OCT 27//GOLD CLOSED DOWN $3.80 TO $1661.40//SILVER CLOSED UP AGAIN BY 3 CENTS TO $19.53//PLATINUM IS UP $10.60 TO $964.10//PALLADIUM IS DOWN $13.35 TO $1944.50//COVID UPDATES//DR PAUL ALEXANDER//VACCINE IMPACT//ECB RELUCTANTLY RAISES ITS INTEREST RATE BY .75% AND YET THE EURO AND POUND FALL//CREDIT SUISSE IN BIG TROUBLE AS THEY CONTEMPLATE A RESTRUCTURING(BANKRUPTCY PROTECTION) AND PLAN ON LAYING OFF 9,000//ANNOUNCED THAT THEY WERE HAVING YOUR OLD FASHIONED BANK RUN!!//IN THE USA POLLSTER 538 (THESE GUYS AND TRAFALGAR ARE THE ONLY ONES YOU PAY ATTENTION TO) SHOWS THE DEMOCRATS IN A DEEP DECLINE//IMPORTANT LETTER TO POWER FROM SENATOR BROWN DEMANDING THAT POWELL PIVOTS CAUSES STOCK MARKETS TO RISE//RAIL: SIGNALMEN REJECT BIDEN’S PRELIMINARY SETTLEMENT AND THAT MAY CAUSE A WALKOUT SHORTLY//TWITTER: MUSK WILL NO DOUBT TAKE OVER THE COMPANY TOMORROW AND THEN THE COMPANY IS DELISTED//SWAMP STORIES FOR YOU TONIGHT/

 harveyorgan · in Uncategorized · Leave a comment·Edit

GOLD PRICE CLOSE: DOWN $3.80 to $1661.40

SILVER PRICE CLOSE:  UP $0.03 to $19.53

Access prices: closes : 4: 15 PM

Gold ACCESS CLOSE 1661.30

Silver ACCESS CLOSE: 19.51

New: early yesterday morning//

Bitcoin morning price: $20,727 UP 73

Bitcoin: afternoon price: $20,646 DOWN 8

Platinum price closing  UP $10.60  AT  $964.10

Palladium price; closing DOWN $13.35  at $1944.90

END

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: 2255.30 DOLLARS DOWN 4.13 CDN DOLLARS PER OZ

BRITISH GOLD: 1436.82 POUNDS PER OZ UP15.40 POUNDS PER OZ

EURO GOLD: 1667.47EUROS PER OZ UP 15.40 EUROS PER OZ.

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EXCHANGE: COMEX

 EXCHANGE: COMEX

CONTRACT: OCTOBER 2022 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,664.000000000 USD
INTENT DATE: 10/26/2022 DELIVERY DATE: 10/28/2022
FIRM ORG FIRM NAME ISSUED STOPPED


323 C HSBC 1
435 H SCOTIA CAPITAL 1
657 C MORGAN STANLEY 2
880 H CITIGROUP 2


TOTAL: 3 3
MONTH TO DATE: 23,394

JPMORGAN STOPPED  0/3 

GOLD: NUMBER OF NOTICES FILED FOR OCT CONTRACT:    3 NOTICES FOR 300 OZ  or 0.00933 TONNES

total notices so far: 23,394 contracts for 2,339,400 oz (72.765 tonnes) 

SILVER NOTICES: 233 NOTICE(S) FILED FOR 1,165000 OZ/

 

total number of notices filed so far this month  689 :  for 3,445,000  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 DOWN $3.80

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: /////NO CHANGE IN GLD INVENTORY /INVENTORY REMAINS AT 928.39 TONNES

INVENTORY RESTS AT 928.39 TONNES

Silver//SLV

WITH NO SILVER AROUND AND SILVER UP 3 CENTS

AT THE SLV// :/BIG CHANGES IN SILVER INVENTORY AT THE SLV//: A HUGE WITHDRAWAL OF 2.579 MILLION OZ INTO THE SLV

INVESTORS ARE SWITCHING SLV TO SPROTT’S PSLV

CLOSING INVENTORY: 484.091 MILLION OZ

Let us have a look at the data for today

SILVER//OUTLINE


SILVER COMEX OI ROSE BY A STRONG SIZED 742 CONTRACTS TO 139,827 AND CLOSER TO  THE  RECORD HIGH OI OF 244,710, SET FEB 25/2020 AND THE STRONG GAIN IN COMEX OI WAS ACCOMPLISHED WITH OUR SMALL   $0.13 GAIN  IN SILVER PRICING AT THE COMEX ON WEDNESDAY.  OUR BANKERS/HFT WERE UNSUCCESSFUL IN KNOCKING THE PRICE OF SILVER DOWN (IT ROSE BY $0.13)., AND WERE UNSUCCESSFUL IN KNOCKING OFF ANY SPEC LONGS, AS WE HAD A VERY STRONG GAIN IN OUR TWO EXCHANGE OF 897 CONTRACTS.  HUGE SPECS CONTINUE TO ADD TO THEIR SHORTFALLS FROM WHICH OUR  BANKERS CONTINUE TO BE PURCHASERS OF NET COMEX LONGS. SOME SPEC LONGS ADDED TO THEIR POSITIONS 

WE  MUST HAVE HAD: 
I) ZERO  SPECULATOR SHORT COVERINGS BUT STRONG SHORT ADDITIONS ////CONTINUED BANKER OI COMEX ADDITIONS /// CONSIDERABLE NEWBIE SPEC LONG 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 AN120,000 OZ QUEUE. JUMP    / //  V)   STRONG SIZED COMEX OI GAIN/ 

 I AM NOW RECORDING THE DIFFERENTIAL IN OI FROM PRELIMINARY TO FINAL: –286

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 21 days, total 57,070 contracts: 28.535 million oz  OR 1.358MILLION OZ PER DAY. (271 CONTRACTS PER DAY)

TOTAL EFP’S FOR THE MONTH SO FAR: 28.535  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.  28.535 MILLION OZ INITIAL

RESULT: WE HAD A STRONG SIZED INCREASE IN COMEX OI SILVER COMEX CONTRACTS OF 742WITH OUR   $0.13 GAIN IN SILVER PRICING AT THE COMEX// WEDNESDAY.,.  THE CME NOTIFIED US THAT WE HAD A STRONG SIZED EFP ISSUANCE  CONTRACTS: 565 CONTRACTS ISSUED FOR DEC AND 0 CONTRACTS ISSUED FOR ALL OTHER MONTHS) WHICH  EXITED OUT OF THE SILVER COMEX  TO LONDON  AS FORWARDS./ WE HAVE A GOOD INITIAL SILVER OZ STANDING FOR OCT. OF 1.580 MILLION  OZ FOLLOWED BY TODAY’S 120,000 QUEUE JUMP  .. WE HAD A VERY STRONG SIZED GAIN OF 1391 OI CONTRACTS ON THE TWO EXCHANGES FOR 6.955 MILLION  OZ..

 WE HAD 233  NOTICE(S) FILED TODAY FOR  1,165,000  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 FAIR SIZED 1657 CONTRACTS  TO 457,729 AND CLOSER TO FROM 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 -642  CONTRACTS.

.

THE FAIR SIZED INCREASE  IN COMEX OI CAME WITH OUR STRONG  GAIN IN PRICE OF $9.25//COMEX GOLD TRADING/WEDNESDAY //  ZERO SPECULATOR SHORT  COVERINGS ACCOMPANYING OUR FAIR SIZED EXCHANGE FOR PHYSICAL ISSUANCE./. WE HAD ZERO LONG LIQUIDATION  AND CONSIDERABLE SPEC SHORT ADDITIONS BUT MINOR SPEC SHORT COVERINGS.   // 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 SMALL EFP  JUMP TO LONDON OF  3400 OZ//NEW STANDING 76.111TONNES (QUEUE JUMPING = EXERCISING LONDON BASED EFP’S WILL CONTINUE UNTIL MONTH’S END)

YET ALL OF..THIS HAPPENED WITH OUR GAIN IN PRICE OF  $9.25 WITH RESPECT TO TUESDAY’S TRADING

WE HAD A FAIR SIZED GAIN OF 2913 OI CONTRACTS 9.06 PAPER TONNES) ON OUR TWO EXCHANGES..

E.F.P. ISSUANCE

THE CME RELEASED THE DATA FOR EFP ISSUANCE AND IT TOTALED A FAIR SIZED 1256 CONTRACTS:

The NEW COMEX OI FOR THE GOLD COMPLEX RESTS AT 457,729

IN ESSENCE WE HAVE A FAIR SIZED INCREASE IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 2913 CONTRACTS  WITH 1657 CONTRACTS INCREASED AT THE COMEX AND 1256 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS  TOTAL OI GAIN ON THE TWO EXCHANGES OF 2913 CONTRACTS OR 9.06 TONNES.

CALCULATIONS ON GAIN/LOSS ON OUR TWO EXCHANGES

WE HAD A FAIR SIZED ISSUANCE IN EXCHANGE FOR PHYSICALS (1256) ACCOMPANYING THE FAIR SIZED GAIN IN COMEX OI (1657): TOTAL GAIN IN THE TWO EXCHANGES 2913 CONTRACTS. WE NO DOUBT HAD 1) STRONG SPECULATOR SHORT ADDITIONS// CONTINUED GOOD BANKER ADDITIONS/// MINOR SPEC SHORT COVERINGS// SOME NEWBIE SPEC  ADDITIONS  ,2.) STRONG INITIAL STANDING AT THE GOLD COMEX FOR OCT. AT 66.099 TONNES FOLLOWED BY TODAY’S 3400 OZ E.F.P JUMP TO LONDON ///NEW STANDING 76.111 TONNES//.    3) ZERO LONG LIQUIDATION //// //.,4)  FAIR 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. :

49,530 CONTRACTS OR 4,953,000 OZ OR 154.05 TONNES 21 TRADING DAY(S) AND THUS AVERAGING: 2358 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE  SIZE OF THESE EFP TRANSFERS :  THIS MONTH IN 21  TRADING DAY(S) IN  TONNES: 154.05 TONNES

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

THUS EFP TRANSFERS REPRESENTS  154.05/3550 x 100% TONNES  4.33% OF GLOBAL ANNUAL PRODUCTION

ACCUMULATION OF GOLD EFP’S YEAR 2021 TO 2022 

JANUARY/2021: 265.26 TONNES (RAPIDLY INCREASING AGAIN)

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

MARCH:.   276.50 TONNES (STRONG AGAIN/

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

MAY:        250.15 TONNES  (NOW DRAMATICALLY INCREASING AGAIN)

JUNE:      247.54 TONNES (FINAL)

JULY:        188.73 TONNES FINAL

AUGUST:   217.89 TONNES FINAL ISSUANCE.

SEPT          142.12 TONNES FINAL ISSUANCE ( LOW ISSUANCE)_

OCT:           141.13 TONNES FINAL ISSUANCE (LOW ISSUANCE)

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

DEC.           175.62 TONNES//FINAL ISSUANCE// 

JAN:2022   247.25 TONNES //FINAL

FEB:           196.04 TONNES//FINAL

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

APRIL:  169.55 TONNES (FINAL VERY  LOW ISSUANCE MONTH)

MAY:  247,44 TONNES FINAL// 

JUNE: 238.13 TONNES  FINAL

JULY: 378.43 TONNES FINAL

AUGUST: 180.81 TONNES FINAL

SEPT. 193.16 TONNES FINAL

OCT:  154.55  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 STRONG SIZED  742 CONTRACT OI TO  139,827 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 565 CONTRACTS

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

DEC 565  ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE:  565 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 742  CONTRACTS AND ADD TO THE 565  OI TRANSFERRED TO LONDON THROUGH EFP’S,

WE OBTAIN A HUGE SIZED GAIN  OF 1307  OPEN INTEREST CONTRACTS FROM OUR TWO EXCHANGES. 

THUS IN OUNCES, THE GAIN  ON THE TWO EXCHANGES 6.9535MILLION OZ//

OCCURRED DESPITE OUR GAIN IN PRICE OF  $0.13

OUTLINE FOR TODAY’S COMMENTARY

1/COMEX GOLD AND SILVER REPORT

(report Harvey)

2 ) Gold/silver trading overnight Europe,

(Peter Schiff,

end

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

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

end

5. Other gold commentaries

6. Commodity commentaries//

3. ASIAN AFFAIRS

i)THURSDAY MORNING// WEDNESDAY  NIGHT

SHANGHAI CLOSED DOWN 16.60 PTS OR 0.55%   //Hang Seng CLOSED UP 110.27 OR 0.72%    /The Nikkei closed DOWN 36.60 PTS OR 0.32%          //Australia’s all ordinaires CLOSED UP 0.53%   /Chinese yuan (ONSHORE) closed DOWN TO 7.2286 //OFFSHORE CHINESE YUAN DOWN 7.2493//    /Oil UP TO 88.17 dollars per barrel for WTI and BRENT AT 95.96    / Stocks in Europe OPENED ALL RED.        ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN  TRADING WEAKER AGAINST US DOLLAR/OFFSHORE WEAKER

a)NORTH KOREA/SOUTH KOREA

outline

b) REPORT ON JAPAN/

OUTLINE

3 C CHINA

OUTLINE

4/EUROPEAN AFFAIRS

OUTLINE

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

OUTLINE

6.Global Issues//COVID ISSUES/VACCINE ISSUES

OUTLINE

7. OIL ISSUES

OUTLINE

8 EMERGING MARKET ISSUES

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

GOLD

LET US BEGIN:

THE TOTAL COMEX GOLD OPEN INTEREST ROSE  BY A FAIR SIZED 1657  CONTRACTS TO 457,729 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 FAIR  COMEX INCREASE OCCURRED WITH OUR STRONG  RISE IN PRICE OF $9.25  IN GOLD PRICING  WEDNESDAY’S COMEX TRADING. WE ALSO HAD A FAIR SIZED EFP (1256 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 1256 EFP CONTRACTS WERE ISSUED:  ;: ,  . 0 DEC : 1256  & ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE: 1256 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 FAIR SIZED  TOTAL OF 2,913  CONTRACTS IN THAT 1256 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE HAD A FAIR  SIZED  COMEX OI GAIN OF 2299  CONTRACTS..AND  THIS FAIR SIZED GAIN ON OUR TWO EXCHANGES HAPPENED WITH OUR  GAIN IN PRICE OF GOLD $9.25//WE HAD CONSIDERABLE SPEC SHORTS ADDITIONS,  WITH BANKERS  AS BUYERS OF COMEX GOLD CONTRACTS.  WE ALSO HAD SOME ADDITIONAL  NEWBIE SPECS GOING LONG

// WE HAVE A STRONG AMOUNT OF GOLD TONNAGE STANDING OCT   (76.217),

 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:  76.217 TONNES

THE SPECS/HFT WERE UNSUCCESSFUL IN LOWERING GOLD’S PRICE  //// (IT ROSE $9.25) AND WERE UNSUCCESSFUL IN KNOCKING OFF ANY  SPECULATOR LONGS// SPEC SHORTS ADDED TO THEIR POSITIONS AS WE HAD A FAIR SIZED TOTAL GAIN ON OUR TWO EXCHANGES OF 2913 CONTRACTS //     WE HAVE  REGISTERED A FAIR GAIN  OF 11.05 PAPER TONNES ON TOTAL OI FROM OUR TWO EXCHANGES, ACCOMPANYING OUR  GOLD TONNAGE STANDING FOR OCT. (76.217 TONNES)…THIS WAS ACCOMPLISHED WITH OUR RISE IN PRICE OF $9.25 

WE HAD -642  CONTRACTS  COMEX TRADES REMOVED. THESE WERE REMOVED AFTER TRADING ENDED LAST NIGHT

NET GAIN ON THE TWO EXCHANGES 2913 CONTRACTS OR 291300  OZ OR  9.06 TONNES

Estimated gold volume 185,286//  poor//

final gold volumes/yesterday  208,159/ poor

INITIAL STANDINGS FOR OCT ’22 COMEX GOLD //OCT 27

GoldOunces
Withdrawals from Dealers Inventory in oznil oz
Withdrawals from Customer Inventory in oz 5925.837oz


Brinks  
Manfra
includes 25 kilobars








 
Deposit to the Dealer Inventory in oznil 
Deposits to the Customer Inventory, in oz
5132.067 oz
Brinks
No of oz served (contracts) today3   notice(s)
300  OZ
0.000933 TONNES
No of oz to be served (notices)1076 contracts 
107,600 oz
3.347
 TONNES
Total monthly oz gold served (contracts) so far this month23,394 notices
2,339,400
72.765 TONNES
Total accumulative withdrawals of gold from the Dealers inventory this monthNIL oz
Total accumulative withdrawal of gold from the Customer inventory this monthxxx oz

total dealer deposit  0

total dealer deposit:  nil oz

No dealer withdrawals

Customer deposits: 1

i) Into brinks: 5132.067 oz

total deposits  5132.067 oz

 customer withdrawals:2

ii) Out of Brinks 803.77 OZ (25 kilobars)

iii) Out of Manfra  5132.067 oz

total:  5935.837 oz

total in tonnes: 0.1846 tonnes

Adjustments: 1//    customer to dealer

i)Out of Malca  7426.881

CALCULATIONS FOR THE AMOUNT OF GOLD STANDING FOR OCT.

For the front month of OCT we have an  oi of 1079 contracts having LOST 118 contracts . We had  84 contracts

filed on WEDNESDAY, so we LOST A SMALL 34 contracts or an additional 3400 oz will NOT  stand in this active delivery month of Oct as they were EFP’d to London. 

November SHOCKINGLY lost only 50 contracts to stand at 3783(WE ARE GOING TO HAVE AN EXTRAORDINARILY LARGE NOV.GOLD DELIVERY OF AROUND 10 TONNES OF GOLD.)

December GAINED 607 contracts UP to 360,552

We had 3 notice(s) filed today for 300 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 3 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 (23,394) x 100 oz , to which we add the difference between the open interest for the front month of  (OCT 1079 CONTRACTS)  minus the number of notices served upon today 3 x 100 oz per contract equals 2,447,000 OZ  OR 76.111 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 (23,394) x 100 oz+   (1079)  OI for the front month minus the number of notices served upon today (3} x 100 oz} which equals 2,447,000 oz standing OR 76.111  TONNES in this NON active delivery month of OCTOBER.

TOTAL COMEX GOLD STANDING:  76.111 TONNES  (A HUMONGOUS STANDING FOR OCT (GENERALLY THE POOREST DELIVERY MONTHS FOR AN ACTIVE MONTH)

 WE WILL INCREASE IN GOLD TONNAGE STANDING FROM TOMORROW ONWARD UNTIL THE END OF THE MONTH.

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

COMEX GOLD INVENTORIES/CLASSIFICATION

NEW PLEDGED GOLD:

241,794.285 oz NOW PLEDGED /HSBC  5.94 TONNES

204,937.290 PLEDGED  MANFRA 3.08 TONNES

83,657.582 PLEDGED JPMorgan no 1  1.690 tonnes

265,999.054, oz  JPM No 2 

1,152,376.639 oz pledged  Brinks/

Manfra:  33,758.550 oz

Delaware: 193.721 oz

International Delaware::  11,188.542 o

total pledged gold:  1,999,245.500 OZ   62,18 tonnes

TOTAL OF ALL GOLD ELIGIBLE AND REGISTERED:  25,059,685.418 OZ  

TOTAL REGISTERED GOLD: 11,468,385.07  OZ (356.71 tonnes)..dropping fast

TOTAL OF ALL ELIGIBLE GOLD: 13,591,300.348 OZ  

REGISTERED GOLD THAT CAN BE SERVED UPON: 9,469140 OZ (REG GOLD- PLEDGED GOLD) 294.53 tonnes//rapidly declining 

END

SILVER/COMEX

OCT 27//INITIAL OCT SILVER CONTRACT

SilverOunces
Withdrawals from Dealers InventoryNIL oz
Withdrawals from Customer Inventory1,824,373.360 oz



CNT
Delaware
JPMorgan
Loomis









 
Deposits to the Dealer Inventorynil OZ
Deposits to the Customer Inventory599,941.510 oz
CNT

 











 
No of oz served today (contracts)233 CONTRACT(S)  
 (1,165,000 OZ)
No of oz to be served (notices)27 contracts 
(135,000 oz)
Total monthly oz silver served (contracts)689 contracts
 3,445,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this monthNIL oz
Total accumulative withdrawal of silver from the Customer inventory this month


i)  0 dealer deposit

total dealer deposits:  nil    oz

i) We had 0 dealer withdrawal

total dealer withdrawals:  oz

We have  4 withdrawals out of the customer account

i) Out of CNT:  24,995.440 OZ

ii) Out of Delaware  17,523.600 oz

iii) Out of JPMorgan: 1,181,538.000 oz

iv) out of Loomis:  600,316.320 oz

Total withdrawals:  1,826,373.360 oz

JPMorgan has a total silver weight: 155.891million oz/301.773 million =51.65% of comex .//dropping fast

 Comex deposits: 1

i) Into CNT: 599,941.510 oz

total:  599,941.510  oz

 adjustments: 1

 Delaware:  customer to dealer  23,410.631 oz

the silver comex is in stress!

TOTAL REGISTERED SILVER: 35.954 MILLION OZ (declining rapidly)

TOTAL REG + ELIG. 301.7763 MILLION OZ (also declining)

CALCULATION OF SILVER OZ STANDING FOR SEPT

silver open interest data:

FRONT MONTH OF OCT OI: 260 CONTRACTS HAVING GAINED 20 CONTRACT(S.) 

WE HAD 4 NOTICES FILED ON TUESDAY SO WE  GAINED 24

SILVER CONTRACTS OR AN ADDITIONAL 120,000 OZ WILL  STAND FOR OCT. 

NOVEMBER LOST 4 CONTRACTS TO STAND AT 242

DECEMBER SAW A LOSS OF 286 CONTRACTS DOWN TO 108,205

.

 .

TOTAL NUMBER OF NOTICES FILED FOR TODAY: 233 for  1,165,000 oz

Comex volumes:53,927// est. volume today// fair   

Comex volume: confirmed yesterday: 59,548 contracts ( fair)

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  689 x 5,000 oz = 3,445,000 oz 

to which we add the difference between the open interest for the front month of OCT(260) and the number of notices served upon today 233 x (5000 oz) equals the number of ounces standing.

Thus the  standings for silver for the OCT./2022 contract month: 689 (notices served so far) x 5000 oz + OI for front month of OCT (260)  – number of notices served upon today (233) x 5000 oz of silver standing for the OCT contract month equates 3,580,000 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

Comex volumes:55,335// est. volume today//    poor

Comex volume: confirmed yesterday: 64,723 contracts ( fair)

END

GLD AND SLV INVENTORY LEVELS

OCT 27/WITH GOLD DOWN $3.80: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 928.39 TONNES

OCT 26/WITH GOLD UP $11.65 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 928.39 TONNES

OCT 25/WITH GOLD UP $3.85: SMALL CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF .29 TONNES OF GOLD INTO THE GLD///INVENTORY RESTS AT 928.39 TONNES

OCT 24/WITH GOLD DOWN $1.80 TODAY: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.89 TONNES FROM THE GLD////INVENTORY RESTS AT 928.10 TONNES

OCT 21/WITH GOLD UP $19.10: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.74 TONNES FROM THE GLD///INVENTORY RESTS AT 930.99 TONNES

OCT 20/WITH GOLD UP $2.40: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 6.08 TONNES FROM THE GLD///INVENTORY RESTS AT 932.73 TONNES

OCT 19/WITH GOLD DOWN $20.65:: SMALL CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF .29 TONNES FROM THE GLD////INVENTORY RESTS AT 938.81 TONNES

OCT 18/WITH GOLD DOWN $7.40: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.03 TONNES FROM THE GLD////INVENTORY RESTS AT 939.10 TONNES

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

 TONNES

GLD INVENTORY: 928.39 TONNES

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

OCT 27/WITH SILVER UP 3 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE S: AWITHDRAWAL OF 2.579 MILLION OZ FROMTHE SLV/////INVENTORY RESTS AT 484.091 MILLION OZ//

OCT 26/WITH SILVER UP 11 CENTS TODAY: BIG CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 1.013 MILLION OZ FROM THE SLV///INVENTORY RESTS AT 486.670 MILLION OZ./.

OCT 25/WITH SILVER UP 17 CENTS TODAY: BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 2.083 MILLION OZ INTO THE SLV//INVENTORY RESTS AT 487.683 MILLION OZ/

OCT 24/WITH SILVER UP 6 CENTS TODAY: SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF .553 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 485.610 MILLION OZ//

OCT 21/WITH SILVER UP 43 CENTS: SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF .46 MILLION OZ INTO THE SLV///INVENTORY RESTS AT 486.163MILLION OZ//

OCT 20/WITH SILVER UP 33 CENTS: BIG CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF .921 MILLION OZ FROM THE SLV///INVENTORY RESTS AT 485.703 MILLION OZ//

OCT 19/WITH SILVER DOWN 27 CENTS: BIG CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 1.105 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 486.624 MILLION OZ///

OCT 18/WITH SILVER DOWN 5 CENTS:BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.658 MILLION OZ INTO THE SLV////INVENTORY RESTS AT 487.729 MILLION OZ///

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 MILLION OZ//

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/

CLOSING INVENTORY 484.091 MILLION OZ//

PHYSICAL GOLD/SILVER STORIES

1.PETER SCHIFF

Peter Schiff: Fed Folds With A Soft Pivot?

THURSDAY, OCT 27, 2022 – 09:08 AM

Via SchiffGold.com,

We have been saying the Federal Reserve is bluffing in this inflation fight because it is holding a losing hand.

And Peter Schiff thinks the central bank has folded with a soft pivot. He explained why on his podcast.

I’m going to go out on a limb here and predict that we’ve already seen the Fed pivot. Now, it wasn’t a pivot in the sense that the Fed has gone from hiking interest rates to cutting interest rates. It hasn’t gone from quantitative easing to quantitative tightening. But it is a pivot in rhetoric. And what it amounts to is an easing of monetary conditions. Because what the Fed is going to be doing going forward is starting to walk back just how aggressive its rate-hiking campaign is going to be.”

The shift may be subtle, but it will be significant. Instead of talking about the urgency of the inflation fight, Peter said he thinks the central bankers at the Fed will start talking about how much progress they have made.

Since they’ve made progress, maybe not completely declaring victory, but indicating they’re seeing the light at the end of the tunnel — that maybe they don’t have to raise interest rates as high as they thought, or maybe leave them as high for as long as they thought. And so the path back down to 2% inflation may not require as aggressive a rate-hiking campaign as they may have previously thought before they started to see the evidence of their success.”

What led Peter to this conclusion?

Last Thursday (Oct. 20), the bond market looked close to a complete collapse. That morning, the yield on the 30-year Treasury nearly rose to 4.4%. Meanwhile, the curve between the 10-year and the 30-year moved positive out of inversion. This was a sign investors were beginning to price in prolonged inflation. Meanwhile, the stock market was also under pressure due to the weakness in the bond market.

The Achilles heel of this bubble economy is interest rates because we’ve got so much debt. And if interest rates rise high enough, the whole thing is going to collapse.”

Consider this tweet Peter sent last Friday.

That would make the interest on the debt the biggest US government expense. (You can read a more in-depth analysis of the national debt HERE.)

Do you see the problem here? Debt is spiraling out of control and is going to crowd out all of the other government spending.

Basically, the US government would become a conduit from taxpayers to bondholders. Now obviously, this can’t happen. At some point, something has to give. And I think that something already gave. I think it gave on Friday morning, and that’s why I think the Fed folded with this ‘soft’ pivot. The reason I’m saying a soft pivot and not a hard pivot is because the Fed is still on the trajectory of hiking rates. I just think it shifted into a lower gear. So that, in and of itself, constitutes an easing. Even if the Fed is tightening, if it’s tightening less aggressively than the markets had thought, then it’s an easing. It’s a forward guidance that is easing conditions a little bit and telling the markets, ‘Hey, you’re too tight. You’re pricing in too many rate hikes. Because we’re probably not going to have to hike as many times as you think. The terminal rate is not going to be as high as you think because we’re already making good progress.’”

The soft pivot was telegraphed to the markets by Wall Street Journal report saying some Fed members were expressing “unease” and were concerned about overtightening. The story reported that San Francisco Fed President Mary Daly said, “The time is now to start planning for stepping down.”

Peter went on to detail some of the bad economic data the Fed will also have to reckon with including contractionary October PMI, tanking consumer confidence, and rising shelter costs (even though housing prices are falling).

end

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

WEDNESDAY, OCT 26, 2022 – 10:00

JIM RICKARDS….

TALKING ABOUT GOLD MANIPULATION

Rickards: “Rigging (Gold) Futures is Child’s Play”

Submitted by GoldFix

-with emphasis and special edits added for ZH readers

Many analysts say gold is volatile. But they should say that the gold market is volatile. That’s because most of it is paper gold, with only a small amount of physical gold to support it. Think of the gold market as an inverted pyramid, with a small amount of gold at the bottom, holding up a huge amount of paper gold. The paper market could be 100 times the size of the physical market.

That means there are 100 paper claims upon each ounce of physical gold. Imagine a coat check at a restaurant issuing 100 claims for one actual jacket. Well, there’s only one coat so 99 claimants are out of luck. It’s the same in the gold market.

It’s the paper market that creates the volatility. Gold itself is remarkably stable. It only appears unstable because its price is quoted in dollars, which fluctuates. When gold goes down, it’s really because the dollar is going up. When gold goes up, it’s really because the dollar is going down.

Right now we have a strong dollar, compared to other currencies at least. In reality, the dollar is simply the cleanest shirt in the laundry pile. And the paper market is highly vulnerable to price manipulation, and there’s been gold price manipulation over the years. There’s no question about it. That’s not just an opinion. The evidence has been very clear, in fact.

The Smoking Gun

I don’t believe in making strong claims without strong evidence. And the evidence is all there. A few years back, I spoke to a PhD statistician who worked for one of the biggest hedge funds in the world. I can’t mention the fund’s name but it’s a household name.

He looked at COMEX (the primary market for gold) opening prices and COMEX closing prices for a 10-year period. He was dumbfounded. He said it was the most blatant case of manipulation he’d ever seen. He said if you went into the aftermarket, bought after the close and sold before the opening every day, you would make risk-free profits.

He said statistically that’s impossible unless there’s manipulation occurring. I also spoke to Professor Rosa Abrantes-Metz at the New York University Stern School of Business. She’s the leading expert on globe price manipulation. She has actually testified in gold manipulation cases.

[EDIT- having worked with Rosa on background collaborating forensic processes in Gold and Silver manipulation, her assertions, in our opinion, are correct. – VBL]

She wrote a report reaching the same conclusions. The bottom line is, price manipulation isn’t just an opinion or some deep, dark conspiracy theory. It’s real. Here you have a PhD statistician and a prominent market expert lawyer, expert witness in litigation, qualified by the courts and as straight-laced as they come, who independently reached the same conclusion. Who carries it out?

Anatomy of a Swindle

Gold manipulation can be done by market players like hedge funds and other major players using ETFs and leasing and unallocated contracts. These manipulations do exist and can influence the price of gold in the short term.The price of gold is a struggle akin to a tug-of-war between physical and paper transactions.

The price of gold will move, in part, because of manipulators’ actions. There’s very strong mathematical evidence that the gold market is manipulated to suppress prices.How do they do it? The easiest way to perform paper manipulation is through rigging the futures market. It’s a bit complicated, but don’t worry about the details. Just realize that they’re meant to suppress gold prices.

Currently the price of gold is set in two places. One is the London spot market, controlled by six big banks including Goldman Sachs and JPMorgan. The other is the New York gold futures market controlled by COMEX, which is governed by its big clearing members, also including major western banks.

In effect, the big western banks have a monopoly on gold prices even if they do not have a monopoly on physical gold. That’s key.

The easiest way to perform paper manipulation is through COMEX futures. Rigging futures markets is child’s play. You just wait until a little bit before the close and put in a massive sell order. By doing this you scare the other side of the market into lowering their bid price; they back away.

[EDIT- Called “Banging the close”-VBL] 

That lower price then gets trumpeted around the world as the “price” of gold, discouraging investors and hurting sentiment. The price decline spooks hedge funds into dumping more gold as they hit “stop-loss” limits on their positions.

[Edit- This is why pricing in USD and having that mechanism used worldwide for deals is key to advertising their price-message. It is a function of USD as reserve currency, and creates “pricing power”.

As that pricing power moves eastward with demand, the COMEX loses relevancy. At some point, either the USD loses its status, COMEX loses all its metal or both.

When that happens, spoofing becomes ineffective on COMEX. The sad part is, it probably moves to ASIA along with the demand and the bank traders.- VBL]

The Snowball Effect

A self-fulfilling momentum is established where selling begets more selling and the price spirals down for no particular reason except that someone wanted it that way. Eventually a bottom is established and buyers step in, but by then the damage is done.

Futures have a huge amount of leverage that can easily reach 20 to 1. For $10 million of cash margin, they can sell $200 million of paper gold. Rigging futures markets is child’s play. You just wait until a little bit before the close of trading and put in a massive sell order.

By doing this you scare the other side of the market into lowering their bid price; they back away. That lower price then gets trumpeted around the world as the “price” of gold, discouraging investors and hurting sentiment. 

[Edit- because if they know it is coming, why pay a higher price?- VBL]

The price decline spooks hedge funds into dumping more gold as they hit “stop-loss” limits on their positions. A self-fulfilling momentum is established where selling begets more selling and the price spirals down for no particular reason except that someone wanted it that way.

Eventually a bottom is established and buyers step in, but by then the damage is done.If you want more details on this topic, please see my book The New Case for Gold. Specifically, read Chapter 4, “Gold Is Constant.”

Take the Long View

I’m not arguing that manipulation is a principle component of today’s depressed gold price. But it is something to keep in mind.

Ultimately, the shrewd gold investor takes the long view. That’s how patient investors preserve wealth in the gold market. For those who flit in and out and occasionally buy rallies and sell dips in panic mode, all I can say is good luck. You’re probably going to get crushed.

My advice to investors is that when you have gold, you should think about the quantity of gold by weight, not dollar price. Don’t get too hung up on the dollar price, because the dollar could collapse quickly and then the dollar price wouldn’t matter. What would matter is how much physical gold you have.The goal is to preserve wealth for the long run.

Originally Entitled “Rigged” by James Rickards via DailyReckoning.com


MS’s Bear Gets Bullish Stocks

Last week’s tactical bullish call was met with doubt from Morgan’s clients, which means there is still upside as we transition from Fire to Ice—falling inflation expectations can lead to lower rates and higher stock prices in the absence of capitulation from companies on 2023 EPS guidance. Yesterday ZH did a prem. piece on it entitled: Wall Street’s Biggest Bear… Expects S&P To Rise As High As 4150.

Wilson summarizes that we are in this particular bear market which began well over a year ago for the average stock. More specifically, he noted, “Many active managers are having a difficult year which puts them on their back foot and unable to fight powerful trends both up and down. This suggests passive trend-following strategies can have even more influence on price than normal.”

So now a bear is tactically bullish. This should bode well for mining stocks too. Good Luck

Continue reading including Moor Gold technicals  here


Free Posts To Your Mailbox

END

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

Did not expect this:  Russian banks are running low on large gold bars amid a surging demand

(Russia today/Moscow/GATA)

Russian banks run low on gold amid surging demand

Submitted by admin on Wed, 2022-10-26 19:46Section: Daily Dispatches

From Russia Today, Moscow
Tuesday, October 25, 2022

Banks in Russia are facing a shortage of gold bars after demand for the precious metal increased sharply, the Vedomosti newspaper reported, citing experts.

The executive director of precious metals operations at Uralsib Bank, Andrey Vasiliev, told the media outlet that supply disruptions arose due to the limited production capacity of refineries and growing demand for gold bars from citizens.

Small ingots are more in demand among individuals, while refineries were focused on bulk purchases of large bars and couldn’t quickly adapt to new market requirements, he explained. The production of small gold bars is a more expensive process, according to experts. It is cheaper to produce one ingot weighing 12 kg than several smaller ones, Evgeny Safonov from Promsvyazbank has confirmed. …

… For the remainder of the report:

https://www.rt.com/business/565294-russia-gold-surging-demand/

END

END

4.  OTHER PHYSICAL SILVER/GOLD COMMENTARIES

5.OTHER COMMODITIES: URANIUM/ENERGY

Uranium and energy units still have room to run higher

(QTRFringe)

Uranium, Energy And Oil Still Have Room To Run

WEDNESDAY, OCT 26, 2022 – 08:05 PM

Submitted by QTR’s Fringe Finance

This is the latest from Harris Kupperman, founder of Praetorian Capital, a hedge fund focused on using macro trends to guide stock selection. Mr. Kupperman is also the chief adventurer at Adventures in Capitalism, a website that details his investments and travels.

I published recent thoughts from Harris just days ago, in a post outlining his thoughts on why the Fed has backed themselves into a corner they can’t get out of.

Harris is one of my favorite Twitter follows and I find his opinions – especially on macro and commodities – to be extremely resourceful. I’m certain my readers will find the same. I was excited when he offered up his latest investor letter to Fringe Finance, which is published in part below.


Harris On Markets and Macro

I have genuinely been surprised at the vigor with which the Federal Reserve has raised rates in their campaign to quash inflation. For my entire investing career, the Fed has been dovish, standing by and ready to reassure speculators at every market gyration. For the first time in my career, they’re actively targeting the stock market in an effort to create a recession and reduce the “wealth effect” when it comes to consumer spending. This is a terrifying policy change that was unexpected by most market observers—including myself. 

At the same time, I feel that they have no real heart for this campaign. As political animals, they’ll be forced to pivot after they succeed in breaking something. Unfortunately, breaking something may lead to scary outcomes in the shorter term and we’ve kept our exposures at reduced levels until it is clear that they’re ready to pivot. When they do pivot, I believe that energy will be the primary beneficiary as both oil and uranium currently exhibit structural deficits that will be difficult to overcome absent substantial increases in capital spending. 

In fact, I think that the magnitude of the movements in energy pricing will stun people who are accustomed to gradual changes in commodity price regimes. If anything, the volatility in European energy prices ought to be a wake-up call for all market participants. It would seem that with structural deficits and rapidly growing demand, the rules have adjusted, and many investors are unprepared for the change. To me, this creates opportunity.   

Unfortunately for the Fed, higher energy prices will feed into higher structural inflation levels and at some point, the Fed will have to decide if they want to continue fighting inflation (which is likely impossible to quash outside of a global depression that dramatically reduces energy demand) or if they want to adjust their mandate and accept an increased level of inflation. Despite them clinging to their inflation-fighting mandate all year, I believe they have no desire to inflict a depression on voters. They’ll eventually pivot and accept dramatically higher inflation levels, while continuing to subsidize interest rates to avert the depression that they seem fixated on creating. As a result, we have continued to increase our exposure to US housing on this pullback, as that will be a prime beneficiary of this set of macroeconomic outcomes.

Thoughts On Portfolio Valuations

Despite only experiencing a -2.87% net decline (performance net of fees) in our fund since the start of the year, many of our largest positions have experienced far more dramatic declines and now represent unusual value. As a way of demonstrating the magnitude of the declines, as of the end of the third quarter, these are our top 5 positions and the declines experienced from their peak price points during 2022. 

Now, you should be asking yourself how it is possible that so many positions have declined dramatically, yet the fund hasn’t performed demonstrably worse. The answer would be a combination of continued gains from the Event-Driven book, realized gains on a number of profitable investments and loss mitigation strategies when trading around core positions. Additionally, we did not own BLDR or BNO at the start of the year, so they are new additions, purchased at depressed prices. Absent these factors, our returns for the year would have been a good deal worse. While the percentage decline from the peak price in a year, is a somewhat arbitrary way to think about a portfolio’s return, I think it is important to point out that the portfolio itself is doing a whole lot better than its larger components. Additionally, the magnitude of the declines from the peak prices is likely indicative of the relative value inherent in our portfolio. 


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As an absolute performance vehicle, I believe that a benchmark would be a foolish metric to use when referencing this fund’s performance. At the same time, it’s hard to ignore the fact that many global equity and bond markets are down dramatically, and our fund is down a good deal less despite being more than 100% net long for most of the year and rarely utilizing shorts or hedges. I believe this is due to my constant focus on sectors that are positively inflecting with strong macro tailwinds. History has shown that despite what happens in global economics or geopolitics, there is always a bull market somewhere. The key is to identify those bull markets and then find the components within those markets that offer exponential upside with a reduced opportunity for a permanent loss of capital. Discipline in this regard often trumps simple valuation, as cheap stocks can always get cheaper. Meanwhile, those with strong tailwinds rarely stay cheap for long. 

As a result of focusing on inflecting trends, we’ve side-stepped a good deal of the carnage in global risk markets, while capturing returns from the Event-Driven book. As a result, I think that we’ve set ourselves up for the continuation of the various trends that we are most fixated on. While history only somewhat repeats when it comes to the markets, my experience has been that strong trends often struggle to produce price positive performance during periods of overall market weakness. Then, when there is a pause in the decline of the overall market, those positions that declined the least with the broader market, tend to lead the next charge higher. The overall strength of many of our positions is indicative to me that we may be setting up for a similar explosive move higher in our portfolio positions when the market eventually bottoms. 

For now, my focus is on avoiding unforced errors, keeping exposure down and being prepared to dramatically increase our exposure to inflation assets when the Fed finally pauses in its rate cycle. 

Russian Securities

During last quarter’s letter, I gave an update on our Russian securities positions and noted that we had moved them into a side-pocket and marked them all at zero. Nothing has changed regarding the side-pocket or the mark on the positions. However, we did succeed in removing the GDR wrapper from 3 of our Russian positions and now own Russian shares. Our fourth position is a Cypriot company and thus far, we have not been capable of removing the GDR wrapper. Fortunately, it does not appear to be at the same risk of disappearing if we do not remove the wrapper.

While it may require some time until we can liquidate these positions, we believe that we’ll ultimately realize sizable gains on them. 

Position Review (top 5 position weightings at quarter end from largest to smallest)

Uranium Basket (Entities holding physical uranium along with production and exploration companies)

It may take some time still, but I believe that society will eventually settle on nuclear power as a compromise solution for baseload power generation. This will come at a time when there is a deficit of uranium production, compared with growing demand. As aboveground stocks are consumed, uranium prices should appreciate towards the marginal cost of production. Additionally, there is currently an entity named Sprott Physical Uranium Trust (U-U – Canada) that is aggressively issuing shares through an At-The-Market offering, or ATM, in order to purchase uranium (we are long this entity). I believe that these uranium purchases will accelerate the price realization function by sequestering much of the available above-ground stockpile at a time when utilities have run down their inventories and need substantial purchases to re-stock. The combination of these factors ought to lead to a dramatic increase in the price of uranium as it will take at least two years for incremental supply to come online—even if the re-start decision were made today. 

While most of our exposure to physical uranium is within the Sprott trust, because it allows us to express this view with reduced risk, we also own shares of Kazatomprom (KAP – UK). I am well aware that mining is one of the riskiest businesses out there, but Kazatomprom is the lowest-cost diversified producer globally, with incredible scale in what is a highly-consolidated industry. At the same time, I recognize that we take on certain risks when owning a company engaged in mineral extraction, especially in a country like Kazakhstan that can be politically unstable at times. That said, I believe that the recent change in government will do little to impact the operating environment in Kazakhstan, though the tax rate may expand moderately. 

Rancang Senjata Nuklir, Iran Mulai Produksi Logam Uranium

Ironically, uranium will be a prime beneficiary of sanctions on Russia as Russia is one of the world’s largest enrichers of uranium. As the West is forced to enrich more of the uranium that ultimately goes into reactors, underfeeding of tails will flip to an overfeeding of tails. The net effect could be anywhere between 10% and 30% of the global supply of uranium disappearing—which may dramatically accelerate the timing of my thesis while increasing the ultimate magnitude of the upward swing in uranium prices.  

Energy Services Basket (Positions Not Currently Disclosed)

In 2020 when oil traded below zero, drilling activity ground to a halt and many energy service providers declared bankruptcy. Many of these businesses had teetered on the verge of bankruptcy for years due to reduced demand and over-leveraged balance sheets. The bankruptcies led to consolidation and reduced future industry capacity, removing future competition in the recovery. 

With oil prices now at multi-year highs, I believe that demand for drilling and other services will recover. While producers have been slow to increase spending on exploration, despite dramatic recoveries in energy prices, I believe that this only extends the timing on the thesis. In the end, the only way to reduce energy prices is to see a dramatic increase in global oilfield services spending. Any postponement of this spending only leads to higher prices and more wealth transfer from the global economy to the oil producers, which will likely end up resulting in an increase in spending on exploration and production. 

We purchased many of these positions at fractions of the equipment’s replacement cost, despite restored balance sheets and positive operating cash flow. As spending in the sector recovers, I believe that the potential for cash flow will become more apparent and this equipment will trade up to valuations closer to replacement cost. 

Oil Futures, Futures and ETF Options and Call Spreads

I believe that years of reduced capital expenditures, along with ESG restricting capital access, combined with Western governments that are openly hostile to fossil fuels, have created an environment for dramatically higher oil prices. While we could purchase oil producers, I feel it is far more conservative to simply own the physical commodity itself. We own December 2025 oil futures, along with various futures calls and call spreads, an ETF and ETF call options and call spreads. I believe that this leveraged play on oil gives us the most upside to oil and ultimately inflation, while exposing us to reduced risk when compared to producers. 

St. Joe (JOE – USA)

JOE owns approximately 175,000 acres in the Florida Panhandle. It has been widely known that JOE traded for a tiny fraction of its liquidation value for years, but without a catalyst, it was always perceived to be “dead money.”  

Over the past few years, the population of the Panhandle has hit a critical mass where the Panhandle now has a center of gravity that is attracting people who want to live in one of the prettiest places in the country, with zero state income taxes and few of the problems of large cities. 

The oddity of the current disdain for so-called “value investments” is that many of them are growing quite fast. I believe that JOE will grow revenue at 30% to 50% each year for the foreseeable future, with earnings growing at a much faster clip. Meanwhile, I believe the shares trade at a single-digit multiple on Adjusted Funds from Operations (AFFO) looking out to 2024, while substantial asset value is tossed in for free. 

Besides the valuation, growth, and high Return on Invested Capital (ROIC) of the business, why else do I like JOE? For starters, land tends to appreciate rapidly during periods of high inflation— particularly an inflationary period where interest rates are likely to remain suppressed by the Federal Reserve. More importantly, I believe we are about to witness a massive population migration as people with means choose to flee big cities for somewhere peaceful. 

I suspect that every convulsion of urban chaos and/or tax-the-rich scheming will launch JOE shares higher, and it will ultimately be seen as the way to “play” the stream of very wealthy refugees fleeing for somewhere better. 

Builders FirstSource (BLDR – USA)

Builders FirstSource produces and distributes building materials, primarily for the home building industry. It trades at a low-single digit cash flow multiple on recent earnings and is using that cash flow to rapidly repurchase shares. One could say that the low multiple is due to peak cyclical earnings. I take a different view and believe that we’re in the early stages of a long-term housing boom caused by migration to low tax states along with a catch-up phase as home construction rates were below trendline over the past decade.

I believe that the US needs in excess of 1 million new single-family homes each year, just to provide for population growth, ignoring the other factors. As a result, this business does not appear to be at peak earnings; instead, I believe we are seeing a new baseline for earnings—though the earnings will be quite volatile—particularly if interest rates remain elevated or increase further. 

Summary

In summary, during the third quarter of 2022, the fund experienced a pullback in many of its core positions. I have used this pullback to moderately increase a number of our positions, which has increased our overall exposure. Our exposure is a bit more concentrated in inflation, particularly in energy, than I’d normally expect it to be, but those are also my favorite themes. We’ve expressed this view through instruments like physical uranium, long-dated oil futures and futures options, energy equipment services companies, and land plays, which I believe should have a reduced risk of permanent impairment. 

I also believe we are in the early stages of this inflationary boom and while there will be sizable volatility going forward, we are positioned well. 


Harris’ Disclaimer:

Nothing set forth herein shall constitute an offer to sell any securities or constitute a solicitation of an offer to purchase any securities.  Any such offer to sell or solicitation of an offer to purchase shall be made only by formal offering documents for Praetorian Capital Fund LLC (the “Fund”) which include, among others, a confidential offering memorandum, operating agreement and subscription agreement.  Such formal offering documents contain additional information not set forth herein, including information regarding certain risks of investing in the Fund, which are material to any decision to invest in the Fund.

No information is warranted by PCM or its affiliates or subsidiaries as to completeness or accuracy, express or implied, and is subject to change without notice.  This document contains forward-looking statements, including observations about markets and industry and regulatory trends as of the original date of this document.  Forward-looking statements may be identified by, among other things, the use of words such as “expects,” “anticipates,” “believes,” or “estimates,” or the negatives of these terms, and similar expressions.  Forwardlooking statements reflect PCM’s views as of such date with respect to possible future events.  Actual results could differ materially from those in the forward-looking statements as a result of factors beyond PCM’s control.  Investors are cautioned not to place undue reliance on such statements. No party has an obligation to update any of the forward-looking statements in this document.

Opinions, estimates, and forward-looking statements in these materials constitute PCM’s judgment and should be considered current only as of the date of publication without regard to the date on which you may receive or access the information.  PCM maintains the right to delete or modify information without prior notice.  Statements made herein that are not attributed to a third-party source reflect the views and opinions of PCM.  

Return targets or objectives, if any, are used for measurement or comparison purposes and only as a guideline for prospective investors to evaluate a particular investment program’s investment strategies and accompanying information.  Targeted returns reflect subjective determinations by PCM based on a variety of factors, including, among others, internal modeling, investment strategy, prior performance of similar products (if any), volatility measures, risk tolerance and market conditions.  Performance may fluctuate, especially over short periods.  Targeted returns should be evaluated over the time period indicated and not over shorter periods.  Targeted returns are not intended to be actual performance and should not be relied upon as an indication of actual or future performance. 

The past performance of the Fund, or PCM, its principals, members, or employees is not indicative of future returns.  The performance reflected herein and the performance for any given investor may differ due to various factors including, without limitation, the timing of subscriptions and withdrawals, applicable management fees and incentive allocations, and the investor’s ability to participate in new issues.

All references to a “net return” or “performance, net of fees” within this letter are for a net return of an investor that is subject to all standard fees and accrued incentive allocation, if any, at Praetorian Capital Fund LLC (“PCF”), as provided for in the PCF’s offering documents, and has been an investor in the PCF since the beginning of the current year or period.

There is no guarantee that PCM will be successful in achieving the Fund’s investment objectives.  An investment in the Fund contains risks, including the risk of complete loss.

The investments discussed herein are not meant to be indicative or reflective of the portfolio of the fund.  Rather, such examples are meant to exemplify PCM’s analysis for the fund and the execution of the fund’s investment strategy.  While these examples may reflect successful trading, obviously not all trades are successful and profitable. As such, the examples contained herein should not be viewed as representative of all trades made by PCM.

COMMODITIES IN GENERAL/

END

6.CRYPTOCURRENCIES

7. GOLD/ TRADING

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

ONSHORE YUAN: CLOSED DOWN 7.2286 

OFFSHORE YUAN: 7.2493

SHANGHAI CLOSED DOWN 16.60 PTS OR .55%

HANG SENG CLOSED UP 110.27 OR 0.72% 

2. Nikkei closed DOWN 181.56 PTS OR 0.67%

3. Europe stocks   SO FAR:  ALL RED

USA dollar INDEX UP TO  109.95/Euro FALLS TO 1.0047

3b Japan 10 YR bond yield: FALLS TO. +.248/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 146.67/JAPANESE YEN COLLAPSING AS WELL AS LONG TERM YIELDS RISING BREAKING THE JAPANESE CENTRAL BANK.

3c Nikkei now  ABOVE 17,000

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

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

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

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

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

3h European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund DOWN TO +2.177%***/Italian 10 Yr bond yield FALLS to 4.404%*** /SPAIN 10 YR BOND YIELD FALLS TO 3.27%…** DANGEROUS//

3i Greek 10 year bond yield FALLS TO 4.66//

3j Gold at $1660.85//silver at: 19.40  7 am est) SILVER NEXT RESISTANCE LEVEL AT $30.00

3k USA vs Russian rouble;// Russian rouble UP 0  AND 49/100        roubles/dollar; ROUBLE AT 61.26//

3m oil into the 88 dollar handle for WTI and  95 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 146.67DESTROYING 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 0.9902– as the Swiss Franc is still rising against most currencies. Euro vs SF 0.9949well 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: 4.067% UP 5 BASIS PTS…GETTING DANGEROUS

USA 30 YR BOND YIELD: 4.184% UP 7 BASIS PTS//

USA DOLLAR VS TURKISH LIRA: 18,60…GETTTING DANGEROUS

GREAT BRITAIN/10 YEAR YIELD: 3.6325%

end

Overnight:  Newsquawk and Zero hedge:

 FIRST, ZEROHEDGE (PRE USA OPENING// MORNING

Futures Coiled Ahead Of Data, Earnings Juggernaut

THURSDAY, OCT 27, 2022 – 08:01 AM

US equity futures swung between gains and losses (a remarkable achievement considering the collapse in generals such as GOOGL and MSFT and last night’s 25% implosion in META, something which startled even JPMorgan’s top trader) as investors weighed disappointing tech earnings amid growing hopes of a Fed pivot and/or a Treasury buyback (Op Twist) announcement.

Contracts on the S&P 500 were little changed as of 7:30 a.m. in New York, while Nasdaq 100 futures fell 0.4% after both indexes snapped a three-day winning streak on Wednesday, dragged down by negative sentiment toward tech following a string of disappointing earnings.

In premarket trading, Nvidia led chipmakers with exposure to data centers higher after Meta Platforms said it’s planning for even bigger capital expenditures in 2023. As noted last night, Facebook Meta projected capex of $34 billion to $39 billion in 2023, up from $32 billion to $33 billion in 2022. Meanwhile, shares in social-media companies tumbled after Meta gave a lukewarm revenue forecast for the fourth-quarter amid ballooning costs, stoking worries about a slowdown in the advertising market amid a weaker economic backdrop. Meta crashed as much as 20% in US premarket trading – its second biggest drop on record; peer Snap drops as much as 1.7%, Pinterest falls as much as 3.6%. Meanwhile, Twitter traded closer to Elon Musk’s offer price of $54.20, with a court-ordered deadline to complete the $44 billion deal just one day away.  Here are the other notable premarket movers:

  • Ford shares declined as much as 2.6% in US premarket trading after narrowing its profit outlook for the year, though the move was relatively muted given the automaker had already issued a profit warning last month.
  • Wolfspeed shares tumble 24% in premarket trading after the semiconductor device company provided second-quarter revenue guidance that was worse than anticipated. Analysts are confident in the company’s longer-term vision, but see near-term headwinds clouding visibility.
  • Teladoc Health’s shares jumped as much as 11% in US premarket trading on Thursday, with analysts reassured by the telehealth company’s smaller-than-expected tweak to its 2023 guidance, making its fourth-quarter goals easier to achieve.
  • Twitter shares rise 1.2% to $53.98 in US premarket trading hours, moving closer to Elon Musk’s offer price of $54.20, with a court-ordered deadline to complete the $44 billion deal just one day away.
  • Vertiv Holdings stock gains 2.1% in premarket trading on thin volume as Cowen upgraded it to outperform from market perform, saying its confidence in the company’s “compelling” guidance has now been restored.
  • Keep an eye on Sleep Number’s stock after the air mattress manufacturer reported third-quarter results that were ahead of expectations, while issues with chip inventory and weakening consumer demand led the company to scale back earnings per share guidance for the full year.
  • Watch Silicon Laboratories as the stock was cut to hold from buy at Needham following Wednesday’s results, based on concerns regarding slowing consumer demand.

It’s another big day for US tech earnings with Amazon.com, Apple and Intel all reporting after market hours.

As Bloomberg notes, hopes for a Fed pivot rose again after a lower-than-expected rate hike from the Bank of Canada on Wednesday, while investors bet that the central bank will be less aggressive as earnings and economic data point to an economic slowdown. The 10-year US Treasury yield receded to the 4% level before bouncing slightly on Thursday, while the Bloomberg Dollar Index was at this month’s after a contraction in services and manufacturing and fewer new home sales showed the Fed’s efforts to cool the economy seem to be bearing some fruit. Still, economists expect the Fed to hike by 75 basis points for the fourth time in a row when it meets next week. Traders have cut expectations for rates to peak next year to 4.86% from 5% a week ago.

“We will hit peak inflation sometime this calendar year and then we’ll see interest rates peaking sometime early next year” ahead of a slowdown, said Jun Bei Liu, a portfolio manager at Tribeca Investment Partners Pty Ltd. “In that scenario, equity doesn’t look too bad. Actually, equity looks pretty well-positioned, even though we may be staring at a mild recession in the US.”

We also get the first read of US Q3 GDP shortly: while consensus still calls for a 2.4% expansion in US gross domestic product in the third quarter, a few forecasters cut their projections after Wednesday’s trade data were released, with one dropping by nearly a full percentage point. The GDP figures are due out later Thursday, along with data on durable-goods orders and weekly first-time unemployment claims.

In Europe, equities slipped before a European Central Bank rate decision. The Stoxx Europe 600 Index was weighed down by technology and mining stocks. Credit Suisse Group AG plunged as much as 16% as the bank reported its fourth straight loss and announced a huge corporate overhaul, an equity offering and massive layoffs. Oil stocks rose after Shell Plc raised its dividend and TotalEnergies SE posted a record profit. Here are the biggest European movers:

  • Shell shares gain as much as much as 5.8% as it raises its dividend after posting its second-highest profit on record, even as some parts of its business showed signs of slowing.
  • AB InBev rises as much as 6.9% after beating 3Q results estimates and raising the lower end of its growth forecast.
  • Casino shares rise as much as 30% on signs that the company’s debt burden is manageable. Rebound in shares may also be driven in part by bearish speculators reversing their bets on sharp declines in the stock this year, rather than just fresh buying by bulls.
  • Aegon shares rise as much as 9.8% after announcing it will combine its Dutch activities with ASR for a total consideration of €4.9 billion, in a move that analysts think makes strategic sense, given scope for material synergies.
  • Credit Suisse shares slumped as much as 16% after the Swiss lender reported a $4b loss and announced a massive overhaul, including thousands of job cuts, the sale of its structured products group and a capital increase to the tune of 4 billion francs.
  • European chip stocks slide on Thursday, with STMicro the biggest decliner of the group after the chipmaker guided fourth-quarter revenue slightly below consensus estimates, triggering concerns that the slowdown in semiconductor demand is spreading beyond consumer end-markets. Peer ASML drops as much as 3.7%
  • Ipsen shares fall as much as 9.7%, the most since April, after the French pharmaceuticals firm published 3Q sales numbers that beat estimates, even as revenue fell for Somatuline, a long-time key drug that’s facing increased competition from generics.
  • Inspecs shares drop as much as 50% to a record low with Peel Hunt (buy) flagging a deteriorating outlook for the eyewear firm.

In just a few minutes, the ECB is set to look past Europe’s growing recession by lifting its main interest rate by another 75 basis points to the highest in more than a decade as it battles record euro-zone inflation. The pace of increases is likely to slow to 50 basis points in December, according to economists.

“We are oriented with consensus, expecting a big hike of 75 basis points” from the ECB, Monica Defend, head of the Amundi Institute, said on Bloomberg Television. “We think they will continue being hawkish until December and then with the beginning of the new year, they might review or slow down a little bit the pace. Yesterday the Central Bank of Canada surprised the market with their final hike — we think the ECB will remain bold.”

Earlier in the session, Asian stocks were mixed, with most advancing for a third straight day, as Hong Kong shares jumped and a weaker dollar supported regional equities, while Japanese equities led declines. The MSCI Asia Pacific Index rose as much as 1.2%, lifted by technology shares, before paring its gain. Gauges in Hong Kong also trimmed their advance to less than 1%, while investors focused on a slew of earnings and awaited further policy guidance following China’s party congress. Benchmarks in Taiwan and South Korea were also higher as some chip stocks rose, with the measures buoyed by encouraging earnings beats this week including by Samsung SDI and LG Energy. The drop in the US 10-year Treasury yield and dollar this week is giving currencies and equity measures in Asia a boost, with traders looking ahead to US employment data later this week for further clues on the Fed’s rate-hike path. And with China’s historic rout on Monday on the mend and the quarterly earnings season providing some positive surprises, the Asian benchmark is close to erasing losses for the month.

“Any admission of major Western central banks having to pause or give up the inflationary fight entirely would be rather big news, potentially leading to sharp asset price reversals,” Martin W. Hennecke, head of Asia investment advisory at wealth management firm St. James’s Place, wrote in a note. If inflation really is to be addressed more seriously, there should arguably be more focus on budget deficits to be brought under better control, he added.

Japanese equities fell for the first time in four sessions, as investors assessed the latest earnings from domestic and foreign companies.  The Topix dropped 0.7% to close at 1,905.56, while the Nikkei declined 0.3% to 27,345.24. Mitsubishi UFJ Financial Group Inc. contributed the most to the Topix decline, decreasing 2.6%. Out of 2,166 stocks in the index, 576 rose and 1,484 fell, while 106 were unchanged. “There are no big surprises in Japanese earnings results,” said Takeru Ogihara, chief strategist at Asset Management One. “On the other hand, although all the results have not been released yet, US earnings are down quite a bit, so I think they may be having a greater impact.”

In India, key stocks gauges overcame volatility induced by the expiry of monthly derivative contracts and resumed their recent advance, with metals and real estate companies recovering. The gains in local shares were in line with Asian peers, which rose tracking decline in the dollar.  The S&P BSE Sensex jumped 0.4% to 59,756.84 in Mumbai, recovering from a drop of 0.1% during the session. The NSE Nifty 50 Index advanced 0.5%. All but three of the 19 sector sub-gauges compiled by BSE Ltd. ended higher.  Both key indexes have now gained in eight out of nine sessions, a period that includes the one-hour ceremonial Diwali trading on Monday. The benchmarks are now less than 3% short of their respective records set last year. Trading resumed after a holiday on Wednesday.      

In rates, the yield on the 10-year Treasury bond rebounded after inching below 4% earlier, with investors positioning for less aggressive rate hikes as earnings and economic data indicate a slowdown. The benchmark US yield has dropped more than 20 basis points over the past two days. A gauge of the dollar gained after two days of steep declines. On Wednesday morning, US yields cheaper by 5bp to 8bp across the curve with losses led by belly, flattening 5s30s by nearly 2bp on the day while 2s5s30s fly cheapens 4bp; 10-year yields around 4.075%, with bunds trading 1bp cheaper in the sector. The US auction cycle concludes with 7-year note sale at 1pm, while first estimate of 3Q GDP leads economic calendar. Money markets pricing around 72bp of rate hikes for ECB policy meeting, and attention will also be centered on possible changes to TLTRO loans. German bonds fell across the curve; the 10-year bund yield climbing 7bps higher to 2.89%.

In Fx, the Bloomberg Dollar Spot Index rose 0.3%, halting two days of steep losses; data due later Thursday may show the US economy rebounded in the third quarter.

  • The yen jumped to a three-week high, before paring gains, as traders geared up for a Bank of Japan policy decision on Friday. The market is abuzz with talk that the BOJ may step in to prop up the yen should the currency weaken if the central bank maintains its super-easy monetary policy as expected.
  • The pound pulled back from early gains against the US dollar to trade 0.6% lower at $1.1560; further gains could be limited given uncertainties about how a revamped UK fiscal plan could impact the economy just as it enters a recession

In commodities, oil fluctuated after touching the highest level in about two weeks after US Secretary of State Anthony Blinken said a deal with Iran would be unlikely to advance in the short term.  Traders placed bets on a soaring price for aluminum as the US considers adding the metal to sanctions against Russia, a major producer. Iron ore futures slumped to the lowest since May 2020 on concern overan economic slowdown in China.

Bitcoin is under modest pressure, downside which has increased amid the recent relative resurgence in the USD.

Looking at the day ahead, today’s big data release will be the advance reading of Q3 GDP in the US. After back-to-back negative readings earlier this year, economists see today’s print at +2.4%, a solid rebound, on the back of strong net exports that could compensate for slowing demand. We will also get the quarterly core PCE, which should provide a clue to tomorrow’s September reading. Other indicators released in the US will include durable goods orders and Kansas City Fed manufacturing activity index. In earnings, we will hear from Apple, Amazon, Mastercard, Samsung, Merck, Shell, McDonald’s, T-Mobile, Linde, TotalEnergies, Comcast, Honeywell, Intel, S&P Global, Caterpillar, AB InBev, American Tower, Gilead Sciences, EDF, Neste, STMicroelectronics, Shopify, PG&E, Repsol, EDP, Pinterest, First Solar, Credit Suisse, Deutsche Lufthansa, Hertz and Ubisoft. So a busy day with the ECB as well.

Market Snapshot

  • S&P 500 futures up 0.4% to 3,855.75
  • STOXX Europe 600 down 0.2% to 409.35
  • MXAP up 0.6% to 138.12
  • MXAPJ up 0.9% to 441.27
  • Nikkei down 0.3% to 27,345.24
  • Topix down 0.7% to 1,905.56
  • Hang Seng Index up 0.7% to 15,427.94
  • Shanghai Composite down 0.6% to 2,982.90
  • Sensex up 0.2% to 59,661.74
  • Australia S&P/ASX 200 up 0.5% to 6,845.13
  • Kospi up 1.7% to 2,288.78
  • German 10Y yield up 3.1% to 2.17%
  • Euro down 0.2% to $1.0058
  • Brent Futures up 0.3% to $95.93/bbl
  • Gold spot up 0.1% to $1,665.68
  • U.S. Dollar Index little changed at 109.74

Top Overnight News from Bloomberg

  • The yen is seeing a respite from recent heavy selling as traders reconsider the pace of US rate hikes and prepare for Friday’s key Bank of Japan policy decision.
  • It’s too soon to write off the dollar’s dominance as the US rate-hike cycle may not be near its peak. That’s the firm conviction of money managers at JPMorgan Asset Management and Fivestar Asset Management even after a gauge of the greenback touched a one-month low on Thursday.
  • Chinese President Xi Jinping said his nation is willing to work with the US to find ways to cooperate, comments that come before a potential meeting with President Joe Biden at a Group of 20 summit next month.
  • Stocks slipped and US futures pared gains as traders digested a flurry of major earnings and prepared for another jumbo European Central Bank rate hike later Thursday.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks traded mixed following a similar lead from Wall Street and amid a lack of fresh fundamental drivers overnight.  ASX 200 was supported by gains across its commodities-related sectors, whilst financials lagged after ANZ Bank shed over 3% post-earnings. Nikkei 225 was in the red as exporters were pressured by the recent firming in the Japanese currency against the Dollar. KOSPI saw gains across its energy, industrial, and IT names, whilst Samsung Electronics saw choppy trade after earnings before stabilising in the green. Hang Seng outperformed and the Hang Seng Tech index also surged following the recent selling – the gains were driven by Alibaba and JD.com. Shanghai Comp was firmer at the open but gains fizzled out, whilst the PBoC injected another CNY +200bln via 7-day reverse repo for a third straight session.

Top Asian News

  • Samsung Electronics (005380 KS) – Q3 2022 (KRW): Revenue 76.8tln (Co. exp. 76tln), Net profit 9.4tln (exp. 7.9tln), expects H2 2023 recovery in memory chips focused on servers and mobile; expect tech and memory chip demand to remain weak in Q4. Q3 Consolidated Net 9.14tln (exp. 9.43tln). Co. expects tech and memory chip demand to remain weak in Q4. Q4 demand for smartphones and wearables is forecast to increase Q/Q; 2023 demand for smartphones and wearables is expected to grow. (Newswires)
  • Japan is eyeing in excess of JPY 29tln in government spending on stimulus, according to NHK.
  • PBoC injected CNY 240bln via 7-day reverse repos at a maintained rate 2.00% for a daily injection of CNY 238bln.
  • China’s MOFCOM sees retail sales keeping a stable recovery, consumption expected to stabilise and recover; Foreign Ministry says China is prepared to make “vast space for peaceful unification”.

European bourses are under modest pressure, Euro Stoxx 50 -0.5%, with the region digesting earnings and largely just awaiting the ECB; FTSE 100 +0.3% outperforms post-Shell +3.5%. Sectors are predominantly in the red though, in-fitting with bourses, Energy outperforms after Shell & Total while Tech names lag following Meta and STMicroelectronics. Stateside, futures are mixed and yet to develop much traction either side of the unchanged mark, NQ -0.3% lags more corporate updates and as yields pick up. Meta Platforms Inc (META) Q3 2022 (USD): EPS 1.64 (exp. 1.88), Revenue 27.71bln (exp. 27.38bln). Facebook DAUs 1.98bln (exp. 1.86bln). Facebook MAUs 2.96bln (exp. 2.97bln). META average price per ad -18% (exp. -15.3%). Co. said it faces near-term challenges on revenue, and sees reality labs op losses in 2023 significantly higher. CFO said revenue from large advertisers remain challenged, while revenue among smaller advertisers remain more resilient. -20% in the pre-market. Ford Motor Co (F) Q3 2022 (USD): EPS -0.21 (exp. 0.27), Revenue 39.4bln (exp. 36.25bln); Raises FY22 FCF outlook to 9.5-10bln (prev. 5.5-6.5bln); sees FY adj. EBIT around USD 11.5bln (prev. 11.5-12.5bln). -2% in the pre-market

Top European News

  • Credit Suisse to Raise $4 Billion to Fund Sweeping Overhaul
  • Campari 3Q Adjusted Ebit Beats Estimates
  • Putin-Linked Celebrity Journalist Sobchak Flees Russia
  • Bankers Grill Erdogan’s Lieutenants Over Risky Build-Up of Bonds
  • Egypt’s Pound Weakens About 10% Versus Dollar After Policy Shift
  • Made.com Abandons Hope for Rescue Buyer as Collapse Looms
  • Is Putin Strangling Russia’s Golden Gas Goose? The IEA Thinks So

FX

  • Buck stops the rot as rival currencies retreat ahead of risk events, including ECB and top tier US data, DXY tops 110.00 vs bottom near 109.500.
  • Euro and Sterling fade just shy of 1.0100 and 1.1650 respectively and in proximity to key technical levels.
  • Aussie undermined by a sharp fall in iron ore and renewed Yuan weakness; AUD/USD down from 0.6500+ peak and eyeing 0.6450, USD/CNH up from circa 7.1640 to 7.2630 or so.

Fixed Income

  • Bonds wane after forging fresh midweek recovery peaks.
  • Bunds reverse around one full point from just over 139.00 pre-ECB.
  • T-note turn tail from 111-05+ to 110-21+ as 4% cash yield holds ahead of US GDP, IJC and Durable Goods.
  • Gilts buck trend and retest 102.000 again amidst reports that UK PM Sunak may hike taxes and cut spending to make budget savings.

Commodities

  • A contained session for the commodity space with markets generally tentative and mixed awaiting the afternoon’s risk events of which the ECB takes centre stage.
  • Crude benchmarks are essentially unchanged on the session and have slipped marginally from best levels of USD 88.50/bbl and USD 96.20/bbl for WTI Dec’22 and Brent Jan’22 respectively.
  • Spot gold spent much of the morning firmer as the DXY waned below 110.00, but as the index reclaims the figure the yellow metal has been tarnished in turn and has slipped back below the 21-DMA though remains above the 10-DMA.
  • Biden admin reportedly reviewing plans for a Russian oil price cap, according to Bloomberg citing sources. Under earlier plans, a price cap in the range of USD 40-60/bbl was mulled, but sources suggested discussions involve a cap at the higher end of that range and above. No decision is expected before the US mid-term elections.

Central Banks

  • RBNZ Governor Orr said New Zealand is relatively well positioned, but inflation is still too high in an absolute sense; has eyes firmly focused on meeting inflation target, via Reuters.
  • Westpac’s Evans is forecasting a 50bp rate hike from the RBA next week (vs market expectations for 25bps hike).
  • Brazilian Selic Interest Rate 13.75% vs. Exp. 13.75% (Prev. 13.75%). BCB will not hesitate to resume the tightening cycle if the disinflationary process does not proceed as expected; it will stay vigilant, and policy can be adjusted, via Reuters and Bloomberg.
  • CBRT raises its year-end inflation estimate to 65.2% from 60.4%.

Geopolitics

  • US has accelerated the fielding of a more accurate version of its mainstay nuclear bomb to NATO bases in Europe, according to a US diplomatic cable and two people familiar with the issue, via Politico.
  • Ukraine has boosted its forces in the northern region to counter the potential attack from Belarus, according to Ukraine’s general staff, via Reuters.
  • Chinese President Xi said, “the Chinese and American peoples have many things in common, and can become good friends and partners for mutually beneficial cooperation.”, according to CCTV
  • US Air Force is to replace its entire fleet of F-15 jets in Okinawa, Japan with a rotational force, via FT; officials cited are concerned this will send a dangerous signal to China re. deterrence.

US Event Calendar

  • 08:30: 3Q GDP Annualized QoQ, est. 2.4%, prior -0.6%
    • 3Q PCE Core QoQ, est. 4.5%, prior 4.7%
    • 3Q GDP Price Index, est. 5.3%, prior 9.0%
    • 3Q Personal Consumption, est. 1.0%, prior 2.0%
  • 08:30: Sept. Durable Goods Orders, est. 0.6%, prior -0.2%
    • Sept. -Less Transportation, est. 0.2%, prior 0.3%
    • Sept. Cap Goods Ship Nondef Ex Air, est. 0.5%, prior 0.4%
    • Sept. Cap Goods Orders Nondef Ex Air, est. 0.3%, prior 1.4%
  • 08:30: Oct. Initial Jobless Claims, est. 220,000, prior 214,000
    • Oct. Continuing Claims, est. 1.39m, prior 1.39m
  • 11:00: Oct. Kansas City Fed Manf. Activity, est. -2, prior 1

DB’s Jim Reid concludes the overnight wrap

I’ll visit our new offices in NY for the first time today as DB hosts a macro conference at which I’m the keynote speaker. I’ve been told that it’s one of the best offices on the buy- or sell-side in Manhattan, so I have high expectations.

While I’ve been in NY, attempts to price in a Fed pivot have gathered pace and continued yesterday after we had a smaller-than-expected hike from the BoC (+50bps vs +75bps expected, taking the overnight lending rate target to 3.75%). That followed the central bank’s expectations of lower inflation and growth on the back of higher rates and subsiding price pressures. Markets got the read-through to the Fed given that the BoC was the first to hike and go in larger increments this cycle, so we saw another day with 2-7bps declines in Fed pricing for 2023 meetings. However, equities struggled even with the continued pivot discussion (S&P 500 -0.74%, Nasdaq -2.04%) given the previous night’s poor tech earnings. That theme continued after the bell as Meta fell -19.70% in after-hours given a weaker revenue outlook and metaverse-related results. This morning futures tied to the S&P 500 (+0.51%) and the NASDAQ 100 (+0.43%) are moving higher, brushing off Meta’s disappointing results. The focus today (outside the ECB meeting) will be on Apple, the world’s most valuable public company at a c.$2.4tn market cap, and Amazon, ranked 5th globally with a market cap of $1.2tn, with both reporting after hours. My purchase of the new iPad Pro yesterday on its release day in NY won’t yet filter into Apple’s results! Intel will also report after hours today following Samsung’s (+0.17%) profit miss this morning (more below).

Back to the pivot discussion, unsurprisingly US bonds reacted by rallying across the curve, including a -5.6bps decline for the 2y yield and a -9.9bps move lower for the 10y. This morning in Asia, yields on 10yr USTs are slightly rebounding (+1.45 bps), trading at 4.02% as we go to press. Given that the ECB is far behind both the Fed and the BoC in its tightening cycle, the pass-through to European yields was more limited. The front-end yields in key markets were mixed (-2.2bps for Germany, -1.2bps in France and +0.2bps in Italy) in anticipation of today’s meeting, with the global move felt a bit more at the longer end (10y Bund -5.7bps, 10y OATs -5.1bps and 10y BTPs -5.0bps). Given the US pivot discussion, the euro strengthened +1.1% against the dollar to above parity for the first time in around 6 weeks, with the DXY index falling by -1.11%.

Speaking of the ECB, the central bank is due to announce its interest rate decision today. Our European economists expect another +75bps hike, which would take the deposit rate to 1.5%, but in their preview here they also outline that it’s the runoff of ECB’s EUR 8.8tn balance sheet that will be the focal point for markets. The team expect QT to be discussed at this meeting but without a decision being made until December. The process will likely be gradual amid concerns over stability and fragmentation ansd will kick off in April, after rates are at the terminal level. They also see the central bank taking measures to encourage early TLTRO repayments today. Beyond today’s meeting, our European economists see rates moving higher by +75bps in December, +50bps in February and +25bps in March, taking the terminal rate to 3%. This is in line with their expectations of a hawkish tone at today’s meeting that potentially would not exclude a possibility of another +75bps in December. Yesterday they put out a note looking at whether the central bank has the capacity to maintain its hiking pace here.

The US equity sell-off discussed earlier accelerated after Europe went home. Sectors like energy (+1.36%), health care (+1.12%) and materials (+0.67%) were the top performers in the S&P 500 after commodity stocks got a boost from a rally in oil (WTI +3.04% and Brent +2.32%). Understandably, IT (-2.23%) and communications (-4.75%) were the heaviest decliners amidst the largest daily declines since March 2020 for Alphabet (-9.63%) and Microsoft (-7.72%). That heavyweight laggard bias actually left roughly 57% of S&P 500 members in the green by the close. In earnings before the closing bell, non-tech stocks gave some relief to investors after a beat and upside guidance tweaks from Kraft Heinz (-0.4%) and Thermo Fisher Scientific (-2.26%). Earnings beats from Universal Health (+13.1%), Hess (+4.82%) and Visa (+4.60%) put them among the top of S&P 500 firms in terms of daily gains. Meanwhile, Boeing (-8.89%) disappointed by missing on revenue and decreasing deliveries forecast.

European stocks managed to post solid gains before the mood soured a bit in the US. The Stoxx 600 was up by +0.66% amid advances in materials (+1.55%), industrials (+1.53%) and healthcare (+1.00%). On a country level, Germany (DAX +1.09%) and Spain (IBEX35 +0.97%) outperformed but most other major bourses (CAC 40 +0.41%) were in the green as well for the day. There weren’t many economic data catalysts yesterday but consumer confidence for France beat consensus of 77 by rising to 82 from 79 last month. Similar gauges are due from Germany and Italy this morning.

In the UK, we had news of the medium fiscal plan being pushed back to November 17th from October 31st, which didn’t prevent a -13.8bps slide in 2y gilts and a drop of 5-10bps in BoE pricing for the next few meetings, including the one next Thursday. A return to credibility has bought the government time which in turn has allowed them to delay the fiscal plan to take advantage of the lower rates seen in the last couple of weeks which will help reduce the size of the fiscal hole that the OBR will report on. The long end rallied too, with 10y yields falling by -6.1bps. Meanwhile, sterling strengthened by +1.33% against the dollar and the FTSE 100 gained +0.61%.

In US data, the advanced goods trade balance for September came in at -$92.2bn, wider than the median Bloomberg estimate of -$87.5bn and wholesale inventories MoM growth also missed (+0.8% vs +1.0% expected). Both could negatively reflect on today’s first reading of Q3 GDP. New home sales, on the other hand, surprised on the upside by coming in at 603k vs 580k expected but it was still a -10.9% MoM decline.

Asian equity markets are mixed this morning. As I type, the Hang Seng (+2.15%) is leading gains across the region after jumping more than +3% in early trade following a broad rally in the Chinese listed tech stocks. Meanwhile, the KOSPI (+1.29%) is also trading in positive territory despite South Korea’s GDP growth decelerating in 3Q22 (more below). Elsewhere, the Nikkei (-0.26%) and the CSI (-0.12%) are trading lower with the Shanghai Composite (-0.06%) just below flat.

Early morning data showed that South Korea’s 3Q GDP grew +0.3% q/q (v/s +0.3% expected), recording its slowest growth since the third quarter of 2021, as the economy is losing momentum due to elevated inflation and global policy tightening denting demand both at home and abroad. It followed a +0.7% gain in the preceding quarter. Elsewhere, China’s industrial profits for January to September fell -2.3% y/y compared to a -2.1% drop recorded in the preceding month.

In company news, Samsung Electronics registered a 31.39% drop in operating profit for the third quarter to 10.85 trillion won ($7.67 billion) from 15.8 trillion won in the same period a year earlier. Additionally, the company announced that geopolitical uncertainties are likely to dampen demand until late 2023, as the global economic downturn slashed appetite for electronic devices.

Today’s big data release will be the advance reading of Q3 GDP in the US and our economists preview the data drop here with a telling title “More trade tricks than growth treats.” After back-to-back negative readings earlier this year, the team sees today’s print at +3.0%, a solid rebound, on the back of strong net exports that could compensate for slowing demand. We will also get the quarterly core PCE, which should provide a clue to tomorrow’s September reading.

Other indicators released in the US will include durable goods orders and Kansas City Fed manufacturing activity index. In earnings, we will hear from Apple, Amazon, Mastercard, Samsung, Merck, Shell, McDonald’s, T-Mobile, Linde, TotalEnergies, Comcast, Honeywell, Intel, S&P Global, Caterpillar, AB InBev, American Tower, Gilead Sciences, EDF, Neste, STMicroelectronics, Shopify, PG&E, Repsol, EDP, Pinterest, First Solar, Credit Suisse, Deutsche Lufthansa, Hertz and Ubisoft. So a busy day with the ECB as well.

end

AND NOW NEWSQUAWK (EUROPE/REPORT)

Mixed trade with drivers limited, USD/JPY eases and Yuan pares gains; ECB ahead – Newsquawk Euro Market Open

Newsquawk Logo

THURSDAY, OCT 27, 2022 – 01:51 AM

  • APAC stocks traded mixed following a similar lead from Wall Street and amid a lack of fresh fundamental drivers overnight
  • DXY edged high, USD/JPY tested 146 to the downside, and the Yuan pared back some recent gains
  • UK PM Sunak is reconsidering tax rises as an improving economic picture means the PM is examining whether some of the sweeping measures can be watered down, according to The Telegraph
  • European equity futures saw modest losses across the board overnight; Euro Stoxx 50 -0.3% after cash markets closed +0.6%.
  • Looking ahead, highlights include  German GfK, ECB Announcement and President Lagarde’s Press Conference, US Quarterly PCE Advance, GDP Advance and Durable Goods, supply from the US
  • Earnings from Amazon, Apple, Intel, Caterpillar, McDonalds, Gilead, AB InBev, Credit Suisse, Deutsche Lufthansa, and more.

View the full premarket movers and news report. 

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

US TRADE

  • US stocks closed mixed in which the SPX and NDX saw losses led by tech, whilst the DJIA closed flat and the Russell 2k held onto modest strength.
  • SPX -0.74% at 3,830, NDX -2.26% at 11,405, DJIA +0.01% at 31,840, RUT +0.46% at 1,804.
  • Click here for a detailed summary.

NOTABLE HEADLINES

  • Meta Platforms Inc (META) Q3 2022 (USD): EPS 1.64 (exp. 1.88), Revenue 27.71bln (exp. 27.38bln). Facebook DAUs 1.98bln (exp. 1.86bln). Facebook MAUs 2.96bln (exp. 2.97bln). META average price per ad -18% (exp. -15.3%). Co. said it faces near-term challenges on revenue, and sees reality labs op losses in 2023 significantly higher. CFO said revenue from large advertisers remain challenged, while revenue among smaller advertisers remain more resilient. Shares fell 19% after-market.
  • Ford Motor Co (F) Q3 2022 (USD): EPS -0.21 (exp. 0.27), Revenue 39.4bln (exp. 36.25bln); Raises FY22 FCF outlook to 9.5-10bln (prev. 5.5-6.5bln); sees FY adj. EBIT around USD 11.5bln (prev. 11.5-12.5bln). Shares fell 0.9% after-market.
  • Pfizer (PFE) is reportedly being probed in Italy over allegedly hiding USD 1.2bln in profits, according to Bloomberg.
  • Tesla (TSLA) faces US criminal probe over its autopilot technology; US DoJ probe involves co. claims that Tesla cars can drive themselves with its autopilot activated, according to Reuters sources.
  • Twitter (TWTR) is set to be delisted from the NYSE effective on Friday, according to a notice. Banks have started to send USD 13bln in cash backing Elon Musk’s takeover of Twitter (TWTR), according to WSJ sources. Elon Musk told Twitter (TWTR) employees that he does not plan to cut 75% of jobs, according to Bloomberg.

DATA RECAP

  • Atlanta Fed GDPNow Model (Q3): 3.1% (prev. 2.9%)

APAC TRADE

EQUITIES

  • APAC stocks traded mixed following a similar lead from Wall Street and amid a lack of fresh fundamental drivers overnight.
  • ASX 200 was supported by gains across its commodities-related sectors, whilst financials lagged after ANZ Bank shed over 3% post-earnings.
  • Nikkei 225 was in the red as exporters were pressured by the recent firming in the Japanese currency against the Dollar.
  • KOSPI saw gains across its energy, industrial, and IT names, whilst Samsung Electronics saw choppy trade after earnings before stabilising in the green.
  • Hang Seng outperformed and the Hang Seng Tech index also surged following the recent selling – the gains were driven by Alibaba and JD.com.
  • Shanghai Comp was firmer at the open but gains fizzled out, whilst the PBoC injected another CNY +200bln via 7-day reverse repo for a third straight session.
  • US equity futures saw two-way action after the bell as Meta initially rose some 8% following a revenue beat, but then fell as much as 20% as the group flagged near-term challenges to revenue. At the re-open, futures were flat/slightly lower but have since moved into modest positive territory across the board.
  • European equity futures saw modest losses across the board overnight; with the Euro Stoxx 50 -0.3% after cash markets closed +0.6%.
  • Click here for a detailed summary.

FX

  • DXY edged higher overnight but remained under 110.00 after falling from its 111.13 peak yesterday.
  • USD/JPY breached 146.00 to the downside after probing the level throughout the first half of the APAC session.
  • GBP/USD was the early outperformer with The Telegraph reporting that UK PM Sunak is reconsidering tax rises as an improving economic picture means the PM is examining whether some of the sweeping measures can be watered down.
  • EUR/USD held onto gains above parity as the DXY remained under 110.00 and with traders looking ahead to Thursday’s ECB announcement.
  • AUD/USD was relatively flat and among the underperformers despite Westpac’s Evans now forecasting a 50bp rate hike from the RBA next week (vs market expectations for 25bps hike).
  • NZD/USD failed to top the 0.5850 level but AUD/NZD stayed above 1.1100.
  • CNH was on a weaker footing with USD/CNH retracing some recent downside, whilst PBoC’s Yuan fix was largely in-line with expectations.
  • PBoC set USD/CNY mid-point at 7.1570 vs exp. 7.1573 (prev. 7.1638)
  • South African Finance Minister is confident it can come up with Eskom debt transfer plan by the February budget, via Reuters.
  • Click here for a detailed summary.

FIXED INCOME

  • 10yr UST futures resumed trade flat after Treasuries bull-flattened on Wednesday with weak tech earnings and a dovish BoC supporting the complex.
  • Bund futures were similarly flat awaiting the latest ECB policy decision on Thursday.
  • 10yr JGB futures were uneventful with the corresponding yield around 0.25%.
  • Click here for a detailed summary.

COMMODITIES

  • Crude futures consolidated following yesterday’s Dollar-driven upside, with news flow for the complex light overnight, with WTI Dec and Brent Jan around USD 88/bbl and USD 94/bbl respectively.
  • Biden admin reportedly reviewing plans for a Russian oil price cap, according to Bloomberg citing sources. Under earlier plans, a price cap in the range of USD 40-60/bbl was mulled, but sources suggested discussions involve a cap at the higher end of that range and above. No decision is expected before the US mid-term elections.
  • Spot gold was flat and traded above USD 1,650/oz, with the yellow metal on either side of its 21 DMA (1,667.96/oz).
  • Copper consolidated following the prior day’s Dollar-induced gains.
  • Click here for a detailed summary.

CRYPTO

  • Crypto markets were flat/mixed with Bitcoin staying above USD 20,500, whilst Ethereum held onto a USD 1,500-handle.

NOTABLE HEADLINES

  • Samsung Electronics (005380 KS) – Q3 2022 (KRW): Revenue 76.8tln (Co. exp. 76tln), Net profit 9.4tln (exp. 7.9tln), expects H2 2023 recovery in memory chips focused on servers and mobile; expect tech and memory chip demand to remain weak in Q4. Q3 Consolidated Net 9.14tln (exp. 9.43tln). Co. expects tech and memory chip demand to remain weak in Q4. Q4 demand for smartphones and wearables is forecast to increase Q/Q; 2023 demand for smartphones and wearables is expected to grow. (Newswires)
  • Japan is eyeing in excess of JPY 29tln in government spending on stimulus, according to NHK.
  • PBoC injected CNY 240bln via 7-day reverse repos at a maintained rate 2.00% for a daily injection of CNY 238bln.

DATA RECAP

  • South Korean GDP Growth YY Advance (Q3) 3.1% vs. Exp. 2.8% (Prev. 2.9%)
  • South Korean GDP Growth QQ Advance (Q3) 0.3% vs. Exp. 0.1% (Prev. 0.7%)
  • Australian Import Prices (Q3) 3.0% (Prev. 4.3%)
  • Australian Export Prices (Q3) -3.6% (Prev. 10.1%)

GEOPOLITICS

RUSSIA-UKRAINE

  • US has accelerated the fielding of a more accurate version of its mainstay nuclear bomb to NATO bases in Europe, according to a US diplomatic cable and two people familiar with the issue, via Politico

OTHER

  • US Secretary of State Blinken said it has taken note of Saudi Arabia’s aid to Ukraine and UN vote against Russia’s annexations and added that the actions do not compensate for OPEC+ decision to cut production, via Reuters.
  • Chinese President Xi said, “the Chinese and American peoples have many things in common, and can become good friends and partners for mutually beneficial cooperation.”, according to CCTV

CENTRAL BANKS

  • RBNZ Governor Orr said New Zealand is relatively well positioned, but inflation is still too high in an absolute sense; has eyes firmly focused on meeting inflation target, via Reuters.
  • Westpac’s Evans is forecasting a 50bp rate hike from the RBA next week (vs market expectations for 25bps hike).
  • Banxico Deputy Governor Esquivel said the central bank should begin thinking about ending the rate-hiking cycle and what ceiling will be compatible with a restrictive enough level; cautions against hiking monetary policy rate to excessively restrictive level amid weak economy, via Reuters.
  • Brazilian Selic Interest Rate 13.75% vs. Exp. 13.75% (Prev. 13.75%). BCB will not hesitate to resume the tightening cycle if the disinflationary process does not proceed as expected; it will stay vigilant, and policy can be adjusted, via Reuters and Bloomberg.
  • International Capital Market Association (ICMA) body urged the ECB to ease the collateral shortage in repo markets, warning of “rising dysfunction” in money markets, according to FT citing letter and ICMA members.

EU/UK

NOTABLE EU/UK HEADLINES

  • UK PM Sunak is reconsidering tax rises as an improving economic picture means the PM is examining whether some of the sweeping measures can be watered down, according to The Telegraph.
  • German government gas relief payment for consumers to cost EUR 12bln and to be paid out in December this year; gas relief payment to apply for consumers below annual consumption of 1.5mln KWh, according to a draft cited by Reuters.

i)THURSDAY MORNING// WEDNESDAY  NIGHT

SHANGHAI CLOSED DOWN 16.60 PTS OR 0.55%   //Hang Seng CLOSED UP 110.27 OR 0.72%    /The Nikkei closed DOWN 36.60 PTS OR 0.32%          //Australia’s all ordinaires CLOSED UP 0.53%   /Chinese yuan (ONSHORE) closed DOWN TO 7.2286 //OFFSHORE CHINESE YUAN DOWN 7.2493//    /Oil UP TO 88.17 dollars per barrel for WTI and BRENT AT 95.96    / Stocks in Europe OPENED ALL RED.        ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN  TRADING WEAKER AGAINST US DOLLAR/OFFSHORE WEAKER

2 a./NORTH KOREA/ SOUTH KOREA/

///NORTH KOREA/SOUTH KOREA/

end

2B JAPAN

end

3c CHINA

CHINA/

end 

4.EUROPEAN AFFAIRS//UK AFFAIRS

ECB

As expected, the ECB reluctantly raised their interest rate 75 basis points and promises to raise further.  The decision to raise will be decided on a meeting by meeting basis. They also change the TLTRO terms

(zerohedge)

ECB Hikes 75bps As Expected And Will “Raise Further” Deciding “Meeting-By-Meeting”, Changes TLTRO Terms

THURSDAY, OCT 27, 2022 – 08:28 AM

As expected (and previewed), moments ago the ECB hiked rates by 75bps as expected, pushing the Deposit rate to 1.50%, the highest since 2008. The Refi rate was also rised by 75bps to 2.00%, all as expected.

In keeping with the hawkish bias even as the eurozone slides into a deep recession, the ECB guided that “the Governing Council took today’s decision, and expects to raise interest rates further, to ensure the timely return of inflation to its 2% medium-term inflation target. The Governing Council will base the future policy rate path on the evolving outlook for inflation and the economy, following its meeting-by-meeting approach.”

But it was a potentially dovish move observed by some, the ECB dropped the language surrounding “several” rate hikes in the future. This is the current language:

With this third major policy rate increase in a row, the Governing Council has made substantial progress in withdrawing monetary policy accommodation. The Governing Council took today’s decision, and expects to raise interest rates further, to ensure the timely return of inflation to its 2% medium-term inflation target. The Governing Council will base the future policy rate path on the evolving outlook for inflation and the economy, following its meeting-by-meeting approach.

And this was the language from the previous meeting:

Based on its current assessment, over the next several meetings the Governing Council expects to raise interest rates further to dampen demand and guard against the risk of a persistent upward shift in inflation expectations. The Governing Council will regularly re-evaluate its policy path in light of incoming information and the evolving inflation outlook. The Governing Council’s future policy rate decisions will continue to be data-dependent and follow a meeting-by-meeting approach.

Notably, and also as some had expected, the ECB also changed the terms and conditions of the third series of targeted longer-term refinancing operations (TLTRO III).

  • From 23 November 2022 until the maturity date or early repayment date of each respective outstanding TLTRO III operation, the interest rate on TLTRO III operations will be indexed to the average applicable key ECB interest rates over this period
  • In view of the unexpected and extraordinary rise in inflation, it needs to be recalibrated to ensure that it is consistent with the broader monetary policy normalisation process and to reinforce the transmission of policy rate increases to bank lending conditions.
  • The Governing Council therefore decided to adjust the interest rates applicable to TLTRO III from 23 November 2022 and to offer banks additional voluntary early repayment dates.
  • In order to align the remuneration of minimum reserves held by credit institutions with the Eurosystem more closely with money market conditions, the Governing Council decided to set the remuneration of minimum reserves at the ECB’s deposit facility rate (prev. 0.50%).
  • The details of the changes to the TLTRO III terms and conditions are described in a separate press release to be published at 15:45 CET Another technical press release, detailing the change to the remuneration of minimum reserves, will also be published at 15:45 CET.

Some more details from the report on inflation and QE:

  • Inflation:  Inflation remains far too high and will stay above the target for an extended period
  • QE: The Governing Council will continue applying flexibility in reinvesting redemptions coming due in the PEPP portfolio, with a view to countering risks to the monetary policy transmission mechanism related to the pandemic.

Full ECB statement below

The Governing Council today decided to raise the three key ECB interest rates by 75 basis points. With this third major policy rate increase in a row, the Governing Council has made substantial progress in withdrawing monetary policy accommodation. The Governing Council took today’s decision, and expects to raise interest rates further, to ensure the timely return of inflation to its 2% medium-term inflation target. The Governing Council will base the future policy rate path on the evolving outlook for inflation and the economy, following its meeting-by-meeting approach.

Inflation remains far too high and will stay above the target for an extended period. In September, euro area inflation reached 9.9%. In recent months, soaring energy and food prices, supply bottlenecks and the post-pandemic recovery in demand have led to a broadening of price pressures and an increase in inflation. The Governing Council’s monetary policy is aimed at reducing support for demand and guarding against the risk of a persistent upward shift in inflation expectations.

The Governing Council also decided to change the terms and conditions of the third series of targeted longer-term refinancing operations (TLTRO III). During the acute phase of the pandemic, this instrument played a key role in countering downside risks to price stability. Today, in view of the unexpected and extraordinary rise in inflation, it needs to be recalibrated to ensure that it is consistent with the broader monetary policy normalisation process and to reinforce the transmission of policy rate increases to bank lending conditions. The Governing Council therefore decided to adjust the interest rates applicable to TLTRO III from 23 November 2022 and to offer banks additional voluntary early repayment dates.

Finally, in order to align the remuneration of minimum reserves held by credit institutions with the Eurosystem more closely with money market conditions, the Governing Council decided to set the remuneration of minimum reserves at the ECB’s deposit facility rate.

The details of the changes to the TLTRO III terms and conditions are described in a separate press release to be published at 15:45 CET. Another technical press release, detailing the change to the remuneration of minimum reserves, will also be published at 15:45 CET.

Key ECB interest rates
The Governing Council decided to raise the three key ECB interest rates by 75 basis points. Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be increased to 2.00%, 2.25% and 1.50% respectively, with effect from 2 November 2022.

Asset purchase programme (APP) and pandemic emergency purchase programme (PEPP)
The Governing Council intends to continue reinvesting, in full, the principal payments from maturing securities purchased under the APP for an extended period of time past the date when it started raising the key ECB interest rates and, in any case, for as long as necessary to maintain ample liquidity conditions and an appropriate monetary policy stance.

As concerns the PEPP, the Governing Council intends to reinvest the principal payments from maturing securities purchased under the programme until at least the end of 2024. In any case, the future roll-off of the PEPP portfolio will be managed to avoid interference with the appropriate monetary policy stance.

The Governing Council will continue applying flexibility in reinvesting redemptions coming due in the PEPP portfolio, with a view to countering risks to the monetary policy transmission mechanism related to the pandemic.

Refinancing operations
The Governing Council decided to adjust the interest rates applicable to TLTRO III. From 23 November 2022 until the maturity date or early repayment date of each respective outstanding TLTRO III operation, the interest rate on TLTRO III operations will be indexed to the average applicable key ECB interest rates over this period. The Governing Council also decided to offer banks additional voluntary early repayment dates. In any case, the Governing Council will regularly assess how targeted lending operations are contributing to its monetary policy stance.

***

The Governing Council stands ready to adjust all of its instruments within its mandate to ensure that inflation stabilises at its 2% target over the medium term. The Transmission Protection Instrument is available to counter unwarranted, disorderly market dynamics that pose a serious threat to the transmission of monetary policy across all euro area countries, thus allowing the Governing Council to more effectively deliver on its price stability mandate.

The President of the ECB will comment on the considerations underlying these decisions at a press conference starting at 14:45 CET today.

And a redline comparison with the previous announcement:

In kneejerk response to the announcement, the EURO – which had spiked over the past 48 hours – slid back to parity with the USD.

end

/EUROPE//HEINEKEN

Heineken stock plunges as cost of living crisis in Europe hammers drinkers

(zerohedge) 

Heineken Pukes As Cost-Of-Living Crisis Hammers Drinkers

THURSDAY, OCT 27, 2022 – 05:45 AM

Dutch brewer Heineken NV shares plunged after third-quarter beer sales missed, suggesting there are signs of waning consumer demand in Europe amid the worst inflation environment in decades. 

Bloomberg reported that the world’s second-largest brewer fell as much as 10% in Amsterdam trading, the most since 2003, after 3Q beer volumes grew by 8.9%, missing the 11.8% average analyst estimate. 

“We increasingly see reasons to be cautious on the macroeconomic outlook, including some signs of softness in consumer demand,” CEO Officer Dolf van den Brink said Wednesday. 

Heineken warned there are emerging “signs of demand slowdown at the end of September and into October” across Europe. It reported a 68% increase in beer sales in the Asia-Pacific region for the quarter. 

The brewer managed to cushion margins this year by hiking prices to match inflation, though rising prices have created demand destruction in some parts of the world where there’s a cost-of-living crisis. 

Heineken said it maintained its full-year outlook for operating margin to be stable for this year. However, there was no update to a 2023 forecast issued in August that operating profit would increase by a mid to high single-digit percentage. 

Here’s what Wall Street analysts are saying about Heineken (list courtesy of Bloomberg): 

Citi (buy), in a note, refers to a disappointing 3Q, expecting Heineken shares to be weaker today 

  • Analyst Simon Hales writes that “worryingly, although the CEO reiterated guidance metrics for 2022, he has not confirmed the 2023 guidance range laid out at the H1 results” 

RBC (underperform) analysts led by James Edwardes Jones, in a note, say they were surprised to see Heineken miss expectations “quite so dramatically”

  • Notes that volume growth and revenue per hectoliter were disappointing

Morgan Stanley (equal weight) says while the weakening consumer demand in Europe shouldn’t come as a surprise, “demand seems to be deteriorating faster than what most investors had expected” 

  • Analyst Pinar Ergun writes that this increases downside risks to Heineken’s 2023 estimated earnings, owing to its more premium portfolio and more profitable on-trade exposure, according to a note

END

SWITZERLAND//CREDIT SUISSE

Credit Suisse stock is hammered on dilution concerns.  The 9,000 layoffs did not help either

(zerohedge)

Credit Suisse Reveals “Radical Overhaul,” Shares Plunge On Dilution Concerns, 9,000 Layoffs

THURSDAY, OCT 27, 2022 – 07:39 AM

While there has been much speculation Credit Suisse Group AG could be the next Lehman — the 2nd largest Swiss bank, desperate for billions of dollars in fresh capital, has unveiled a restructuring plan: multi-billion dollar capital raise, thousands of job cuts, and plans to spinout its investment bank. 

Bloomberg reports CS plans to raise $4.1 billion through a rights issue and sell shares to investors, such as Saudi National Bank (with a proposed stake of 9.9%). CS will spin off its investment bank unit, separating the advisory and capital markets units, while most of its securitized products group will be sold to Apollo Global Management Inc. and Pacific Investment Management Co. We noted CS was nearing a deal to sell its SPG business on Wednesday. 

Under this structure of spinning off its capital markets, advisory and leveraged finance business in a new entity called CS First Boston. Reuters said sources familiar with the matter expect the Swiss firm to IPO CS First Boston. CS will still maintain a large stake in CS First Boston but, over time, will wind down its position. 

CS First Boston will concentrate on US equities in a “capital-light” business to support domestic and foreign clients. The new headquarters will be in NYC, and Michael Klein, a current member of CS’ board of directors, will soon step down and become CEO of CS First Boston.  

“The new Credit Suisse will definitely be profitable from 2024 onwards,” CEO Ulrich Koerner said in an interview with Bloomberg Television. “We do not want to over promise and under deliver, we want to do it the other way around.”

Here’s what the new CS will look like…

CS’ structure in detail will be in place at the start of the new year.

Details of the restructuring frightened investors in Zurich as shares plunged as much as 12% on the idea of restructuring costs and the dilution effect of the share sales. 

The urgent overhaul comes as CS attempts to restore credibility after huge losses and mismanagement that has destroyed its image as one of Europe’s top banks. 

Last month, CS breached liquidy requirements when depositors quickly pulled out money on rising default risks. This caused credit default swap levels to blow out to record highs. The good news is the CS 5YR CDS has declined below 2008 GFC levels but remains elevated. 

CS equity has declined for nearly two years after a series of bad news. Shares topped out in early 2021 at around 13.50 Swiss francs and have since fallen 74%. 

There was also talk CS will begin to reduce 2,700 jobs this quarter and shrink the overall workforce by 9,000 to 43,000 by 2025.

Here’s what analysts on Wall Street are saying about the restructuring plan:

JPM analyst Kian Abouhossein (neutral) says restructuring is in the right direction but was hoping for more

  • Says banks seems to want to put a line under concerns of wealth management clients, counterparty worries
  • Says the dilutive capital raise impacts the long-term return on tangible equity generation

Citi’s Andrew Coombs (buy, CHF 6) says dilution is disappointing but was widely expected 

  • Adds that his main concern is the low return on equity target for 2025, which “appears to lack ambition”
  • Writes part of the rationale for re-allocating capital is to drive a re-rating, but this can only go so far if the return prospects remain this low
  • The stock appears cheap, even post dilution, but there’s likely to be significant execution risk in the coming month; reiterates this remains a “high risk” investment

ZKB analyst Christian Schmidiger (market perform) says the focus is clearly on the strategic realignment, which should meet market expectations with a relatively strong reduction in the Investment Bank 

  • The capital increase of CHF4 bn was anticipated by the market 
  • Views the plans outlined as positive, but notes questions about financing and certain implementation risks remain

end

SWITZERLAND/CREDIT SUISSE//LATE AFTERNOON

Huge liquidity problems surfacing at Credit Suisse as we told you.  They are contemplating a looming bankruptcy restructuring

This will blow up the derivatives. Grab your gold.

(zerohedge0

Credit Suisse Crashes Most Ever After Admitting It Suffered A Bank Run And Breached Liquidity Requirements

THURSDAY, OCT 27, 2022 – 02:00 PM

Two weeks ago, the NYT mocked “amateur investors” for piling up in a historic, “meme” short bet against the troubled Swiss bank Credit Suisse, which it argued was nowhere near as distressed as rumors suggested and when discussing the violent plunge in the stock price said that “the timing puzzled the bank’s analysts, major investors and risk managers. Credit Suisse had longstanding problems, but no sudden crisis or looming bankruptcy.”

Well, in retrospect it did, because as today’s shocking “radical overhaul” by Credit Suisse – which included massive layoffs, new equity injection, a strategic outside investors (apparently Saudi money talks and fake woke anger about Jamal Khashoggi walks), and a complete business restructuring – showed, the second largest Swiss Bank was indeed on the brink.

And it wasn’t just on the brink of insolvency: as Bloomberg today also reports, the (former) Swiss banking giant, was this close to a liquidity crisis too!

On Thursday, Credit Suisse said one or more of its units breached liquidity requirements this month when depositors pulled their money amid speculation about the lender’s turnaround plan.

Translation: the bank admits it suffered a bank run, something which the NYT shoudl have been reporting on instead of mocking all those who were shorting the bank to oblivion… and as we now learn, with justification.

According to a bank statement, the withdrawals were triggered by “negative press and social media coverage based on incorrect rumors” and made worse because the bank had limited its access to debt markets in the weeks before it unveiled its restructuring plan. Liquidity and funding ratios for the group as a whole have been maintained at all times.

But… but… how is it “incorrect rumors” if the Swiss bank ended up having a bank run, the very thing said rumors were warning about.

Circular sarcasm aside, we appreciate the bank’s “explanation” but if all it took to put a giant bank out of business was “negative press and social media coverage” then not a single bank would exist today. Which begs the question: why is Credit Suisse once again prevaricating, especially since it just admitted its entire former business model was just hours away from total collapse.

“These outflows have partially utilized liquidity buffers at the group level and legal entity level, and we have fallen below certain legal entity-level regulatory requirements,” the bank said.

Sorry, bank, but if all it takes for your liquidity to fall below legal regulatory requirements are a few tweets, then you probably shouldn’t exist in the first place. Which, incidentally, is the hard lesson that those who believed the NYT and bought the stock – because, you see, it was all meme traders’ fault – are learning today: the Swiss stock just tumbled the most on record.

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

END

>

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

Vaccine//Covid issues:

GLOBAL ISSUES//FREIGHT

Does not look good for the global freight industry

(Fuller/Freightwaves)

The Freight Industry Is Looking At A “Very, Very Ugly” End Of 2022

THURSDAY, OCT 27, 2022 – 06:30 AM

By Craig Fuller, CEO of FreightWaves

For freight companies, this year’s peak will be weak

Peak season, an annual event in the freight industry, serves as the most important season in the calendar for many transportation firms. Depending on mode, peak season kicks off at different points on the calendar, mostly based around the role in the supply chain that a freight provider plays in ensuring that retail goods are on the shelves for the holidays. 

Peak season by mode: 

  • Ocean container: July through September 
  • Trucking and rail intermodal: October through December 15th
  • Parcel: Black Friday through December 24th

With the peak season already completed in ocean freight, we can say with certainty that this year’s peak season will be incredibly weak.

Back in June, FreightWaves reported that ocean container volumes were dropping quickly, based on data found in SONAR’s Container Atlas, which tracks bookings volumes at the point of origin. By tracking point of origin bookings, we get an advanced look at import volumes months before those containers hit U.S. ports. At the time of publication, we believed that the contraction in volumes would happen at U.S. ports by July, but we underestimated how long it would take to clear the backlog of containerships off major U.S. ports and then waiting to clear U.S. Customs. 

In August, it appeared that FreightWaves’ warning was unwarranted, at least looking only at U.S. customs import volume data. That data showed the market was relatively stable and hadn’t contracted. 

But maritime spot rates and container shipping lines’ actions told a completely different story.

Ocean spot rates and imports fell off a cliff this year

First, we saw container rates collapse – suggesting that carriers were rapidly losing pricing power. When we published our June piece, the cost to ship a 40-foot container from China to the U.S. West Coast was $9,630. Today the same container would be transported for $2,470 – 74% lower than just a few months ago. This happened in a backdrop of a significant number of “blank sailings” by container ship lines. The container lines will cancel voyages to pull capacity out of the market.

According to Sea-Intelligence, container lines have canceled more than quarter of sailings across the Pacific in recent weeks. 

Freight transportation is a commodity and responds to the laws of supply and demand. The collapse in container rates reflected volumes that were quickly deteriorating. 

By September, the slowdown in container import volumes was becoming too significant to dismiss, even for the most hardened skeptic. The Port of Los Angeles reported that it handled the fewest number of loaded import containers for the month of September since the Great Financial Crisis (2009). The Port of Los Angeles is the largest port in the United States. 

Weak import volumes weren’t just limited to Los Angeles, but affected all the major West Coast ports. Long Beach posted the lowest September loaded imports since 2016; Seattle/ Tacoma had its worst September for loaded imports in seven years. The decline in volumes will take longer to hit East Coast ports, but it’s already starting – September was Savannah’s weakest month this year for loaded imports, down 9.8% year-over-year.

With an estimated 75% of U.S. container imports related to consumer activity, a sharp drop in volume provides an ominous warning for any mode of transportation that is further downstream and closer to the point of consumption.

How the trucking turndown materialized 

The trucking industry has been struggling since the first quarter. FreightWaves predicted that a freight recession was imminent, based on the drop in truckload volumes and tender rejections in the first quarter. 

The SONAR Outbound Tender Volume Index (OTVI) measures truckload load requests from shippers to carriers, moving under contract rates. From the start of February to the end of March, it dropped by 12%. 

The volume drop continued in April and May, with OTVI registering another 2.5% decline, but stabilized in June in conjunction with the summer construction, beverage, and produce shipping seasons. In June, the OTVI index registered an increase of 1%.Trucks at docks. (Photo: Shutterstock)

A stable June provided some confidence to carrier executives that the slowdown in the earlier part of the year was just a cooling of volumes from the inflated levels of the COVID economy.

Unfortunately, the optimism at the end of June was short-lived and proved to be an anomaly in a disappointing year.  

The OTVI index dropped by 8% in the third quarter, with the majority of this drop  occurring in the last two weeks of September. The decline has continued into October, with OTVI dropping an additional 3%.

The reality of the market deterioration is starting to set in across all trucking fleets. During the publicly traded trucking companies’ third quarter conference calls executives talked about how muted they expected the peak to be.

Trucking executives are wary

Here were some of the notes (quotes and other market commentary) from the early earnings reports and calls from the trucking industry. 

Knight-Swift – the largest truckload carrier in the U.S.

CFO Adam Miller: “It’s rare that you go into a fourth quarter and not see some type of seasonal uplift and projects and spot opportunities. Especially with companies of our scale, we typically get some of these large, kind of difficult projects to handle and they typically pay a premium; … none of that stuff materialized.”

CEO David Jackson: “Anecdotally, we hear from those that have receivables with small carriers, and it has turned ugly very, very quickly for them,” Jackson said. “The pressures just continue to mount. I wouldn’t be surprised if there aren’t many small carriers that were just holding out hope for a strong fourth quarter to bail them out of a tougher summer with no spot [freight].”

Landstar  – one of the largest truckload carriers, largely made up of a network of small franchise operators: 

President and CEO Jim Gattoni on customer expectations: “Everybody’s [indicating a] flat to a soft, muted peak season. Since our July call, I would say things have clearly softened up compared to the anticipation of a better peak season.”

J.B. Hunt  – the largest surface transportation company in the U.S., with significant operations in intermodal, dedicated, truckload and brokerage:

CEO John Roberts: “Further evidence has presented itself over the course of the quarter that requires an increased level of caution and awareness on broader demand trends and economic activity.”

Head of intermodal Darren Field: “Peak season this year just doesn’t appear to be much of an event, although the company is taking market share.”

Covenant Logistics – a large expedited and dedicated truckload carrier:

CEO David Parker: “As we look toward 2023, we anticipate a difficult freight environment coupled with cost inflation, which will pressure margins.”

Triumph Bank – one of the largest providers of banking, factoring, and payment services to the trucking industry

CEO Aaron Graft on factoring (i.e., short-term trade finance): “The decline in freight rates is starting to show up at TBC. September’s gross revenue was $17.2 million, 8.2% less than a year ago. October is already tracking down 19% from a year ago.”

Retailers command trucking by the fourth quarter

In the context of understanding the trucking calendar and sharp decline in container volumes, the slowdown makes sense. Retail has an outsized impact on the fourth quarter trucking market. Even in a good year, construction, agriculture, and beverage volumes slow down in the fourth quarter significantly. Retail becomes king. 

Retailers have nearly all of the products they need in their distribution networks for the holidays (and then some), which means that there won’t be a lot of freight demand as we head into the last two months of the year.

In recent quarters, retailers have talked about how much inventory they are carrying. This holiday season, they will be focused on burning that inventory down – potentially through aggressive discounting and promotions. 

As firms get more nervous about the broader economy heading into 2023, there is little incentive to replenish bloated inventories. This is bad news for most freight companies as they will find far fewer load opportunities. 

While the timing of when the freight recession started will be hotly debated, carriers from the weakest spot participants to the best run are starting to realize that peak will be very weak. 

To borrow a phrase from Mish Shedlock, author of the macro-economics blog, Mishtalk, whether we are in a recession or headed for one, the question is moot.

PAUL ALEXANDER

Raw et al.: “Previous COVID-19 infection but not Long-COVID associated with increased adverse events after Pfizer vaccination”; to layer COVID vaccine on recovered immunity is not good; see Krammer

Prior COVID-19 infection but not ongoing Long-COVID symptoms were associated with an increase in the risk of self-reported adverse events following BNT162b2/Pfizer vaccination.

DR. PAUL ALEXANDEROCT 27
 
▷  LISTENSAVE
 

“Prior COVID-19 infection but not ongoing Long-COVID symptoms were associated with an increase in the risk of self-reported adverse events following BNT162b2/Pfizer vaccination.”

SOURCE 1:

Open in app or online

Still birth danger signal: “Danger Signal’: Leaked Hospital Email Reports Increase in Stillbirths, COVID-19 Vaccine Suspected”

An email recently shared with The Epoch Times that was sent out to the healthcare staff of a hospital system in Fresno, California, reported an increase in “demise patients,” or stillbirths

DR. PAUL ALEXANDEROCT 27
 
▷  LISTENSAVE
 

Matt McGregor is author at EPOCH

end

Bivalent booster has FAILED and new study shows this, simple, yet potent original antigenic sin; “Antibody responses to Omicron BA.4/BA.5 bivalent mRNA vaccine booster shot”, Wang et al. PRE-PRINT

Those with 3 shots alone and then infection seemed to have higher antibody levels than those with boosters (see extreme two right sided graphs); bivalent boosters yields the lowest antibody response

DR. PAUL ALEXANDEROCT 27
 
▷  LISTENSAVE
 

Wang et al.: Antibody responses to Omicron BA.4/BA.5 bivalent mRNA vaccine booster shot

By looking at the graphs below, those with the 3 shots alone and then infection seemed to have higher antibody levels than those with boosters (see A extreme left compared to two right sided graphs).

It appears on these graphs (row A) that the bivalent boosters yields the lowest antibody responses and someone should tell that to POTUS Biden.

If you also look closely at the lower left side of each graph, at all 4, you see the antibody levels (antibody surge) for the D614G initial strain (Wuhan and some initial mutation) much more elevated and this makes complete sense given the potent role of original antigenic sin (mortal antigenic sin) with immune fixation, immune priming, prejudicing of the immune response based on the initial prime or exposure. Bottom line, the new bivalent boosters are near dead on arrival (DOA), does not work effectively. It is done and there will be re-infections and we fear antibody dependent enhancement of disease.

We must pray that our prediction of more infectious variants (due to mounting immune selection pressure) do not emerge whereby a sub-variant is also highly virulent/lethal due to the sub-optimal immune pressure placed on viral virulence (non-neutralizing vaccinal antibodies placing pressure on the N-terminal domain (viral virulence); this can lead to the virus (variants) overcoming the pressure and selecting for variants that cause severe disease in the lower distal lung. The present enhanced infectiousness (URT) we are seeing in the vaccinee can also evolve to enhanced severe illness (LRT) if selected variants can overcome the present blocking (via non-neutralizing vaccinal antibodies) of severe illness in the lower lung.

“At ~3-5 weeks post booster shot, individuals who received a fourth vaccine dose with a bivalent mRNA vaccine targeting BA.4/BA.5 had similar neutralizing antibody titers as those receiving a fourth monovalent mRNA vaccine against all SARS-CoV-2 variants tested, including BA.4/BA.5.”

The graphs (the 2 right-sided graphs) basically show that the new bivalent is useless. Adds nothing and actually by my visual interpretation, appears to confer far less protection.

(see top graphs, row A, the extreme right 2 graphs, 4 shots vs 3 shots plus bivalent booster)

“Those who received a fourth monovalent vaccine (2 initial doses plus 2 boosters) dose had a slightly higher neutralizing antibody titers than those who received the bivalent vaccine against three related sarbecoviruses: SARS-CoV, GD-Pangolin, and WIV1.” (see top graphs, row A, the extreme right 2 graphs, 4 shots vs 3 shots plus bivalent booster)

“When given as a fourth dose, a bivalent mRNA vaccine targeting Omicron BA.4/BA.5 and an ancestral SARS-CoV-2 strain did not induce superior neutralizing antibody responses in humans, at the time period tested, compared to the original monovalent vaccine formulation.” This is classic original antigenic sin with immune fixation and priming to the initial prime or exposure (vaccine or infection). The antibody titer response to the original strain is clearly greater. (see top graphs, row A, the extreme right 2 graphs, 4 shots vs 3 shots plus bivalent booster)

Open in app or online

STUNNING development: More WOMEN than MEN at risk for COVID vaccine induced myocarditis (3rd dose)? Research suggests here females more at risk than males! Idiosyncratic? Christian Eugen Mueller,Basel

Basel, Switzerland, cumulative distribution curve is alarming as fully shifted to the right beyond control & seems everyone regardless of gender has some elevated troponin (troponinemia, hs-cTnT)

DR. PAUL ALEXANDEROCT 27
 
▷  LISTENSAVE
 

‘Significant incidence of myocarditis after 3rd dose of anti-COVID 19 messenger RNA vaccine (author: Guillaume Le Pessec)’

This finding is opposite to what evidence had already accumulated with boys, males being usually at much more elevated risk, at a reported 9:1 ratio and this is very stunning. Is this idiosyncratic and thus a one-off? We need further data to unravel this gender differential to assess if it is stable or transitional.

end

I/we warned them, Geert told them: “Get ready for the TRIPLEDEMIC this winter: Children’s hospitals are overwhelmed by RSV, flu cases triple in a month & there are early signs of a Covid comeback”

This is because of 2 issues: i) Fauci, Birx, Francis Collins lockdown lunacy & their school closure lunacy & ii) if you inject young children, kids with these COVID jabs, you damage innate immunity

DR. PAUL ALEXANDEROCT 26
 
▷  LISTENSAVE
 

SOURCE:

Get ready for the TRIPLEDEMIC this winter: Children’s hospitals are overwhelmed by RSV, flu cases triple in a month and there are early signs of a Covid comeback

  • Data shows that cases of RSV, flu and Covid are now all starting to rise in the US
  • This is prompting fears of a ‘tripledemic’ hitting the health system this winter
  • Doctors warn that other viruses are returning ‘with a vengeance’ in the US
  • Immunity against them in the population has dropped raising infection risk 

VACCINE IMPACT/

The Myth that the Two Party Democrat vs. Republican Choices Bring Different Results Through “Elections”

October 26, 2022 5:45 pm

With national elections just days away now here in the United States, this is a good time to review the facts regarding the U.S. two-party system where during national elections the public heads to the polls, or votes via the mail, for either a Democrat or Republican candidate for elected office. The general belief among most who cast votes is that the United States is a “democratic” nation where “public servants” are elected by the people to serve their electorate in Washington D.C. in the House of Representatives and Senate (Congress), and as the President of the United States. However, this notion that the people of the United States choose their leaders who then determine public policy as a representative of their constituents, is a myth. It is actually quite easy to see that this popular belief is not a fact, but to see this truth one has to divorce themselves from their political belief system, and much like religious beliefs, very few people seem to be able to do so. When people hang on to a belief in an ideology, rather than objectively look at the facts and try to come to an unbiased opinion based on reason, they are open to manipulation by propaganda, and those who control the flow of information. For this system of perceived “democracy” to work where the masses are fooled into believing that they have some kind of control over how the country is run through the election process, there MUST be a two-party system, and two ONLY, and those two parties have to have a perceived opposition to each other on the “issues.” Because the one thing the Globalists who actually run the country fear the most, is a unified public where the masses wake up and discover that “the emperor has no clothes,” and instead of half the country fighting the other half, they join forces and fight the true enemies of the people: the Wall Street Billionaires and Bankers.

Read More…

end

VACCINE INJURY

MICHAEL EVERY//RABOBANK 

Michael Every on the major topics of the day

END

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

Interesting:  Kimani explains why Russian LNG exports to Europe exploded this summer despite the upcoming embargo in December

(Kimani/OilPrice.com)

Why Russian LNG Exports To Europe Exploded This Summer

THURSDAY, OCT 27, 2022 – 03:30 AM

By Alex Kimani of OilPrice.com

Whereas supplies of Russian pipeline gas–the bulk of Europe’s gas imports before the Ukraine war–are down to a trickle, Europe has been hungrily scooping up Russian LNG.

Europe has been working hard to wean itself off Russian energy commodities ever since the latter invaded Ukraine. The European Union has banned Russian coal and plans to block most Russian oil imports by the end of 2022 in a bid to deprive Moscow of an important source of revenue to wage its war in Ukraine.

But ditching Russian gas is proving to be more onerous than Europe would have hoped for. Whereas supplies of Russian pipeline gas–the bulk of Europe’s gas imports before the Ukraine war–are down to a trickle, Europe has been hungrily scooping up Russian LNG. The Wall Street Journal has reported that the bloc’s imports of Russian liquefied natural gas jumped by 41% Y/Y in the year through August.

Russian LNG has been the dark horse of the sanctions regime,” Maria Shagina, research fellow at the London-based International Institute for Strategic Studies, has told WSJ. Importers of Russian LNG to Europe have argued that the shipments are not covered by current EU sanctions and that buying LNG from Russia and other suppliers has helped keep European energy prices in check.

LNG Deluge

Maybe Europe’s LNG imports from Russia can be justified on a purely economic basis.

Natural gas prices in Europe have plunged over the past few weeks with CNBC reporting that a  “Wave of LNG tankers is overwhelming Europe in an energy crisis and hitting natural gas prices.” According to MarineTraffic via CNBC, 60 LNG tankers, or  ~10% of the LNG vessels in the world, are currently sailing or anchored around Northwest Europe, the Mediterranean, and the Iberian Peninsula. Such vessels are considered floating LNG storage since they cannot unload, something that is impacting the price of natural gas and freight rates.

It’s a fair bet that a good chunk of those vessels originated from the United States.

Europe’s natural gas demand has skyrocketed as the EU tries to lower its reliance on Russian natural gas following its invasion of Ukraine. Europe has displaced Asia as the top destination for the U.S. LNG, and now receives 65% of total exports. The EU has pledged to reduce its consumption of Russian natural gas by nearly two-thirds before the year’s end while Lithuania, Latvia and Estonia have vowed to eliminate Russian gas imports outright. Unlike pipeline gas, supercooled LNG is much more flexible and can be shipped from far-flung regions, including the U.S. and Qatar. 

Europe is not alone here. Shipping data has revealed that China has imported nearly 30% more gas from Russia so far this year, typically at a steep discount.

Thankfully, there’s a clear upside to imports of Russian LNG to Europe: the continent  has managed to fill its gas stores well ahead of schedule, with Reuter’s gas meter revealing that 93.8% of the EU gas storage is currently filled.

Financing Putin’s war machine

Still, it’s hard to argue that buying Russian LNG even in relatively small quantities is not playing a part in financing Putin’s war machine. Although Russian LNG has accounted for just 8% of the European Union and U.K.’s gas imports since the start of March, the trade runs counter to the EU’s efforts to deprive Russia of fossil-fuel revenue.

A lot of blame falls on Switzerland, with 80% of Russian raw materials traded via the Central European nation and its nearly 1,000 commodity firms. Switzerland is an important global financial hub with a thriving commodities sector despite the country being far from all the global trade routes and without access to the sea;  no former colonial territories and without any significant raw materials of its own. In fact, Oliver Classen, media officer at the Swiss NGO Public Eye, says that “this sector accounts for a much larger part of the GDP in Switzerland than tourism or the machinery industry.” According to a 2018 Swiss government report, commodity trading volume reaches almost $1 trillion ($903.8 billion). 

Deutsche Welle has reported that 80% of Russian raw materials are traded via Switzerland, according to a report by the Swiss embassy in Moscow. About a third of it are oil and gas while two-thirds are base metals such as zinc, copper and aluminum. In other words, deals signed on Swiss desks are directly facilitating Russian oil and gas to continue flowing freely.

This definitely is a big deal considering that gas and oil exports are the main source of income for Russia, accounting for 30 to 40% of the Russian budget. In 2021, Russian state corporations earned around $180 billion (€163 billion) from oil exports alone.

Again, unfortunately, Switzerland has been handling its commodities trade with kid gloves.

According to DW, raw materials are often traded directly between governments and via commodities exchanges. However, they can also be traded freely, and Swiss companies have specialized in direct sales thanks to an abundance of capital.

In raw materials transactions, Swiss commodity traders have adopted letters of credits or L/Cs as their prefered instruments. A bank will give a loan to a trader and as collateral receive a document making it the owner of the commodity. As soon as the buyer pays the bank, the document and thus ownership of the commodity are transferred to him/her. What this does, in effect, is grant traders more credit without checking their creditworthiness, while the banks get the commodity value as security.

This is a prime example of transit trade, where only the money flows through Switzerland but actual raw materials usually do not touch Swiss soil. Thus, no details about the magnitude of the transaction land on the desk of the Swiss customs authorities leading to highly imprecise information about the flow volumes of raw materials. 

The whole commodities trade is under-recorded and underregulated. You have to dig around to collect data and not all information is available,” Elisabeth Bürgi Bonanomi, a senior lecturer in law and sustainability at Bern University, has told DW.

Obviously, the lack of regulation is very appealing to commodity traders–especially those that deal with raw materials mined in non-democratic countries such as the DRC.

 “Unlike the financial market, where there are rules for tackling money laundering and illegal or illegitimate financial flows, and a financial market supervisory authority, there is currently no such thing for commodity trading,” financial and legal expert at Public Eye David Mühlemann told the German broadcaster ARD.

But don’t expect things to change any time soon.

Calls for a supervisory body for the commodities sector based on the model of the one for the financial market by the likes of Swiss NGO Public Eye and Swiss Green Party proposal have so far failed to bear fruit. Thomas Mattern from the Swiss People’s Party (SVP) has spoken out against such a move, insisting that Switzerland should retain its neutrality, “We do not need even more regulation, and not in the commodities sector either.”

END

8 EMERGING MARKET& AUSTRALIA ISSUES & OTHER EMERGING NATIONS

end

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

Euro/USA 1.0047 DOWN    0.0046 /EUROPE BOURSES // ALL RED 

USA/ YEN 146.67   UP  0.579 /NOW TARGETS INTEREST RATE AT .11% AS IT WILL BUY UNLIMITED BONDS TO GETS TO THAT LEVEL…//YEN TOTALLY COLLAPSES//

GBP/USA 1.1581 DOWN   0.0058

 Last night Shanghai COMPOSITE CLOSED DOWN 16.60 PTS OR 0.55% 

 Hang Seng CLOSED  UP 110.27 POINTS OR 1.21% 

AUSTRALIA CLOSED UP  0.53%    // EUROPEAN BOURSE: ALL RED

Trading from Europe and ASIA

I) EUROPEAN BOURSES  ALL RED

2/ CHINESE BOURSES / :Hang SENG CLOSED UP 110.27 PTS OR 1.21%

/SHANGHAI CLOSED  DOWN 16.60 PTS OR 0.55%

AUSTRALIA BOURSE CLOSED UP 0.53% 

(Nikkei (Japan) CLOSED  DOWN 36.80 PTS OR 0.32%

INDIA’S SENSEX  IN THE GREEN

Gold very early morning trading: 1661.90

silver:$19.37

USA dollar index early THURSDAY morning: 109.95 UP 0.40  CENT(S) from WEDNESDAY’s close.

 THURSDAY  MORNING NUMBERS ENDS

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And now your closing THURSDAY NUMBERS 1: 00 PM

Portuguese 10 year bond yield: 2.92% DOWN 25  in basis point(s) yield

JAPANESE BOND YIELD: +0.249% DOWN  0 AND 0/10   BASIS POINTS /JAPAN losing control of its yield curve/

SPANISH 10 YR BOND YIELD: 3.00%// DOWN 23 in basis points yield 

ITALIAN 10 YR BOND YIELD 4.02  DOWN 31   points in basis points yield ./ THE ECB IS QE ITALIAN BONDS (BUYING ITALIAN BONDS/SELLING GERMAN BUNDS)

GERMAN 10 YR BOND YIELD: FALLS TO +1.963%  DOWN 16 BASIS PTS 

END

IMPORTANT CURRENCY CLOSES FOR THURSDAY  

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

Euro/USA 0.9989UP .01048   or 104 basis points//

USA/Japan: 145.90 DOWN 0.180 OR YEN UP 18 basis points/

Great Britain/USA 1.15860 DOWN .0052 OR  52 BASIS POINTS //

Canadian dollar UP .0023 OR 23 BASIS pts  to 1.3527

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The USA/Yuan,  CNY: closed    ON SHORE  (CLOSED ..(DOWN) AT 7.2287

THE USA/YUAN OFFSHORE:    (YUAN CLOSED (DOWN)…. 7.2470

TURKISH LIRA:  18.59  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 9 IN basis points from WEDNESDAY at  3.929% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic

 USA 30 yr bond yield   4.076 DOWN 9  in basis points 

Your closing USA dollar index, 110.20 UP 65 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 THURSDAY: 12:00 PM

London: CLOSED UP 17.62 PTS OR  0.25%

German Dax :  CLOSED UP 15.42 POINTS OR 0.12%

Paris CAC CLOSED DOWN 32/28PTS OR 0.51% 

Spain IBEX CLOSED UP 50.50 OR  0.64%

Italian MIB: CLOSED UP 200.63 PTS OR  0.90%

WTI Oil price 89;24 12: EST

Brent Oil:  96.94   12:00 EST

USA /RUSSIAN ///   RUBLE FALLS TO:  61.73 DOWN 0  AND 3/100       RUBLES/DOLLAR

GERMAN 10 YR BOND YIELD; +1.963

CLOSING NUMBERS: 4 PM

Euro vs USA: 0.9971 DOWN .0124     OR  124  BASIS POINTS

British Pound: 1.1573 DOWN  .0066 or  66 basis pts

BRITISH 10 YR GILT BOND YIELD:  3.4365% 

USA dollar vs Japanese Yen: 146.19 DOWN 1.622//YEN UP 162 BASIS PTS//

USA dollar vs Canadian dollar: 1.3556 UP 0.0007  (CDN dollar, DOWN 7 basis pts)

West Texas intermediate oil: 88.83

Brent OIL:  96.78

USA 10 yr bond yield DOWN 6 BASIS pts to 3.952%

USA 30 yr bond yield DOWN 6 BASIS PTS to 4.105%

USA dollar index:119,37 UP .82 CENTS

USA DOLLAR VS TURKISH LIRA: 18.60

USA DOLLAR VS RUSSIA//// ROUBLE:  61.73  UP 0 AND  3/100 ROUBLES 

DOW JONES INDUSTRIAL AVERAGE: UP 194.17 PTS OR 0.61 % 

NASDAQ 100 DOWN 214.1026TS OR 1.88%

VOLATILITY INDEX: 27.01 DOWN 0.27 PTS (0.99)%

GLD: $154.75 DOWN 0.23 OR 0.15%

SLV/ $17.98  UP $0.00 OR 0.00%

end)

USA trading day in Graph Form

Nukes & Pukes – Big-Tech & Bond Yields Plunge On Putin, Pentagon, & Earnings Panic

THURSDAY, OCT 27, 2022 – 04:00 PM

The ECB hiked rates by 75bps as expected but the somewhat dovish language sent Bund yields (-25bps) and EUR lower on the day. 10Y Bund yields tumbled back below 2.00%…

Source: Bloomberg

EUR back below parity against the dollar…

Source: Bloomberg

US stocks gained some ground on the ECB but tumbled on the US cash open, then ripped back after another Democrat demanded Powell stop hiking rates (but not for political reasons of course).

That rally last about 45 minutes, and then… (amid Putin’s address), the nuke threats started from Washington:

  • *AUSTIN DESCRIBES RUSSIA AS ‘ACUTE’ THREAT TO US VALUES, WON’T RULE OUT NUCLEAR USE AGAINST NON-NUCLEAR THREATS,  DEFENSE STRATEGY SHUNS LIMITS ON USE ONCE EMBRACED BY BIDEN

And stocks sank. Nasdaq was monkeyhammered 2% lower and along with the S&P closed red. The Dow was the only major to manage gains, helped by CAT (which added over 100pts alone)…

Shorts were squeezed again at the open, but – again – that didn’t last…

Source: Bloomberg

But call demand continues to dominate put demand as there is no fear…

Source: Bloomberg

Notably, VIX was flat to down today despite the S&P being down… once again as we suspect puts were covered (pressuring vol lower)…

Source: Bloomberg

META was clubbed like a baby seal (-24% – its second worst day ever), tumbling to 6 year lows, down 75% from the highs (with Zuck down over $100bn in net worth since the highs!!)…

Source: Bloomberg

The market cap of the FANG stocks is back below pre-COVID highs…

Source: Bloomberg

Just for some context, the impact of GOOGL, MSFT, and META (among others) has prompted the biggest 2 day outperformance of the equal-weighted Nasdaq over the cap-weighted Nasdaq since Nov 2012

Source: Bloomberg

As month-end spookily looms on Monday, the spread in US Majors is massive (Nasdaq +2% but The Dow +12% MTD)

Source: Bloomberg

Most notably today we saw rate-trajectory expectations dovishly dive (GDP Price indices fell a little?) with terminal rate dropping and rate-cut hopes rising.Note that the Fed terminal rate (in May 2023) is down from 5.03% last Friday to 4.78% at its lows today…

Source: Bloomberg

That helped send UST yields dramatically lower with 5Y outperforming (-8bps) and 30Y the relative weakest. However, from the day’s highs, the swing in yields was huge 15-20bps across the curve. The main buying pressure in TSYs was from the GDP data to the European close…

Source: Bloomberg

10Y Yields dropped back below 4.00%…

Source: Bloomberg

The BoJ is set to announce tonight… will they comment on the fact that their YCC has broken?

Source: Bloomberg

The dollar rebounded modestly after 2 ugly days…

Source: Bloomberg

Bitcoin drifted lower today after 2 days higher…

Source: Bloomberg

Gold also drifted lower today

With the easing of rate expectations, and despite the ugly durable goods data (perhaps offset by US GDP), oil prices rallied today with WTI back abive $89.50…

US NatGas, on the other hand, was smashed lower (back below $6)…

Finally, is it over yet?

Source: Bloomberg

Maybe… but Nasdaq never made it back to those levels for years.
END

end

I) / LATE MORNING//  TRADING//

AFTERNOON TRADING//AFTER HOURS

Amazon Implodes More Than 20% After Missing on Revenues, Disappointing On AWS, Catastrophic Guidance

THURSDAY, OCT 27, 2022 – 04:14 PM

With the bulk of the FAAMG stocks – which is now GAMMA following Facebook’s rebranding to Meta (at least until the company  quietly changes its name back now that the whole Metaverse farce has blown up in its Metaface) – having reported Q3 results (which have uniformly been a disaster, sending megatech stocks tumbling), investors were keenly looking to Amazon and Apple earnings after the close today, to round out the picture for the (former?) market generals and set the tone for the rest of 2022, or at least until after the midterms when the BLS reports that real payrolls were actually -1,000,000, and also to conclude whether the ongoing Nasdaq implosion has been justified.

Focusing on Amazon, investors are expecting Amazon to outperform digital advertising peers Facebook and Google through an ad slump. The theory, as Bloomberg notes, is Amazon is closer to the customer at the time they are prepared to buy something, so that advertising is more valuable when consumers are penny-pinching when compared to broader marketing campaigns aimed at awareness on social-media sites like Instagram or Google’s search engine where users aren’t necessarily shopping.

Investors also expect a slight slowdown in Amazon Web Services sales growth (thank you Microsoft and Google), with third-quarter revenues expected to come in at $21 billion, up 30% from a year earlier. Cloud-industry peer Microsoft reported earlier this week that rising energy prices cut into cloud computing profits, so there will likely be some focus on Amazon’s cloud profit margins as well to see if they are under similar pressure. Investors expect operating income of $6.1 billion in the third quarter from Amazon’s cloud business.

Poonam Goyal, senior retail industry analyst for Bloomberg Intelligence, and Anurag Rana, BI’s senior software analyst, point to Microsoft’s projection of a slowdown as a harbinger for AWS. “Amazon Web Services’ sales growth in constant currency could dip in 4Q to about 26%-27% from consensus of 29%,” they wrote in a recent note. “The slump is probably going to stretch through 2023, with recovery possible in 2024.”

Amazon’s employee count will also be an interesting metric to watch. The company has been busy cutting some experimental projects, which would reduce its numbers, but it also announced plans to hire 150,000 people for the holidays, which is the same as last year. As of June 30, Amazon had 1.52 million employees globally. If that figure goes down, it will be the first time Amazon has reduced its number of employees for two consecutive quarters since 2001 and gives a clearer picture of how deep the cuts have been.

But while Q3 earnings will matter, all eyes will likely be on the forecast for the busy holiday quarter. Investors expect earnings of 39 cents per share on sales of $156 billion. Investors are counting on Amazon to boost profits and sales while trimming costs through hiring freezes and cutting experimental projects.

That said, like the rest of the tech sector, rising labor and energy costs coupled with slower spending growth have put a strain on Amazon’s business model. Amazon CEO Andy Jassy has taken several steps this year to boost revenues, including increasing the price of Prime membership and tacking new fees on merchants selling goods on the web store. Investors want to see if Amazon can maintain that strong connection with Prime subscribers and win their spending during the holidays, or if more expensive Prime membership compels them to shop elsewhere.

Heading into earning, Amazon shares suffered steep declines, falling as much as 5.1%. The e-commerce giant’s shares are down 8.5% over the past two days, the worst two-day slump since June.

So with all that in mind moments ago AMZN just reported Q3 results which were an absolute disaster and nailed the coffin of the FAAMGs shut, because not only did Amzn miss sales, and report disappointing AQS metrics but its forecast was a disaster.

  • EPS 28c, beating estimates 22c
  • With all that in mind, moments ago AMZN just reported Q3 results and they were an absolute disaster.
  • Net sales $127.10 billion, +15% y/y, missing estimate $127.64 billion
    • Physical Stores net sales $4.69 billion, +10% y/y, beating estimate $4.68 billion
    • Online stores net sales $53.49 billion, +7.1% y/y, missing estimates $54 billion
    • Third-Party Seller Services net sales $28.67 billion, +18% y/y, beating estimates $28.49 billion
    • Subscription Services net sales $8.90 billion, +9.3% y/y, missing estimate $9.18 billion
    • AWS net sales $20.5 billion, +27% y/y, missing estimate $21.0 billion
    • North America net sales $78.84 billion, +20% y/y, beating estimate $76.95 billion
    • International net sales $27.72 billion, -4.9% y/y, missing estimate $29.28 billion
  • Third-party seller services net sales excluding F/X +23% vs. +18% y/y, beating estimate +18.7%
  • Subscription services net sales excluding F/X +14% vs. +23% y/y, estimate +20% (2 estimates)
  • Amazon Web Services net sales excluding F/X +27% vs. +39% y/y, estimate +31.9%
  • Operating income $2.53 billion, -48% y/y, missing estimate $3.11 billion
  • Operating margin 2% vs. 4.4% y/y, missing estimate 2.48%
  • Intl oper margin -8.9% vs. -3.1% y/y, missing estimate -7.71%
  • Fulfillment expense $20.58 billion, +11% y/y, below the estimate $21.58 billion

But while revenue was disappointing and AWS was subpar at best, the reason why AMZN stock is imploding after hours is because the company’s guidance was absolutely catastrophic

  • Sees net sales $140.0 billion to $148.0 billion, the midline coming far below the median estimate of $155.52 billion
  • Sees operating income to be between $0 and $4 billion, also missing the median estimate of $4.66BN

In short: ugly earnings, catastrophic guidance!

Digging into the numbers we find that operating margins tumbled to 2.0%, down from 4.0% and missing the estimate of 2.5%. In fact as shown below, the only reason this number wasn’t positive is thanks to AWS.

And while the market was not happy with the overall profit margin, it was even less enthused with the profit margin breakdown where despite a modest improvement in AWS, the international operating margin collapsed to the lowest in the past decade, with US online sales still unable to turn green. In fact, if it wasn’t for AWS, AMZN would have negative operating income.

The chart above shows that Amazon’s online retail business in North America and international both lost money. This is after hiking the cost of Amazon Prime $20 a year and adding fees to online merchants that sell on the platform. If Amazon Web Services is subsidizing the e-commerce side, it makes it harder to justify keeping the businesses together.

And while AWS did post a modest improvement in profit margins, where it did disappoint was in revenue growth, which rose 27% Y/Y to $20.54 billion, missing the estimate of $21.01 billion.

But all these disappointing data points aside, what markets are mostly focused on is that forecast revenue growth in a range of $140-$148BN (midline at $144BN) suggests that very soon the company may see an unheard of event: shrinking revenues!

As Bloomberg puts it, the results will ramp up pressure for CEO Andy Jassy – and all the other tech giants – to further cut costs. Amazon has a hiring freeze in its retail team and has been cutting experimental projects. But investors will be hungry for deeper cuts if sales are falling flat.

And speaking of Bloomberg, BBG Intel’s Poonam Goyal was rather adamant “It’s actually pretty bad across the board. It’s hard to find something good in this press release….It’s kind of humming the same tune of results we saw earlier. The consumer is slowing.”

In light of these catastrophic earnings and terrible guidance, it is not surprising that the kneejerk reaction may have been the worst in post-earnings plunge Amazon history: the stock was down as much as 21% after hours, plunging to the lowest level since the March 2020 covid crash when the entire economy was locked down!

Not surprisingly, Wayfair and EBay shares are falling postmarket after Amazon’s forecast miss. Wayfair is down as much as 6.2% while EBay declines as much as 3.6%. Alibaba is down 1.7%.

ii) USA DATA/

USA core durable goods orders tumble the most since COVID lockdowns

(zerohedge)

US Core Durable Goods Orders Tumble Most Since COVID Lockdown Collapse, CapEx Shrinks

THURSDAY, OCT 27, 2022 – 08:40 AM

After two straight months of declines, analysts expected a modest rebound in US durable goods orders, and they did, rising 0.4% MoM in preliminary Sept data (less than expected +0.6%) with August being revised upwards to a very small rise…

Source: Bloomberg

end

First reading of 3rd quarter GDP up 2.6%. That will probably be revised downwards in the next few months

(zerohedge)

US GDP Grows 2.6% In Q3 Driven Entirely By Trade; Price Index Comes Cooler Than Expected

THURSDAY, OCT 27, 2022 – 08:57 AM

Ahead of today’s GDP print, economist consensus was that in the 3rd quarter, the US economy would grow if entirely on the back of net exports (or trade), and sure enough that’s precisely what happened. While the BEA reported that in the third quarter, US GDP rose 2.57%, more than the 2.4% consensus and up notably from last quarter’s -0.6% and the -1.6% drop in Q1…

… net trade contributed to 2.77% of this number, or 108% of the bottom line!

According to the BEA, the upturn in the third quarter, compared to the second quarter, primarily reflected a smaller decrease in private inventory investment, an upturn in government spending, and an acceleration in nonresidential fixed investment that were partly offset by a larger decrease in residential fixed investment and a deceleration in consumer spending. Imports turned down.

But, again, it was all about trade…

… as the following breakdown shows:

  • Personal Consumption: 0.97% of the bottom line number, down from 1.38% and the lowest since 2019.
  • Fixed Investment subtracted -0.89% from the GDP, in line with last month’s -0.92% as corporations continue to retrench ahead of the recession
  • The change in private inventories shrank for the 3rd quarter, this time shrinking GDP by -0.70%
  • On the positive side net exports rose by 2.77% courtesy of a 1.63% increase in exports and a decline in imports which contributed another 1.14% to the GDP print. As noted above, this alone was enough to explain the entire gain in Q3 GDP, and is a function of US support of the European war economy as the US exports record amount of commodities (oil and gas) as well as weapons to Europe.
  • Finally, government consumption – which was and remains an oxymoron – added 0.42% to the bottom line GDP.

Looking at the slowdown in consumption, BBG notes that personal consumption expenditures on goods were down 1.2% annualized in Q3, after dropping 2.6% in Q2. Meanwhile, growth of personal consumption expenditures on services moderated to 2.8%, from 4.6%.

Commenting on the surge in trade, the BEA wrote that the increase in exports reflected both goods (led by industrial supplies and materials as well as nonautomotive capital goods) and services (led by “other” business services and travel). Some more details:

  • The increase in consumer spending reflected an increase in services (led by health care and “other” services) that was partly offset by a decrease in goods (led by motor vehicles and parts as well as food and beverages). 
  • The increase in business investment reflected increases in equipment and intellectual property products that were partly offset by a decrease in structures.   
  • The increase in government spending reflected increases in federal (led by defense spending) as well as state and local.  
  • The decrease in housing investment was led by new single-family housing units and brokers’ commissions. 
  • The decrease in private inventory investment was led by retail trade (mainly “other” retailers). 
  • The decrease in imports reflected a decrease in goods (led by consumer goods) that was partly offset by an increase in services (led by travel).

And while the headline GDP was generally in line with expectations, where the market was decidedly pleased was to learn that the GDP price index rose just 4.1%, well below the 5.3% expected, and down more than half from 9.0% last quarter.

Excluding food and energy, core PCE 4.5% after increasing 4.7%, in line with expectations. This was enough to whiplash the USD, which was spiking after the somewhat dovish ECB (having dropped the “next several meetings” language), and reverse some of its gains in what has so far been a very fast, nail-bitting session.

Today data, according to some such as the FT, “ends a debate that raged over the summer as to whether the US economy was already in a recession” although we disagree since the only reason the GDP print was strong is because Europe is collapsing into a recession and is now overly reliant on US energy and weapons exports; the GDP print also did little to dispel fears that the US will eventually (again) tip into an even bigger recession given the aggressive steps the US central bank is taking to stamp out elevated inflation.

Two consecutive quarters of shrinking GDP has long been considered a common criteria for a so-called “technical recession”. However, top policymakers in the Biden administration and at the Federal Reserve pushed back forcefully on that framing, citing ample evidence that the economy was still on firm footing. The Fed is poised early next month to deliver its fourth consecutive 0.75 percentage point interest rate increase, which will lift its benchmark policy rate to a new target range of 3.75 per cent to 4 per cent. As recently as March, the federal funds rate hovered near zero, making this tightening campaign one of the most aggressive in the US central bank’s history.

As of last month, most officials thought the fed funds rate would peak at 4.6%, but now investors expect it to close in on 5% next year (that said, today’s weaker than expected PCE print will likely ease those bets). Given how large an impact the Fed’s actions are expected to have on growth and the labour market, most economists now expect the unemployment rate to rise materially from its current level of 3.5 per cent and for the economy to tip into a recession next year.

Top officials in the Biden administration maintain that the US economy is strong enough to avoid that outcome, citing the resilience of the labor market, but even Jay Powell has acknowledged the odds have risen. “No one knows whether this process will lead to a recession or if so, how significant that recession would be,” he said at his last press conference in September.

III) USA ECONOMIC STORIES

Your most important read of the day.  Democrats are sending letters to Powell to pivot.  And markets believe he will. Pozsar believes Powell will bring about a depression to save the dollar  (bring down inflation)

I Suggest You Pivot: Stocks Soar After Democrat Senator Urges Powell To End Hikes

THURSDAY, OCT 27, 2022 – 10:32 AM

Who could have seen this coming? Well, all our readers for one…

Back In July, we wrote “Democrats Prepare To Unleash Hell On Fed Chair Powell For The Coming Recession“, in which we laid out the “cunning” Democrat plan to blame Fed Chair Jerome Powell for the economic hurricane that is imminent, as poll numbers started to slide and the Midterms looked like a disaster:

“It is important for the Fed not to overreach and trigger a recession unnecessarily, as part of its effort to bring inflation down,” said Representative Hakeem Jeffries of New York, the No. 5-ranked House Democratic leader.

“Inflation is a global problem, and is actually not as bad in America as it is in almost every other developed economy in the world,” he told Bloomberg.Then, in September, none other than Senator Elizabeth Warren unleashed hell on the former lawyer, tweeting that:

“Chair Powell just announced another extreme interest rate hike while forecasting higher unemployment. I’ve been warning that Chair Powell’s Fed would throw millions of Americans out of work — and I fear he’s already on the path to doing so.”

Interestingly, we noted at the time that Senate Baking Committee Chair Sherrod Brown, an Ohio Democrat, defended Powell during an interview on Bloomberg Television. But that all changed on Monday, when in a sternly-worded letter Brown made it clear that he too is on team-fake Indian and that Powell needs to stop the hikes now (which he won’t, but will provide just the right cover for Democrats when the catastrophic job prints start hitting).

“As you know, the Federal Reserve is charged with the dual mandate of promoting maximum employment, stable prices, and moderate long-term interest rates in the U.S. economy. It is your job to combat inflation, but at the same time, you must not lose sight of your responsibility to ensure that we have full employment.

For the first time in decades, we have seen historic job growth, and workers have begun to see wage gains, gains that your prior actions to stabilize the economy helped achieve. Yet, many workers and their families are struggling under the weight of inflation.”

“However, a family’s “pocketbook” needs have little to do with interest rates, and potential job losses brought about by monetary over-tightening will only worsen these matters for the working class. “

Translation: leave inflation alone – which by implication means raise the Fed’s inflation target to what 4%? 5%%? and instead just focus on preventing the economy from getting much worse.

And now, just two days later, yet another Democrat – and certainly not the last – has joined the chorus, when Senator John Hickenlooper sent a letter to Powell urging the Fed Chair to “pause and seriously consider the negative consequences of again raising interest rates.”

Translation: Democrats have either finally realized that a market crash does not poll well…

…. or, worse, have seen next month’s nonfarm payrolls print and it is clearly a disaster.

In any case, what we said long ago when we disagreed with Zoltan Pozsar – namely that the Fed’s inflation fight will end the moment politicians tell the “independent Fed” to end it – is starting to come true. As a reminder, this is what we argued back in August in “Zoltan Pozsar: Powell Will Push The Economy Into A “Depression” To Curb Inflation“:

The problem with this line of thinking is that Pozsar thinks anyone – whether Congressional Republicans or Democrats – will agree to a “depression” just to contain inflation. Spoiler alert: they won’t as it means an immediate end of all their political (and all other careers). Instead, they will browbeat Powell and the Fed, into doing just enough to avoid this outcome even if it means raising the inflation target, which we are 100% certain is how this episode ends: with the Fed raising its inflation target quietly from 2% to 3% or more, with the usual hedonic adjustments of course.

To summarize: the problem with Pozsar’s latest note is that it is too rational, too logical, and it reduces to the following – US society can be fixed at the individual level by realigning incentives, motivations and beliefs, and the Fed will do what is right even if it means the collapse of the US political system. Alas, that will never happen, and that’s why Zoltan’s argument fails. After all, it’s far easier to simply print a few trillion (again) and kick the can for a few more years and dump the plate of troubles on some other unhappy politician. It’s also why the gating constraint here is not inflation but the dollar reserve currency status: at the end of the day, the Fed will devalue the dollar to permit both more monetary and Fiscal easing thus keeping both the lower and upper classes happy, and it will keep doing so until it risks hyperinflation – pushing the dollar-based system to the point beyond which the world will no longer accept it; after all  that was the endgame since the day the Fed was launched in 1913. Whether the system is actually pushed beyond said point, well that’s the real $64 trillion question.

… and after tumbling earlier in the session, stocks have exploded higher following news of the letter as they too now agree with our take…

… with yields and the dollar tumbling.

…and short-term interest rate markets shifting significantly dovishly, from ‘pause’ to ‘pivot’ with rate-hike expectations sliding and subsequent rate-cut expectations spiking…

The only wildcard here is the senile occupant of the White House himself. For now, he appears more focused on inflation:

  • *BIDEN: WE NEED TO DO MORE TO BRING PRICES DOWN

…but the moment the monthly payrolls report hits and is worse than -100,000 all bets are off and the time to pivot is here.

end

USA oil executives tell Minister Granholm  ( a total nutcase) that the shuttered USA oil refineries will not restart this winter //2023

(Geiger/OilPrice.com)

Energy Execs Tell Granholm Shuttered US Oil Refineries Won’t Restart

THURSDAY, OCT 27, 2022 – 07:20 AM

Authored by Julianne Geiger via OilPrice.com,

U.S. energy executives told Jennifer Granholm that shuttered crude oil refineries won’t restart, Valero’s Chief Executive Joe Gorder said on Tuesday.

The comments were made to the U.S. Energy Secretary at a recent White House meeting with energy executives, Reuters reported on Tuesday.

“The one interesting thing that came out of it, too, was there was consideration for the ability to restart refining capacity that had been shut down, and  I think the general sentiment was that wasn’t going to happen,” Gorder said.

Limited U.S. refinery capacity – and perhaps more critically, refinery capacity in specific U.S. geographic areas, known as PADDs – has spared worry in the United States over high gasoline prices and energy security.

US refinery run rates were north of 90% for much of the summer, according to the EIA’s Weekly Petroleum Status Report.

Shuttered refineries unlikely to start back up are the latest nail in the U.S. refinery coffin.

In June, Chevron CEO Mike Wirth posited that there would never be another new refinery built in the United States.

“Building a refinery is a multi-billion dollar investment. It may take a decade. We haven’t had a refinery built in the United States since the 1970s. My personal view is that there will never be another refinery built in the United States,” Wirth said at the time.

Oil and gas companies would have to weigh the benefits of committing capital ten years out that will need decades to offer a return to shareholders “in a policy environment where governments around the world are saying ‘we don’t want these products to be used in the future,’” Wirth added.

Refinery utilization in the United States for the week ending October 14 was 89.5% of their operable capacity, the most recent EIA data shows.

end

There are only two pollsters you can trust is accurate, Trafalgar and 538

Nate Silver’s 538 reports that the Democrat scheme to alienate ‘election denier’ GOP candidates is backfiring big time

take a look at this data:

(zerohedge)

Democrat Scheme To Alienate ‘Election Denier’ GOP Candidates Backfires Spectacularly

WEDNESDAY, OCT 26, 2022 – 07:45 PM

Democrat attempts to dehumanize their ‘election denier’ GOP opponents is backfiring spectacularly, as a new report from Nate Silver’s FiveThirtyEight reveals there are ‘well over a hundred’ midterm GOP candidates who have denied the legitimacy of the 2020 election ‘have a strong chance of winning their race.’

Of the 185 Republican candidates running for House, Senate and governor’s seats who have denied the legitimacy of the 2020 election, 124 — or 67 percent — are in races our forecast currently pins at “Solid R,” meaning they have a 95-in-100 or better chance of winning. Overall, a bigger share of election deniers are running in Solid R races than Republican candidates in general: Of the 496 Republican candidates running for House, Senate and governor, 225 — or 45 percent — are in Solid R races. -FiveThirtyEight

One such wrong-thinker is Anna Paulina Luna – a GOP candidate for Florida’s 13th district who, per the report, “donned a red-carpet-worthy ball gown to a screening of “2000 Mules,” a debunked documentary that falsely claims to show evidence of widespread voter fraud in the 2020 election.” (The ‘debunking’ makes for great bathroom reading, by the way)

In June, Luna proclaimed “I believe that President Trump won that election, and I do believe that voter fraud occurred.”

And now she’s likely to be elected to Congress…

Luna is the Republican candidate for Florida’s 13th District, on the Gulf Coast around St. Petersburg. During redistricting last year, Republicans redrew this previously competitive district to be much redder, and as a result, Luna has a 97-in-100 shot at beating her Democrat opponent, according to FiveThirtyEight’s Deluxe forecast, as of Monday at 12 p.m. Eastern. (All numbers in this story are as of that same time and date.)

Interestingly, candidates running for the House who question the 2020 election are fairing better than those running to be governor or Senator, with 70% running in “Solid R” races (likely to win), while just two out of seven running for Governor are favored to win. In the Senate, three out of eight ‘election deniers’ (Katie Britt (AL), Eric Schmitt (MO) and Markwayne Mullin (OK)) have better than 95-100 odds.

Also interesting is that GOP candidates who have accepted the legitimacy of the 2020 election are less likely than their ‘election-denying’ counterparts to be in ‘Solid R’ races.

Of the 67 Republican candidates who accept the 2020 election, 30 — or 45 percent — are running in races where they have 95-in-100 or better odds. This includes candidates such as North Dakota Sen. John Hoeven, who is running for reelection and is one of the Republicans who voted to certify the 2020 election results. 

On the other side of the coin, around 19% of election denying candidates (36) are running in races where a Democrat is likely to win.

There are currently four toss-ups involving ‘election-denying’ candidates; Kari Lake, who’s running for governor in Arizona; Monica De La Cruz and Mike Garcia, who are running for House seats in Texas and California, respectively; and Senate candidate Adam Laxalt in Nevada.

It may also be the case that Democrats have steered the country into such a tailspin that a GOP sack of flour would win, but ‘election denier’ status doesn’t seem to have hurt conservative candidates.

Maybe Nate Silver can tally how the 2016 Democrat election deniers are doing?

end

This could be troublesome:  6 unions for the railroad signalmen rejected the Biden backed tentative labour agreement

A national strike could be devastating

(Freightwaves)

Another Rail Union Rejects Biden-Backed Tentative Labor Agreement

THURSDAY, OCT 27, 2022 – 09:45 AM

Authored by Joanna Marsh via FreightWaves.com,

Roughly 61% of Brotherhood of Railroad Signalmen’s voting members oppose deal intended to head off strike…

Count the Brotherhood of Railroad Signalmen (BRS) as another union to reject the tentative labor agreement that representatives of the rail unions and the freight railroads negotiated under pressure from the White House.

The union and the organization representing the railroads plan to return to the negotiating table, but BRS’ vote further clouds the question of whether a freight rail strike could occur — something that the tentative agreement had sought to stave off. Members of the Brotherhood of Maintenance of Way Employes Division rejected that union’s tentative agreement earlier this month.

BRS announced Wednesday that 60.57% of voting members opposed ratification, while 39.23% voted in favor. 

BRS represents more than 6,000 members affected by the negotiations, which is about 5% of the 115,000 union members involved in the negotiations process.

BRS President Michael Baldwin said the percentage of members who voted — 73.18%  — was the highest participation rate in BRS history.

The union was represented at the negotiating table by the Coordinated Bargaining Coalition and later by the United Rail Unions. The National Carriers Conference Committee (NCCC) represented the freight railroads.

In response to BRS’ vote, NCCC said it was “disappointed” in the outcome, saying that the failure to ratify the agreement would delay the benefits of the tentative agreement for BRS members.

Both NCCC and BRS have agreed to maintain the status quo until early December, which means any potential service disruptions by BRS members would not occur before then. Both parties will be going back to the bargaining table for further contract negotiations.

NCCC says the tentative agreement includes recommendations by the Presidential Emergency Board (PEB), a three-person independent group appointed by President Joe Biden over the summer to work with the railroads and the unions on finding ways to resolve the labor contract impasse and avert a strike. The railroads and unions have been negotiating a new contract since January 2020.

Those recommendations included the largest wage increase in nearly five decades, maintained rail employees’ platinum-level health benefits and added an extra day of paid time off, NCCC said, noting that six other unions had already voted in favor of ratifying their labor agreements. 

NCCC said PEB’s recommendations “represent a carefully considered compromise of all parties’ interests.”

“BRS asserts that the tentative agreement is inadequate because it does not provide for additional paid sick time. However, the vast majority of BRS members work predictable schedules and all have access to time off,” NCCC said. “Like other rail employees, they can and do take time off for sickness and already have paid sickness benefits beginning after four days of illness-related absence and extending for up to a year.

“The structure of these benefits is a function of decades of bargaining where the unions have repeatedly agreed that short-term absences would be unpaid in favor of higher compensation for days worked and more generous sickness benefits for longer absences,” NCCC continued. “The three experienced arbitrators appointed to PEB 250 by President Biden thoroughly reviewed and rejected a union proposal to add paid sick time for short-term absences to the existing system, noting in their report that union concerns had been considered in formulating the PEB’s historic wage recommendation.”

But BRS said the vote “spoke loudly and clearly that their contributions are worth more.”

“I have expressed my disappointment throughout the process in the lack of good-faith bargaining on the part of the NCCC, as well as the part PEB 250 played in denying BRS members the basic right of paid time off for illness,” Baldwin said in a statement. “The NCCC and PEB also both failed to recognize the safety-sensitive and highly stressful job BRS members perform each day to keep the railroad running and supply chain flowing. 

“Without Signalmen, the roadways and railroad crossings would be unsafe for the traveling public, and they shoulder that heavy burden each day. Additionally, the highest offices at each Carrier, as well as their stockholders, seem to forget that the rank-and-file of their employees continued to perform their job each day through an unprecedented pandemic, while the executives worked from home to keep their families safe.”

The six unions that have approved their agreements are the American Train Dispatchers Association, the International Brotherhood of Electrical Workers, the Transportation Communications Union, the Brotherhood of Railway Carmen, the National Conference of Firemen & Oilers, and the mechanical and engineering division of the International Association of Sheet Metal, Air, Rail and Transportation (SMART) Workers.

Two of the largest unions representing train engineers and conductors — the Brotherhood of Locomotive Engineers and Trainmen and SMART-Transportation Division — have yet to vote on whether to ratify their agreements.

end

Musk to take over Twitter on Friday:  he brings in a sink saying the following:

“Let that sink in”

(zerohedge)

‘Let That Sink In’ – Elon Musk Barges Into Twitter HQ Ahead Of Deal Close

WEDNESDAY, OCT 26, 2022 – 03:24 PM

Update (10/20/2022 1520ET): Elon Musk sauntered into Twitter’s San Francisco headquarters on Wednesday carrying a kitchen sink in preparation for his Friday takeover of the company.

The world’s richest man also changed his Twitter bio to “Chief Twit.”

According to Twitter’s chief marketing officer, Leslie Berland, “Elon is in the SF office this week meeting with folks, walking the halls, and continuing to dive in on the important work you all do,” adding “For everyone else, this is just the beginning of many meetings and conversations with Elon, and you’ll all hear directly from him on Friday.”

Now fast forward to Friday:

*  *  *

Update (1355ET): Elon Musk has told debt bankers that he intends to close the Twitter deal on Friday.

*  *  *

Twitter employees have penned an open letter to soon-to-be boss Elon Musk and the Board of Directors begging to keep their jobs, after the Washington Post reported that Musk is planning to get rid of nearly 75% of the company’s 7,500 workers – whittling Twitter down to a ‘skeleton’ staff of just over 2,000.

Elon Musk’s plan to lay off 75% of Twitter workers will hurt Twitter’s ability to serve the public conversation,” reads a draft of the letter, which has not yet been published. “A threat of this magnitude is reckless, undermines our users’ and customers’ trust in our platform, and is a transparent act of worker intimidation.”

The letter then suggests that the full staff is “helping to uplift independent journalism in Ukraine and Iran, as well as powering social movements around the world.”

The employees then demand that Musk “explicitly commit to preserve our benefits, those both listed in the merger agreement and not (e.g. remote work). We demand leadership to establish and ensure fair severance policies for all workers before and after any change in ownership.”

They also demand “Dignity,” writing “We demand transparent, prompt and thoughtful communication around our working conditions. We demand to be treated with dignity, and to not be treated as mere pawns in a game played by billionaires.”

Following the ‘75% layoff’ report, ‘experts’ told ABC News that the change could “compromise the platform’s capacity to police false or harmful content, with ramifications that extend to social issues like election integrity,” and that “The experience of a typical user could change significantly, they added, noting the possible rise of harassment and other forms of corrosive discourse.”

Cuts to the content moderation workforce would align with statements made by Musk in recent months about his commitment to the principle of free speech, suggesting that Twitter should permit all speech that stops short of violating the law, the experts said. -ABC News

Musk has reportedly told employees that “Anyone who is a significant contributor should have nothing to worry about,” according to a June 16 tweet from Bloomberg reporter Kurt Wagner.

“If there is more harassment and other forms of toxic speech, if there is more misinformation and disinformation, then people’s experience on the platform is going to be really different,” said Zeve Sanderson, the executive director at New York University’s Center for Social Media and Politics. 

In short, Twitter employees are freaking out, and left-wing ‘experts’ fear that free speech will allow ‘dangerous’ information to reach millions.

This is what it looks like when ideological zealots lose control over narratives.

end

In Stunning Strategy Reversal, Pentagon Will No Longer Rule Out Use Of Nuclear Weapons Against Non-Nuclear Threat

THURSDAY, OCT 27, 2022 – 12:05 PM

Well, we’re finally there: stocks are officially trading off nuclear war headlines.

Moments ago, as part of his closely-watched speech, Vladimir Putin appeared to talk down the likelihood of a nuclear attack in Ukraine:

  • *PUTIN: NO POLITICAL, MILITARY REASON IN NUKE STRIKE IN UKRAINE
  • Which, however, is more than can be said about the US.As Bloomberg just reported, the Pentagon’s new National Defense Strategy rejects limits on using nuclear weapons long championed by arms control advocates (and, in the not too distant past, by Joe Bide) citing burgeoning threats from Russia and China.“By the 2030s the United States will, for the first time in its history face two major nuclear powers as strategic competitors and potential adversaries,” the Defense Department said in the long-awaited document issued Thursday. In response, the US will “maintain a very high bar for nuclear employment” without ruling out using the weapons in retaliation to a non-nuclear strategic threat to the homeland, US forces abroad or allies.In yet another stark reversal for the senile occupant of the White House basement, in his 2020 presidential campaign Biden had pledged to declare that the US nuclear arsenal should be used only to deter or retaliate against a nuclear attack, a position blessed by progressive Democrats and reviled by defense hawks. But, like with every other position held by the pathological liar who even trumps Trump in the untruth department, this one has just been reversed as well as “the threat environment has changed dramatically since then” and the Pentagon strategy was forged in cooperation with the flip-flopping White House.In a stunning move that should – or rather “should” – spark outrage among the so-called progressives but will at best prompt some very sternly retracted letters, the nuclear report that’s part of the broader strategy said the Biden administration reviewed its nuclear policy and concluded that “No First Use” and “Sole Purpose” policies “would result in an unacceptable level of risk in light of the range of non-nuclear capabilities being developed and fielded by competitors that could inflict strategic-level damage” to the US and allies.meanwhile…The nuclear strategy document doesn’t spell out what non-nuclear threats could produce a US nuclear response, but current threats include hypersonic weapons possessed by Russia and China for which the US doesn’t yet have a proven defense.It does spell out, however, in the strongest terms, what would happen to another nuclear power, North Korea, if it launched a nuclear attack on the US, South Korea or Japan. That action “will result in the end of that regime,” it says. US nuclear weapons continue to play a role in deterring North Korean attacks.So, the brilliant neocon minds behind the report concluded, it is better to instill the fear of a disproportionate nuclear retaliation, thus making an outright nuclear attack far more likely (if the US will nuke you anyway, may as well go all out).In the document, which was framed well before the invasion, the Pentagon says Russia continues to “brandish its nuclear weapons in support of its revisionist security policy” while its modern arsenal is expected to grow further. In other words, the Pentagon knew what Putin would do even before he did it and that defined the dramatic revision in US nuclear posture. Almost as if the Pentagon directed the entire sequence of events…Meanwhile, China remains the US’s “most consequential strategic competitor for coming decades,” Defense Secretary Lloyd Austin said in a letter presenting the new defense strategy. He cited China’s “increasingly coercive actions to reshape the Indo-Pacific region and the international system to fit its authoritarian preferences,” even as it rapidly modernizes and expands its military. China wants to have at least 1,000 deliverable nuclear warheads by the end of the decade, the nuclear strategy document says, saying it could use them for “coercive purposes, including military provocations against US allies and partners in the region.”The nuclear strategy affirmed modernization programs including the ongoing replacement of the aging US air-sea-land nuclear triad. Among them are the Navy’s Columbia-class nuclear ICBM submarine, the ground-based Minuteman III ICBM replacement, the new air-launched Long-Range Standoff Weapon and F-35 fighter jets for Europe carrying nuclear weapons.The review confirmed previous reports that the Pentagon will retire the B83-1 gravity bomb and cancel the Sea-Launched Cruise Missile program. But the review endorses a controversial Trump-era naval weapon, the low-yield W76-2 submarine-launched nuclear warhead, which is described as providing “an important means to deter limited nuclear use.”The broader strategy report also offered gently worded criticism of major US weapons programs, which often runs years behind plans and billions of dollars over initial budgets.“Our current system is too slow and too focused on acquiring systems not designed to address the most critical challenges we now face,” the Pentagon said. It called for more “open systems that can rapidly incorporate cutting-edge technology” while reducing problems of “obsolescence” and high costs.The Pentagon strategy documents were sent to Congress in classified form in March so they were considered during congressional approval of the fiscal 2023 defense budget.* * *So how to trade all of this? Well, the initial instinct now that nuclear war headlines are being lobbed around is that it may be time to sell… but as Art Cashin so insightfully put it some time ago, “Never bet on the end of the world, because it only happens once.”Now thanks to the Biden admin, that “once in a lifetime” event is that much closer to taking place.

III B    USA COMMODITY PROBLEMS//INFLATION WATCH

end

SWAMP STORIES

Oh NO!! not again!!

(zerohedge)

After Sending Out 240,000 Unverified Ballots, Pennsylvania Now Warns Of ‘Delays’ Counting Midterm Votes

WEDNESDAY, OCT 26, 2022 – 08:25 PM

Here we go again…

Just one day after 15 Pennsylvania House Republicans sent a letter to acting Secretary of State Leigh Chapman demanding to know why 240,000 unverified ballots had been mailed out (“which, according to the law, must be set aside and not counted for the 2022 General Election unless the voter produces lD,” the lawmakers wrote), Chapman revealed that there will likely be delays posting the results after the midterm elections.Acting Secretary of State Leigh Chapman spoke on Monday, Oct. 24 to discuss voting procedures throughout the state.

It’s really important for us to get accurate information about the election process in Pennsylvania,” Chapman said during a virtual conference, where she said it would likely take ‘several days’ to count and certify the votes.

“So voters and the public know that when there are delays in counting, it doesn’t mean that there’s anything nefarious happening. It’s just what the law is in Pennsylvania.”

According to Chapman, the delays would be attributed to poll workers not being able to pre-canvas, or count mail-in ballots prior to election day.

She also encouraged voters to go ahead and send in their ballots, contrary to Republican messaging which urged voters to hold onto their mail-in ballots and turn them in to their local board of elections on election day – which Chapman said could (somehow) cause voters to become disenfranchised.

“We have heard that there’s messaging out there in Pennsylvania, as far as instructing voters to hold onto their mail-in ballots,” she said, adding “As part of our voter education campaign, we encourage voters to request that mail-in ballot now and return it as soon as possible. We don’t want voters to delay.”

Chapman took the opportunity to convey concerns she says stem from ‘misinformation’ – threats to interrupt voting and calls to delay the sending of mail-in ballots.

While she didn’t detail a specific incident, Chapman said there have been reports of threats aimed at the voting process throughout the state. She promised that her office has worked to investigate any threat made toward a free and fair election.

Since I’ve been in office in January, we have constantly met with the FBI and Homeland Security just to talk through what the current threat landscape is and tools that we can give our counties to make sure that they have physical security protection as well as cyber security protection,” she said.

“So it’s been great to partner with both the federal and state law enforcement organizations. We are in constant communication with them and it’s a situation that we are monitoring,” Chapman added. –Lehigh Valley News

According to Chapman, over 1.2 million mail-in ballots have been requested across the state, and 43% – or 556,000, have been returned.

So does that mean that nearly 25% of mail-in ballots sent out were unverified?

END

Trump Was Right On TikTok, Top Democrat Senator Admits

THURSDAY, OCT 27, 2022 – 11:26 AM

Authored by Victoria Kelly-Clark via The Epoch Times (emphasis ours),

One of the Democratic Party’s leading figures, Sen. Mark Warner (D-Va.), who is head of the United States Senate intelligence committee, has said former President Donald Trump was right when it came to the security risks around the Chinese-owned TikTok.

This is not something you would normally hear me say, but Donald Trump was right on TikTok years ago,” said Warner during a visit to Australia, reported The Sydney Moring Herald on Oct. 25.

Warner, who is currently in Australia to engage with local intelligence chiefs, politicians, and business people, also warned about the technological domination that the Chinese regime is exerting over other countries, calling it scary.

“China having this kind of technology domination in a number of countries ought to scare the heck out of us because we’ve seen the kind of Orwellian surveillance state they’ve already created within China,” he said.

Australia is Concerned About Tiktok

The U.S. is not the only country concerned about Tiktok.

Australia’s Home Affairs Minister Clare O’Neil has ordered cybersecurity authorities to investigate social media giant’s data collection security.

O’Neil, who is also the cybersecurity minister, has called on Australians who use TikTok to be cautious of the app’s data collection.

“I’d say to Australians: if you’re using TikTok, think about what data of yours might be being collected, and know that we’re not always 100 percent confident of how that data’s being used,” O’Neil said on an Australian Broadcasting Corp. (ABC) TV program on Sept. 5.

“We do need to take precautions in this digital age.”

According to Digital 2022, a report released by internet data research company WE ARE SOCIAL, the international version of TikTok has 7.38 million adult users in Australia, second only to Facebook, Facebook Messenger, and Instagram.

The move comes after TikTok Australia acknowledged in July that its employees in China had access to Australian users’ data.

“Our security teams minimize the number of people who have access to data and limit it only to people who need that access in order to do their jobs,” Brent Thomas, TikTok’s Australian director of public policy, wrote in reply to the shadow minister for cybersecurity and countering foreign interference, James Paterson.

We have policies and procedures that limit internal access to Australian user data by our employees, wherever they’re based, based on need.”

Trump Administration Wanted to Shut Down Tiktok

Former President Donald Trump attempted to shut down social media apps TikTok and WeChat in 2020, citing security risks because of their connections to the Chinese Communist Party (CCP).

Trump’s executive actions centred on ByteDance, a Beijing-based firm that owns TikTok, and WeChat, which is owned by the Shenzhen-based Tencent Holdings. However, they were blocked by federal court orders.

Read more here…

30,500147

end

KING REPORT

The King Report October 27, 2022 Issue 6874Independent View of the News
 Offshore Yuan Rises Most on Record as China Banks Sell Dollars
  The offshore yuan jumped 1.7% to 7.1917, while the currency climbed 1.4% in the mainland… State-owned banks were also see selling the dollar… suspected state bank intervention
https://www.bloomberg.com/news/articles/2022-10-26/offshore-yuan-gains-1-as-banks-sell-dollars-better-sentiment
 
The Bank of Canada on Wednesday hiked its benchmark interest by 50bps.  The market expected a 75bp rate hike.  The usual suspects immediately proclaimed that the Fed might ape the Bank of Canada and only hike fed funds by 50bps next week instead of the expected 75bps.
 
Bonds, stocks, and commodities soared; the dollar tanked on the hope that the Fed might pivot next week.  As we keep harping, the equity rally makes it less likely that the Fed will pivot next week and next month.
 
Another dynamic that might be driving stocks higher: The GOP is now favored to capture the Senate.  Fetterman’s disturbing debate performance on Tuesday night induced the betting markets to give Dr. Oz a 63% chance of winning the US Senate seat from Pennsylvania.  Bidenomics would end, with prejudice.
 
From the Fed’s view, economic data remains mixed; Q3 earnings are mixed; but gasoline prices are surging anew, and inflation, particularly for services, remains elevated.
 
@ClevFedResearch: Indirect consumer Inflation Expectations increased to 7.31% last week, from 7.03% in the prior week, implying that Consumer Expectations of inflation remain elevated.
View the indicator on @CebraOrg: https://t.co/2hfv5dAVCC
 
New York, New England Rationing Heating Oil
Heating oil stockpiles are at a third of normal levels for this time of year, causing suppliers to begin rationing in New York and New England, the Daily Mail reports… https://t.co/vFiTh40KI1
 
@SantiagoAuFund: If Powell tightens into a crisis, he can then pivot & safely (for him) do what central banks have always done. And most mkt participants will beg him to do it.  If he pivots before a crisis & inflation accelerates, he (and Fed) are done.  And he knows it.
 
@JackFarley96: U.S. banks had mark-to-market losses of nearly HALF A TRILLION DOLLARS at the end of Q3, per @rcwhalen. 20% of CET1 capital. Major banks such as BofA are burying the losses in the “bowels of the bank.” Important – the losses are due to rate risk – NOT CREDIT risk…
https://twitter.com/JackFarley96/status/1584917281938804740
 
 
@charliespiering: Incredible. Team Biden worked frantically to cut a deal with the Saudis to manipulate gas/oil prices before the election and thought they had a secret deal.
 
U.S. Officials Had a Secret Oil Deal with the Saudis. Or So They Thought.
After Saudi leaders pushed to slash oil production despite a visit by President Biden, American officials have been left fuming that they were duped…
    Leading proponents of the visit, including Mr. Hochstein and Brett McGurk, the top National Security Council official for Middle East policy, met during the spring with Prince Mohammed and his advisers. American officials said that in May, they reached a private oil deal with the Saudis that had two parts.
    First, the Saudis would accelerate an OPEC Plus production increase of 400,000 barrels per day already planned for September, moving it to July and August. Then the Saudis would get the cartel to announce a further production increase of 200,000 barrels per day for each month from September to December of this year
    American officials say they believe that Prince Mohammed was particularly influenced by a high-level Sept. 27 meeting in which Prince Abdulaziz, the energy minister, argued that oil production cuts were needed to keep prices from plummeting to as low as $50 per barrel. The U.S. officials said they learned Prince Abdulaziz asserted that, under such a scenario, the Saudi government would lack the resources to fund economic diversification projects at the heart of Prince Mohammed’s domestic agenda.
    Some U.S. officials believe that the Russians influenced the Saudi about-face, pointing to Prince Abdulaziz’s strong working ties with top Russian officials close to Mr. Putin, particularly Alexander Novak, the deputy prime minister who oversees energy policy…  https://t.co/TUzhLbgfeA
 
US September New Home Sales are 603k; 580k was expected.  August was revised to 677k from 685k.
 
U.S. new home sales fall in September; prices remain high http://reut.rs/3syY2KL
The median new house price in September was $470,600, a 13.9% increase from a year ago…
 
ESZs traded deeply negative during Asian trading due to Google and Microsoft’s poor results.  When Europe opened, ESZs rallied 22 handles by4:37 ET.  They then rolled over until then went nearly vertical at 10:00 ET.  ESZs peaked at 3897.50; they sank to 3838.50 by 13:32 ET.  After a 17-handle rebound, ESZs and stocks headed south again.  ESZs bottomed at 3836.25 (-61.25 from high) at 15:05 ET.
 
A 15-handle A-B-C rally for ESZs ended at 15:46 ET.  ESZs and stocks sank into the close on exhaustion.
 
USZs peaked (121 23/32) at 11:33 ET; they traded sideways, in a half-point range thereafter.  Apparently, Europeans were excited buyers of US Treasuries and US stocks on Wednesday.
 
@bespokeinvest: The only other time in at least the last ten years that Alphabet and Microsoft traded down 5% on the same day and the Nasdaq was down less than 1% was back in April 2016.
 
Positive aspects of previous session
China intervention and the feckless BoC ignite a risk rally
 
Negative aspects of previous session
Commodity prices rallied sharply, even though gasoline retreated
ESZs and US equities peaked early after incontinent buying by various classes of traders
Fangs got hammered
 
Ambiguous aspects of previous session
Which central bank or government will intervene next?
Have US equities hit a ‘the Fed pivot is nigh’ and the Q3 results peak?
First Hour/Last Hour Action [S&P 500 Index]: 1st Hour from NYSE open: Up; Last Hour: Up
 
Pivot Point for S&P 500 Index [above/below indicates daily trend to traders]: 3846.97
Previous session High/Low3886.15; 3824.07
 
Pfizer Probed in Italy for Allegedly Hiding $1.2 Billion Profit – BBG
https://twitter.com/gurgavin/status/1585353533461004290/photo/1
 
After the close, Meta (Facebook) reported EPS of 1.64 (1.89 exp); Revenue of $27.71B ($27.41B exp); average price per ad -18% (-15.3% exp); and sees Q4 Revenue at $30B to $32.5B, $32.2B prior estimate.  META sank as much as 19.0% in after-hour trading.
 
@JackFarley96: META Q3 2022 vs. Q3 2021 comparison: earnings are down 49%; revenues are down 4%; costs are up 19%
 
Today – Have US equities have hit the Q3 results peak and/or the ‘Fed pivot is nigh’ peak?  ESZs are +19.00 at 20:15 ET despite Meta’s travails because Amazon and Apple report results are the close.  The seasonal upward bias for Fang results ends soon after Amazon and Apple report results.
 
If AMZN and/or AAPL results disappoint, the frenzy to unload will be extreme.  If results are good, tomorrow will mark the end of the rally.  Calculating traders will liquidate into late strength. 
 
Beaucoup traders of various classes are trapped long Fangs and Fang options.  Netflix reported great results; Meta, MSFT, and GOOGL reported poor or disappointing results.   Be alert for a pump & dump!
 
3800 is important support for the S&P 500 Index. 
 
Expected economic data: Q3 GDP 1.4%, Consumption 1.0%, GDP Price Index 5.3%, Core PCE 4.5%; Sept Durable Goods 0.6% m/m, ex-Trans 0.2%, Nondef ex-Air 0.3%, Shipments 0.4%; Initial Jobless Claims 220k, Continuing Claims 1.39m; KC Fed Mfg Activity -2
 
Expected earnings: CAT 3.18, MRK 173, BAX .82, HON 2.15, BWA 1.04, CMCSA .90, NOC 6.11, IP 1.21, MCD 2.57, TXT .93, MO 1,30, MA 2.57, LUV .45, COF 5.10, INTC .33, AMZN .22, AAPL 1.26
 
S&P 500 Index 50-day MA: 3859; 100-day MA: 3909; 150-day MA: 4022; 200-day MA: 4122
DJIA 50-day MA: 30,0992; 100-day MA: 31,393; 150-day MA: 32,095; 200-day MA: 32,682
 
S&P 500 Index – Trender trading model and MACD for key time frames
MonthlyTrender and MACD are negative – a close above 4570.18 triggers a buy signal
WeeklyTrender and MACD are negative – a close above 3951.16 triggers a buy signal
Daily: Trender and MACD are positive – a close below 3645.85 triggers a sell signal
Hourly: Trender is positive; MACD is negative – a close below 3826.97 triggers a sell signal
 
Hunter Biden’s ‘flirty’ Chinese secretary who urged ‘Uncle Joe’ to run is new GOP focus
First son Hunter Biden’s “flirty” former secretary JiaQi “Jackie” Bao, who pushed for “Uncle Joe” Biden to run for president and has been linked to the Chinese government, is the focus of a new House Republican inquiry into the first family’s extensive overseas business dealings…
    Bao “worked for the [Chinese government’s] National Development and Reform Commission (NDRC), which ‘is in charge of China’s macroeconomic planning’ and approves any major project that receives foreign funding” and therefore “was linked to the Communist Party of China (CCP), her employer before the Biden family.”  “After infiltrating the Biden family, Bao urged Hunter to encourage Joe Biden to run for president months before he announced and then supplied the Biden family campaign advice related to China,” the letter says…
    “Documents obtained by Committee Republicans reveal that Bao was also working for CEFC employees linked to the CCP. Regarding a potential US liquified natural gas (LNG) purchase Bao and the Bidens sought to sell to China, Bao told Hunter Biden, Jim Biden and CEFC associates in an email that ‘my job is to make sure our interest is protected.’”…
https://nypost.com/2022/10/26/hunter-bidens-chinese-secretary-who-urged-joe-to-run-is-new-gop-focus/
 
Biden mimics reporters shouting questions, declines to answer any as midterm elections loom
The White House Correspondents’ Association has tried since June 2021 to understand and end a mysterious prescreening process for journalists allowed into large indoor events with Biden.. prompting journalists… to sign an unprecedented protest letter in June… Biden’s team has also frustrated journalists by giving very few interviews and press conferences… https://trib.al/musRUaq
 
@FreeBeacon: Biden: “Some airlines, if you want six more inches between you and the seat in front, you pay more money but you don’t know it … these are junk fees, they’re unfair and they hit marginalized Americans the hardest, especially … people of color.”
https://twitter.com/FreeBeacon/status/1585293597796360194
 
Violent Crime Is Driving a Red Wave
Voters… link the rise in crime to Democratic policies, to their unwillingness to make public safety a high priority, to their refusal to enforce the law. They don’t believe candidates who blame these problems mainly on bad policing or “systemic racism.”…
    The Democrats’ message on crime is failing for another reason: They control the cities where crime is rampant…Violent crime, in particular, has reached record levels…
https://www.realclearpolitics.com/articles/2022/10/25/violent_crime_is_driving_a_red_wave_148370.html
 
‘Don’t know why that’s so important’: Hochul baffled when Zeldin talks jailing criminals during NY gov debate – Gov. Kathy Hochul stunningly said she didn’t know why it’s “so important” to lock up criminals when confronted by Republican challenger Lee Zeldin over the state’s controversial bail reform law during their first and only debate Tuesday night… https://t.co/GSxj4MYimH
 
WSJ Editorial Board: Why Democrats Are Losing The Midterms
With Trump out of the spotlight, voters are focusing on how far left the Democratic Party has turned.
    Democrats are finally paying for their sharp left turn during the Trump Presidency. That turn began in earnest with Alexandria Ocasio-Cortez’s 2018 primary victory in New York over party war horse Joe Crowley. That scared Democrats nationwide, and it caused many to adopt positions well to the left-of-center to avoid Mr. Crowley’s fate…Crime is another issue where Democratic excess has left candidates asking voters to deny what they see with their own eyes
    The Trump Presidency caused many people to lose their minds, Democrats and the media most of all. The normal party checks on radical policies vanished as opposition to Trump became the party’s self-defining political mission. Perhaps a drubbing on Nov. 8 will jolt the party back to reality.
https://www.wsj.com/articles/why-democrats-are-losing-john-fetterman-mehmet-oz-fracking-pennsylvania-far-left-u-s-senate-11666821289
 
Fetterman stumbles over speech in Pa. Senate debate with Dr. Oz https://t.co/AXOgEu2rC6
 
Senior Dems slam Fetterman’s decision to take part in debate with Dr. Oz
https://www.dailymail.co.uk/news/article-11357385/Senior-Dems-slam-Fettermans-decision-debate-Dr-Oz.html
 
Letting John Fetterman debate was political malpractice
His performance was all the more pitiful as it was avoidable
    Lieutenant Governor John Fetterman, hobbled by a stroke that has done significant damage to his capacity, was wheeled onto stage at the sole Pennsylvania Senate debate against Dr. Mehmet Oz where the performance was cringe-inducing…
https://spectatorworld.com/topic/forcing-john-fetterman-debate-dr-oz-pennsylvania/
 
@IAPolls2022: WPXI Online Poll Who won the PA Senate Debate? (R) Mehmet Oz — 82%
(D) John Fetterman — 18%
 
@RaheemKassam: The Fetterman campaign is blaming the teletext system THEY DEMANDED for their candidate — coz he can’t process questions in real time — for his poor performance. Just… wow.
 
@NewsNation: A Nexstar spokesperson says both candidates agreed to the technical setup and had the opportunity to do two full rehearsals, but Fetterman only did one. Morehttps://trib.al/DpEcJFM
 
Gisele Fetterman Owes Dasha Burns an Apology
A lot of people — including Fetterman’s wife — owe public apologies to NBC’s Dasha Burns, who reported a couple of weeks ago that Fetterman could not understand her small talk, and was smeared and lambasted for her troubles….  https://www.nationalreview.com/corner/gisele-fetterman-owes-dasha-burns-an-apology/
 
Hemingway: Media Cover Up Fetterman’s Problems Just Like They Covered Up Biden’s
https://thefederalist.com/videos/hemingway-media-cover-up-fettermans-problems-just-like-they-covered-up-bidens/
 
Can’t blame Team Fetterman for trying the ploy that Team Big Guy successfully utilized!
 
@realDailyWire: Kamala: “Who doesn’t love a yellow school bus, right? Can you raise your hand if you love a yellow school bus? Many of us went to school on the yellow school bus, right? …The excitement and joy of going to school…the school bus takes us there.”
https://twitter.com/realDailyWire/status/1585326160715866112
 
McConnell creates new rift inside GOP, earning censure from Alaska state party – Senate leader spends millions attacking GOP nominee Tshibaka to help old friend, Trump foe Murkowski.
    The Alaska Republican Party responded Monday by voting to censure McConnell for spreading “divisive and misleading statements” about Tshibaka, who was endorsed both by the state party and former President Donald Trump. The censure resolution, which passed 49-8, also declared McConnell’s financial support for Murkowski to be “in direct contradiction” to the party’s rules
https://justthenews.com/politics-policy/elections/mcconnell-creates-new-rift-inside-gop-earning-censure-alaska-state-party
 
Justice Alito said the leak of his draft opinion eliminating the constitutional right to abortion made members of the Supreme Court majority “targets for assassination.”    https://t.co/h53uas2AVr
 
MSNBC contributor claims GOP rhetoric is ‘dangerous’ while calling them ‘fascist,’ ‘Nazi’ is ‘correct’ https://t.co/hh2DTdpp2K
 
@axios: People in the Midwest are more distrustful of major American institutions than any other part of the country, according to data from the Edelman Trust Barometer. https://twitter.com/axios/status/1584324278220386304
 
Babylon Bee: Democrats Form Committee to Get to The Bottom of Who Did All Those Lockdowns and Vaccine Mandates https://t.co/I2DdA8HQ2h
 
 

GREG HUNTER REPORT 

WILL SEE YOU TOMOROW

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