb which was delivered by long range artillery, since the Ukraine has no air borne capability without affecting its’ own soil.
In addition to China the following countries are closing their embassies as of late last night and have issued notice to all of their citizens to leave the Ukraine at once. Those countries include Serbia, Kyrgyzstan, Uzbekistan, Turkmenistan and several other. I doubt very much that any notice of this will be given to any western country.
Whatever comes next and it will come, and it will be severe for the Ukrainians as all capability to wage war will be eliminated without exception. And what comes for the neighbors and enablers is unknown this morning but there will be a response. Hiding out in Israel is not going to make a difference in response, or any where else. However, you now understand why certain eastern European countries have been accumulating and distributing iodine to their citizens. Frankly, the so called foreign legion there should get out while they can or make peace with God. Because if you thought a 1000 missiles a day was something you will be shocked by what comes and the resulting deaths.
In America, the Democrats have been looking at a means to avoid midterms which they will lose and now they might just get a excuse.
Thinking of traveling in the region is bets avoided as things will heat up without much notice and there is no telling of how naive and crazy people will be in their reactions. If America wanted a Cuban missile crisis Moment thief is fast approaching. And there will be be no belief on the part of Russia that this incident was without American blessing and knowledge.
If you thought markets were Upside down then watch what happens next.
END
6.GLOBAL ISSUES////COVID ISSUES/VACCINE ISSUES
Vaccine//Covid issues:
This should be interesting!!
(zerohedge)
EU Prosecutor Opens Probe Into COVID Vaccine Purchases
MONDAY, OCT 17, 2022 – 02:45 AM
Two weeks after Pfizer CEO bailed on EU testimony in the wake of a report highlighting a ‘secretive’ vaccine deal between himself and European Commission President Ursula ‘missing texts‘ von der Leyen, the European Public Prosecutor’s Office (EPPO) has opened an investigation into the EU’s Covid-19 vaccine purchases, Politicoreports.
EPPO, and independent EU body, is responsible for investigating and prosecuting financial crimes, including fraud, money laundering and corruption, according to the report. In its Friday announcement, the body did not specify who was being investigated, or which contracts were the subject of inquiry.
That said, twoother watchdog agencies have brought attention to the von der Leyen – Bourla deal.
“This exceptional confirmation comes after the extremely high public interest. No further details will be made public at this stage,” said the EPPO.
In April 2021, the New York Times first reported on text messages exchanged between von der Leyen and Pfizer CEO Albert Bourla in the run-up to the EU’s biggest vaccine procurement contract — for up to 1.8 billion doses of BioNTech/Pfizer vaccine. The deal would be worth up to €35 billion if fully exercised, according to leaked vaccine prices.
In January this year, the EU’s ombudsman charged the Commission with maladministration for failing to look for the text messages in response to a freedom of information request. Without confirming the existence of the texts, the Commission argued in its response that “short-lived, ephemeral documents are not kept.” It said that a search for the text messages hadn’t yielded any results. -Politico
Last month, the European Court of Auditors published the aforementioned report in which it said the Commission refused transparency regarding details of von der Leyen’s personal role in the Pfizer contract.
In it, the budget watchdog found that the EU chief went rogue in order to personally hammer out a preliminary deal with Pfizer, instead of relying on joint negotiating teams. While the Commission has been forthcoming with other vaccine contracts, it has refused to provide the court with any documents regarding those preliminary negotiations.
According to Belgian Socialist MEP Kathleen van Brempt, “several aspects” of the Pfizer contract should be investigated, including “the text messages between the Commission President and the fact that there is no paper trail of the preliminary negotiations in first instance.”
According to Politico, “The MEP chairs the European Parliament’s special committee on COVID-19,” adding that both the EU’s ombudsman and a member of the European Court of Auditors have made appearances before the panel.
“The [COVID-19] committee will be following this case with great attention,” said Van Brempt.
GLOBAL ISSUES
CANADA
We are in such a mess! asset seizures are skyrocketing due to post pandemic debt default
(Sandes/EpochTimes)
“Canary In The Gold Mine”: Asset Seizures Could Skyrocket Due To Post-Pandemic Debt Default, Says Bailiff
North Central Bailiffs in Kelowna, B.C., is busy. In fact, as pandemic restrictions and mandates continue to ease, owner Mike Sundstrom has never had more work end up on his desk.
From Sundstrom’s vantage point, the industry where he makes his living as a licensed bailiff and licensed sheriff isn’t prepared to handle the massive surge of claims he predicts is just around the corner.
His firm, one of several bailiff firms in the province, gets to see a sweeping overview where most of the financial and economic sectors collide. And given how many lenders and government agencies hit the pause button on collections during the past two and a half years of COVID-19 when Canadians’ ability to pay was most fragile, Sundstrom says every sector is now beginning to call him.
“[Bailiffs are] the canary in the gold mine,” he told The Epoch Times.
From banking to car dealerships to residential defaults, he says asset seizures continue to climb. Yet, he says, what has him even more concerned is the fallout when the slow pace of government claims such as tax files eventually make their way through the system.
“Every time I turn around there’s a new file coming in, and we’re seeing this all at once,” Sundstrom says.
“Everything is up. Repossessions are up, evictions are up. And this even though we’re not seeing Revenue Canada, PST [provincial sales tax], and WCB [Workers’ Compensation Board] back to full speed. They’re sitting on the edge of the dam with all of that workload behind them that they’ve held back because of COVID-19. And it’s just a matter of time before they can’t hold it back any further.”
Sundstrom says a combination of financial and social factors have contributed to the dramatic increase.
“There’s quite a number of things that are going on all at the same time that we’re seeing,” he said.
“Definitely the post-COVID hangover in the economy that’s going on. And there’s this productivity slump with all kinds of jobs everywhere but nobody wants to work. And then there’s inflation. And then there’s the interest rates trying to counter the inflation. And underneath all of the usual suspects in a poor economy, especially with evictions, is an acute drug crisis that’s going on.”
Freida Richer, a licensed insolvency trustee with Grant Thornton LLP based in Edmonton, says her office has seen an increase in people looking for advice on dealing with debt they can no longer afford to pay.
“I think that the post-pandemic financial picture is really different from the pre-pandemic picture,” Richer said in an interview.
“Maybe they’ve gone back to work but with significantly reduced income, or some people haven’t gone back to their old job because it no longer exists. Another factor is the debt levels, which have not decreased. And based on the discussions I have with consumers and other insolvency trustees, [Canadians] have had to use credit to supplement their lack of income. And at the end of the day, do you dig yourself into a bigger death hole?”
Part of the challenge, Richer adds, is that banks, credit card companies, and other lenders stopped their collections when people defaulted on their payments, or didn’t seek aggressive collections or wage garnishments during the past couple of years. That trend has now changed, she says.
Vulnerabilities
In its 2022 Financial System Review, Bank of Canada Governor Tiff Macklem said it’s important to be prudent with high debt loans and associated burdens during a high-priced housing market—especially when the central bank looks to curb inflation with higher interest rates.
“[H]igh household debt and elevated house prices are vulnerabilities,” Macklem said upon the release of the review.
And concerns with high cost-of-living issues and consumer insolvency rates persist.
A variety of credit cards are seen in a file photo. (The Canadian Press/AP/John Raoux)
Statistics Canada’s Consumer Price Index calculated inflation at 7 percent in August, a slight drop from 7.6 percent in July. Its inflation calculation for September will be announced Oct. 19.
Equifax Canada’s Sept. 6 Market Pulse quarterly consumer credit trends publication says that compared to the second quarter (Q2) in 2021, total consumer debt increased 8.2 percent to $2.32 trillion during the same quarter this year. It adds that increases in new lending and higher spending linked to inflation pushed non-mortgage debt to $591.4 billion, up 5.2 percent from Q2 2021. In addition, credit card balances for consumer segments with a credit score lower than 620 rose 16.2 percent from Q2 2021. Moreover, consumer insolvency rose to the highest level since the start of the pandemic.
Rebecca Oakes, vice-president of advanced analytics at Equifax Canada, said Canadians are feeling the pinch as the cost of living is rising faster than their incomes can support.
“Financial stress is becoming a very real thing for many more Canadians,” Oakes said in a news release.
“Its impact on consumer credit is not just visible in day-to-day credit card spending, but also in other non-mortgage debt like auto loans and lines of credit where balances are on the rise. … Early indications in our data suggest financial stress is starting to emerge; Canadians should continue to be mindful of their spending and debt obligations.”
This is the story that is being repeated not only in Canada but in many parts of the world and like most things, all things are cyclical and suffer corrections in value. I’d like to relate to you 2 stories. First is a story about a younger couple in Toronto with the median age of 32 who are living in a rented home and are building a new house in Toronto. Having recently moved to Toronto they opted to build as opposed to purchase. And found themselves trapped in a cycle of rising interest rates. To the point where their $9000 a month cost of maintaining the build property is not affordable by them. The consequences that having to pay for rent in the home they are renting while the new one is being built is such that they simply cannot afford the costs. So as most younger couples do, they return to their parents for money. Both sets of parents are contributing $3000 each monthly to the cost of carry while the house is being completed. No one assesses that perhaps even when the house is completed that this couple will not be able to afford to carry this home on their own. If they can’t at some point they will sell into what will be a down market.
Second story is about an enterprising mid 30s entrepreneur living in Toronto who is doing exceptionally well in the business he inherited from his father. His income of $1 million a year places him in a rarified income bracket. Not satisfied with his current business, he decided to be a real estate developer and is currently constructing two homes while living in an existing home with a mortgage. Today, he finds he is paying $36,000 a month in interest cost on the construction of these two new properties. Even with his income he is finding it difficult to the point, that he has canceled their Christmas trip to Disneyland to save money.
At some point early next year the consequences of decisions taken in the past will come to bear and this will place pressure on the existing marketplace. Because these two examples are not isolated and or existent in many locations from Switzerland to Italy.
So it is the heat? We could argue that the virus (or pathogen or something) contributed to the increase in deaths beyond baseline or expected in 2020, and we can argue that it was the accumulation of deaths due to delayed critical treatment as well as virus in 2020 and 2021; but in 2022, the virus is flat and cannot account for the excess deaths. What then is it? I argue the impact of the COVID gene injection as do others. What do you think? What are we missing? Is it the heat?‘ Excess mortality in the EU fell to +12% in August 2022 compared with the peak of +16% recorded in July, which was the highest value on record to date in 2022 and unusually high for the month of July. This comes after both May and June 2022 recorded +7% of the average number of deaths for the same period in 2016-2019. END Open in browser“Covid vaccines are the biggest corruption scandal in the history of the world, says MEP”; by RHODA WILSON Dr. Paul AlexanderOct 17 ▷ LISTENSAVE
Homburg’s tweet below is translated here: ‘Unprecedented drop in births in Q1. In previous years, the births were quite constant, even the lockdown in 2020 left no noticeable traces.’
They are not saying she is wrong, it is just that her statements & data are harmful. Harmful how? Because she tells truth? They cannot debate her & show her data is wrong, so cancel her due to fact?
———- Forwarded message ——— From: Dr. Paul Alexander from Alexander COVID News<palexander@substack.com> Date: Fri, Oct 14, 2022 at 4:32 PM Subject: Germany: COVID cases up to today October 13th, something is up in Germany? As you see cases not getting back to ba… To: <sabioncello@gmail.com>
Dr. Vanden Bossche and Dr. Alexander: Pfizer’s failure to test COVID vaccines for transmission; point is if it could not stop infection then it could not stop transmission
You look at the list and add to what we are saying was done wrong (I argue some level of mal-intent, recklessness, and ineptness) by Pfizer et al. e.g. did not test for genetic mutations in the host
-did not test whether there were any serious drug interactions with other commonly used medicines/vaccines.
-did not test whether there were genetic mutations in the host
-did not test whether the “vaccine” became systemic or stayed restricted to the injection site
-did not test whether “boosters” were actually beneficial (they simply stated that as the initial protocol as a two dose protocol without any data to support it)
-did not test whether the “non-active” ingredients caused any problems (these were not normal excipients-some of the placebo arm data suggests that these were also causing problems)
-did not test whether the “vaccine” was transmissible from the recipient
-did not test as to metabolic elimination of the vaccine from the host, i.e. how long does it remain active in the host
-proposed a product specification that would essentially allow for almost anything to pass
-did not account (i.e. screen) for a rather pronounced natural immunity already in the population
-conducted most of their studies outside of the US in countries that have been known for questionable clinical studies (Brazil in particular)
-had virtually no stability data
Substack Alexander COVID News evidence-based medicine
Financial Collapse Is a Mathematical Certainty: The Perfect Storm Threatening the Dollar Hedgemony
October 14, 2022 1:21 pm
After the 2008 stock market crash, governments, because the economy collapsed globally, started spending like drunken sailors. The last 14 years have been a ballooning of the sovereign debt bond bubble. Who’s going to save that bubble? Who’s going to be the buyer of all that debt when this bubble finally blows up? Answer: No one. Many who are aware of the situation are just surprised the system has lasted this long. It looked like it was ready to burst in September 2019, and then, conveniently, COVID showed up, which granted emergency powers to all central banks. Governments went on another spending spree, printing money, and this allowed them to kick the proverbial can down the road for another two years. Here we are in 2022 and it’s unraveling again. And the reason why COVID was important is because the Federal Reserve was able to plug the hole in what was beginning to become a liquidity debt crisis. COVID provided cover for the central banks and the governments, but it also allowed for a control system. If everything’s going to collapse, wouldn’t it be nice to have a control system where travel is restricted, you can blame it on a virus; you create vaccine passports, which then get linked to digital IDs, and then central bank digital currency. So, COVID was a convenient excuse. The Rockefeller and Rothschild Empires were prepared to sacrifice the globe in order to save their empires. And six months after the start of the Ukraine war, we find that the Rockefeller Empire is now doing their best to destroy the EU, along with the Rothschild Empire-whose base is Europe. It’s funny how things work.
Over 1000 New Injury Cases Including 7 More Deaths Recorded this Week Following New COVID Bivalent Booster Shots
October 14, 2022 3:36 pm
The U.S. Government’s Vaccine Adverse Events Reporting System (VAERS) maintained by the FDA and the CDC was updated today, and 1,064 new cases were added to the database this week, including 7 new deaths, following the newly launched COVID-19 Bivalent booster shots from Pfizer and Moderna. That brings the total to 3,232 cases including 26 deaths recorded in VAERS since this new COVID-19 vaccine was given emergency use authorization at the end of August, just 6 weeks ago. These dangerous shots were just granted emergency use authorization by the FDA this week to children as young as 5 years old. You or your children can receive one of these dangerous shots in all 50 states (and yes, this includes Florida – just call your local pharmacy and ask them). To date, there have been 1,437,273 cases filed in VAERS from ALL COVID-19 vaccines since December of 2020, including 31,470 deaths. That is 3 times more deaths following COVID-19 vaccines than deaths (9,149) following all other FDA-approved vaccines for the previous 30 years (1990 through 2019). This is all public information based on the U.S. Government’s own data, but the Corporate Media refuses to publish this, and if you share this information on Social Media platforms owned by Big Tech, they will flag it as “fake news” or just ban it completely.
White House Extends COVID Public Health Emergency Status to Get More People Vaccinated with Deadly New Boosters
October 15, 2022 3:58 pm
The tyrannical decree to declare COVID-19 as a “Public Health Emergency” that ushered in unprecedented measures to ignore the Constitution of the United States and to lock everyone down and eventually start injecting Americans with experimental shots that have now resulted in massive deaths and injuries, which was first declared by President Donald Trump almost 3 years ago on January 31, 2020, was just extended by the Biden Administration this week. For those who have eyes to see and ears to hear discerning the truth over the propaganda, it is obvious that this tyrannical decree was extended on behalf of Pfizer and Moderna, to continue justifying emergency use authorizations for experimental injections that otherwise would be illegal. This has always been the primary goal of the COVID-19 emergency measures started by Donald Trump in 2020 and his massive federal funding of Operation Warp Speed, which resulted in the addition of $TRILLIONS into the U.S. economy, bailing out Wall Street and the Central Bankers in the process. In order to justify this extension of the “Public Health Emergency,” the State Department’s medical authority talking heads had to lie to the American public, by stating that the current flavor of COVID-19 circulating around could only be stopped by the newly authorized COVID-19 “vaccines” produced by Moderna and Pfizer. White House COVID-19 Response Coordinator Ashish Jha, FDA Commissioner Robert Califf, and CDC Director Rochelle Walensky, are now complicit in criminal intent to commit mass murder in the United States. The FDA, CDC, and White House could not have authorized these new versions of the experimental COVID-19 shots without extending the “Public Health Emergency” status which overrides laws and Constitutional protections that prohibit drug companies from injecting experimental products into the bodies of American adults and children.
Every American Executive and Engineer in China’s Semiconductor Manufacturing Industry Resigned Last Week due to Biden’s Sanctions
October 16, 2022 5:41 pm
A Twitter thread translated by Rhodium Group China expert Jordan Schneider – whose blog, China Talk, provides keen insight into the effects of the Biden administration’s new export controls on the chip industry. To review, the Biden administration last week laid out new rules on chip exports based on US concerns that China will use AI to improve military capabilities, support surveillance for human rights abuses and “disrupt or manufacture outcomes that undermine democratic governance and sow social unrest,” according to Assistant Secretary of Commerce for Export Administration Thea D. Rozman Kendler. The sweeping regulations will curb the sale of semiconductors and chipmaking equipment to its #1 geopolitical rival – which, as Bloomberg puts it, is “sending shockwaves through the $440 billion industry.” In a Friday Twitter thread which he translated from Hedgehog Computing Group founder Xinran Wang (@lidangzzz), Schneider lays out the carnage in English: “To put it simply, Biden has forced all Americans working in China to pick between quitting their jobs and losing American citizenship,” Schneider writes, adding “One round of sanctions from Biden did more damage than all four years of performative sanctioning under Trump.”
Trump Claims he could “Easily” be Israeli PM – Is this why Pfizer Received First COVID Vaccine Authorization in U.S. and Exclusive Rights in Israel?
October 16, 2022 7:47 pm
Former US President Donald Trump stated today that he is so popular in Israel, that he could “easily” be the Prime Minister there. And while he claims he is so popular in Israel, he acknowledged that Evangelical Christians are “far more appreciative” for what he has done for Israel, than “people of the Jewish faith” living in the U.S. Donald Trump continues to take credit for what he says was one of the greatest achievements of his term serving as President, which was forcing the FDA to grant emergency use authorization (EUA) for the COVID-19 vaccines. Here at Health Impact News, we gave extensive coverage in 2020 to the $BILLIONS of government funds that were being handed out like candy to Big Pharma to produce COVID-19 vaccines, and the early front-runners to get the first nod from the FDA for an EUA COVID-19 vaccine were Anthony Fauci’s funded Moderna, and Bill Gates’s funded Astrazenca shots. When Pfizer joined the mix, it raised some concerns, as their deal with the U.S. government and Operation Warp Speed was reportedly different from the other drug companies, and was conditioned upon getting approval from the FDA, something Astrazenca never obtained in the U.S. The deal with Pfizer reportedly also did not involve intellectual property rights. Pfizer ended up being the first company to get an FDA EUA for what became the first, and most lucrative, COVID-19 vaccine, but it took threats from President Trump to fire then FDA head Stephen Hahn if he did not approve the Pfizer shot. Shortly after getting the FDA nod for the first COVID shot in the U.S., Israel agreed to an exclusive deal with Pfizer in return for sharing data on its population, effectively making Israel the world’s laboratory for the experimental Pfizer COVID-19 injections.
The finale to the $1bn ‘The Rings of Power’ had Ga-Liz-riel making an epic screw up that reveals chaos and darkness. Its canon-shattering dross lacked the right script; costumes; lighting; cinematography; editing; direction; character development; logic, depth, and belief, without which it had no power to move us, and so managed the morphological feat of being both shallow and hollow. I have produced things more authentically Tolkien myself after eating brussels sprouts.
PM Liz Truss’s eight-minute, four-question press conference(!) after firing Chancellor Kwarteng — making him even shorter-lived than his predecessor Zahawi — was also canon-shattering dross lacking the right script; costumes; lighting; cinematography; editing; direction; character development; logic; and depth. However, the PM retained her belief: in Kwarteng, who is gone; in low taxes, which are gone; and in higher GDP growth, which is gone. Even pro-Truss journalists asked if she should be gone too, and many believe she soon will be given her government is powerless, shallow, and hollow too. Perhaps we get PM Wallace, Mordaunt, or Sunak and sensible policies: like paying people to eat in pubs, then closing them down because they caught Covid there. Until then, Chancellor Hunt will reverse floated corporate and income tax cuts to juice GDP growth, and cut, not raise spending.
Both ‘Tolkien’ Ga-Liz-riel and Tory Liz lazily copied-and-pasted things they believed were the keys to quick success:
“Let’s have Hobbits/top-income and corporate tax cuts though they shouldn’t exist in this timeline.”
“Let’s have Gandalf/Thatcher though he/she belongs in a different Age.”
Such is the crossover idiocy that we could soon see dramatized tax cuts for Númenor’s rich, who are already complaining about elves “stealing our jeerbs”, and Truss say the UK can heat itself with a Balrog. (After all, others’ energy policies are already as ‘magical’.)
The Shadow of the Past Policy Errors
Markets believe the BOE was right to force Truss to U-turn from the wrong kind of fiscal loosening for the supply side to letting growth slump while not dealing with the supply side fiscally, ensuring a lower GDP ceiling, and plummeting long-run socio-political and macro-stability.
Remainers believe rejoining the EU will solve all the UK’s problems, not just some, regardless of how the EU is doing on the supply-side and geopolitical front. (Or how the angry UK demographic who voted for Brexit would take a reversal: yes, let’s radicalise people even more, why not!) Clearly something needs to be done, and perhaps the EU or a ‘51st state’ future beckons.
Markets believe that having broken the Chancellor and PM, they can now break the BOE; then the ECB; then the Fed. From today, the BOE will have to prove it won’t step in to save markets: Gilt yields are going back up to test its belief in QT. So then we either end up with more instability, or more QE ‘as the key to quick success’,… and then different instability.
“Not all who wander are lost.” Some are lost without moving
Indeed, markets still retain a belief that inflation is transitory and a Fed pivot looms despite:
the low Mississippi river;
ocean carriers consolidating/scrapping vessels/blank sailing as freight rates fall;
the Ukraine grain deal maybe failing;
Russian metals to be banned by the G7;
Russian oil caps looming as OPEC+ production cuts do too;
the US SPR emptying;
diesel shortages;
Europe facing energy rationing and loss of industry;
US unions getting large pay deals or striking;
and on/reshoring trends.
Markets will keep looking powerless as inflation stays supply sticky despite demand destruction.
Central bank models failed to predict inflation, and none of their mean-reverting, GDP-by-demand, DSGE models have changed since: some ECB economists are now arguing rates can peak at just 2.25% when headline CPI is 10%, and the RBA believes similar nonsense. Such forecasts assume no nth-order effects, or supply side problems, and that things always mean revert. Or, for the RBA, that ‘housing is all’. The Fed is making some progress though: reportedly, it no longer believes in its own inflation models. It is showing its power to shock, as some now talk of rates higher than 5%, as the Fed thinks high CPI needs a demand-side, not supply-side response.
However, the Fed also thinks they can carry on with QT without blowing markets up.They will soon feel their powerlessness in the face of market wrath, or panic, if so.
Whichever past route to quick success you think you are copying-and-pasting, you are wrong if you are basing it on neoclassical economics. Indeed, other, totally-ignored schools of economic thought have different convictions and conclusions:
Austrians believe you can’t model an economy and that state intervention and low rates lead to malinvestment and/or inflation, which must be purged by letting the system crash: but this tends to crash social stability too. Austrians favour exogenous money (i.e., gold) to limit the power of the state: but that favours the strong over the weak, and those lucky enough to have gold and guns (personally and nationally) over those who have neither. Some like crypto, despite these having an infinite supply, because they aren’t state-backed – yet.
Marxists share ground with Austrians over “fictitious vs. productive capital” and the dangers of fiat, but believe capitalism will collapse due to how badly it treats workers. They have no idea what to do next, but follow-on Leninists believe you must accelerate that collapse, form a dictatorship, use the private sector to grow your capital stock provided the state kicks them out afterwards, and that war inevitably emerges from capitalism’s late crisis-prone stage.
Post-Keynesians believe 2008-style crashes are key threats, like Austrians: Minsky’s PhD advisor was Schumpeter. However, they believe tight regulation of banks stops malinvestment, not gold, and the central bank and government must support the economy via endogenous money/MMT – which creates its own malinvestment and inflation. They don’t have answers for supply-side issues that stop MMT from working, i.e., the US aside, you need a trade surplus.
Fascists believe in a zero-sum world and imposing unity domestically. This can also be watered down to corporatism or ‘state capitalism’, which many economies use or have used, or to ‘industrial policy’, which is back in vogue in the US.
What do you believe? That markets revert to equilibrium or collapse: and why? That you can lower rates, borrow, and live on malinvestment forever? That private debt matters, or public debt? That salaries can be trimmed: or revolution results? That you can print money and not collapse? That we can all run a trade surplus? That it’s a dog-eat-dog world?
Or are you lost without wandering (or wondering), and just repeating that “Tighten fiscal policy into a deep, geopolitical recession, and CPI will go down to 2% again because Balrogs”?
That seems to be where many sit, including the IM, who just told us to “buckle up and keep going,” rather than doing any new/old deep thinking.
Out of the Frying Pan, into the Fire
Meanwhile, in the background to these profound (political-) economic thoughts:
How many models of the Chinese economy match what The Economist just implied using satellite images taken at night – that it, and others, are much smaller than purported to be?
The 20th CCP congress cementing Xi’s third term began with him stating we are a “critical time” in history, and to be “prepared for the great tests of not only high winds and rapid waves, but also stormy waves and hazardous seas.”
He showed no backing away from Covid Zero. Or from Marxism, which is: “the fundamental guiding ideology upon which our party and country are founded and thrive. Our experience has taught us that at the fundamental level we owe our success… to the fact that Marxism works.” Don’t tell neoclassical economists and models backing capital flows into China.
He also underlined China must be prepared to “struggle” – meaning more in the Chinese context, while pledging, “We will improve the system of income distribution,” and “we want to regulate the mechanism of wealth accumulation.” As Wall Street banks in China go all in on wealth management as their strategy.
There was a call to promote the “spirit of frugality across the entire society,” which doesn’t sound like what the lines I still see are predicting about Chinese demand growth.
Externally, he added: “The wheels of history are rolling on towards reunification and the rejuvenation of the great Chinese nation. Complete reunification must be realised and it can without a doubt be achieved. We will continue to strive for peaceful reunification with the greatest sincerity and utmost effort, but we will never promise to renounce the use of force and reserve the option of taking all measures necessary.”
Elsewhere, Liu Mingfu, a hawkish retired professor at the PLA’s National Defence University, speaking in a personal capacity, proposed “socialism with Hong Kong characteristics“, as the autonomous region can only practice the “unscientific creed” of capitalism – which “will not remain unchanged in the long run.” (Again, sorry DSGE models.) This isn’t the first time this has been floated in public, but comes days after the HK authorities spoke of new visa and tax incentives to try to stop an ongoing brain drain.
Conversely, the new US National Security Strategy focuses on Russia and China from a whole-of-government perspective, including trade, industrial policy, regulation, and markets; and NSA Sullivan says the post-Cold War era is over. Very much so, it seems, as new US restrictions on China’s access to tech are so draconian they are seen as an “industry-wide decapitation” that may even echo the 1941 US oil boycott vs. Japan in some observers’ eyes.
The US is also busy threatening to stop selling weapons to the Saudis in response to OPEC+ production cuts; coming out in support of Iranian anti-regime protestors; calling Pakistan “one of the most dangerous nations in the world” for having “nuclear weapons without any cohesion”; watching North Korean missile launches and threatened nuclear tests; and facing rising tensions with Turkey.
Again, what does your model say about all this? If the answer is “nothing”, then it lacks the right script, logic, and depth, and rests on copy-and-paste neoclassical beliefs. Until it does have an answer, it will remain trapped in a ring of powerlessness
The USA/Yuan, CNY: closed ON SHORE (CLOSED ..(DOWN) AT 7.1945
THE USA/YUAN OFFSHORE: (YUAN CLOSED (UP)…. 7.2021
TURKISH LIRA: 18.89 EXTREMELY DANGEROUS LEVEL/DEATH WISH/HYPERINFLATION TO BEGIN.
the 10 yr Japanese bond yield at +0.249
Your closing 10 yr US bond yield DOWN 5 IN basis points from FRIDAY at 3.959% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic
USA 30 yr bond yield 3.954 DOWN 2 in basis points
Your closing USA dollar index, 112.15 DOWN 105 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 MONDAY: 12:00 PM
London: CLOSED UP 63/02 PTS OR 0.92%
German Dax : CLOSED UP 217.40POINTS OR 1.75%
Paris CAC CLOSED UP 111.82PTS OR 1.89%
Spain IBEX CLOSED UP 169.20 OR 2.29%
Italian MIB: CLOSED UP 400.64PTS OR 1.91%
WTI Oil price 86.27 12: EST
Brent Oil: 92.35 12:00 EST
USA /RUSSIAN /// RUBLE RISES TO: 61.65 UP 0 AND 46/100 RUBLES/DOLLAR
GERMAN 10 YR BOND YIELD; +2.261
CLOSING NUMBERS: 4 PM
Euro vs USA: 0.9838 UP .01231 OR 123 BASIS POINTS
British Pound: 1.1357 UP .02024 or 202 basis pts
BRITISH 10 YR GILT BOND YIELD: 3.974%
USA dollar vs Japanese Yen: 148.92 UP 0.475//YEN DOWN 48 BASIS PTS
USA dollar vs Canadian dollar: 1.3723 DOWN 0.01403 (CDN dollar, UP 140 basis pts)
West Texas intermediate oil: 85.38
Brent OIL: 91.61
USA 10 yr bond yield UP 2 BASIS pts to 4.021%
USA 30 yr bond yield UP 3 BASIS PTS to 4.025%
USA dollar index:111.98 DOWN 1.22 CENTS
USA DOLLAR VS TURKISH LIRA: 18.58
USA DOLLAR VS RUSSIA//// ROUBLE: 61.65 UP 1 AND 462/100 ROUBLES
DOW JONES INDUSTRIAL AVERAGE: UP 550.99 PTS OR 1.86 %
NASDAQ 100 UP 370.47 PTS OR 3.46%
VOLATILITY INDEX: 31.27 DOWN 0.75 PTS (2.34)%
GLD: $153.46 UP 0.48 OR 0.31%
SLV/ $17.12 UP $.31 OR 1.84%
end)
USA trading day in Graph Form
Stocks Soar On Big Negative Delta Squeeze (Or Because “Our Economy Is Strong As Hell”?)
As SpotGamma detailed earlier, indicators suggests markets are at “max put” positioning. One of the prime metrics for this is our Delta Tilt indicator, which shows that the ratio of put delta: call delta is at lows that has been related to stock bottoms…
The overall Prime book saw the largest notional net selling in 4 months (-2.1 SDs), driven by short sales outpacing long buys nearly 5 to 1 – this week’s notional short sales ranks in the 94th percentile vs. the past year.
Setting the market up for the negative delta squeeze…
US Futures rallied non-stop from their Sunday night open (as we warned they might after the extravaganza of shorting that occurred last week), and when the cash markets opened, the short squeeze accelerated hard, sending Nasdaq up over 3.5% (its best day since July 27th). The Dow rallied 2% at its highs and the S&P was up over 2.5%…
Notably, only The Dow is back in the green since before the payrolls print on 10/7…
“Most Shorted” stocks face-ripped at the open but notably that was it, the squeeze was over…
Source: Bloomberg
VIX fell back to a 30 handle today…
BofA’s results today sent it soaring higher while Morgan Stanley remains the laggard. Goldman is flat ahead of tomorrow’s earnings…
Source: Bloomberg
Bonds were also bid early on but as the equity market opened, yields started to rise. By the close, the 30Y yield was up 2bps but the short-end remained bid (2Y -4bps)…
Source: Bloomberg
10Y yields bounced back above 4.00% later in the day however…
Source: Bloomberg
The 30Y yield also pushed back above 4.00% (above Friday’s high yield) back to its highest since Aug 2011…
Source: Bloomberg
As a reminder, bond yields have already risen 11 straight weeks – the longest such streak since at least 1978…
Rate-trajectory expectations were basically unchanged on the day…
Source: Bloomberg
The dollar dived back down towards pre-payrolls levels today…
Source: Bloomberg
Despite the dollar weakness, JPY tumbled back above 149/USD…
Source: Bloomberg
Bitcoin rallied back above $19,500 today…
Source: Bloomberg
Gold followed a similar path to bonds today, rallying overnight and then reversing at the US equity open…
Oil prices chopped around today with modest early gains giving way to a red close, but WTI traded in a narrow range around $86…
But, “this isn’t a Pollyanna moment,” said Robert Teeter, a managing director of Silvercrest Asset Management. “Inflation clearly remains a problem until proven otherwise, and disappointing earnings, particularly from consumer facing-companies, could trigger another rough stretch, with recession fears at the fore.”
I) / EARLY MORNING// TRADING//CPI RELEASE
AFTERNOON TRADING//FOMC MINUTES
ii) USA DATA/
New York factory activity stumbles in October
Oct. 17, 2022 at 8:32 a.m. ET
MarketWatch
The index falls 7.6 points to negative 9.1 in the third straight negative reading
The numbers: The New York Fed’s Empire State business conditions index, a gauge of manufacturing activity in the state, fell 7.6 points to negative 9.1 in October, the regional Fed bank said Monday.
This is the third straight negative reading.
Economists had expected a reading of negative 5.0, according to a survey by The Wall Street Journal.
Any reading below zero indicates deteriorating conditions.
Key details: The index for new orders was unchanged at 3.7 in October. The shipments index dropped by a sharp 19.9 points to negative 24.1.
Unfilled orders rose 3.8 points to negative 3.7.
Labor market conditions had a modest improvement.
The prices-paid index rose 9 points to 48.6 after a sharp decline over the past three months.
Firms do not expect conditions to improve over the next three months.
Big picture: The U.S. factory sector is under pressure from falling orders, thinning backlogs and right-sizing of inventories, according to Richard Moody, chief economist at Regions Financial Corp.
The Institute for Supply Management’s closely watched national manufacturing index slipped to 50.9 in September, the lowest reading since May 2020.
III) USA ECONOMIC STORIES
end
III B USA COMMODITY PROBLEMS//INFLATION WATCH
Beans piling up on shores//farms along the Mississippi as barges cannot meet harvest demand
(zerohedge)
* * *
SWAMP STORIES
KING REPORT
The King Report October 17, 2022 Issue 6866
Independent View of the News
On Friday, embattled UK PM Truss ousted Chancellor of the Exchequer Kwarteng and replaced him with former British foreign secretary Jeremy Hunt. Despite the ploy, Truss remains under pressure to resign.
Hunt Replaces Kwarteng as Liz Truss Plans Humiliating U-TurnPrime minister may roll back plan to freeze corporation taxDeparture of finance minister comes after less than six weeksKwasi Kwarteng’s departure is a major blow to Liz Truss and leaves her in a precarious position, with members of her own party openly plotting against her.https://t.co/j2pDdDQe2W
Sky News @BethRigby: Cabinet minister tells me “This isn’t going to last“. Hunt a good choice who’ll appeal to the moderate wing of the party, but Truss is not performing “She abandoned one firewall with policy change, then another firewall sacking her chancellor. The only firewall left is her.”
UK Yields Shoot Higher as Truss Remains Under Pressure – BBG 11:18 ET This selloff in gilts is getting a bit worrying now. Yields on 30-year debts have soared in the past few minutes and are now 24 basis points higher at 4.79%. That’s getting close to the closing level on Wednesday, before talk of a u-turn emerged.
FT Moscow bureau chief @maxseddon: Asked if Ukraine and Russia will continue to exist as states after the war, Putin says: “We never set ourselves the goal of destroying Ukraine.” He adds a there is “no need for massive airstrikes” on Ukraine after Monday’s. “For now. Then we’ll see.”
Swiss National Bank makes another large draw on Fed swap line The SNB on Wednesday drew $6.27 billion in U.S. currency for a seven-day term at an annualized rate of 3.33%. A week earlier it drew $3.1 billion at the same term and rate. The two transactions were larger than any of the draws the SNB made during the spring of 2020… (serious collateral shortage) https://www.reuters.com/markets/europe/swiss-national-bank-makes-another-large-draw-fed-swap-line-2022-10-13/
Credit Suisse prepares Swiss business sales to raise capital, Financial Times reports… as it attempts to close a capital hole of around 4.5 billion Swiss francs ($4.48 billion)… The parts that are being considered for sale include a stake in the SIX Group, which runs the Zurich stock exchange, an 8.6% holding in Madrid-based tech company Allfunds, two specialist Swiss banks, Pfandbriefbank and Bank-Now and Swisscard, a joint venture with American Express, the newspaper added… https://www.reuters.com/markets/europe/credit-suisse-prepares-swiss-business-sales-raise-capital-ft-2022-10-15/
Wells Fargo Earnings Marred by $2 Billion Regulatory Charge – BBG Wells Fargo Says Mortgage Revenues to Decline Further – BBG 10:28 ET
Wells Fargo shares jump 3% as bank tops expectations despite boosting loan loss reserves The bank set aside $784 million for credit losses after reducing its provisions by $1.4 billion a year ago.Earnings per share: $1.30 adjusted vs. $1.09 expectedRevenue: $19.51 billion vs. $18.78 billion expectedhttps://www.cnbc.com/2022/10/14/wells-fargo-wfc-q3-2022-earnings.html
JPMorgan tops estimates as bank reaps more interest income than expected after jump in ratesEarnings: $3.12 a share, may not be comparable with the $2.88 estimate, according to Refinitiv.Revenue: $33.49 billion, vs. $32.1 billion estimate…JPMorgan booked $959 million in losses on securities after opting to sell Treasuries and mortgage bonds to reposition its portfolio…Net interest income surged 34% to $17.6 billion in the period because of higher rates and an expanding book of loans… https://www.cnbc.com/2022/10/14/jpm-jpmorgan-chase-earnings-3q-2022-.html
University of Michigan October Sentiment shows 1-year inflation expectations jumped from 4.7% to 5.1%; 4.6% was expected. This is the first increase in inflation expectations since March. Sentiment 59.8, 58.8 expected, Current Conditions 65.2, 59.6 consensus, Expectations 56.2, 58.3 consensus
@stlouisfed: Sticky price CPI (slow-to-change consumer prices) from @AtlantaFed rose 8.5% on an annualized basis in September, up from a 7.7% increase in Augusthttps://t.co/S0ZqGJ4mNv
NY Post cover on Friday: Lies, Damned Lies and Joe Biden – President AGAIN dismisses brutal inflation -despite 40-year high. https://nypost.com/cover/october-14-2022/
Biden says $7 gas has ‘always been the case’ in Calif. — after paying $60 for taco takeout: ‘Bidenism at its finest – “The inflation report is out. Have you seen gas prices around here in LA? It’s 7 bucks a gallon almost,” a reporter said after Biden handed a cashier three $20 bills for a $16.45 order of six tacos and two quesadillas. “Well, that’s always been the case here,” Biden replied… https://nypost.com/2022/10/14/biden-says-7-gas-always-been-the-case-in-calif/
BIDEN: “My younger sister used to be 3 years younger than me. Now, she’s 23 years younger. There’s not a single solitary Biden man that is younger than any Biden woman.” https://t.co/OecL4dL8kM
Biden’s lies, outright fabrications repeatedly dismissed, downplayed, and softened by mediahttps://t.co/Gkop2ZlUTY (Habitual lying or diminished mental capacity?)
WSJ: Inflation and the Midterm Elections The main legacy of the 117th Congress is a decline in living standards. Wages after inflation have now fallen more since Biden took office, 4.3%, than they did during the financial crisis of the last 2000s… https://t.co/RQDgOZaiOY
(KC) Fed’s (Ester) George: The Only Clear Data Point Is That We Have High Inflation – BBG Fed’s George Says Broad-Base Nature of Inflation Is Worrisome – BBG 10:05 ET Fed’s George: Recent US Productivity Performance Has Been ‘Abysmal’ – BBG 10:10 ET Fed’s George Advocates for Steady, Predictable Rate Hike Path – BBG 10:14 ET (SF) Fed’s (Mary) Daly: Likely See Rates Going to 4.5%-5%, Then Holding – BBG 10:22 ET Fed’s (Lisa) Cook (Gov): Inflation Remains Stubbornly High – BBG 10:34 ET
WSJ’s @NickTimiraos: KC Fed President Esther George: A higher savings buffer suggests the Fed may have to raise rates to a higher peak than would otherwise be the case and to stay at that higher level longer. “But I’m more cautious than most” about the pace. “I’d much prefer a steadier path.”
Team Biden has proposed a bond market rig ahead of the Midterm Election, which contravenes Fed policy by injecting money into the system! This is an incredibly transparent election ploy!
@Convertbond: Fed QT and Treasury QE, hitting the breaks and gas at the same time.
US Treasury Sec. Yellen: The US Is Paying Close Attention to the Effects of Monetary Tightening We’re Seeing Swings in Capital Flows and Robust Movements in Capital Markets Yellen Warns of Macro Tightening Spillovers from Advanced Economies to the Rest of the World
ESZs traded mostly negative in a very small range during early Asian trading. Then then higher at 21:30 ET. They quickly returned to trading flat – until they commenced a decline when Europe opened. The decline ended at 5:47 ET. After a moderate rally and modest retreat, ESZs zoomed higher on the usual buying for the NYSE open. It was a mistake. ESZs hit the daily high of 3733.75 at 8:56 ET.
ESZs tumbled when the NYSE opened. After a moderate rally from 10:48 ET to 11:02 ET, ESZs sank to within 0.50 of the 3605.00 daily low. A modest Noon Balloon ended at 12:43 ET. ESZs and stocks then eased lower to new lows at 14:40 ET. ESZs and stocks then went inert until the last-hour rally began.
It ended at 15:17 ET; ESZs and stocks slid to new lows. Another rally ended at 15:35 ET. ESZs and stocks eased lower until a down thrust appeared at 15:54 ET. News lows appeared at 15:59 ET.
USZ traded similarly to ESZs during Asian and early European trading. But they hit their high of 125 31/32 at 8:49 ET. They then tumbled to a daily low of 123 14/32 at 11:37 ET – seven minutes after European bouses closed. After a spike higher and commensurate decline, USZs went inert. USZs traded with a 5-tick range from 12:47 ET to 14:26 ET. A modest rally then appeared.
Positive aspects of previous session Stocks and bonds only rescinded part of Thursday’s massive rally
Negative aspects of previous session Stocks and bonds declined – they could not extend Thursday’s rally The dollar rallied sharply
Ambiguous aspects of previous session When will capitulation occur?
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]: 360.62 Previous session High/Low: 3712.00; 3579.68
@berlin_bridge: Remember the IT company @janboehm revealed is a Russian company founded by an ex-KGB agent? I spoke w/ cybersecurity experts about it & yes, it gets worse. Protelion had opportunity to compromise every company that used their software & give Moscow access to their network. Protelion/Infotecs sold software in Germany for yrs that scans IT networks for vulnerabilities *from the inside*. That means: They could report vulnerabilities to Russia Bc the software is installed by the admin they’d be able to plant other software & time bombs in the network. That means **any of the 1M+ terminals, company locations & servers” that have used Infotecs/Protelion software may be potentially spied on & compromised by Russia.** This is a major security risk.
Alex Berenson says Pfizer-linked former FDA official got him banned from Twitter in ‘months-long conspiracy’ – Scott Gottlieb, a former Trump FDA commissioner, now sits on Pfizer’s board https://t.co/lEBjFG1apB
U.S. extends Covid public health emergency even though Biden says pandemic is overhttps://t.co/cj2I2wdtzH
President Biden keeps the COVID ’emergency’ going so he can act like a dictatorhttps://t.co/o7cpCUPUfY
Moderna CEO Confirms New mRNA ‘Injection’ to Repair Heart Muscles After Heart Attack… Just in Time to Repair Damage by Their Other Shot. https://t.co/bfVx0a8OSX
@DrJBhattacharya: In a direct conflict of interest, the @CDCgov hired Moderna-affiliated contractors to design and conduct its propaganda campaign for the covid vaccines. Everyone should read journalist Paul Thacker’s (@thackerpd) substack scoop, now free to the public.
Weber Shandwick Provides PR for Moderna and Pfizer, While Staffing the CDC’s Vaccine Office A potential $50 million contract allows PR firm to be “embedded at the Centers for Disease Control and Prevention in Atlanta as part of the Division of Viral Diseases team.”… https://disinformationchronicle.substack.com/p/weve-unlocked-the-article-weber-shandwick
@ClayTravis: Democrats responding to forty-year high inflation by voting to subpoena Donald Trump in a two-year-old January 6th investigation 26 days before a midterm election is one of the most breathtakingly tone deaf political moves I’ve ever seen. Faced with forty-year high inflation, all time failures in border security, & 21st century highs in violent crime, the Democrat midterm plan has boiled down to orange man bad. A red wave is coming & it’s going to wipe out a ton of Democrat politicians who think they’re safe.
NATO to kick off nuclear drills involving B-52 bombers on Monday – Reuters (Will the October Surprise for the Midterms be a nuclear exchange of some magnitude?)
Atlanta Fed President Discloses Violations of Financial Transaction Policies – WSJ Raphael Bostic… said Friday he had improperly disclosed financial transactions covering five years… More than 150 of those transactions had settled on dates when they weren’t allowed because of restrictions around sales or purchases before and after Fed policy meetings… https://www.wsj.com/articles/atlanta-fed-president-discloses-violations-of-financial-transaction-policies-11665774059
@unusual_whales: Atlanta Fed President Raphael Bostic had to restate financial disclosures for the past five years and found violations—including more than 150 transactions during restricted “blackout” periods—because he didn’t understand his disclosure obligations. (Then he should not be Atl Fed Pres) https://www.nytimes.com/2022/10/14/business/federal-reserve-atlanta-raphael-bostic-trading.html
@PollWatch2020: Trafalgar also shows significant GOP lead on Generic ballot: GOP +5.3%; Harvard-Harris: GOP +6; Rasmussen Reports GOP +7 (Some polls show CT and WA Dem senate seats in play!)
@ggreenwald: Fascinating new Harvard-Harris poll: The 3 issues Americans are most worried about: Inflation, Economy/Jobs and Immigration. People perceive the GOP’s top priorities are also those. But they see that Dems are most obsessed with a 3-hour riot that happened almost 2 years ago: https://twitter.com/ggreenwald/status/1581648758378758144 Biden and Harris are under water by 8-10 points. AOC is at 29% approval. Those with highest negatives besides Putin: Hillary, Pelosi, Manchin, McConnell: https://twitter.com/ggreenwald/status/1581649404133445634 Most popular Dem is… Bernie Sanders, whose at 42% but with a net approval of even. But the highest disapproval numbers (again, besides Putin) are Pelosi (55%), Biden (51%) and Kamala Harris (50%).
Just 33% of voters would re-elect Biden if the 2024 election was today, a new poll showshttps://t.co/YkE0XQOKQv
Obama warns Dems against obsessing over Trump, putting ‘basic interests’ on back burnerhttps://t.co/dfvoIXYl9P
@WallStreetSilv: Assets of Bank of Japan, up 6x in 10 years. BOJ now owns 70% of all 10y bonds… with the yen imploding, and BOJ unwilling to raise interest rates, BOJ will have to sell down its US Treasuries to prevent the yen from free-fall… upward pressure on US yieldshttps://t.co/xGxYptivpF
@Mayhem4Markets: More than 40% of SPX option volume in Q3 has had less than 24 hours to expiration. Imagine that!https://t.co/Y4pFtRum39
Today –Gilts are supposed to trade unencumbered by BoE interventions. This is expiry week; and important companies report Q3 results. ESZs are +13.00 at 20:30 ET on buying for the Monday, expiry-week, and earnings season rallies. The usual suspects are very bullish on the noted rallies. Will negative fundamentals thwart trading schemes today and for the week? Watch SPY October options for clues!
The yen is 148.50/$; 150 is perceived to be the BoJ’s Maginot Line. This will be a precarious week!
Expected economic data: Oct Empire Mfg -1.0; Expected earnings: BK 1.10, BAC .78, SCHW 1.05
S&P 500 Index – Trender trading model and MACD for key time frames Monthly: Trender and MACD are negative – a close above 4570.18 triggers a buy signal Weekly: Trender and MACD are negative – a close above 3954.41 triggers a buy signal Daily: Trender is negative; MACD is positive – a close above 3743.32 triggers a buy signal Hourly: Trender is positive; MACD is negative – a close below 3559.31 triggers a sell signal
Creepy Joe strikes again! Biden sneaks up behind girl, grabs her shoulders and tells her ‘no serious guys until you’re 30’ – as the uncomfortable teen tries to laugh it off – He has been photographed kissing girls on the head and seemingly sniffing hair… https://t.co/NFrtoC5arU
@EndWokeness: Biden attempts a sniffing at a Baskin Robbins in Oregon todayhttps://t.co/HeTcGxPLXj
@ClayTravis: Joe Biden saying, “Our economy is strong as hell,” while eating an ice cream cone is so tone deaf and out of touch to what Americans actually see in their livesthat it feels like the Democrats are intentionally tanking the election.
Biden promotes coffee machine tax credit in flub-filled speech “And you buy an efficient refrigerator, efficient coffee machine, you get a tax credit for it.”… The comment apparently revealed Biden’s continued unfamiliarity with the details of a bill he has touted as one of his presidency’s greatest achievements — and showed him to be out of touch with voters’ economic woes… https://t.co/1xI1Iq2963
@FoxNews: @IngrahamAngle tears into the Left for ‘enlisting’ President Biden and John Fetterman’s wives to cover up their ‘physical and cognitive struggles.’https://fxn.ws/3MAQFLO
Rolling Stone writer deletes tweet referring to Mrs. Fetterman as ‘de facto candidate’ since husband’s strokehttps://t.co/mTKnyRFjAN
Clinton Associate Testifies He Lied About Claim That Made Its Way into Dossier “I lied. I got it off cable news,” Charles Dolan, the associate, testified… On Aug. 20, 2016, Dolan messaged Danchenko, relaying what he portrayed as inside information about Trump campaign officials Corey Lewandowski and Paul Manafort. “I had a drink with a GOP friend of mine who knows some of the players and got some of what is in this article, which provides even more detail. She also told me that Corey Lewandowski, who hates Manafort and still speaks to Trump, regularly played a role. He is said to be doing a happy dance over it,” Dolan said, including a link to a news article. “I think the bottom line is that in addition to the Ukraine revelations, a number of people wanted Manafort gone. It is a very sharp elbows crowd.” Dolan admitted on Thursday he fabricated the “GOP friend.”… https://www.theepochtimes.com/clinton-associate-testifies-he-lied-about-claim-that-made-its-way-into-dossier_4794675.html
New video shows Pelosi threatened to ‘punch out’ Trump on Jan. 6: ‘I’m going to go to jail’ “I hope he comes; I’m going to punch him out,” Pelosi tells her Chief of Staff Terri McCullough, who discourages her boss from making the comments. “I’ve been waiting for this, for trespassing on the Capitol grounds. I’m going to punch him out.”…The new footage, recorded by filmmaker Alexandra Pelosi, the speaker’s daughter, was released during the House Jan. 6 Committee hearing on Thursday… (Pelosi admits she was “waiting for this, for trespassing on the Capitol grounds”) https://t.co/cIGAmABMcQ
@JackPosobiec: Nancy Pelosi hired her daughter’s documentary film crew to follow her around on Jan 6 after rejecting calls for increased security at the Capitol. And now you know why Pelosi will never testify at the J6 Committee.
@julie_kelly2: Pelosi’s anger and contempt here for Trump says it all. And how did her chief of staff know before Trump did that the Secret Service wouldn’t take the president to Capitol Hill? None of this adds up. And GOP better get real answers about this staged coup.
@bennyjohnson:Nancy Pelosi was mic’d up and had a professional documentary film crew with multiple cams recording her every move on J6. Stop acting like this is “normal.”
@julie_kelly2: Ok for the thousandth time. Steve Sund, the USCP chief who took the fall for Jan 6, REPEATEDLY asked the sergeants-at-arms for Pelosi and McConnell to authorize the deployment of guardsmen before the Capitol protest. (They refused to grant it!)
Whitlock: Tampa coach Todd Bowles rejects media’s racial script “I have a very good relationship with Tomlin… We don’t look at what color we are when we coach against each other. I have a lot of very good white friends that coach in this league as well.” Unsatisfied with his answer, another reporter told Bowles: “You also understand that representation matters, too, right? And that when aspiring coaches, or even football players, they see you guys, they see someone who looks like them, that grew up like them, that has to mean something.” Bowles rejected that notion, too. He argued that the question made black coaches seem like “oddballs.” “I think the minute you guys stop making a big deal about it, everybody else will as well,” he said…The reporter telling Bowles that black coaches “grew up like each other” is naive and foolish. She has no idea whether Tomlin and Bowles had similar childhood experiences. It’s all speculation, driven by the assumption that black Americans have a shared upbringing… Skin color is a superficial issue that corporate media want us to obsess about. The media point us away from the deeper things that tie us together…Let’s hope Bowles isn’t punished for failing to follow the script.https://www.theblaze.com/fearless/oped/whitlock-tampa-coach-todd-bowles-rejects-medias-racial-script
@BjornLomborg: Polar bears used to be the poster child of climate change. But their numbers have been increasing, from 5-10k polar bears in the 1960s, up to around 26k today. We don’t hear this news. Instead, campaigners just quietly
Catherine Austin Fitts (CAF), Publisher of The Solari Report and former Assistant Secretary of Housing (Bush 41 Admin.), says what is coming for the economy is pain–and lots of it. CAF explains, “We are either in a major correction or we are going to go into a bear (market), and a lot of it depends on many different politics. If you look at the money being pumped out . . . on climate change, on green energy, environment and all theses and all these different new sort of scams, it depends on how they inject money. It’s either a major correction or it could turn into a bear (market). There is no way to tell because it is purely political.”
Various Fed presidents are repeatedly saying the central bank is going to continue raising interest rates. Why? CAF says, “I think they are going to keep raising interest rates. If you are Federal Reserve, you are playing a global game, and what you have to do is protect the reserve currency status. It looks like to me they have decided that all the BIS (Bank of International Settlements) members need to be in the dollar channel. They are doing everything they can to collapse the market share of the euro and then move that into the dollar syndicate. I think they have to keep driving the dollar up. The U.S dollar index is up to 113, and at one point it was at 114. One analyst said it was going to 120. They have the entire frontier market and the emerging markets in a bear trap, and that is very significant power. If you are going to go into the woods and shoot the bear, you can’t wound the bear, you have to kill the bear. So, I think the Fed is going to keep doing this for some time now. They don’t mind, as you learned from the pandemic, collapsing the small business side of the economy or collapsing the middle-class. . . . They are implementing the ‘Going Direct Reset.’ They are doing a currency reset. What you are looking at is a fundamental reengineering of the governance system on planet Earth. Most of the benefits in the dollar system come from the benefits of having the reserve currency and being able to swap money you print out of thin air for real labor and real commodities worldwide. That’s an enormous benefit, and they are going to protect that benefit. If they don’t protect that benefit, they run the risk of everybody moving out of the channel. This is what the Chinese and Russians are trying to do. They are trying to move out of the dollar channel and trying to create economic resiliency and trade outside the channel. What the Fed is trying to do and the dollar syndicate is trying to do is protect that channel. . . . It’s global government reengineering. It’s 100% power politics, and it’s a war.”
In short, the Fed will defend the dollar and the world reserve currency status no matter how hard the stock market crashes, no matter how much the economy crashes, no matter how much the bond market crashes and no matter how much the housing market crashes.
In closing, CAF says, “Stop helping them. . . . Don’t bank at the big banks. . . use cash whenever you can, and pray. . . . This is first and foremost a spiritual war, and prayer is the best navigation tool possible. With this level of uncertainty and change, there is no way there is enough experts to help you and enough time to listen to them all. You have to focus on what is important. You have to decide are you here to be free or are you here to be a slave? There is no more middle of the road. There are two sides, one leads to freedom and one leads to slavery. You have to choose.”
There is much more in the 58-minute interview.
Join Greg Hunter of USAWatchdog.com as he goes One-on-One with the Publisher of The Solari Report, Catherine Austin Fitts. (10.15.22)
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