FEB 22/GOLD CLOSED DOWN 60 CENTS TO $1832.65/SILVER CLOSED DOWN 22 CENTS TO $21.63//PLATINUM CONTINUES TO CLIMB AGAINST PALLADIUM: PLATINUM ROSE BY $11.65 TO $953.25 WHILE PALLADIUM CLOSED DOWN $36.70 TO $1491.95//UPDATES ON COVID//VACCINES//DR PAUL ALEXANDER/DR PANDA/VACCINE IMPACT//SLAY NEWS//UPDATES ON RUSSIA VS UKRAINE//UPDATES ON EAST PALESTINE DISASTER//TRUMP VISITS EAST PALESTINE//USA DATA: WORLD’S LARGEST CHIP MAKER INTEL SUFFERS LOSS AND CUTS ITS DIVIDEND//SWAMP STORIES FOR YOU TONIGHT./
072 C GOLDMAN 1 104 C MIZUHO 1 118 C MACQUARIE FUT 201 435 H SCOTIA CAPITAL 1 624 H BOFA SECURITIES 98 657 C MORGAN STANLEY 2 1 661 C JP MORGAN 10 686 C STONEX FINANCIA 5 709 C BARCLAYS 1 737 C ADVANTAGE 1 800 C MAREX SPEC 4 8 905 C ADM 13 991 H CME 67
TOTAL: 207 207
JPMORGAN STOPPED 10/207
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GOLD: NUMBER OF NOTICES FILED FOR FEB/2023. CONTRACT: 207 NOTICES FOR 20700 OZ or 0.6438 TONNES
total notices so far: 14,846 contracts for 1,484,700 oz (46.180 tonnes)
SILVER NOTICES: 8 NOTICE(S) FILED FOR 40,000 OZ/
total number of notices filed so far this month :860 for 4,300,000 oz
END
GLD
WITH GOLD DOWN $0.60
INVESTORS SWITCHING TO SPROTT PHYSICAL (PHYS) INSTEAD OF THE FRAUDULENT GLD
/NO CHANGES IN GOLD INVENTORY AT THE GLD////
INVENTORY RESTS AT 919.92TONNES
Silver//SLV
WITH NO SILVER AROUND AND SILVER DOWN 22 CENTS
AT THE SLV// SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 689,000 OZ INTO THE SLV/
INVESTORS ARE SWITCHING SLV TO SPROTT’S PSLV
CLOSING INVENTORY: 485.693. MILLION OZ (CORRECTED)
Let us have a look at the data for today
SILVER//OUTLINE
SILVER COMEX OI FELL BY A HUGE SIZED 2732 CONTRACTS TO 123,906 AND FURTHER FROM THE RECORD HIGH OI OF 244,710, SET FEB 25/2020 AND THE FAIR LOSS IN COMEX OI WAS ACCOMPLISHED DESPITE OUR $0.14 GAIN IN SILVER PRICING AT THE COMEX ON TUESDAY. WE HAVE NOW SURPASSED OUR ALL TIME LOW OF 124,000 OI CONTRACTS. OUR BANKERS WERE UNSUCCESSFUL IN KNOCKING THE PRICE OF SILVER DOWN (IT ROSE BY $0.14). AND WERE SUCCESSFUL IN KNOCKING SOME SPEC LONGS, AS WE HAD A HUGE SIZED LOSS ON OUR TWO EXCHANGES 1989 CONTRACTS. AS WELL, WE HAD 890 NOTICES FOR EXCHANGE FOR RISK TRANSFER (4.45 MILLION OZ. ) AS THE TOTAL ISSUED IN THIS CATEGORY SO FAR THIS MONTH TOTAL 6.225 MILLION OZ. WE HAVE FINISHED WITH OUR SPECS BEING SHORT AS THEY COVERED WITH THE RISE IN PRICE IN JANUARY . WE HAVE NOW RETURNED TO OUR USUAL AND CUSTOMARY SCENARIO: BANKERS SHORT AND SPECS LONG.
WE MUST HAVE HAD: A GOOD ISSUANCE OF EXCHANGE FOR PHYSICALS( 569 CONTRACTS) iiii) AN INITIAL SILVER STANDING FOR COMEX SILVER MEASURING AT 0.540. MILLION OZ FOLLOWED BY TODAY’S 115,000 OZ QUEUE JUMP OF 40,000 OZ// NEW TOTALS STANDING = 4.40 MILLION OZ + 6.225 MILLION OF EXCHANGE FOR RISK//TOTAL STANDING 10.625 MILLION OZ//// V) HUGE SIZED COMEX OI LOSS/ GOOD SIZED EFP ISSUANCE/
I AM NOW RECORDING THE DIFFERENTIAL IN OI FROM PRELIMINARY TO FINAL -174
HISTORICAL ACCUMULATION OF EXCHANGE FOR PHYSICALS FEB. ACCUMULATION FOR EFP’S SILVER/JPMORGAN’S HOUSE OF BRIBES/STARTING FROM FIRST DAY/MONTH OF FEB:
TOTAL CONTRACTS for 15 days, total 14,067 contracts: OR 70.335 MILLION OZ . (937 CONTRACTS PER DAY)
TOTAL EFP’S FOR THE MONTH SO FAR: 70.335 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. 29.017 MILLION OZ FINAL
NOV: 134.290 MILLION OZ//FINAL
DEC, 61.395 MILLION OZ FINAL
JAN 2023/// 53.070 MILLION OZ //FINAL
FEB: 2023: 70.335/ MILLION OZ/INITIAL//MUCH STRONGER ISSUANCE VS THE LATTER TWO MONTHS.
RESULT: WE HAD A GIGANTIC SIZED DECREASE IN COMEX OI SILVER COMEX CONTRACTS OF 2732 DESPITE OUR $0.14 GAIN IN SILVER PRICING AT THE COMEX//TUESDAY.,. THE CME NOTIFIED US THAT WE HAD A GOOD SIZED EFP ISSUANCE CONTRACTS: 569 CONTRACTS ISSUED FOR MAR 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 FEB OF 0.54 MILLION OZ FOLLOWED BY TODAY’S 40,000 OZ QUEUE JUMP = NEW STANDING: 4.40 MILLION OZ + 6.225 MILLION OZ EXCHANGE FOR RISK://NEW STANDING INCREASES TO 10.625 MILLION OZ .. WE HAVE A HUGE SIZED LOSS OF 1989OI CONTRACTS ON THE TWO EXCHANGES
WE HAD 8 NOTICE(S) FILED TODAY FOR 40,000 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 TINY SIZED 132 CONTRACTS TO 422,648 AND CLOSER TO THE RECORD (SET JAN 24/2020) AT 799,541 AND PREVIOUS TO THAT: (SET JAN 6/2020) AT 797,110.
THE DIFFERENTIAL FROM PRELIMINARY OI TO FINAL OI IN GOLD TODAY: REMOVED 1722 CONTRACTS.
.
WE HAD A TINY SIZED INCREASE IN COMEX OI ( 132 CONTRACTS) DESPITE OUR $7.45 LOSS IN PRICE. WE ALSO HAD A SMALL INITIAL STANDING IN GOLD TONNAGE FOR FEB. AT 41.601 TONNES ON FIRST DAY NOTICE FOLLOWED BY TODAY’S QUEUE JUMP OF 6000 OZ //NEW STANDING: 47.079 TONNES//(QUEUE JUMPING = EXERCISING LONDON BASED EFP’S ) (EFP is the transfer of contracts immediately to London for potential gold deliveries originating from London). TONNES
YET ALL OF..THIS HAPPENED WITH OUR $7.45 LOSS IN PRICEWITH RESPECT TO TUESDAY’S TRADING
WE HAD A FAIR SIZED GAIN OF 1610 OI CONTRACTS (5.007 PAPER TONNES) ON OUR TWO EXCHANGES
E.F.P. ISSUANCE
THE CME RELEASED THE DATA FOR EFP ISSUANCE AND IT TOTALED A FAIR SIZED 1478 CONTRACTS:
The NEW COMEX OI FOR THE GOLD COMPLEX RESTS AT 422,248
IN ESSENCE WE HAVE A FAIR SIZED INCREASE IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 1610 CONTRACTS WITH 132CONTRACTS INCREASED AT THE COMEX AND 1478 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS TOTAL OI GAIN ON THE TWO EXCHANGES OF 1610 CONTRACTS OR 10.364 TONNES.
CALCULATIONS ON GAIN/LOSS ON OUR TWO EXCHANGES
WE HAD A FAIR SIZED ISSUANCE IN EXCHANGE FOR PHYSICALS (1478 CONTRACTS) ACCOMPANYING THE TINY SIZED GAIN IN COMEX OI (132) TOTAL GAIN IN THE TWO EXCHANGES 1610 CONTRACTS. WE HAVE ( 1) NOW RETURNED TO OUR NORMAL FORMAT OF BANKERS GOING SHORT AND SPECULATORS GOING LONG ,2.) FAIR INITIAL STANDING AT THE GOLD COMEX FOR FEB. AT 41.601 TONNES FOLLOWED BY TODAY’S 6,000 OZ QUEUE JUMP // ///3) ZERO LONG LIQUIDATION //4) TINY SIZED COMEX OPEN INTEREST GAIN// 5) FAIR ISSUANCE OF EXCHANGE FOR PHYSICAL PAPER/
HISTORICAL ACCUMULATION OF EXCHANGE FOR PHYSICALS IN 2023 INCLUDING TODAY
FEB
ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF FEB :
38,887 CONTRACTS OR 3,740,900 OZ OR 120.95 TONNES 15 TRADING DAY(S) AND THUS AVERAGING: 2592 EFP CONTRACTS PER TRADING DAY
TO GIVE YOU AN IDEA AS TO THE SIZE OF THESE EFP TRANSFERS : THIS MONTH IN 15 TRADING DAY(S) IN TONNES 120.95 TONNES
TOTAL ANNUAL GOLD PRODUCTION, 2022, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 3555 TONNES
THUS EFP TRANSFERS REPRESENTS 120.95/3550 x 100% TONNES 3.40% OF GLOBAL ANNUAL PRODUCTION
SEPT 142.12 TONNES FINAL ISSUANCE ( LOW ISSUANCE)_
OCT: 141.13 TONNES FINAL ISSUANCE (LOW ISSUANCE)
NOV: 312.46 TONNES FINAL ISSUANCE//NEW RECORD!! (INCREASING DRAMATICALLY)//SIGN OF REAL STRESS//SURPASSING THE MARCH 2021 RECORD OF 276.50 TONNES OF EFP
DEC. 175.62 TONNES//FINAL ISSUANCE//
JAN:2022 247.25 TONNES //FINAL
FEB: 196.04 TONNES//FINAL
MARCH: 409.30 TONNES INITIAL( THIS IS NOW A RECORD EFP ISSUANCE FOR MARCH AND FOR ANY MONTH.
APRIL: 169.55 TONNES (FINAL VERY LOW ISSUANCE MONTH)
MAY: 247,44 TONNES FINAL//
JUNE: 238.13 TONNES FINAL
JULY: 378.43 TONNES FINAL
AUGUST: 180.81 TONNES FINAL
SEPT. 193.16 TONNES FINAL
OCT: 177.57 TONNES FINAL ( MUCH SMALLER THAN LAST MONTH)
NOV. 223.98 TONNES//FINAL ( MUCH LARGER THAN PREVIOUS MONTHS//comex running out of physical)
DEC: 185.59 tonnes // FINAL
JAN 2023: 228.49 TONNES FINAL//HUGE AMOUNT OF EFP’S ISSUED THIS MONTH!!
FEB: 120.95 TONNES/INITIAL
SPREADING OPERATIONS
(/NOW SWITCHING TO GOLD) FOR NEWCOMERS, HERE ARE THE DETAILS
SPREADING LIQUIDATION HAS NOW COMMENCED AS WE HEAD TOWARDS THE NEW ACTIVE FRONT MONTH OF FEB. WE ARE NOW INTO THE SPREADING OPERATION OF BOTH GOLD (
HERE IS A BRIEF SYNOPSIS OF HOW THE CROOKS FLEECE UNSUSPECTING LONGS IN THE SPREADING ENDEAVOUR ;MODUS OPERANDI OF THE CORRUPT BANKERS AS TO HOW THEY HANDLE THEIR SPREAD OPEN INTERESTS:HERE IS HOW THE CROOKS USED SPREADING AS WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF OCT HEADING TOWARDS THE ACTIVE DELIVERY MONTH OF FEB., FOR BOTH GOLD:
YOU WILL ALSO NOTICE THAT THE COMEX OPEN INTEREST STARTS TO RISE BUT SO IS THE OPEN INTEREST OF SPREADERS. THE OPEN INTEREST IN WILL CONTINUE TO RISE UNTIL ONE WEEK BEFORE FIRST DAY NOTICE OF AN UPCOMING ACTIVE DELIVERY MONTH (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 FELL BY A HUGE SIZED 2732 CONTRACTS OI TO 123,906 AND FURTHER FROM OUR COMEX HIGH RECORD //244,710(SET FEB 25/2020). THE LAST RECORDS WERE SET IN AUG.2018 AT 244,196 WITH A SILVER PRICE OF $14.78/(AUGUST 22/2018)..THE PREVIOUS RECORD TO THAT WAS SET ON APRIL 9/2018 AT 243,411 OPEN INTEREST CONTRACTS WITH THE SILVER PRICE AT THAT DAY: $16.53). AND PREVIOUS TO THAT, THE RECORD WAS ESTABLISHED AT: 234,787 CONTRACTS, SET ON APRIL 21.2017 OVER 5 YEARS AGO. HOWEVER WE HAVE SET A RECORD LOW OF 124,080 CONTRACTS TODAY.
EFP ISSUANCE 569 CONTRACTS
OUR CUSTOMARY MIGRATION OF COMEX LONGS CONTINUE TO MORPH INTO LONDON FORWARDS AS OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE:
MAR 569 and ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 569 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. IF WE TAKE THE COMEX OI LOSS OF 2732 CONTRACTS AND ADD TO THE 569 OI TRANSFERRED TO LONDON THROUGH EFP’S,
WE OBTAIN A HUGE LOSS OF 2163 OPEN INTEREST CONTRACTS FROM OUR TWO EXCHANGES.
THUS IN OUNCES, THE LOSS ON THE TWO EXCHANGES 10.815 MILLION OZ//
OCCURRED DESPITE OUR TINY $0.14 GAIN IN PRICE ….. OUR SPEC SHORTS HAVE NOWHERE TO HIDE!
4. Chris Powell of GATA provides to us very important physical commentaries
end
5. Other gold/silver commentaries
6. Commodity commentaries//
7/CRYPTOCURRENCIES/BITCOIN ETC
3. ASIAN AFFAIRS
i)WEDNESDAY MORNING//TUESDAY NIGHT
SHANGHAI CLOSED DOWN 15.38 PTS OR 0.47% //Hang Seng CLOSED DOWN 105.65 PTS OR 0.85% /The Nikkei closed DOWN 368.78 PTS OR 1.34% //Australia’s all ordinaries CLOSED DOWN 0.36% /Chinese yuan (ONSHORE) closed DOWN 6.8947 //OFFSHORE CHINESE YUAN DOWN TO 6.9014// /Oil DOWN TO 75.93 dollars per barrel for WTI and BRENT AT 82.51 / 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 TINY SIZED 132 CONTRACTS UP TO 422,648 DESPITE OUR LOSS IN PRICE OF $7.45. I THINK WE HAVE HIT OUR LOW IN OPEN INTEREST YESTERDAY AT 422,516.
EXCHANGE FOR PHYSICAL ISSUANCE
WE ARE NOW IN THE ACTIVE DELIVERY MONTH OF FEB… 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 1478 EFP CONTRACTS WERE ISSUED: : APRIL 1478 & ZERO FOR ALL OTHER MONTHS:
TOTAL EFP ISSUANCE: 1478 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 1610 CONTRACTS IN THAT 1478LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE HAD A FAIR SIZED COMEX OI GAIN OF 1854 CONTRACTS..AND THIS TINY SIZED GAIN ON OUR TWO EXCHANGES HAPPENED (DESPITE OUR FALL IN PRICE OF $7.45). WE ARE NOW WITNESSING THE BANKERS GOING NET SHORT AND THE SPECS GOING NET LONG.
// WE HAVE A STRONG AMOUNT OF GOLD TONNAGE STANDING: FEB (47.079)
TONNES),
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 YEAR 2021 (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: 77.390 TONNES/ FINAL
NOV 27.110 TONNES/FINAL
Dec. 64.541 tonnes (TOTAL YEAR 656.076 TONNES)
2003:
JAN/2023: 20.559 tonnes
FEB 2023: 46.893 tonnes
THE SPECS/HFT WERE SUCCESSFUL IN LOWERING GOLD’S PRICE( IT FELL $7.45) //// BUT WERE UNSUCCESSFUL IN KNOCKING ANY SPECULATOR LONGS AS WE HAD A FAIR SIZED GAIN OF 3332 CONTRACTS ON OUR TWO EXCHANGES
WE HAVE GAINED A TOTAL OI OF 5.007 PAPER TONNES OF TOTAL OI FROM OUR TWO EXCHANGES, ACCOMPANYING OUR INITIAL GOLD TONNAGE STANDING FOR FEB. (41.219 TONNES) FOLLOWED BY TODAY’S QUEUE. JUMP OF 6000 OZ OR 0.1866 TONNES//NEW STANDING INCREASES TO 47.079 tonnes … ALL OF THIS WAS ACCOMPLISHED DESPITE OUR FALL IN PRICE TO THE TUNE OF $7.45.
WE HAD- 1722 CONTRACTS COMEX TRADES (REMOVED) TO OPEN INTEREST AFTER TRADING ENDED LAST NIGHT
NET GAIN ON THE TWO EXCHANGES 1610 CONTRACTS OR 161,000 OZ OR 5.007 TONNES
Estimated gold comex today 123,827// //poor
final gold volumes/yesterday 220,181/// fair
INITIAL STANDINGS FOR FEB 2023 COMEX GOLD //FEB 22//
Total monthly oz gold served (contracts) so far this month
14,847 notices 1,484,700 46.180TONNES
Total accumulative withdrawals of gold from the Dealers inventory this month
NIL oz
Total accumulative withdrawal of gold from the Customer inventory this month
x
i)Dealer deposits: 0
total dealer deposit: nil oz
No dealer withdrawals
Customer deposits: 0
total deposits: NIL oz
customer withdrawals: 0
total withdrawals: NIL oz
in tonnes: 0.0 tonnes
Adjustments; 0
CALCULATIONS FOR THE AMOUNT OF GOLD STANDING FOR FEBRUARY.
For the front month of FEBRUARY we have an oi of 496 contracts having gained 37 contracts. We had 23 notices
filed on Friday so we gained 60 contracts or an additional 6000 oz will stand searching for metal at the comex
March gained 60 contracts to stand at 2040.
April lost 3384 contracts down to 332,225
We had 207 notice(s) filed today for 20700 oz
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 207 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer notice(s) was (were) stopped 10/ Received) by J.P.Morgan//customer account 3 and 0 notice(s) received (stopped) by the squid (Goldman Sachs)
To calculate the INITIAL total number of gold ounces standing for the FEB. /2023. contract month,
we take the total number of notices filed so far for the month (14,847 x 100 oz ), to which we add the difference between the open interest for the front month of (FEBRUARY 496 CONTRACTS) minus the number of notices served upon today 207 x 100 oz per contract equals 1,513,600 OZ OR 47.079 TONNES the number of TONNES standing in this active month of February.
thus the INITIAL standings for gold for the FEB contract month:
No of notices filed so far (14,847 x 100 oz+ 496 OI for the front month minus the number of notices served upon today (207)x 100 oz} which equals 1,513,600 oz standing OR 47.079 TONNES in this active delivery month of FEBRUARY..
TOTAL COMEX GOLD STANDING: 47.079TONNES. SO JUST LIKE LAST MONTH WE START WITH A LOW INITIAL AMOUNT OF GOLD STANDING BUT THIS WILL GROW AS THE MONTH PROCEEDS TO ITS CONCLUSION.
To calculate the number of silver ounces that will stand for delivery in FEBRUARY. we take the total number of notices filed for the month so far at 860 x 5,000 oz = 4,300,000 oz
to which we add the difference between the open interest for the front month of FEB(28) and the number of notices served upon today 8 x (5000 oz) equals the number of ounces standing.
Thus the standings for silver for the FEB./2023 contract month:860 (notices served so far) x 5000 oz + OI for the front month of FEB 28 – number of notices served upon today (8) x 500 oz of silver standing for the FEB. contract month equates 4.40 million oz + PREVIOUS 1.775 MILLION OZ ( EXCHANGE FOR RISK)+ 4.450 NEW EXCHANGE FOR RISK = 10.625 MILLION OZ//(TOTAL OZ OF SILVER STANDING).
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
END
GLD AND SLV INVENTORY LEVELS
FEB 22/WITH GOLD DOWN 22 CENTS TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 919.92 TONNES
FEB 21/WITH GOLD DOWN $7.45 TODAY: HUGE CHANGES IN GOLD INVENTORY AT THE GLD A WITHDRAWAL OF 1.16 TONNES OF GOLD FROM THE GLD///INVENTORY RESTS AT 919.92 TONNES
FEB 17/WITH GOLD DOWN $1.35 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 921.08 TONNES
FEB 16/WITH GOLD UP $6.80 TODAY; SMALL CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSITOF .29 TONNES OF GOLD INTO THE GLD///INVENTORY RESTS AT 921.08 TONNES
FEB 15/WITH GOLD DOWN $19.65 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 920.79 TONNES
FEB 14/WITH GOLD UP $1.40 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 920.79 TONNES
FEB 13/WITH GOLD DOWN $9.90 TODAY: SMALL CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF .31 TONNES FORM THE GLD///INVENTORY RESTS AT 920.79 TONNES
FEB 10/WITH GOLD DOWN $4.05 TODAY: SMALL CHANGES IN GOLD INVENTORY AT THE GLD//A WITHDRAWAL OF .0.38 TONNES/INVENTORY RESTS AT 920.79 TONNES
FEB 9/WITH GOLD DOWN $10.90 TODAY:SMALL CHANGES IN GOLD INVENTORY AT THE GLD A DEPOSIT OF .38 TONNES OF GOLD INTO THE GLD./INVENTORY RESTS AT 921.10 TONNES
FEB 8/WITH GOLD UP $6.15 TODAY: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 2.9 TONNES OF GOLD INTO THE GLD////INVENTORY RESTS AT 920.82 TONNES
FEB 7/WITH GOLD UP $5.25 TODAY: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.32 TONNES OF GOLD FROM THE GLD////INVENTORY RESTS AT 917.92 TONNES
FEB 6/WITH GOLD UP $3.30 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 920.24 TONNES
FEB 3/WITH GOLD DOWN $52.55 TODAY: STRANGE: BIG CHANGES AGAIN IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 1.74 TONNES OF GOLD INTO THE GLD///INVENTORY RESTS AT 920.24 TONNES
FEB 2/WITH GOLD $10.95 TODAY: BIG CHANGE IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 1.44 TONNES OF GOLD INTO THE GLD////INVENTORY RESTS AT 918.50 TONNES
FEB 1/WITH GOLD DOWN $2.55 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 917.06 TONNES
JAN 31/WITH GOLD UP $6.55 TODAY; BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.44 TONNES OF GOLD FROM THE GLD////INVENTORY RESTS AT 917.06 TONNES
JAN 30/WITH GOLD DOWN $6.00 TODAY: SMALL CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF .87 TONNES OF GOLD FROM THE GLD.//INVENTORY RESTS AT 918.50 TONNES
JAN 27/WITH GOLD DOWN $0.85 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 919.37 TONNES
JAN 26/WITH GOLD DOWN $11.55 TODAY; HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 2.03 TONNES OF GOLD INTO THE GLD////INVENTORY RESTS AT 919.37 TONNES
JAN 25/WITH GOLD UP $7.55 TODAY: SMALL CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF .28 TONNES OF GOLD INTO THE GLD/INVENTORY RESTS AT 917.34 TONNES
JAN 24/WITH GOLD UP $7.35 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 917.06 TONNES
JAN 23/WITH GOLD UP $0.25 TODAY: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 4.63 TONNES OF GOLD INTO THE GLD////INVENTORY RESTS AT 917.06 TONNES
JAN 20/WITH GOLD UP $4.75 TODAY;BIG CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 1.45 TONNES OF GOLD INTO THE GLD////INVENTORY RESTS AT 912.43 TONNES
JAN 19/WITH GOLD UP $16.95 TODAY; HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 1.74 TONNES INTO THE GLD///INVENTORY RESTS AT 910.98TONNES
JAN 18/WITH GOLD DOWN $1.95 TODAY; HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.9 TONNES FROM THE GLD////INVENTORY RESTS AT 909.24 TONNES
JAN 17/WITH GOLD DOWN $11.45 TODAY; NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 912.14 TONNES
JAN 13/WITH GOLD UP $22.90 TODAY: SMALL CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF .29 TONNES FROM THE GLD///INVENTORY RESTS AT 912.14 TONNES
JAN 12/WITH GOLD UP $20.55 TODAY: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.74 TONNES FROM THE GLD///INVENTORY RESTS AT 912.43 TONNES
JAN 11/WITH GOLD UP $1.20 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 914.17 TONNES
JAN 10/WITH GOLD UP $1.00 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD///INVENTORY RESTS AT 915.33 TONNES
JAN 9/WITH GOLD UP $ 8.60 TODAY: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.44 TONNES FROM THE GLD//.//INVENTORY RESTS AT 915.33 TONNES
JAN 6/WITH GOLD UP $28.80 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 916.77 TONNES
JAN 5/WITH GOLD DOWN $17.05 TODAY: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF .87 TONNES FORM THE GLD////INVENTORY RESTS AT 916.77 TONNES
JANUARY 4/WITH GOLD UP $32.40 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 917.64 TONNES
JAN 3/WITH GOLD UP $20.00 TODAY: SMALL CHANGES IN GOLD INVENTORY AT THE GLD:STRANGE: A WITHDRAWAL OF .87 TONNES FORM THE GLD////INVENTORY RESTS AT 917.64 TONNES
GLD INVENTORY: 919.92 TONNES
Now the SLV Inventory/( vehicle is a fraud as there is no physical metal behind them
FEB 22/WITH SILVER DOWN 22 CENTS TODAY:SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 689,000 OZ FROM THE SLV////INVENTORY RESTS AT 485.693 MILLION OZ
FEB 21/WITH SILVER UP 14 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.5363 MILLION OZ INTO THE SLV////INVENTORY RESTS AT 486.382 MILLION OZ//
FEB 17/WITH SILVER UP 2 CENTS TODAY: SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 827,000 OZ INTO THE SLV////INVENTORY RESTS AT 484.819 MILLION OZ/
FEB 16/WITH SILVER UP 8 CENTS TODAY: SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 690,000 OZ OF SILVER INTO THE SLV////INVENTORY RESTS AT 483.992 MILLION OZ//
FEB 15/WITH SILVER DOWN $0.26 TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 483.302 MILLION OZ//
FEB 14/WITH SILVER DOWN 1 CENT TODAY: SMALL CHANGES IN SILVER INVENTORY AT THE SLV” A WITHDRAWAL OF 460,000 OZ FROM THE SLV////INVENTORY RESTS AT 483.302 MILLION OZ//
FEB 13 WITH SILVER DOWN 17 CENTS TODAY; NO CHANGES IN SILVER INVENTORY AT THE SLV// INVENTORY RESTS AT 483.762 MILLION OZ//
FEB 10/WITH SILVER DOWN 8 CENTS: NO CHANGES IN SILVER INVENTORY AT THE SLV: //INVENTORY RESTS AT 483.762 MILLION OZ
FEB 9/WITH SILVER DOWN 14 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV: INVENTORY RESTS AT 483.76 MILLION OZ (CORRECTED).//
CLOSING INVENTORY 485.693 MILLION OZ//
PHYSICAL GOLD/SILVER STORIES
1:Peter Schiff
Thomas Jefferson’s Blueprint For Handling The National Debt
The way Thomas Jefferson handled the national debt should serve as a blueprint for today. But instead, modern presidents look more like college students on a spending spree with their first credit cards.
We all know how the debt ceiling fight will end. Congress will raise the borrowing limit and the government will keep right on spending money.
That reveals the nature of the problem. It’s not the debt ceiling. It’s the spending.
When Donald Trump took office in January 2017, he inherited a $19.95 trillion federal debt. He handed over a $27.75 trillion debt to Joe Biden. In just four years, the Trump administration added $7.8 trillion to the national debt.
But there was a time when some presidents took paying off Uncle Sam’s debts seriously. For instance, Thomas Jefferson faced a huge national debt when he took office in 1800. But unlike his modern counterparts, he didn’t grow it further. In fact, he significantly whittled down the debt.
“I am for a government rigorously frugal and simple, applying all the possible savings of the public revenue to the discharge of the national debt and not for a multiplication of officers & salaries merely to make partizans, & for increasing, by every device, the public debt, on the principle of it’s being a public blessing.”
Despite facing a number of contingencies, Jefferson limited federal spending, keeping total outlays flat at between $8 and $10 million throughout his presidency.
The Democrat-Republicans held costs down by cutting the federal bureaucracy. And they even managed to do this with a federal workforce totaling just 130 employees.
There wasn’t a whole lot of fat to slice, so Jefferson went to part of the budget where the money was being spent – the military. He argued that funding a standing army in peacetime was a colossal waste of money. In his first message to Congress, Jefferson wrote:
“Sound principles will not justify our taxing the industry of our fellow citizens to accumulate treasure for wars to happen we know not when, and which might not perhaps happen but from the temptations offered by that treasure.”
Congress responded to Jefferson’s message, reducing the army to 3,000 soldiers and 172 officers. It also cut the navy to six frigates and reduced the number of foreign embassies to only three — in Britain, France, and Spain.
All of these spending cuts freed up about $7 million in revenue annually. Secretary of Treasury Albert Gallatin used the surplus to pay down the debt.
At the same time, Congress even reduced taxes, eliminating the hated whiskey tax, along with other internal taxes.
During Jefferson’s tenure, the federal debt fell from $83 million in 1801 to $57 million in 1809. As Chris Edwards at the Cato Institute noted, the drop in debt was impressive, especially considering that the government swallowed that $13 million of added debt from the Louisiana Purchase.
Jefferson was also the beneficiary of a growing economy. After falling in the first two years of his first term, primarily due to the tax cuts, federal revenues soared to nearly $17 million by the end of his presidency. This was largely a function of a huge increase in import duties. Instead of using growing revenue to increase the size and scope of the federal government, Jefferson and Gallatin applied the surplus to pay down the debt.
“A rigid economy of the public contributions and absolute interdiction of all useless expenses will go far towards keeping the government honest and unoppressive.”
end
2 Lawrie Williams//Pam and Russ Martens/Jim Rickards/Mathew Piepenburg/Von Greyerz//Rickards:
Powell’s Gettysburg Moment, the USD’s Waterloo and Today’s Open Madness
Matthew Piepenburg February 22, 2023
Below we examine the historical interplay of losing wars, cornered egos, tanking currencies, greater controls and gold’s loyalty in times of open madness.
History Matters
Despite the fact that universities even in the Land of Lincoln have had a say in cancelling Abraham Lincoln (good grief…) for apparently not being “woke” enough circa 1861 to be as wise as the neo-liberal faculties of 2023, I’d still make a case that history matters, and by this, I mean all its wonderful and ugly nuances (and lessons), whether they offend modern sensibilities or not.
History, of course, is full of desperate figures and times, many of which involve desperate economies followed by equally desperate (proxy) wars and desperate turning points.
In this light, the more things change, the more they stay the same. Just look around you…
And in the largely forgotten history of war, there is no shortage of desperate generals at desperate turning points.
Wars Doomed from the Start
Napoleon, who having previously won countless battles from Rivoli to Austerlitz, found himself shivering through an 1812 Russia after losing the vast bulk of his army to General Russian Winter and remarking to one of his generals that it’s “only a fine line between the sublime and the ridiculous.”
Three years later, at Waterloo, Napoleon’s “sublime” days (and countless casualty numbers) ended for good.
At Gettysburg, on the 3rd day of July, 1863, an equally talented and grossly outnumbered Confederate States Army under Robert E. Lee, having humbled Union forces at Manassas 1 & 2, Fredericksburg, Gaines Mill and Chancellorsville, looked across an open field from Seminary Ridge to the Emmitsburg Road strewn with the dying and dead of his once bravest divisions as the U.S. Civil War reached a mathematical turning point.
Despite this carnage, the war (post Pickett’s doomed July 3rd charge) dragged on for 2 more horrendous years (and countless casualty numbers), ignoring the hard math of waning troop numbers, supplies, cannons and horses which now rendered Southern “victory” impossible.
Less than a century later, this time near Stalingrad in the winter of 1943, the seemingly invincible German Wehrmacht, having conquered Poland, France, North Africa and large swaths of the East, found itself (and General von Paulus) facing the equally mathematical reality of what once seemed like impossible defeat.
By all metrics the Germans, having engaged in a two-front war, were done, but the war (and countless casualty numbers) would continue for two more senseless years.
But what do any of these examples of doomed and costly wars have to do with current global markets and our financial “generals”?
In fact, quite a bit.
Financial Policies Doomed from the Start
The overlapping interplay of human ego, hard math, and failed strategies doomed from the start have their place in both military and financial history.
For example, once upon a time (circa 2008), our central bankers in general, and the U.S. Fed in particular, had the insanely bad idea that central banks could use fiat money created out of thin air to save bad banks, defeat recessions, manage inflation, monetize debt, win a Nobel Prize and ensure total employment with a “Pickett’s charge” of mouse-click money.
Such grand plans, like the promises of failed generals and insane wars of Lebensraum, la gloire de l’empire or the “Southern Cause,” were initially followed by a string of early “Austerlitz-like successes” (i.e., market bubbles) which brought near-term euphoria.
Unfortunately, those early and mouse-clicked victories ignored the longer-term realities/casualties, namely: historically unprecedented wealth inequality, grotesque currency debasement, the death of free-market price discovery and the birth of what amounts to little more than Wall Street socialism and market feudalism masquerading today as MMT “capitalism.”
Such short-term “glory” at the expense of longer-term ruin is a pattern all too familiar for those paying attention…
Emperor Powell, for example, thinks he can “win the war against inflation,” but like Napoleon, Lee and von Paulus, he is still unable to admit to himself (or us lieutenants) that his grand vision is doomed either way.
And so, he continues to desperately fight a losing cause at the expense of countless currencies and investors (casualties) around the world.
How can we know this?
It All Boils Down to Hard Math and Bad Options
As detailed in prior reports, the math speaks for itself.
Global debt levels are past their “Gettysburg moment”—there are no easy victories left once we start dealing in the quadrillions…
Whether Powell continues with QT or pivots to more QE, retail foot-soldiers here and abroad face either economic recession/depression or extreme inflation.
Pick your “victory” or your poison. I see both, namely: Stagflation
Regardless of whether the USD (DXY) rises or falls in the near-term, the end result is as inevitable and mathematical as Germany’s two-front war, Pickett’s charge or Napoleon’s Waterloo: Disaster.
Once stock and bond bubbles reach their tipping points, the last bubble to die is always the currency, which is precisely where our prize-winning (?) central bankers have placed us.
In short, and as shown below, the global economy and USD, led by Field Marshall Powell, is about to cross that infamously fine line from the sublime to the ridiculous…
The USD’s Sublime Last Moments
As in any losing war, however, there are always those clinging for hope, including those who think the USD will never, well…surrender. (In 2022, the British pound, the yen and the euro already caved…)
Recently, for example, the headlines, politicos, markets and perma-bulls were positively giddy over the stronger than expected US jobs report and non-farm payroll data. The DXY climbed in lock-step.
However, what was equally higher (60% higher…) than expected was the 2023 US Treasury borrowing estimate –aka: Uncle Sam’s increasing bar tab–$930B! –for Q1 alone.
Each of these data points has sent the USD temporarily higher, along with inflation expectations, which now seem to be embedded.
So, the big question today is this: Will the USD get stronger or weaker in 2023 and beyond?
There are two camps in this strategic debate, and two consequences depending on which camp is right. Neither are “victorious.”
Bad Scenario 1: A Rising Dollar’s Consequences
If the USD gets stronger, it kills just about every asset class but the USD…
Already, we are seeing this open carnage in credit markets as rising rates and General Powell’s strong-Dollar policies cripple lending and borrowing norms of the past.
Loan officers are confirming a tightening of credit availability (and a widening of bank lending spreads, above) at levels only seen in prior recessions, adding more weight to my ongoing contention that the US is already in a recession, despite every Göbbels-like attempt in DC to redefine, cancel, ignore or downplay the same.
The equally dismal rise of defaulting High Yield bonds adds further proof of the slow (then steady) death of bleeding bonds in a rising rate and strong USD backdrop/policy.
A strengthening USD will send bonds down and hence yields and rates higher, which will be deflationary as debt-soaked America gets poorer and foreigners are forced to sell more USTs alongside a tightening Fed which is doing exactly the same thing—namely: Bond dumping and yield-spiking.
Bad Scenario 2: A Falling Dollar’s Consequences
However, if the USD gets weaker, the inflation we are already feeling will only get worse as $2T+ deficits make their steady climb North toward $3T, $4T or even $5T+ for 2023.
So, once again: Will the USD get stronger or weaker?
The answer lies in what signals (or desperate generals) you track or trust: Powell’s Fed or the UST market?
Trust What Powell SAYS?—Strong Dollar Ahead
If, for example, you follow the Fed and its bogus yet deadly-serious inflation narrative, then you will be lured into Powell’s “we must beat inflation” war cry, which boils down to a zero-sum battle-plan of “high inflation bad, low inflation good. Must beat inflation.”
Equally part of this bogus battle plan (Powell needs inflation and negative rates…) is the courageous meme that “rising rates kills inflation.”
Well… yes, but at what cost?
If Powell wins the headline battle against inflation, he loses the war for global credit markets, economies and political credibility, which loss will be immediately blamed on a virus and Russian bad guy but never on the mad generals who pushed us over the debt cliff.
However, if we get beyond linear headlines and two-dimensional thinking of central bankers like Powell, we quickly realize that the 3-dimensional UST market is perhaps the real (and superior) indicator of future probabilities.
Or, Trust What Bond Markets DO?—Weaker Dollar Ahead
Thus, rather than watch the Fed, I’m looking at bond markets to get my directional compass-North in a world of policy cannon smoke.
As said more times than I can count: The bond market is the thing.
And as for the sovereign bond market, it has seen 3 periods of complete dysfunction in recent years, namely: 1) the repo rate spike of September 2019; 2) the March 2020 “Covid” crash, and 3) last October’s gilt implosion spawned by the rising USD.
Those who follow the Fed (and this is entirely understandable given that the Fed IS the market in our post-2008 centralized nightmare) can’t be blamed for therefore expecting the USD to rise on more tightening and Powell “inflation-fighting.”
But those who follow the Fed are also ignoring those 3 bond market cracks in the ice above.
It’s my view that this ice is about to break if we have a 4th “uh-oh” moment/crack in sovereign bonds.
Thus, rather than follow the Fed, we might be wiser to look at the UST market, which is heading precisely in that “uh-oh” direction unless someone (i.e., Yellen?) pushes another meme—namely more toxic liquidity and thus a weaker USD.
Failed Battle Plan 1: Tightening into a Debt Crisis (Stronger Dollar)
Let’s play out the Fed’s current scenario first.
If we look only at what the Fed says, and it tightens, which, for now seems like the plan for Q1 and Q2, the USD will strengthen, yields and rates (5% to 5.25%) will rise further and the UST market will see such a wave a selling (foreign and QT Fed-driven), that a fourth “uh-oh” moment in the sovereign bond market will be inevitable, and likely enough to not only “crack the ice” of global bond markets, but drown everyone skating above it.
Given these realities and risks in the UST market, risks which even a fork-tongued and totally cornered Jerome Powell understands, I see no realistic way forward other than a weaker USD and thus a move from QT to QE.
Why?
Again: Because I’m taking my signals from the bond market not Powell.
To track (and trust) Powell means a tanking US Treasury and fatally rising rates, which is like kryptonite to America’s debt-based “accommodation” model.
Instead, I believe Powell will be forced to strategically consider the fact that this inflation war has killed his army of USTs and hence force him (at Yellen’s direction) to change tactics.
Or stated more simply, just as Napoleon, Robert E. Lee, and even the Wehrmacht learned that no outnumbered army can win an extended war, Powell will discover that no sustained policy of rising rates can end well for the toxic bonds/IOUs which float a bankrupt nation.
In short: Unless Powell weakens the USD and injects more QE liquidity sometime in 2023, his victory over inflation will be at the expense of America’s life-blood—namely the UST market.
Failed Battle Plan 2: Resort to More Mouse-Click “Miracles” (Weaker Dollar)
At the end of the day, and despite all this “beat inflation” rhetoric from Powell, it is my admittedly contrarian and unpopular (don’t say “gold-bug”) view that saving Uncle Sam’s IOU lifeline (i.e., the UST market) will take strategic priority over “beating inflation.”
By the way, this appears to be a view shared by none of other than that Corps Commander of toxic liquidity herself: General Janet Yellen…
In other words, expect an eventual (not immediate) capitulation to more fake money—aka, QE, i.e., “liquidity.”
This means that despite gyrating USD moves and hence DXY flip-flops today, the only direction and choice in the longer term to beat a recession and save Uncle Sam’s IOUs is a weaker not stronger Dollar.
Ultimate End-Game? Blame, Reset and Centralized Control
A weaker USD will buy time (and USTs) until ultimately the developed economies of the world, which in fact have the balance sheets of banana republics, finally realize that there’s still nothing left to save them but a great big “reset”—i.e., a global Chapter 11 or Economic “Versailles Treaty.”
The need for this “re-set” will, of course, be conveniently blamed on Putin and Covid rather than the central bankers (failed generals) who caused this horrific war on real money, sustainable debt and sound fiscal spending years ago.
Switching from military to equestrian metaphors, I argued in 2022 that investors, like polo players, need to think where the ball is headed, not where it lies currently.
Regardless of what Powell says today, the real play is 3 to 4 moves ahead, which all point toward an inevitably weaker USD and thus an inevitably rising gold price.
Powell, of course, is more politician than economist, and central banks like the Fed are anything but independent.
As such, Powell, DC and the creative math and fiction writers at the BLS will continue to do what all politicians (or losing armies) do when things are going against them: Lie.
Thus, the DC creative writers will continue to fudge, distort and “tweak” the CPI data to mis-report true inflation as nearly “beating expectations,” thereby allowing Powell to save face in a losing “war against inflation” while Lieutenant Yellen quietly pushes a weaker USD narrative to save the UST market (i.e., prevent more foreign UST dumping).
This face-saving policy will then allow the US to do what it does best: Borrow, spend and go deeper into inflationary debt spirals.
The Pesky Human Factor
Based on bond market Realpolitik, the probabilities point toward a liquidity pivot and weaker USD, longer term.
But history also reminds us that power-drunk figures don’t like to admit defeat. Their egos get in the way of rational decisions.
Powell, who desperately wishes to be remembered as a Napoleonic Paul Volcker rather than a comical Arthur Burns, is no exception to such human-all-too-human small-mindedness.
Unwilling to accept a Gettysburg moment that originated with Colonel Greenspan, General J. Powell could indeed push too far and too long with rising rates, a stronger USD and tanking bonds until inflation and everything else is destroyed.
We can only wait and see.
The Gold Factor
Whether on battlefields or economic cycles, man’s history of the absurd and his disloyalty to the many for the benefit of a few is nothing new under the sun.
In short, chaos eventually rears its head.
Powell or Yellen, QT or QE, inflation to deflation, left or right, Davos or DC, the chaotic results are always the same: Currencies and markets die, opportunists, lies and controls increase and the little guy (and common sense) gets trampled, drafted or “cancelled.”
Physical gold, of course, loves chaos and offers far greater loyalty to those who put their trust in this natural metal rather than flimsy paper money and the even flimsier promises from on high.
So which form of money will you trust to preserve your wealth?
A fiat currency that is losing its purchasing power by the second?
Or a naturally finite monetary metal with infinite duration born from the earth rather than an anonymous code writer or over-heating printer?
The choice, of course, is yours.
END
3. Chris Powell of GATA provides to us very important physical commentaries//
this is good: Mississippi legislatures votes overwhelmingly to send sales taxes on gold and silver
(MMN/GATA)
Mississippi legislature votes overwhelmingly to end sales taxes on gold and silver
Submitted by admin on Tue, 2023-02-21 19:42Section: Daily Dispatches
By JP Cortez Money Metals News Service, Eagle, Idaho Tuesday, February 21, 2023
JACKSON, Mississippi — Both houses of the Mississippi Legislature have just voted overwhelmingly to exempt physical gold, silver, platinum, and palladium coins and bullion from the state sales tax, sending the bill to Governor Tate Reeves for his signature.
Senate Bill 2019, sponsored by Sen. Chad McMahan, R-6, passed yesterday out of the full Senate by a vote of 47-2. This afternoon, Rep. Jody Steverson’s identical House Bill 1661 passed out of the full house chamber on an overwhelming voice vote.
Backed by the Sound Money Defense League, Money Metals Exchange, and in-state Mississippi dealers and investors, the legislative effort built on last year’s momentum. In 2022 a similar sales tax exemption bill had passed out of the Mississippi House of Representatives overwhelmingly but it missed the deadline in the Senate needed to receive a hearing.
If Gov. Reeves signs the bill next week (or if he simply chooses not to veto it), Mississippi will become the 43rd state to exempt sales of sound money from state sales tax. The effective date is July 1, 2023. …
Turkey bought $3.6 billion worth of gold in January (58.3 tonnes). how did Turkey have that much foreign reserves in its account to purchase gold
(Reuters)
Switzerland shipped $3.6 billion of gold to Turkey in January, most since at least 2012
Submitted by admin on Tue, 2023-02-21 20:45Section: Daily Dispatches
By Peter Hobson Reuters Tuesday, January 22, 2023
LONDON — Switzerland sent 58.3 tonnes of gold worth 3.3 billion Swiss francs ($3.6 billion) to Turkey in January, by far the most for any month in records stretching back to 2012, Swiss customs data showed today.
Gold is traditionally seen as a safe means of storing wealth and Turkish demand for the metal has rocketed as sky-high inflation erodes the value of the local lira currency.
Switzerland is the world’s biggest bullion refining and transit hub. It shipped 188 tonnes of gold worth 10.1 billion Swiss francs last year to Turkey, up from only 11 tonnes in 2021.
But January’s shipments are an acceleration. Switzerland’s gold exports to Turkey have never previously exceeded 34 tonnes in a single month, Swiss data shows. …
1. YOUR EARLY CURRENCY/GOLD AND SILVER PRICING/ASIAN AND EUROPEAN BOURSE MOVEMENTS/AND INTEREST RATE SETTINGS//WEDNESDAY MORNING.7:30 AM
ONSHORE YUAN: CLOSED DOWN TO 6.8947
OFFSHORE YUAN: 6.9014
SHANGHAI CLOSED DOWN 15.38 PTS OR 0.47%
HANG SENG CLOSED DOWN 105.65 PTS OR 0.85%
2. Nikkei closed DOWN 368.78 PTS OR 1.34%
3. Europe stocks SO FAR: ALL RED
USA dollar INDEX UP TO 104.14 Euro FALLS TO 1.0643 DOWN 8 BASIS PTS
3b Japan 10 YR bond yield: RISES TO. +.5000!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 134.37/JAPANESE YEN RISING AS WELL AS LONG TERM 10 YR. YIELDS RISING //EVENTUALLY THIS WILL BREAK 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 UP CHINESE YUAN: DOWN-// OFF- SHORE: DOWN
3f Japan is to buy INFINITE TRILLION YEN’S worth of BONDS. Japan’s GDP equals 5 trillion usa
Japan to buy 100% of all new Japanese debt and NOW they will have OVER 50% of all Japanese debt.
3g Oil DOWN for WTI and DOWN FOR Brent this morning
3h European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund UP TO +2.527%***/Italian 10 Yr bond yield RISES to 4.467%*** /SPAIN 10 YR BOND YIELD RISES TO 3.594…** DANGEROUS//
3i Greek 10 year bond yield RISES TO 4.527//
3j Gold at $1837.95//silver at: 21.84 7 am est) SILVER NEXT RESISTANCE LEVEL AT $30.00
3k USA vs Russian rouble;// Russian rouble UP 0 AND 25/100 roubles/dollar; ROUBLE AT 74.80//
3m oil into the 75 dollar handle for WTI and 82 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 CONTINUES NIRP. THIS MORNING RAISES AMOUNT OF BONDS THAT THEY WILL PURCHASE UP TO .5% ON THE 10 YR BOND///YEN TRADES TO 134.60/10 YEAR YIELD AFTER BREAKING .54%, REMAINS AT .5000% STILL ON CENTRAL BANK (JAPAN) INTERVENTION
30 SNB (Swiss National Bank) still intervening again in the markets driving down the FRANC. It is not working: USA/SF this 0.9275–as the Swiss Franc is still rising against most currencies. Euro vs SF 0.98569well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.
USA 10 YR BOND YIELD: 3.941% DOWN 1 BASIS PTS…GETTING DANGEROUS
USA 30 YR BOND YIELD: 3.965 DOWN 1 BASIS PTS//
UK 2 YR BOND YIELD: 4.689 DOWN 1 BASIS PT
USA DOLLAR VS TURKISH LIRA: 18,88…
GREAT BRITAIN/10 YEAR YIELD: 3.689% DOWN1 BASIS PTS
end
i.b Overnight: Newsquawk and Zero hedge:
FIRST, ZEROHEDGE (PRE USA OPENING// MORNING
Futures Rebound As Yields, Dollar Drop, Fed Minutes Loom
WEDNESDAY, FEB 22, 2023 – 08:07 AM
After suffering their biggest one-day drop of 2023, US futures rebounded in muted trading on Wednesday, boosted by a drop in rates (the 10Y just hit a session low of 3.92% after rising as high as 3.97%) and weakness in the dollar, even as investors awaited further clues on the direction of monetary policy from the Federal Reserve’s minutes due out at 2pm today. S&P 500 and Nasdaq futures rose 0.3% and 0.4%, respectively, at 7:45am ET; sentiment was boosted by a CNBC appearance of the Fed’s “trial balloon” speaker, St Louis Fed president James Bullard, who was hawkish – saying he favors hiking rates to 5.375% as fast as possible, but not as hawkish as some had feared, leading to a sharp bounce in futures just after 7am. Yields dropped, as did the dollar, while oil, gold and crypto erased earlier losses.
In premarket trading, CoStar Group led declines in US premarket trading after its annual guidance disappointed analysts and News Corp. said it’s no longer involved in discussions to sell its Move subsidiary to the real estate information and services company. Coinbase Global Inc. declined after the cryptocurrency exchange posted a $557 million loss. Here are some other notable premarket movers:
Palo Alto shares rose nearly 10% after the cybersecurity company’s results beat across the board. Several analysts raised their price targets for the stock, saying the firm is managing macro pressures effectively and executing well on its strategy
Keep an eye on Constellation Energy as it was cut to neutral from outperform at Credit Suisse as the broker says the green energy group’s shares now look expensive and lack near-term catalysts
Watch Nordson after it was raised to overweight from sector weight at KeyBanc, with the broker saying a good entry point for the adhesives and sealants company has materialized following a post-earnings decline in its shares
Morgan Stanley is constructive on US software stocks, given that the moderation in forward IT spending growth is likely to prove less severe than feared. Valuations are still near multi-year trough levels and longer-term demand trends are intact
Keysight shares fell 7.1% in after-hours trading on Tuesday as the company’s results showed order weakness, and guidance will create cause for concern in the near term, analysts said, though they remain positive on the longer-term outlook for the electronic measurement services firm
Meanwhile disappointing earnings projections are seen everywhere. Walmart Inc. reported a weak profit outlook that fell short of analyst estimates, signaling another rocky year for the world’s largest retailer. Home Depot Inc. also released a profit-decline forecast. Only 68% of S&P 500 companies reporting results this season have beaten estimates, compared with about 80% seen during recent quarters.
Following strong business activity data on Tuesday, a classic example of “good news is bad news for markets”, stocks tumbled as evidence mounted that the Fed may have to hike even more (ignoring for a second the fact that the data is manipulated “strong” for purely political reasons and will soon slump) and prompted fears the powerful stock rally since the start of the year may be coming to an end, as hot economic indicators pressure central banks to keep monetary policy tight. And while until recently investors looked as though they may be pricing in a soft landing for the economy, that may be ending said Stephanie Niven, portfolio manager at Ninety One UK Limited, and hoping strong economic conditions may cushion higher rates.
“We will continue to see investors adjust their expectations,” said Niven. “We see a harsher economic cycle into the second half of this year, and we really think a harder landing is the likely outcome here.”
In a relatively quiet calendar, today’s main event will be the Minutes from the Fed’s Jan. 31-Feb. 1 meeting, which while naturally backward looking, may shed light on the path forward. For context, officials at the meeting voted unanimously to raise rates by just 25 basis points, moderating from a half-point hike in December after four 75-bp increases. The policy statement said the “extent of future increases” will depend on a number of factors including cumulative tightening of monetary policy, wording Fed watchers viewed as a signal the central bank may stick with smaller moves. Watch the minutes for insight into whether a larger hike is still on the table, which in turn may mean the Fed’s terminal rate is higher than some expect.
“Investors are waking up to a stark realization that the Fed’s work is not done, and that interest rates may have to be hiked even higher to cool hot inflation,” Susannah Streeter, the head of money and markets at Hargreaves Lansdown Plc, wrote in a note. “Waves of exuberance, which have propelled equities higher since the start of the year, have turned into tides of disappointment and apprehension about the difficulties that still may lie ahead for the mighty US economy.”
A rocky geopolitical outlook has not helped. President Vladimir Putin said Russia will suspend its observation of the New START nuclear weapons treaty with the US, a decision Secretary of State Antony Blinken called “irresponsible.” President Joe Biden hit back at Putin, saying he would never win his war in Ukraine.
In delayed response to yesterday’s US slump, European stocks fall for a second day after disappointing corporate earnings gave investors another reason to be cautious besides the prospect of tighter monetary policy. The Stoxx 600 is down 0.9%, headed for a second-day loss, though it came off the day’s lows. Lloyds Banking Group Plc dropped, weighing on the FTSE 100 Index, after results and guidance for 2023 came in below analyst estimates, despite announcing a £2 billion ($2.4 billion) share buyback. Miner Rio Tinto Plc fell after reporting lower than expected profit and slashing its dividend due to weak demand for metals in China. Here are some of the biggest movers on Wednesday:
Lloyds Banking Group shares fall as much as 3% after the lender reported fourth-quarter results and guidance that were mixed with the bank affected by competition in the mortgage market
Rio Tinto shares slip as much as 3.2% after the mining conglomerate slashes dividends and reports lower-than-expected profits, hurt by weaker demand and higher costs
Grifols shares fell as much as 8.2%, the most intraday in four months, after the Spanish blood plasma company said executive chairman Steven F. Mayer resigned after four months in the job
Covivio shares fall as much as 5.4%, the most since December, with analysts saying the French real estate firm’s guidance is soft and that its dividend is lower than expected
Korian shares fell as much as 20%, set to close at their lowest level since 2006, after the French care home operator reported 2022 full year results that came short of analysts’ expectations
Siegfried shares fall as much as 11%, the most since 2015, after the Swiss pharma company delivered an outlook analysts considered cautious given its strong performance in 2022
Danone shares rise as much as 2.8% in early Paris trading, before paring gains, after reporting full-year recurring operating income that beat estimates
Wolters Kluwer shares rise as much as 3.9%, the biggest intraday climb since October, after the information services company forecast organic sales growth this year will be in-line
UCB gains as much as 4.9% after the Belgian pharmaceuticals firm reported better-than- expected earnings
BE Semiconductor gains as much as 9.9% after reporting fourth-quarter orders that blew past analyst estimates
Stellantis shares rise as much as 3.4% to the highest since March 2022 after the carmaker’s full-year results beat expectations and it announced a buyback of as much as €1.5 billion
Earlier in the session, Asian stocks declined for a second day after the aforementioned jump in US Treasury yields undermined confidence in the equity market’s advance this year, with shares in Hong Kong falling to the brink of a correction. The MSCI Asia Pacific Index fell as much as 1.4% to its lowest level since Jan. 9, with TSMC and Tencent among the heaviest drags on the gauge. Shares in Australia, Japan and mainland China slipped, while losses in Hong Kong’s Hang Seng Index reached almost 10% since a Jan. 27 peak. Technology stocks dropped after Treasury yields touched new highs for the year amid growing concern the Federal Reserve will continue to raise interest rates. Investors are pricing in the federal funds rate climbing to around 5.3% in June. That compares with a perceived peak of 4.9% just three weeks ago.
“We see more signs of a growth slowdown” into year end, Alexander Wolf, Asia head of investment strategy at JPMorgan Private Bank, told Bloomberg Television. Fixed income “still remains our highest conviction call, given what we’ve seen with the move up in yields, you can achieve equity-like returns.” Read: Investors Stung by Treasuries Rout Brace for Next Fed Blow A key MSCI gauge of Indian stocks was also on course to enter a technical correction as the selloff in Adani Group shares deepened. Indexes in Vietnam and South Korea were among the biggest decliners in the region as investors awaited the release of Fed minutes from its latest policy meeting.
Japanese equities fell, following US peers lower on concerns of further Fed hikes and after weak corporate forecasts from US retailers Walmart and Home Depot. The Topix Index fell 1.1% to 1,975.25 as of market close Tokyo time, while the Nikkei declined 1.3% to 27,104.32. Sony Group Corp. contributed the most to the Topix Index decline, decreasing 2%. Out of 2,162 stocks in the index, 431 rose and 1,636 fell, while 95 were unchanged. “Expectations for an early halt to US interest rate hikes and cuts have faded, with the landing point for a rate hike higher than what the market expected,” said Kiyoshi Ishigane chief fund manager at Mitsubishi UFJ Kokusai Asset Management.
India’s benchmark stocks gauge posted its biggest single-day slump this year as a selloff across global equity markets extended amid worries over interest rates staying higher-for-longer. Sentiment in India continued to be weighed down by the ongoing decline in Adani shares. The rout triggered by US short-seller Hindenburg Research’s report has now stretched to $144 billion, with the group’s flagship firm Adani Enterprises plunging 11% today. All 10 group stocks declined during the session. The S&P BSE Sensex fell 1.5% to 59,744.98 in Mumbai, the most since Dec. 23 and is close to erasing its gains for February. The NSE Nifty 50 Index declined by a similar measure. “There is an increasing fear that the Fed may remain hawkish for a longer duration than expected, which may even force RBI to keep interest rates high,” Siddhartha Khemka, head of retail research at Motilal Oswal Financial, said in a note. All 20 sector sub-gauges compiled by BSE Ltd. declined, led by utilities, while 29 out of Sensex’s 30 companies closed lower
In FX, the dollar slid against its Group-of-10 currencies, where Sweden’s krona was the best performer followed by the yen while the Australian dollar and British pound are the weakest among. The euro fell a third day, to touch a low of $1.0630. Bund yields were a tad higher, led by longer maturities A German expectations gauge by the Ifo institute rose to 88.5 in February from 86.4 the previous month. That was better than the 88.3 median estimate in a Bloomberg poll of economists
The Swedish krona outperformed other G-10 peers against the dollar and neared 11 per euro in the wake of comments from the new Riksbank Governor Erik Thedeen, who described underlying inflation figures in January as worrying. He also said that Sweden is currently not experiencing a housing market crash
The pound fell, erasing some of its Tuesday gains, as investors mulled the UK economic outlook following data that showed the nation is weathering the sharpest cost-of-living crisis in generations better than feared. The gilt yield curve bear-flattened, with yields rising 3-6bps
The yen advanced as much as 0.3% to 135.06 per dollar as the nation’s benchmark bond yield climbed back above the BOJ ceiling for a second day amid a global bond selloff. BOJ Governor nominee Kazuo Ueda is due to face confirmation hearings in the parliament this week. BOJ Board Member Naoki Tamura says that any decision on conducting a policy assessment will be made by looking at wage growth, prices and the economy. A divergence in the spot and options markets for the dollar-yen pair suggests traders are looking once again to position for possible hawkish signals from BOJ officials
The New Zealand dollar was little changed after earlier rising as much as 0.4% to 0.6246 even as the RBNZ hiked rates by 50 basis points as expected and forecasting that it would take longer than previously expected to reach its 5.5% peak rate
The Australian dollar was the worst G-10 performer following a smaller-than-expected wages increase in the fourth quarter. Wage price index rose 0.8% q/q (estimate +1.0%) in 4Q
In rates, Treasuries held on to modest gains as US trading day begins, after erasing declines that pushed yields to new YTD highs, with the exception of the new 2-year note. Shorter-term Treasuries rose more than longer-dated ones in a choppy session. The two-year rate slid 5 basis points from the highest level since early November. Its 10-year counterpart was 3 basis points lower. The 10-year reached 3.966% before dropping as low as 3.92%. Gilts have led European bonds lower as markets continue to price in higher terminal rates for the Bank of England and European Central Bank. UK two-year yields are up 8bps while the German equivalent adds 2bps.
In the US, the Treasury auction cycle continues with 5-year note sale at 1pm New York time, and FOMC releases minutes of Jan. 31-Feb. 1 meeting at 2pm. WI 5-year yield 4.13%; current issue traded as high as 4.185%, still more than 30bp below last year’s multiyear high, as traders are assigning higher odds to more Fed rate increases to follow the 25bp move on Feb. 1. Since then, St. Louis Fed President Bullard — appearing on CNBC — has said he advocated for a 50bp hike and might support one in March, heightening interest in whether the minutes will reveal broader appetite for reacceleration.
Oil extended its longest run of losses this year, with West Texas Intermediate contracts falling for a sixth day. The prospect of more aggressive interest-rate hikes from the Fed to quell inflation have kept a lid on prices, despite increasing evidence of a robust recovery in China following the end of Covid Zero. Crude futures decline with WTI down 0.6% to trade around $75.89, off session lows. Spot gold rose to $1,840.
Looking to the day ahead. In terms of data releases, we have the German February ifo survey which came in stronger than expected, and the France February business and manufacturing confidence indicators; in the US. the latest MBA mortgage applications dropped -13.3%, following last week’s -7.7% slide. For central banks, first and foremost we have the release of the Fed’s FOMC minutes, and we will also hear from the Fed’s Williams. Finally, we will have earnings releases from NVIDIA, TJX, Pioneer and eBay.
Market Snapshot
S&P 500 futures little changed at 4,004.75
STOXX Europe 600 down 0.9% to 459.50
MXAP down 1.3% to 160.19
MXAPJ down 1.3% to 521.69
Nikkei down 1.3% to 27,104.32
Topix down 1.1% to 1,975.25
Hang Seng Index down 0.5% to 20,423.84
Shanghai Composite down 0.5% to 3,291.15
Sensex down 1.5% to 59,790.65
Australia S&P/ASX 200 down 0.3% to 7,314.50
Kospi down 1.7% to 2,417.68
German 10Y yield little changed at 2.56%
Euro little changed at $1.0643
Brent Futures down 1.1% to $82.13/bbl
Gold spot down 0.1% to $1,834.10
U.S. Dollar Index little changed at 104.26
Top Overnight News
Japan’s 10-year government bond yield on Wednesday breached the top end of the Bank of Japan’s policy band for a second straight session, prompting the central bank to step into the market with emergency bond buying and offering of loans. RTRS
Two of Japan’s biggest automakers (Toyota & Honda) agreed to the biggest wage hikes in decades in an early sign of momentum in annual pay negotiations as the central bank looks for evidence of a wage-price cycle that could lead to policy change. BBG
Chinese authorities have urged state-owned firms to phase out using the four biggest international accounting firms, signaling continued concerns about data security even after Beijing reached a landmark deal to allow US audit inspections on hundreds of Chinese firms listed in New York. BBG
Missing Chinese investment banker Bao Fan was preparing to move some of his fortune from China and Hong Kong to Singapore in the months leading up to his disappearance, according to four people with knowledge of his plans. FT
Investors increase bets on ECB lifting rates to all-time high. Buoyant service sector and wages fuel expectations of further rises in eurozone borrowing costs. FT
The Fed minutes may show how many officials pushed for a larger hike and whether they saw the need to take rates higher than anticipated. Markets expect tightening to be extended after stronger economic data and some hawkish messaging, with rates peaking at 5.36% this year. The RBNZ slowed its pace with a 50-bp increase to 4.75% after mulling another move of 75 bps. The projection for peak rates was left unchanged at 5.5%, over a slightly longer timeframe. BBG
Authorities accused crypto trader Avi Eisenberg of manipulating token prices on an exchange. Mr. Eisenberg countered, saying he did only what was permitted by the exchange’s software code. At the core of this case is the idea held by some crypto enthusiasts that “code is king.” WSJ
In the hunt for Lael Brainard’s successor, the White House is “focusing in” on Harvard University professor Karen Dynan, Northwestern University finance professor Janice Eberly and Morgan Stanley Chief Global Economist Seth Carpenter. BBG
JPMorgan cut staff access to ChatGPT, a person familiar said, confirming an earlier Telegraph report. The move wasn’t triggered by any specific incident. BBG
Consistent with the increase in leverage, demonstrated hedge fund equity market exposures have begun to rise from the extremely low levels registered late last year. Hedge funds exhibited exceptionally low betas to the equity market in 2022, reaching levels only matched during the last 20 years in 2009. Betas have rebounded in the last few weeks, driven in part by increased net length, but remain well below historical averages. GIR
A more detailed look at global markets courtesy of Newsquawk
Asia-Pacific stocks were subdued after the declines on Wall St where the major indices were pressured on return from holiday as strong PMI data from Europe and the US spurred hawkish central bank repricing. ASX 200 briefly dipped below 7,300 amid a slew of earnings releases although clawed back most of its losses after weak data releases including a surprise contraction in Construction Work and softer-than-expected Wage Price Index, which removes some of the hawkish impulses for the RBA. Nikkei 225 underperformed and approached closer to testing the 27,000 level to the downside. Hang Seng and Shanghai Comp. conformed to the subdued mood in which weakness in tech briefly pulled the Hong Kong benchmark into correction territory although losses were then pared after the budget announcement which included a giveaway of HKD 5,000 in consumption vouchers and a cut to salary taxes, while there was also strength in HSBC and Hang Seng Bank post-earnings.
Top Asian News
Hong Kong Finance Secretary Chan delivered the Budget and confirmed the government will provide HKD 5k in consumption vouchers to residents aged 18 years old and above, while they will reduce salaries tax with a ceiling of HKD 6,000 which will benefit 1.9mln taxpayers and lower government revenue by HKD 8.5bln. Chan also noted that the city is at the beginning of a recovery and that GDP contracted by 3.5% in 2022, although the government expects Hong Kong GDP growth of 3.5%-5.5% in 2023.
China’s top diplomat Wang Yi met with Russia’s security chief and said the two sides discussed their willingness to oppose all forms of unilateral bullying and discussed ways to improve global governance. Furthermore, the two sides believe peace and stability in the Asia-Pac region should be resolutely upheld and they oppose the introduction of a cold war mentality, according to Reuters.
RBNZ hiked the OCR by 50bps to 4.75%, as expected, while it maintained its view for rates to peak at 5.50% and considered hikes of 50bps and 75bps at the meeting. RBNZ stated that although there are early signs of price pressure easing, core consumer inflation remains too high and the Committee agreed it must continue to raise the OCR to return inflation to the target and to fulfil its remit.
European bourses are softer across the board, Euro Stoxx 50 -0.8%, as hawkish price action remains in full swing. Sectors are lower across the board ex-Media following individual earning updates, while Basic Resources lag as underlying commodities are dented. Stateside, futures are flat/negative with the ES holding around the 4k mark having briefly and incrementally dipped below the figure in European trade.
Top European News
ECB’s Villeroy reiterates that there is excessive volatility of the market view on the terminal rate. Already in restrictive territory with a 2.5% rate, ECB is not obliged to hike at every meeting to September, via Les Echos. Remarks which echo his commentary from last Friday.
UK PM Sunak reportedly secured the backing of two key Brexiteers for the Northern Ireland trade deal with Heaton-Harris and Braverman getting behind the outline agreement, according to FT.
DUP’s Donaldson reportedly told an ERG meeting on Tuesday that UK PM Sunak was just halfway to meeting the DUP’s seven tests re. N. Ireland Protocol, having made progress towards three or four of them, via Politico citing sources; added that progress towards the remaining DUP tests is critical, telling PM Sunak to abandon the “arbitrary deadline” of April 10th.
FX
The DXY remains underpinned on haven dynamics and as yields continue to climb across the board, index continues to climb above a 104.00 base with the current high at 104.33
As such, peers are generally softer across the board with the AUD lagging post-data and as the NZD clings onto gains following the hawkish RBNZ announcement; AUD around 0.6810 and NZD near 0.6210 vs USD.
EUR was generally unreactive to the morning’s Ifo data while dovish commentary from Villeroy prompted some pressure, but this was brief and limited given his remarks are a repeat of Friday’s, EUR/USD at the lower-end of 1.0630-1.0663 parameters.
JPY and CHF are rangy and narrowly mixed against the USD, after the JPY regrouped on some convergence in JGB-UST yields irrespective of BoJ buying while CHF shrugged off an upbeat domestic investor survey.
GBP is giving back some of Tuesday’s marked upside, with caution around N. Ireland Protocol progress perhaps weighing though the focus is firmly on BoE-related dynamics; Cable around 20 pips shy of 1.21 though off worst.
EUR/SEK continues to test 11.00 with Riksbank’s Thedeen assisting while the ZAR is a touch softer heading into the budget announcement from 12:00BST/07:00ET onwards.
PBoC set USD/CNY mid-point at 6.8759 vs exp. 6.8776 (prev. 6.8557)
Yonhap reports that as USD/KRW soared “the foreign exchange authorities called an emergency market situation inspection meeting this afternoon.”.
Riksbank’s Thedeen says inflation is far too high; January’s inflation data was a negative surprise, it is worrying.
Fixed Income
EGBs have experienced a modest bounce in the wake of well-received EZ & UK supply, with Bunds now back to 104.00 from the new 133.63 YTD low and Gilts firmly above 101.00 in a similar fashion.
Prior to this, the complex had been under marked pressure in a continuation of recent hawkish price action with the German 10yr yield as high as 2.57%; though, pre-supply this eased following a rerun of recent dovish remarks from Villeroy.
Stateside, USTs have been moving in-tandem with EGBs with specific catalysts thin ahead of FOMC minutes and a 5yr sale, as such USTs are flat within 110.30+ to 111.08 parameters.
Commodities
Crude benchmarks remain underpressure with specific developments limited and focus on the broader risk tone; WTI & Brent Apr at the lower end of USD 74.96-76.55/bbl and USD 81.70-83.25/bbl intraday parameters respectively.
Nat Gas futures are mixed, though remain pressured vs recent levels as desks continue to cite relatively mild weather in the US and Europe.
Kazakhstan may send the first batch of oil to Germany in the coming days which could possibly occur today, according to RIA citing the Energy Minister.
Morgan Stanley sees Brent trading in a USD 90-100bbl range in H2 vs. its prev. view of USD 100-110bbl; raises estimate for oil demand growth to 1.9mln BPD from 1.4mln BPD.
Nigeria raises March Bonny Crude OSP to +0.95/bbl vs dated Brent; Qua Iboe raise to +1.27/bbl vs dated Brent.
Spot gold is little changed as any haven allure is offset by the USD’s strength, while base metals are lower given the tone and with focus on commentary from Rio Tinto overnight.
Ukraine could export a total of 8mln tonnes of agricultural good a month for Odesa and Mykolaiv ports; will talk to UN to extend the grain deal for another year, according to Ukrainian Deputy Minister.
Geopolitics
Russia reportedly conducted an ICBM test when US President Biden was recently in Ukraine although the test was said to have failed, while an official stated that Russia notified the US in advance of the launch through deconfliction lines, according to CNN.
Russian PM Medvedev says Russia is ready to defend itself with any weapon, including nuclear.
Russian Foreign Minister Lavrov says relations between Moscow and Beijing are developing despite the tense international situation; China’s Top Diplomat says we continue to maintain close communication with Russia, via Sky News Arabia. Subsequently, Russian Kremlin says President Putin is to meet with China’s Top Diplomat Wang Yi on Wednesday (as touted).
US President Biden’s administration is expected to impose fresh sanctions on about 200 Russian individuals and entities this week, according to WSJ citing sources.
North Korea could fire ICBMs at a normal angle and conduct its seventh nuclear test this year, according to South Korean lawmakers citing intelligence officials.
US Event Calendar
07:00: Feb. MBA Mortgage Applications, prior -7.7%
14:00: Feb. FOMC Meeting Minutes
17:30: Fed’s Williams Discusses Inflation
DB’s Jim Reid concludes the overnight wrap
I’m still in a bit of a state of shock this morning after the Liverpool / Real Madrid game last night. From wild jubilation to the end of the world within an hour. A Bit like financial markets in the last three weeks.
Back before the game when there was still hope in my heart, I released my latest monthly chart book, “Waiting for the lag” that debates the themes around the near-term improvement in the global outlook versus that of the lag of monetary policy. At this stage of a normal hiking cycle, we show that markets and economies are usually fairly benign so don’t confuse recent strength in data as a soft landing. It’s not until year 2 onwards of the hiking cycle that pain normally starts to be felt. So the real test will be when the lag of monetary policy fully kicks in as it should do over the next few quarters. By March, the ECB will have likely hiked +350bps in 8 months and the Fed +475bps in 12 months. More hikes are likely to come too.
Indeed our European economists yesterday lifted our ECB terminal rate call from 3.25% to 3.75% (more below). Until all these hikes on both sides of the Atlantic fully pass through the economy it is impossible to sound the all clear. We’ve always thought the first few months of the year would be positive with the problems building by year-end, but the extent of the rally in January made us shift back to neutral in credit quicker than we thought we would. Indeed, we think US credit has now passed the tights of the year. See the chart book here for much more.
The skinny in markets today is that the week has sprung into action over the last 24 hours after the US holiday on Monday, as a run of better than expected flash global PMIs led to a sizeable global bond sell off (10yr USTs +13.8bps), with the S&P 500 (-2.00%) wiping out its February gains. More on markets later but while we wait for the full lag of policy, the flash PMIs continued to improve yesterday from what were quite stressed levels. Indeed the US composite PMI rose back into expansionary territory at 50.2 (vs 47.5 expected). Much of the strength originated from a strong performance in services, which surprised to the upside at 50.5 (vs 47.3 expected). There was less evidence of a similarly strong improvement in manufacturing as it modestly surprised to the upside at 47.8 (vs 47.2 expected). As we dug into the weeds of the data release, it is clear that whilst input costs rose at a softer pace in February, there was a sharper rise in private sector output charges at both manufacturing and service sector firms. This comes as the pace of increase in selling prices was the quickest it has been since October, as firms reportedly passed through these increases as costs to their customers. This increased the chatter on inflation being sticky. The immaculate disinflation story has had some big blows in the last 2-3 weeks.
Markets subsequently moved to price in bets that the Fed will need to keep rates higher for longer, as expectations for the terminal rate for July’s meeting increased by 6.2bps to 5.367%. However, the increase was most evident for December’s meeting, with rate expectations for year-end increasing by 12.5bps to 5.19% since Friday’s close.
With uncertainty over terminal back on the agenda, the S&P 500 fell back -2.00% in its largest down move since the day after the December FOMC meeting and erasing its February gains. It was a broad based decline for US equities with every industry group lower on the day as over 93% of index members declined. The NASDAQ retreated further, down -2.50% at the close – also its biggest downside move since December 15. In US fixed income markets, the 10yr US Treasury yield spiked up by +13.8bps to reach its highest level since the second week of November at 3.945%. The 2yr Treasury also saw large moves, as yields rose +10.6bps to 4.723%, the highest level since July 2007. All eyes will be on the release of the Fed’s minutes today, as markets look for guidance on policy going forward. However it’s likely to feel a bit dated as a lot has happened in the subsequent three weeks.
Over to the other side of the Atlantic, the European PMI releases fitted in with the global pattern of improving services, but limited improvement from manufacturing. The EA services PMI came in above expectations at 53 (vs 51 expected). On the other hand, we had a downward surprise with the manufacturing release which fell to 48.5 (vs 49.3 expected). Resultingly, the composite PMI rose to 52.3 (vs 50.7 expected) and into expansionary territory. Against this backdrop, markets have moved to price in +126bps of rate hikes until hitting terminal at the October meeting (3.658%), up +6.4bps yesterday.
As stated near the top, our European economists yesterday lifted their ECB terminal rate call from 3.25% to 3.75%. They had previously expected a 50bp hike in March and a final 25bp in May. Now the baseline is for 50bp hikes at both the March and May meetings followed by a final hike of 25bp in June. See their note here for why a robust European economy and labour market along with hawkish ECB commentary have caused them to upgrade their call. They also explain why the heightened uncertainties make risks fairly balanced for a terminal landing zone between 3.50-4.00%.
Narrowing in, the German composite PMI also beat consensus, rising into mildly expansionary territory to 51.1 (vs 50.3 expected). This strong performance largely came from services, which rose to 51.3 (vs 51 expected), whilst manufacturing surprised to the downside at 46.5 (vs 48.1 expected). These releases affirm our expectation that Germany will have a shallow technical recession over the winter half year. For a bit more colour, look at the new Germany: Economic Chartbook from our Frankfurt team for all things Germany related. The beat in German composite PMI also reflects a rosier outlook for the German economy following a warm winter (here), and a significant drop in wholesale gas prices and favourable gas storage levels. Indeed, our German economists confirm the view that they’ll be no gas supply crunch for the country for this winter nor for winter 23/24. See their latest and final European Gas monitor here. Final due to the fact that the supply issue has now been covered. Yesterday, European natural gas futures sat below €50 at €48.54/contract, down -2.67%.
France’s PMI’s largely mirrored the broader Euro Area release, with the manufacturing surprising to the downside at 47.9 (vs 51 expected), and services to the upside at 52.8 (vs 49.8 expected). The overall composite PMI rose into expansionary territory to 51.6 (vs. 49.8 expected). Off the back of these upward surprises and expectations of larger rate hikes by the ECB, the 10yr bund yield rose +6.5bps to 2.529%, reaching their highest level since the end of 2022. The policy sensitive 2yr bund also rose by +5.1bps yesterday. The STOXX 600 modestly fell back -0.19%.
This morning in Asia equity markets are tracking the US falls with the KOSPI (-1.46%) emerging as the biggest underperformer followed by the Nikkei (-1.30%), the CSI (-0.56%) and the Shanghai Composite (-0.25%). Meanwhile, the Hang Seng (+0.03%) is just above flat after opening lower. In overnight trading, US stock futures tied to the S&P 500 (+0.19%) and NASDAQ 100 (+0.28%) are inching higher.
Early morning data showed that Japan’s producer prices index (PPI) rose +1.6% y/y in January, inline with market expectations and slightly higher than December’s increase of +1.5%. Elsewhere, Australia’s wage price index (WPI) for the final three months of 2022 rose +3.3% (+3.5% expected) from an upwardly revised +3.2% in the September quarter, thus slightly easing the RBA’s rate hike concerns.
In terms of monetary policy action, the Reserve Bank of New Zealand (RBNZ) hiked interest rates by +50bps (as expected) to a more than 14-year high of 4.75% while highlighting that rates could still rise as inflation remains too high. Following the decision, the New Zealand dollar rose as high as $0.6246, reflecting the hawkishness of the statement before settling to trade at $0.6224 (+0.03%) as we go to press.
Back to yesterday, and the same PMI story reverberated in the UK as the composite PMI came firmly in above expectations at 53 (vs 49 expected). There was a big jump in services, which rose to 53.3 (vs 49.2 expected). Manufacturing saw a stronger beat than over in the Continent, with UK manufacturing PMI surprising to the upside at 49.2 (vs 47.5 expected). With concerns over inflations still at large, 2yr and 10yr Gilts rose +16.3bps and +14.3bps respectively.
Aside from the rush of the global flash PMIs, we had further developments in the geopolitical space yesterday, as Bloomberg reported that President Putin announced Russia was suspending (but not exiting) its participation in the New Start Treaty, a significant shift in its policy. The Treaty limited each signatory to no more than 1,550 deployed nuclear warheads and 700 deployed long-range missiles and bombers and had been renewed for five years in 2021, as reported by Reuters. We also saw Russia’s Secretary of the Security Council Patrushev meet with China’s Director of Central Commission for Foreign Affairs Wang Yi in Moscow. Yi had previously met on less than amicable terms with US Secretary of the State Blinken last weekend. President Biden reiterated NATO’s resolve at a speech in Warsaw yesterday, saying “there should be no doubt: Our support for Ukraine will not waver, NATO will not be divided, and we will not tire.” This comes alongside the $480mn arms announcement made by the Biden administration in recent days.
Looking to other data releases, yesterday also saw the release of Germany’s February’s ZEW investor expectations index, which rose to 28.1 (vs 23 expected). We also had Canadian February CPI data, which decelerated to 5.9% year-on-year (vs 6.1% expected) – a rare recent positive inflation surprise.
To the day ahead. In terms of data releases, we have the German February ifo survey, and the France February business and manufacturing confidence indicators. For central banks, first and foremost we have the release of the Fed’s FOMC minutes, and we will also hear from the Fed’s Williams. Finally, we will have earnings releases from NVIDIA, TJX, Pioneer and eBay.
end
AND NOW NEWSQUAWK (EUROPE/REPORT)
Hawkish action continues pre-FOMC Minutes/Williams; fixed off worst post-supply – Newsquawk US Market Open
WEDNESDAY, FEB 22, 2023 – 06:24 AM
European bourses are softer across the board as hawkish price action remains in full swing, US futures contained pre-Minutes.
DXY remains underpinned by haven dynamics to modest detriment of peers ex-NZD after a 50bp RBNZ hike and guidance for further tightening.
Core fixed has bounced following well-received EZ/UK supply, in a rebound from marked initial pressure with Bunds printing a fresh YTD trough.
Commodities are underpressure by the above risk tone/hawkish dynamics with specific drivers limited though geopols remain in focus.
Looking ahead, highlights include Fed’s Williams, FOMC Minutes (Feb), S. African Budget Presentation, Supply from the US, Earnings from NVIDIA.
Or why not try Newsquawk’s squawk box free for 7 days?
EUROPEAN TRADE
EQUITIES
European bourses are softer across the board, Euro Stoxx 50 -0.8%, as hawkish price action remains in full swing.
Sectors are lower across the board ex-Media following individual earning updates, while Basic Resources lag as underlying commodities are dented.
Stateside, futures are flat/negative with the ES holding around the 4k mark having briefly and incrementally dipped below the figure in European trade.
The DXY remains underpinned on haven dynamics and as yields continue to climb across the board, index continues to climb above a 104.00 base with the current high at 104.33
As such, peers are generally softer across the board with the AUD lagging post-data and as the NZD clings onto gains following the hawkish RBNZ announcement; AUD around 0.6810 and NZD near 0.6210 vs USD.
EUR was generally unreactive to the morning’s Ifo data while dovish commentary from Villeroy prompted some pressure, but this was brief and limited given his remarks are a repeat of Friday’s, EUR/USD at the lower-end of 1.0630-1.0663 parameters.
JPY and CHF are rangy and narrowly mixed against the USD, after the JPY regrouped on some convergence in JGB-UST yields irrespective of BoJ buying while CHF shrugged off an upbeat domestic investor survey.
GBP is giving back some of Tuesday’s marked upside, with caution around N. Ireland Protocol progress perhaps weighing though the focus is firmly on BoE-related dynamics; Cable around 20 pips shy of 1.21 though off worst.
EUR/SEK continues to test 11.00 with Riksbank’s Thedeen assisting while the ZAR is a touch softer heading into the budget announcement from 12:00BST/07:00ET onwards.
PBoC set USD/CNY mid-point at 6.8759 vs exp. 6.8776 (prev. 6.8557)
Yonhap reports that as USD/KRW soared “the foreign exchange authorities called an emergency market situation inspection meeting this afternoon.”.
Riksbank’s Thedeen says inflation is far too high; January’s inflation data was a negative surprise, it is worrying.
EGBs have experienced a modest bounce in the wake of well-received EZ & UK supply, with Bunds now back to 104.00 from the new 133.63 YTD low and Gilts firmly above 101.00 in a similar fashion.
Prior to this, the complex had been under marked pressure in a continuation of recent hawkish price action with the German 10yr yield as high as 2.57%; though, pre-supply this eased following a rerun of recent dovish remarks from Villeroy.
Stateside, USTs have been moving in-tandem with EGBs with specific catalysts thin ahead of FOMC minutes and a 5yr sale, as such USTs are flat within 110.30+ to 111.08 parameters.
Crude benchmarks remain underpressure with specific developments limited and focus on the broader risk tone; WTI & Brent Apr at the lower end of USD 74.96-76.55/bbl and USD 81.70-83.25/bbl intraday parameters respectively.
Nat Gas futures are mixed, though remain pressured vs recent levels as desks continue to cite relatively mild weather in the US and Europe.
Kazakhstan may send the first batch of oil to Germany in the coming days which could possibly occur today, according to RIA citing the Energy Minister.
Morgan Stanley sees Brent trading in a USD 90-100bbl range in H2 vs. its prev. view of USD 100-110bbl; raises estimate for oil demand growth to 1.9mln BPD from 1.4mln BPD.
Nigeria raises March Bonny Crude OSP to +0.95/bbl vs dated Brent; Qua Iboe raise to +1.27/bbl vs dated Brent.
Spot gold is little changed as any haven allure is offset by the USD’s strength, while base metals are lower given the tone and with focus on commentary from Rio Tinto overnight.
Ukraine could export a total of 8mln tonnes of agricultural good a month for Odesa and Mykolaiv ports; will talk to UN to extend the grain deal for another year, according to Ukrainian Deputy Minister.
ECB’s Villeroy reiterates that there is excessive volatility of the market view on the terminal rate. Already in restrictive territory with a 2.5% rate, ECB is not obliged to hike at every meeting to September, via Les Echos. Remarks which echo his commentary from last Friday.
UK PM Sunak reportedly secured the backing of two key Brexiteers for the Northern Ireland trade deal with Heaton-Harris and Braverman getting behind the outline agreement, according to FT.
DUP’s Donaldson reportedly told an ERG meeting on Tuesday that UK PM Sunak was just halfway to meeting the DUP’s seven tests re. N. Ireland Protocol, having made progress towards three or four of them, via Politico citing sources; added that progress towards the remaining DUP tests is critical, telling PM Sunak to abandon the “arbitrary deadline” of April 10th.
DATA RECAP
German Ifo Business Climate New (Feb) 91.1 vs. Exp. 91.2 (Prev. 90.2, Rev. 90.1); domestic economy will not get around a recession, but it will be mild.
German Ifo Current Conditions New (Feb) 93.9 vs. Exp. 95 (Prev. 94.1); Expectations New (Feb) 88.5 vs. Exp. 88.4 (Prev. 86.4)
NOTABLE US HEADLINES
China urges state firms to drop the Big Four auditors over data risks, via Bloomberg, suggesting that local auditors should be utilised instead.
There has been a security alert at the US embassy in London, according to the Daily Mail, and staff have been evacuated.
Russia reportedly conducted an ICBM test when US President Biden was recently in Ukraine although the test was said to have failed, while an official stated that Russia notified the US in advance of the launch through deconfliction lines, according to CNN.
Russian PM Medvedev says Russia is ready to defend itself with any weapon, including nuclear.
Russian Foreign Minister Lavrov says relations between Moscow and Beijing are developing despite the tense international situation; China’s Top Diplomat says we continue to maintain close communication with Russia, via Sky News Arabia. Subsequently, Russian Kremlin says President Putin is to meet with China’s Top Diplomat Wang Yi on Wednesday (as touted).
US President Biden’s administration is expected to impose fresh sanctions on about 200 Russian individuals and entities this week, according to WSJ citing sources.
North Korea could fire ICBMs at a normal angle and conduct its seventh nuclear test this year, according to South Korean lawmakers citing intelligence officials.
CRYPTO
Coinbase (COIN) executive said they are seeing increased regulatory scrutiny in the wake of the FTX and other crypto company failures, according to Reuters.
APAC TRADE
APAC stocks were subdued after the declines on Wall St where the major indices were pressured on return from holiday as strong PMI data from Europe and the US spurred hawkish central bank repricing.
ASX 200 briefly dipped below 7,300 amid a slew of earnings releases although clawed back most of its losses after weak data releases including a surprise contraction in Construction Work and softer-than-expected Wage Price Index, which removes some of the hawkish impulses for the RBA.
Nikkei 225 underperformed and approached closer to testing the 27,000 level to the downside.
Hang Seng and Shanghai Comp. conformed to the subdued mood in which weakness in tech briefly pulled the Hong Kong benchmark into correction territory although losses were then pared after the budget announcement which included a giveaway of HKD 5,000 in consumption vouchers and a cut to salary taxes, while there was also strength in HSBC and Hang Seng Bank post-earnings.
NOTABLE ASIA-PAC HEADLINES
Hong Kong Finance Secretary Chan delivered the Budget and confirmed the government will provide HKD 5k in consumption vouchers to residents aged 18 years old and above, while they will reduce salaries tax with a ceiling of HKD 6,000 which will benefit 1.9mln taxpayers and lower government revenue by HKD 8.5bln. Chan also noted that the city is at the beginning of a recovery and that GDP contracted by 3.5% in 2022, although the government expects Hong Kong GDP growth of 3.5%-5.5% in 2023.
China’s top diplomat Wang Yi met with Russia’s security chief and said the two sides discussed their willingness to oppose all forms of unilateral bullying and discussed ways to improve global governance. Furthermore, the two sides believe peace and stability in the Asia-Pac region should be resolutely upheld and they oppose the introduction of a cold war mentality, according to Reuters.
RBNZ hiked the OCR by 50bps to 4.75%, as expected, while it maintained its view for rates to peak at 5.50% and considered hikes of 50bps and 75bps at the meeting. RBNZ stated that although there are early signs of price pressure easing, core consumer inflation remains too high and the Committee agreed it must continue to raise the OCR to return inflation to the target and to fulfil its remit.
DATA RECAP
Australian Construction Work Done (Q4) -0.4% vs. Exp. 1.5% (Prev. 2.2%, Rev. 3.7%)
Australian Wage Price Index QQ (Q4) 0.8% vs. Exp. 1.0% (Prev. 1.0%); YY (Q4) 3.3% vs. Exp. 3.5% (Prev. 3.1%)
1.c WEDNESDAY/ TUESDAY NIGHT
SHANGHAI CLOSED DOWN 15.38 PTS OR 0.47% //Hang Seng CLOSED DOWN 105.65 PTS OR 0.85% /The Nikkei closed DOWN 368.78 PTS OR 1.34% //Australia’s all ordinaries CLOSED DOWN 0.36% /Chinese yuan (ONSHORE) closed DOWN 6.8947 //OFFSHORE CHINESE YUAN DOWN TO 6.9014// /Oil DOWN TO 75.93 dollars per barrel for WTI and BRENT AT 82.51 / 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/USA/JAPAN
2B JAPAN
JAPAN/
end
3c CHINA /
CHINA/RUSSIA
This is what sanctions will do!! China is now ready to join forces with Russia to defend its national interests
(zerohedge)
China Says Ready To “Join Forces With Russia” To “Defend National Interests” As Putin Confirms Xi Visit
WEDNESDAY, FEB 22, 2023 – 10:00 AM
Despite all latest among Washington’s repeat warnings to Beijing against strategic or military cooperation with Moscow, China is now pledging to “join forces” with “like-minded” partner Russia to defend national interests. The statement came by the close of the first day of the director of the Office of the Foreign Affairs Commission of the Communist Party of China’s Central Committee Wang Yi’s trip to Moscow.
“The People’s Republic of China is ready to join forces with Russia to decisively stand up for national interests and promote mutually beneficial cooperation in all areas,” Wang said Tuesday while meeting with Russian Security Council Secretary Nikolay Patrushev. On Wednesday he met with Russian President Vladimir Putin in what appeared a warm and cooperative visit.
“During a virtual meeting at the end of last year our leaders [Xi Jinping and Vladimir Putin] came up with a plan for further development of bilateral relations. We are ready to join forces with the Russian side, in accordance with the high-level agreements, to decisively stand up for national interests and virtues, and promote mutually beneficial cooperation in all areas,” the Chinese diplomat’s statement said.
He additionally said China will “together with all like-minded partners further promote the development of the international order in the direction of equitable development.”
“It’s necessary to unlock the potential of this mechanism, and it’s also necessary to develop new steps of strategic interaction in accordance with the changing situation in order to provide the necessary guarantees for national development,” Wang added. “I want to fully join your appreciation of the strategic cooperation between the two countries.”
The positive and glowing statements amid the high-level visit comes at a crucial juncture in which Moscow needs a powerful backer in its corner which also holds a seat on the national security council. The war in Ukraine is days away from reaching its one-year mark since the invasion began.
The Kremlin praised Wang’s stance in response, with Russian Foreign Minister Sergey Lavrov welcoming “China’s balanced position on the Ukraine issue.” He further declared that “ours and China’s vision is much the same” concerning the crisis.
However, it will be interesting to see if any further specifics on Ukraine emerged from the China side. So far, Wang appears to be advancing the official party line which has been somewhat ambiguous, also while in Moscow saying that China will maintain its “objective and impartial stance” on the Ukraine crisis. Toward this end, he said that China “appreciates Russia’s willingness to resolve the crisis through negotiations,” according to TASS.
Beijing has of late expressed its desire for warring parties to reach negotiated peaceful settlement in Ukraine. This could be focus of President Xi Jinping’s upcoming trip to Russia. While news of the future trip broke Tuesday, President Putin confirmed Wednesday that it will happen – a very significant symbolic first since the Ukraine invasion.
“We are expecting the president of the People’s Republic of China to visit Russia. We agreed on this earlier,” Putin said as he welcomed Wang Yi in the Kremlin. The Russian leaders praised the “new frontiers” that both countries are forging together:
President Vladimir Putin said on Wednesday that China’s Xi Jinping would visit Russia, saying relations had reached “new frontiers” amid U.S. concerns that Beijing could provide material support to Russia’s invasion of Ukraine.
“We understand that [China] has a domestic political agenda, but we assume that as we tackle all the issues related to this agenda – with the National People’s Congress, which is made up of Chinese deputies, who must also resolve serious personnel issues – we will implement our plans for personal meetings as well, which will give an additional impetus to our relations,” the Russian president added. A specific timetable has yet to be publicized, but US policy makers along with the rest of NATO and other UN Security Council members will without doubt be watching closely.
Meanwhile, Putin is on the offensive against his enemies near and far…
* * *
Rabobank previews China’s proposed peace plan for Ukraine in the analysis below:
Relatedly, Friday will see China’s proposed peace plan for Ukraine. Any such attempt should be applauded, but the question is on whose terms. Western observers remain skeptical the plan will see any concrete details, while rumors are also flying China may threaten to do for Russia what the US is doing for Ukraine, amplified by the news that Xi Jinping will visit Moscow soon.
Logically, assuming China is not going to dump Russia, which it won’t, there are few potential outcomes:
China offers nothing new. However, this would underline that it remains a bystander having bullets fired at it by the White House, who just warned that Chinese firms that try to circumvent sanctions on Russia will face “repercussions”: like the ones forbidding the flow of Iranian oil?; or
China “escalates to deescalate” with an implied threat to stand behind Russia, in which case:
The US accepts a grand deal to climb down and partition Ukraine. That would mean a Western retreat on an historic scale that could snowball into a broader partition of the geopolitical and geoeconomic architecture – and the US won’t want that. Yet it would also allow the US to pivot towards Taiwan – and China won’t want that; or
The US reacts as if ‘China just bought a ticket for the Titanic after seeing the movie’, and the geopolitical and geoeconomic architecture shatters.
In short, the most logical probability is that neither the China peace plan nor the upcoming Xi visit to Moscow provide anything new. In which case, Ukraine escalation, inflation, and global polarisation it is. Yet the fact that we have a war in Ukraine at all should underline that the fat tail-risks are of something even worse – a scenario we originally flagged in our Ukraine metacrisis report in early 2022
end
CHINA/GLOBE
Kyocera one of the largest chip component manufacturers in the world believes China can no longer play its role as the largest global factory as heavy sanctions from the USA is playing a major role. They have begun shifting production to other places including Japan
(Athrappully/EpochTimes)
Manufacturing In China And Exporting Globally “No Longer Viable”: Kyocera
Kyocera, one of the largest chip component manufacturers in the world, believes China can no longer play its role as the global factory amid heavy sanctions from the United States, and the company has begun shifting production to other places, including Japan.
“It works as long as [products are] made in China and sold in China, but the business model of producing in China and exporting abroad is no longer viable,” Hideo Tanimoto, president of Kyocera, said in an interview with the Financial Times. “Not only have wages gone up, but obviously, with all that’s happening between the United States and China, it’s difficult to export from China to some regions.”
Kyocera is building its first factory in Japan in almost 20 years.
On Oct. 7, 2022, the U.S. Department of Commerce announced new export restrictions on chip manufacturing and advanced semiconductors in a bid to prevent American technology from being used in the development of the Chinese military.
Tanimoto admitted that the U.S. export controls were a reason why the firm cut down its operating profit forecast for the year by 31 percent. Kyocera commands a 70 percent market share globally in ceramic components used in chip-manufacturing equipment.
“If chip equipment makers stop shipments to China, our orders will be somewhat affected … They are now even [being] asked not to ship their non-cutting-edge tools,” Tanimoto said.
Back in 2019, when the Trump administration had imposed tariffs on China, Kyocera had moved the manufacturing of copiers for the U.S. market from China to Vietnam.
Moving Production Out of China
Many companies have moved production out of China or plan to do so. In April last year, for example, Apple began manufacturing its iPhone 13 in India at a site owned by Foxconn, its Taiwanese contract manufacturer. In addition, Apple is sending the production of iPads and AirPods to Vietnam.
Samsung shifted production to Vietnam back in 2019. The company has also decided to manufacture its flagship Galaxy S23 smartphones in India for local sale. Amazon has shut down its Kindle facility in China and now produces FireTV devices in India.
Footwear brand Dr. Martens has been reducing its manufacturing dependence on China. Since 2018, the company has shifted 55 percent of total production out of the nation.
“The big message is reducing reliance on China,” Dr. Martens’ chief executive Kenny Wilson said in November, according to the Financial Times. “You don’t want all of your eggs in one basket.”
Declining Investment in China
An analysis by Investment Monitor, a network of B2B websites, shows that greenfield foreign direct investments (FDIs) in China have been falling over the past few years.
Greenfield investment is a type of FDI whereby a parent company sets up a subsidiary in a different nation and builds its business from the ground up, including setting up production facilities, offices, distribution hubs, and so on.
In 2022, greenfield FDI levels into China had halved compared to 2019, according to the analysis. Merger and acquisition deals also fell. Companies were said to be looking to diversify away from the Chinese mainland due to concerns regarding geopolitics and disruption to supply chains.
In China’s tourism sector, greenfield FDI fell by 78 percent between 2019 and 2022. The electronics sector saw greenfield FDI decline by 56.7 percent during this period, financial services by 62.5 percent, logistics 28.6 percent, software and IT services by 48.5 percent, and industrial machinery, equipment, and tools fell by 56.7 percent.]
Some experts foresee more production by American firms being moved to friendlier nations. Governments and corporations are expected to invest “substantially in on-shoring, near-shoring, and friend-shoring for value chains,” said Michael Zezas, head of U.S. public policy research and municipal strategy at Morgan Stanley Research, according to a July 25th post by the investment firm.
“Mexico, India, Vietnam, and Turkey stand out as countries that could benefit from U.S. and European Union companies diversifying value chains.”
end
CHINA //GLOBE
China’s shipping containers pile up at overcrowded port as overseas orders dwindle | South China Morning Post
Robert Hryniak
The reality is the Western Economies are slowing down as consumer spending declines as people. And this is not just China but export countries like South Korea and Japan. In order to maintain their economies these countries will look to Eurasia for growth as they realize the west has slowed down and will continue to have troubled economies until they pay attention to investment to create renewed consumer based growth. In the absence of this growth the only growth is in higher value products at more efficient pricing. And in many cases that means new investment to lower the cost of goods at expense of the competitor.
This should end USA citizens from investing in Chinese firms. Another decoupling of China with the USA(zerohedge)
China Tells State Firms To Ditch Western-Linked Big Four Auditors Over ‘National Security Concerns’
WEDNESDAY, FEB 22, 2023 – 12:29 PM
China’s Ministry of Finance has instructed state-owned enterprises to phase out contracts with US-linked global audit firms as Beijing seeks to decouple and curb the influence of Western auditors, according to Bloomberg, citing people familiar with the matter.
Last month, the Ministry of Finance urged SOEs to let contracts expire with the Big Four auditing firms, including PricewaterhouseCoopers LLP, Ernst & Young, KPMG, and Deloitte & Touche LLP. The reason has been due to national security concerns. One of the people said there were no audit request changes for offshore subsidiaries of the Chinese firms.
Beijing’s objective is to ensure the nation’s data security and limit the influence of US-linked global audit firms. The people also noted the government is attempting to boost the local accounting industry.
No timeline has been provided to companies, and the auditor changes might occur over time as contracts expire.
The new audit guidance is a reminder that decoupling between China-US is still in full swing. Bloomberg pointed out, “One risk for China is that shifting to lesser-known auditors will make it harder for SOEs to attract capital from international investors.”
Richard Harris, CEO of Hong Kong-based investment business consultancy and fund manager Port Shelter Investment Management, explained:
“It builds in a further hurdle for Chinese SOEs in terms of appealing to international capital.
“I’m not sure if the data held secret as a result is likely to be important enough to justify inhibiting that access to international capital as accountants have a legal obligation to be confidential.”
And it was only last year when US-China signed a deal to allow security regulators to inspect the financials of Chinese companies in Hong Kong. The Public Company Accounting Oversight Board, a US accounting watchdog, said in December it had full access to inspect and investigate firms in China for the first time. After today’s news, SOEs might soon be blocked for review by Big Four auditing firms.
4/EUROPEAN AFFAIRS/UK AFFAIRS//
ITALY/UKRAINE/EU
Meloni’s first big mistake for meeting with Zelensky
(Brooke/ReMix)
Cracks In Italy’s Right-Wing Coalition Grow After Berlusconi Blasts Meloni For Meeting With Zelensky
The three leaders of Italy’s coalition partners hold vastly differing views on how best to tackle the war in Ukraine. Do these views complement each other, or are cracks in the right-wing alliance starting to show?
Silvio Berlusconi may belong to Giorgia Meloni’s right-wing governing coalition, but on the issue of Ukraine, the two are gravely at odds, with their differing views on Ukraine’s leader and how involved Italy should be in the conflict spilling out into sharply critical public statements.
Sympathetic to Russia long before the conflict in Ukraine erupted last February, outspoken former Italian premier Silvio Berlusconi recently publicly criticized the Italian prime minister’s decision to side with Ukrainian President Volodymyr Zelensky.
“If I had been premier, I would never have gone to speak to Zelensky,” the leader of Meloni’s coalition partner Forza Italia told Italian media after voting in the regional elections won by the right-wing coalition. Instead of Russian President Vladimir Putin, he blamed the Ukrainian president for the continuing conflict across the country.
“It would have been enough if he had stopped attacking the two autonomous republics of Donbas, but this never would have happened, so I judge the behavior of this gentleman very, very, very negatively,” Berlusconi added.
The issue of Ukraine has long been a sticking point within the coalition, with political analysts stating that it was one of the most divisive issues facing the government when it first formed.
Five months on, she repeated this pledge during a visit to the Polish capital of Warsaw on Monday ahead of her trip to Kyiv, insisting Italy’s humanitarian, financial, and military support for the country fighting back against Russian aggression for close to a year now will continue.
Meloni leads the Brothers of Italy (FdI) which is the largest party in the Italian coalition government. While she continues to toe the line expected of “mainstream” European leaders and pledges unwavering support for Zelensky, primarily in a bid to be accepted by Western counterparts initially dubious about her electoral victory, her coalition partners have shown considerably less enthusiasm for the Ukrainian question, as recent public remarks demonstrate.
When asked by a journalist off camera whether he supported his prime minister’s view that an appropriate peace agreement can only be reached in Ukraine if both sides are equally equipped militarily, Berlusconi replied, “No,” and called for U.S. President Joe Biden to create a Marshall Plan to rebuild Ukraine on the condition of an immediate cease-fire. The original Marshall Plan saw the U.S. provide European nations with long-term loans to rebuild their infrastructure and stimulate their economies in the aftermath of World War II.
“The American President should take Zelensky aside and say, ‘I am willing at the end of the war to create a Marshall Plan to rebuild Ukraine. A Marshall plan of 6, 7, 8, 9 billion dollars on one condition, that you order a cease-fire tomorrow, because as of tomorrow we will not give you any more dollars and we won’t give you any more arms.’ Only something like that will convince this gentleman to agree to a cease-fire,” Berlusconi added.
It is worth noting that Berlusconi is a long-time acquaintance of the Russian president. In October, the Forza Italia leader revealed the pair had exchanged “lovely letters” despite the ongoing war in Ukraine, and Putin had sent him 20 bottles of vodka for his birthday. He was reportedly told by Putin in one such letter that he was the Russian leader’s “number one among his five best friends.”
As Remix News reported yesterday, Berlusconi has just been acquitted for his role in the so-called “bunga-bunga” parties, with the trials dragging on for years. The Remix News article details that there is evidence that Italy’s judicial system was weaponized against the former prime minister to remove him from power, including under instructions from Western countries like the United States. These nations reportedly saw him as a threat to liberal Western interests due to his views on Putin, Libya’s Gaddafi, and Iran.
Where does Salvini stand?
While Meloni and Berlusconi appear to be, publicly at least, at opposite ends of the spectrum when it comes to Ukraine, the third major player in the right-wing coalition is somewhere in the middle. Matteo Salvini, the leader of the League party whose core voter support fled to Giorgia Meloni in the last election after an underwhelming stint in government, has frequently criticized the Western response to the war in Ukraine, and while the right-wing firebrand reportedly has ties to Russia, he has refrained from making any public statements as bold as Berlusconi’s.
Salvini has been skeptical of the anti-Russia sanctions imposed by Western allies. However, much of his criticism was offered prior to the electoral success of Italian conservatives in late September of last year.
“Do we have to defend Ukraine? Yes,” Salvini said. “But I would not want the sanctions to harm those who impose them more than those who are hit by them,” he had warned earlier that month.
“If we get into government, will we change alliances? No. We remain deeply, proudly and firmly rooted in a free and democratic West that opposes war and aggression,” Salvini maintained at the time. The League leader has been far more reserved since the right-wing coalition took office.
Salvini’s position could be considered to be in alignment with European leaders such as Hungarian Prime Minister Viktor Orbán, who has long been a public opponent of anti-Russian sanctions that impact negatively on the lives of Europeans.
“At first I thought we just shot ourselves in the foot, but now it seems that the European economy shot itself in the lung, and that’s why it is now gasping for air,” Orbán said of the Western approach to Russian sanctions in July last year, and he has not changed his viewpoint.
Despite the leaders of the three main coalition partners sharing considerably varied opinions on how to tackle the Ukrainian issue, the differences of opinion have not resulted in adverse electoral results. In fact, the right-wing alliance stormed to victory earlier this month in the Lombardy and Lazio regional elections, retaining control of the former and seizing control of the latter from the center-left.
However, with Berlusconi’s latest remarks, the cracks are beginning to show on the issue of Ukraine and there are two ways in which such a fracture could go. The first is a political breakdown of the right-wing alliance, which up until now has remained fairly cohesive and efficient. Alternatively, Berlusconi’s remarks, deemed unpalatable by the Western mainstream, could actually help to promote Giorgia Meloni’s image in the eyes of initially skeptical Western leaders.
The more Meloni distances herself from the remarks of her coalition partners and wholeheartedly doubles down on Italy’s support for Ukraine, the more she shores up her image as a moderate, as one of the gang, and the more leeway she may perhaps have with her European counterparts when it comes to her conservative domestic reforms, including on the issue of tackling illegal immigration.
end
END
5.UKRAINE RUSSIA//MIDDLE EASTERN AFFAIRS
IRAN//ISRAEL/UKRAINE/RUSSIA
This will be a tough decision for Netanyahu whether to meeting Zelensky or not. Netanyahu needs Russia as they blast Syria (Iranian ammunitions). But they are also angry that Russia supplies Iranian drones
(the Cradle)
Netanyahu Mulls Meeting Zelensky In Kiev As Pressure On Israel Grows
Israeli media reported on Tuesday that Israeli Prime Minister Benjamin Netanyahu’s office is considering whether to accept an invitation for a meeting with Ukrainian President Volodymyr Zelensky in Kiev. The proposal for a meeting with Netanyahu came from Israeli Foreign Minister Eli Cohen, who paid a visit to Kiev last week, according to Channel 13. Such a meeting could put Israel in a difficult position, given the current political climate and Israel’s sensitivity to Russian concerns, but the Prime Minister’s Office is still looking into the request, according to top Israeli officials.
During his recent trip to Israel, US Secretary of State Antony Blinken was given a promise from Netanyahu to review Israel’s stance on arming Ukraine with air defenses systems, which Tel Aviv has so far refused to do.
Meanwhile, MPs Zeev Elkin (National Union) and Yuli Edelstein (Likud) held a surprise meeting with Zelensky in Kiev, a day after the Ukrainian president met with Foreign Minister Cohen, who reiterated their support for Ukraine.
Zelensky again called for more support from Israel during the meeting with the Knesset deputies, according to Israeli state broadcaster Kan:
“I am glad that there is finally an embrace from Israel. This includes the chancellor’s visit. But I want to see action. I hope to see a change in Israeli policy, especially as Russia and Iran are getting closer. Israel has to help not only with the early warning system, but also with drone defense systems,” Zelensky demanded.
Edelstein later confirmed the visit, posting a photo with Zelensky on his Twitter account.
“I met last night with Ukrainian President Zelensky and saw with my own eyes what is happening in the region. Iranian intervention is evident. Iranian technology and weapons are used by the Russians and provide Iran with combat experience. Israel must side with Ukraine against the dangerous combination of Russia and Iran,” Edelstein said.
On Sunday, the US Ambassador to Israel, Tom Nides, told Tel Aviv’s government that it can do “whatever they need” to against Iran, affirming US support on the issue, despite pending US-Iranian negotiations regarding Tehran’s nuclear program.
Nides added that as long as Iran provides Russia with drones for its military operation in Ukraine, indirect negotiations with Tehran regarding the revival of the Joint Comprehensive Plan of Action (JCPOA) would not continue. Nides highlighted that a “nuclear Iran” is not just a threat to Tel Aviv but rather to the entirety of West Asia and Washington.
END
end
IRAQ/USA/CHINA
Iraq has a problem finding dollars to finance it ‘s trade. So this would be a good move for the country but bad for the USA
especially after financing the Saddam Hussein wars etc.
The Iraqi central bank announced Wednesday that, for the first time, it plans to allow trade from China to be settled directly in yuan instead of the US dollar to improve access to foreign currency.
“It is the first time imports would be financed from China in yuan, as Iraqi imports from China have been financed in (US) dollars only,” the government’s economic adviser, Mudhir Salih, told Reuters.
According to a statement released by the Iraqi central bank, carrying out transactions in the Chinese currency would boost the balances of Iraqi banks with accounts with Chinese banks. However, this option depends on the size of the central bank’s yuan reserves.
A second option to boost local banks’ yuan balances would involve converting US dollars held in the central bank’s accounts with JP Morgan and the Development Bank of Singapore (DBS) to yuan before paying the final beneficiary in China.
The Iraqi central bank has been on a mad dash to compensate for a dollar shortage in local markets. This crisis prompted the cabinet to approve a currency revaluation earlier this month.
Last year, the US Treasury and the Federal Reserve Bank of New York began enforcing stricter controls on international transactions by Iraqi commercial banks, forcing them to comply with specific SWIFT global transfer system criteria to access their foreign reserves.
The move was allegedly meant to “curtail money laundering and the illegal siphoning of dollars to Iran and other heavily sanctioned [West Asian] countries.”
However, the sudden rules change for Iraqi banks sent the economy reeling as 80 percent, or more of Iraq’s daily US dollar wire transfers could no longer be completed.
Last week, a senior Iraqi delegation visited the US capital to discuss easing the US Treasury measures. Following the trip, Foreign Minister Fuad Hussein denied reports that Washington imposed conditions on Baghdad to help with the dollar crisis. Hussein added that it is “only a matter of time” before the exchange rate stabilizes.
Since the war in Ukraine started, several nations in the Global South have begun to moveaway from the US dollar in bilateral trade with China. Many others have chosen to boost their Chinese yuan reserves at a time when the hegemony of the greenback continues to weaken.
end
RUSSIA/.WAGNER GROUP
This is interesting: Russia’s private army (mercenary) accuses the Russian defense ministry of treason for failing to provide ammunition’s for the group
(zerohedge)
Russia’s Wagner Chief Accuses Defense Ministry Of Treason As Spat Widens
TUESDAY, FEB 21, 2023 – 10:00 PM
Going back to the battle of Soledar, when Wanger Group was reportedly the first to enter the city and claim victory for itself, there’s been a widening rift between the mercenary outfit with links to Putin and the regular Russian military.
The rift widened this week in a spat which is going increasingly public, as Wagner’s founder Yevgeny Prigozhin, often referred to as “Putin’s chef”, accused the defense ministry and its Chief of the General Staff of purposefully blocking badly needed munitions to Wagner fighters.
The defense ministery stands accused of ordering national forces to withhold munitions supplies, and to avoid assisting with any air transport.
“There is quite simply direct obstruction going on,” Prigozhin said. He’s ratcheted his rhetoric, provocatively going so far as to use the word “treason” applied to the high military chain of command, which is a first.
“This can be equated with high treason,” he said, saying the lack of ammo supplies are to blame for his fighters “dying en masse.” The blistering words which demonstrate a clear battlefield rift came in the form of a seven-minute audio message published Monday by Wagner’s press service, wherein—
“…an apparently angry and emotional Prigozhin said he was required to “apologize and obey” to secure ammunition for his fighters. Speaking at times with a raised voice and occasionally swearing, he said: “I’m unable to solve this problem despite all my connections and contacts.”
Prigozhin said Russia’s military production was now sufficient to supply the forces fighting at the front and the supply difficulties his fighters were experiencing were the result of conscious decisions.
“Those who interfere with us trying to win this war are absolutely, directly working for the enemy,” he said.
What’s more is that Prigozhin is going straight after the generals and even Kremlin officials while appealing to popular discontent over the war’s execution. His message is likely to reverberate more among Russian hawks. He said defense ministry officials were negligent while “eating breakfast, lunch and dinner off golden plates” and regularly send their family members off to vacation in Dubai.
But Wagner has proven hugely controversial even among the hawks, given things like its policy of recruiting straight from Russian prisons – including individuals convicted of violent crimes – and in return promising them freedom.
Tensions also soared when Prigozhin and his officials said that it was Wagner alone which captured the salt mining town of Soledar, and without the help of regular forces. This was blasted by military brass, and seen as an attempt at self-promotion and and part of the firm raking in in money. Now, Wagner’s leadership says there’s a plot afoot to take down the organization.
END
UKRAINE/USA
Chemical Weaponry Destined For Ukraine Ignited In East Palestine Train Wreck
Robert Hryniak
9:45 AM (20 minutes ago)
to
He just may have outed the entire Biden regime for war crimes. Lawyers in America will have a field day suing and that goes above political affiliations. And sorrow for the poor souls who innocently became guinea pigs. As any thinking person realizes that a $150 billion sent to Ukraine was not just for the conflict. As numerous stories occurred of gun running of weapons sent etc. to money laundered through FTX to eager politicians willing to take money regardless of where and how it came to be. All at the expense of Americans. So how far fetched is that the same thievery might not exist to ignite a larger conflict? It seems even Canadians are surprised that China has buoys in Canadian Arctic waters to monitor vessel traffic. Frankly, while we can say we do not trust China or Russia; it is doubtful they trust us. A sad commentary on mankind when so many bigger issues exist that faces us all. Stripping away so called civilized veneer one does wonder why we allow such behavior that does not add to society.
Republican lawmakers from Idaho have introduced a bill that will make it a crime to administer mRNA vaccines in the state, citing safety concerns, which would apply to COVID-19 vaccines manufactured by companies like Pfizer and Moderna.
“Notwithstanding any other provision of law, a person may not provide or administer a vaccine developed using messenger ribonucleic acid (mRNA) technology for use in an individual or any other mammal in this state. A person who violates this section is guilty of a misdemeanor,” according to House Bill 154 (pdf) presented to the state’s House Health and Welfare Committee on Feb. 15. The bill was introduced by state Sen. Tammy Nichols and Rep. Judy Boyle.
While promoting the bill before the committee, Nichols pointed out that there have been “more and more concerns rising” about the mRNA vaccines.
“We have issues that this was fast-tracked, there’s no liability, there’s no access to data, risk-benefit analysis has not been done, there’s no informed consent,” she said.
Nichols insisted that mRNA vaccines be treated in a “similar manner” to harmful drugs. She pointed out that there are “concerns of blood clots and heart issues” related to using COVID-19 mRNA vaccines which need to be addressed.
COVID-19 mRNA Approvals
At present, three types of COVID-19 vaccines exist—protein subunit, viral vector, and mRNA. Vaccines produced by Moderna and Pfizer, which have been widely distributed, come under mRNA categorization.
Around 400 million Pfizer COVID-19 vaccines and over 250 million Moderna vaccines have been administered in the United States.
According to the CDC, mRNA vaccines use mRNA developed in a laboratory to teach cells in a human body to produce a protein or part of a protein triggering an immune response. It is this immune response that then creates antibodies to fight the SARS-Cov-2 virus.
State Rep. Ilana Rubel, a Democrat, questioned Nichols about fast-track approvals granted to the COVID-19 mRNA vaccines by the Food and Drug Administration (FDA).
Rubel asked about the vaccines being initially approved under the “ordinary approval process” and subsequently passing the scrutiny of “normal tests.”
Dr. Eli David on Twitter: “Israel court ordered Ministry of Health to release the agreement with Pfizer. These two pages contain the section titled “Liability & Indemnity Provision” I wish this were a joke, but it’s not… https://t.co/FNhBWYck9O” / Twitter
Robert Hryniak
10:03 AM (5 minutes ago)
to Harvey
Israel court ordered Ministry of Health to release the agreement with Pfizer.
These two pages contain the section titled “Liability & Indemnity Provision” 👇 I wish this were a joke, but it's not… pic.twitter.com/FNhBWYck9O
What is important about this is that the CDC et al. have always lied that the vaccine stays at the injection site (deltoid) and dissolves/removed immediately after one-off use; they LIED to you!
My take: finding the spike mRNA sequences 28 days post shot is hugely damaging, a huge percentage and it seems the mRNA does not decompose in the cytosol as it should. As we have been told. The IDSA (and the CDC) is actually behind the science e.g. the Danish research above, and are very wrong for their web-site says the mRNA degrades rapidly. They state that the mRNA is not available long-term in the system yet that too is a lie.
Dr. Peter McCullough updates Dan Ball on the risk today, not from the virus, but form the COVID mRNA technology gene injection; Cedar Sinai doctor is insane, misinformed with her understanding of risk
‘No signs that young people who had mild COVID at home have any increased risk of heart disease, now we roll in the vaccine, and we see this surge in heart damage’.
A hat-tip to Makis once again and I share his substack:
‘As an Oncologist, I diagnosed 10,000s of Canadian cancer patients and treated 100s with Targeted Radionuclide Therapy. I have seen many horrific things during my career. But I have never seen a rapid progression like this.
From Diagnosis to death in 4 days
21 year old California University student Evan Fishel was graduating from Cal Maritime Academy and was accepted to Berkeley Law School. He died on Feb.10, 2023, 4 days after being diagnosed with Leukemia (click here).
His University, Cal Maritime Academy had a COVID-19 vaccine mandate and to this day, recommends COVID-19 booster shots based on CDC guidelines (click here).
“Turbo cancer” post COVID-19 Vaccination
I never liked the term “turbo cancer”. It doesn’t sound very scientific. However, it is a term that has caught on and is now recognized as a frightening phenomenon following COVID-19 vaccination.
In November 2021, a small paper was published by Goldman et al: “Rapid Progression of Angioimmunoblastic T Cell Lymphoma Following Pfizer mRNA vaccine booster shot” (click here).
This image will be familiar to many:
I performed thousands of PET/CT scans like this in Edmonton, Alberta with radio-labeled glucose, to diagnose cancer patients. Other than the normal brain, heart and radioactive urine in the bladder, the rest of the black dots are cancer-filled lymph nodes in the neck, axillae and iliac regions.
This was a 66 yo man who had 2 Pfizer COVID-19 mRNA vaccines and developed an aggressive lymphoma 6 months later (left image). In preparation for chemotherapy, doctors gave him a Pfizer COVID-19 mRNA booster shot (!!!). Within a few days, the patient reported “considerable swelling of neck lymph nodes”. Fortunately, his doctors wanted another PET/CT scan to have a more precise baseline scan before his chemotherapy, so they did one 8 days after the COVID-19 booster shot.
In the image on the right, the cancer effectively exploded all over the body, growing and spreading to new groups of lymph nodes in new locations. The authors themselves noted just how abnormal this was:
“First, the dramatic speed and magnitude of the progression manifested on two 18F-FDG PET-CT performed 22 days apart. Such a rapid evolution would be highly unexpected in the natural course in the disease.”
“this is the first observation suggesting that administration of a SARS-CoV-2 vaccine might induce AITL (lymphoma) progression”
This was the first time that “turbo cancer” following COVID-19 vaccination was caught on a PET/CT scan, and it was purely by chance.
There was another small study by Zamfir et al. reporting two cases of aggressive lymphoma that developed within a week following Pfizer COVID-19 mRNA vaccination (click here). This study includes some gruesome pictures of these rapidly progressing cancers.
No one has been able to properly explain these cases. One US surgical oncologist wrote a long article in Dec.2022 claiming that “turbo cancer” doesn’t exist (click here). In his article, he also doesn’t provide any explanation for these shocking cases, and his entire argument rests on a series of faulty assumptions on what the spike protein mRNA can or cannot do.
How can COVID-19 vaccines induce “turbo cancer”?
The effects of COVID-19 vaccines on the immune system are extremely complex and not fully understood. However, based on several studies I can best summarize it like this:
COVID-19 vaccines “reprogram” the immune system (click here). This reprogramming alters the normal communication between immune system cells (production of certain cytokines), and it also alters the function and activity of certain immune cells.
As the authors of another study noted (click here):
“…revealed dramatic alterations in gene expression of almost all immune cells after vaccination”
MIT scientist Stephanie Seneff and Texas Cardiologist Dr.Peter McCullough wrote an article titled “Innate Immune Suppression by SARS-CoV-2 mRNA vaccinations” (click here) which describes complex mechanisms by which mRNA vaccines impair immune system signaling, leading to innate immune suppression:
There is also a study that suggests that SARS-CoV-2 spike protein strongly interacts with tumor suppressor proteins p53 and BRCA-1/2, potentially turning them off (click here):
“p53 and BRCA are the well-known tumor suppressor proteins, that regulate downstream genes in response to numerous cellular stress and are frequently mutated in human cancer”
In some people, this immune system “reprogramming” or innate immune system suppression leads to a complete loss of protection against cancer cells arising and spreading rapidly.
Recently, on the “Ask Dr. Drew” show, US pathologist Dr. Ryan Cole showed evidence of the extensive presence of spike protein in lymphoma tumors (view here).
Needless to say, COVID-19 mRNA vaccine spike protein should not be found in malignant tumours.
Anecdotal reports on twitter…
There are many anecdotal reports on twitter from people who describe “turbo cancers” suffered by their family members following COVID-19 vaccination. Most of these seem honest enough to take seriously, but it is clear that doctors are not taking these cases seriously enough.
My take…
Many obituaries now talk about a “brief but courageous battle with cancer”. We need more autopsies with immunohistochemical staining for the spike protein in cases of rapidly progressing cancer, but we will not be getting them anytime soon. Certainly not in Canada.
So far, doctors are not taking this issue seriously, and by the time they do, it will be far too late for many, and we may have a full blown healthcare catastrophe on our hands.’
The mRNA technology-LNP complex could have never stayed in the arm. Why? It was designed to go all over the body, that is why it was encased in the LNP so they knew & kept silent; why? people died!
They knew the purpose of the LNP fatty ball was to take the mRNA payload all over the body, to all the lymph nodes possible e.g. spleen, groin, adrenals, liver, ovaries, testis, everywhere and anywhere that the dendritic cells could produce spike. They knew it would have drained into the lymphatic system and lymph drainage nodes (local). They will need answer this too in hearings as to why they allowed the population to be misled, and yes, will now come out and say they did not know or some BS crap as usual, but the history is there. The inventors of the mRNA technology injection have lots to answer for and will answer for it. People died and they are complicit, all of them. We will never ever forget and they will answer in proper forums.
Every single aspect of COVID, the virus, the time line origin, location of origin, the lockdown lunatic response, all of it, the fraud failed mRNA technology gene injection, all were lies!
‘The estimated IFR is close to zero for children and younger adults but rises exponentially with age, reaching 0.4% at age 55, 1.3% at age 65, 4.5% at age 75, and 15% at age 85. We find that differences in the age structure of the population and the age-specific prevalence of COVID-19 explain 90% of the geographical variation in population IFR.’
‘The overall noninstitutionalized IFR was 0.26%. In order of magnitude, the demographic-stratified IFR varied most by age, race, ethnicity, and sex (Table). Persons younger than 40 years had an IFR of 0.01%’.
Here is an update on excess deaths in Europe. It’s not looking good. Germany had the highest excess mortality rate of 37.3%! This is the latest data from December provided by eurostat.
Excess mortality in Europe rose to 19% collectively
Germany recorded the highest excess mortality rate of 37.3%
Countries like Bulgaria and Romania recorded little or no excess deaths
This is worse than any point in the pandemic. Think these deaths are COVID? COVID is not causing these deaths.
Although there are some deaths caused by COVID-19, the numbers are not nearly as high as they were in 2020 and 2021. Therefore, the excess deaths currently being observed in the EU are not solely due to COVID-19.
Does anyone have any idea what’s causing it? Doctors are baffled. The media is in hyperdrive producing article after article saying it’s anything but the vax. A recent article published by NBC acknowledges the 30% rise in cardiac arrests in people aged 25-44 and gives many theories – from not masking enough to the virus’s impact on the cardiovascular system – but neglects to mention the elephant in the room.
Have a look at one published just yesterday by the San Francisco Chronicle. The more vax you get the lower your heart attack risk! Nonsense.
Remember the two countries – Bulgaria and Romania – that recorded little or no excess deaths? They are also the least mRNA vaccinated European countries. However, Germany, the excess death leader, is one of the most mRNA vaccinated European Countries.
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A reanalysis of Pfizer & Moderna’s clinical trials – the trials that lead to EUA approval – found you are more likely to suffer a severe adverse event if you took the vaccine then you were to be hospitalized with COVID. 1 serious adverse event (hospitalization, disability, death, etc) per 800 doses. Which is likely an underestimate due to the fact the trial was only 2 months long.
We have evidence from studies, randomized control trials, autopsy data and clinical data that show a majority of these excess deaths are cardiovascular related. We must conclude, until proven otherwise, the primary cause of these excess deaths are from the mRNA vaccines.
They told you everything would return to normal once everyone got their vaccines and boosters. Folks, we are far from normal.
concerns”; I have nothing to gain & all to lose talking about it…I am watching people get absolutely destroyed.”; deaths of military members from the vaccines exceeds deaths from COVID virus
The doctor said she is constantly contacted by people who have been injured by the mRNA technology genetic COVID vaccines, and that many of those injured are pilots, who are expected to meet high fitness standards. ‘Long told Staver that in just one afternoon she heard from four pilots who had just gotten MRIs back showing that they had myocarditis.’
Re-post:
Alexander COVID News-Dr. Paul Elias Alexander’s Newsletter
Dr. Long also testified that the data shows that deaths of military members from the vaccines exceed deaths from COVID itself. Dr. Theresa Long US military ‘Dr. Theresa Long, a medical officer with the United States military, has testified in court that she was ordered by a superior to suppress Covid-19 vaccine injuries following the Biden regime’s mand…
Eating Lab Grown Chicken Equivalent to Eating Cancer Tumors?
February 21, 2023 6:46 pm
This past November we reported how a new lab-grown chicken product is being developed and could soon be available commercially. The company, Upside Foods, is run by a medical doctor, and they put out a press release last year claiming that the FDA had “cleared” the product. But that was simply a clever marketing campaign, as the FDA does not approve foods, like they do drugs. Unlike other lab-produced meats which are vegetarian and plant based, this product uses cell lines from chickens. Bloomberg did an investigative report on this product this week, and reported that these cell lines are “immortalized” and are basically the same as cancerous tumors. They reported: “Thank the biotech revolution. Under the right conditions, animal cells can be grown in a petri dish, or even at scale in factories full of stainless-steel drums. For decades, companies such as Pfizer Inc. and Johnson & Johnson have cultured large volumes of cells to produce vaccines, monoclonal antibodies and other biotherapeutics. Now the idea is that we might as well eat these cells, too.”
Yesterday saw stocks swoon (S&P -2.0%, Dow -2.1% to negative year-to-date) and bonds slump (US 2-year yields +10bp, 10-year yields +12bp to test closer to 4%), with expectations of the Fed Funds terminal rate rising to 5.35% – still 15bps short of reality, but a partial market catch-up to it.
There were lots of reasons why the “2023 is not 2022 because reasons!” crowd saw their hopes shattered. First, early February global PMI surveys underlined growth is picking up in services, where inflation, staff shortages, and pay pressures are most deeply entrenched: Japan was 53.6 (vs. 52.3 in January), the Eurozone 53.0 (50.8), the UK 53.3 (48.7), and the US 50.5 (46.8). Where is the economic downturn that means unemployment rises, so rates and yields plunge, so stocks surge?
Second, Timiraos of the Wall Street Journal highlighted research from the Cleveland Fed arguing “A deep recession would be necessary to achieve” 2.1% inflation by 2025, i.e., the curve flattening trade. Yet, “the researchers also conclude that, **if 2.8% inflation doesn’t result in an un-anchoring of inflation expectations**, the December FOMC projection (in which inflation stays somewhat above the 2% target for longer) would be the optimal policy.**” That’s a hypothetical argument for curve steepening trades, surely?
Third, geopolitics. President Putin’s bellicose national address expressed that Russia feels betrayed by the West, despises what the West now is, and won’t retreat from Ukraine. President Biden, in Poland (not France or Germany) stressed in lofty terms that the US will never abandon Ukraine. As the Guardian puts it,Biden and Putin both implicitly tie their futures to the outcome in Ukraine. That will be expensive for one, or both, politically.
It is expensive economically too. Higher production of military goods is inflationary. Poland are doubling their defence spending to 4% of GDP: the rest of the EU is doing a tenth of that in new spending while waiting for the US to lead. Are you putting a Cold War surge in defence spending and the need for a larger army despite labour shortages into your inflation projections? No? Because in an op-ed Monday, Dutch Prime Minister Rutte wrote…
“In peacetime, it’s easy to pay lip service to beautiful ideals. But when democracy and freedom are attacked, it comes down to it. In today’s geopolitical reality, for the first time in a long time, we have to ask ourselves: what is our way of life worth to us?… in the Netherlands and in many other NATO member states, the defence budget is being structurally increased at a rapid pace.”
Escalation will also be costly for the geopolitical and geoeconomic architecture markets rest on. A European Council on Foreign Relations (ECFR) survey of opinion in nine EU states, the UK, US, China, Russia, India, and Turkey underlines the war in Ukraine is “defining a new world order”. This is no revelation to anyone outside Europe or blue states in the US, and the limited subset of countries surveyed still displays Western-centric thinking. However, the revealed sharp geographical differences in attitudes to the war, democracy, and the global balance of power suggest to the ECFR that we may be at an historic turning point to a “post-western” world order.
“The paradox of the Ukraine war is that the west is both more united, and less influential in the world, than ever before,” says the ECFR’s director.
The unity is clear as PM Rutte argues, “I cannot see how this will be China’s century… the 21st century will be the century of democracy and thus the century of America,” and, “It is extremely important that we in the Netherlands and Europe appreciate the great role of the US.”
Relatedly, Friday will see China’s proposed peace plan for Ukraine. Any such attempt should be applauded, but the question is on whose terms. Western observers remain skeptical the plan will see any concrete details, while rumors are also flying China may threaten to do for Russia what the US is doing for Ukraine, amplified by the news that Xi Jinping will visit Moscow soon.
Logically, assuming China is not going to dump Russia, which it won’t, there are few potential outcomes:
China offers nothing new. However, this would underline that it remains a bystander having bullets fired at it by the White House, who just warned that Chinese firms that try to circumvent sanctions on Russia will face “repercussions”: like the ones forbidding the flow of Iranian oil?; or
China “escalates to deescalate” with an implied threat to stand behind Russia, in which case:
The US accepts a grand deal to climb down and partition Ukraine. That would mean a Western retreat on an historic scale that could snowball into a broader partition of the geopolitical and geoeconomic architecture – and the US won’t want that. Yet it would also allow the US to pivot towards Taiwan – and China won’t want that; or
The US reacts as if ‘China just bought a ticket for the Titanic after seeing the movie’, and the geopolitical and geoeconomic architecture shatters.
In short, the most logical probability is that neither the China peace plan nor the upcoming Xi visit to Moscow provide anything new. In which case, Ukraine escalation, inflation, and global polarisation it is. Yet the fact that we have a war in Ukraine at all should underline that the fat tail-risks are of something even worse – a scenario we originally flagged in our Ukraine metacrisis report in early 2022.
If you think markets are unhappy in recognizing that they have been wrong on Fed Funds again, wait until they grasp that shattering revelation.
7//OIL ISSUES//NATURAL GAS ISSUES/USA AND GLOBE
Chesapeake Energy to cut production amid the price crash
(zerohedge)
Chesapeake Energy Caves, Announces ‘Slowdown’ In NatGas Production Amid Price Crash
WEDNESDAY, FEB 22, 2023 – 03:25 PM
US natural gas futures are up more than 4.5% Wednesday morning. The price rise is likely due to trading shops digesting news from the second-largest producer of NatGas, Chesapeake Energy Corp., which mapped out a plan to reduce production due to crashing prices.
Around 0600 ET, NatGas for March delivery fell to $1.970 per million British thermal units in New York. Shortly after, prices then embark on a wild 11.42% move higher to as high as $2.192.
During the surge in prices, Bloomberg released this headline around 0925 ET:
*CHESAPEAKE SAYS IT’S SLOWING HAYNESVILLE SHALE DRILLING WORK
Yesterday, we noted that oversupply conditions would force producers to take rigs offline due to prices below breakeven levels. Today’s price surge is on the hope production will slow in the coming months.
Chesapeake’s earnings were released today, and the E&P’s slide deck outlined their near-term strategy adjustments for 2023 and a long-term plan for development through 2027.
Note: The images within this report are all sourced via Chesapeake’s latest investor presentation, which you can find here.
2023 Drilling & Completion Program Adjustments
CHK’s headline news from the day was centered around the E&P’s adjustment to the current Lower 48 supply & demand dynamics. The company is opting to release three rigs and two completion crews this year, which will include cutting two rigs in the Haynesville (one in 1Q23 and one in 3Q23) and releasing one Marcellus rig in the third quarter of 2023. They will also drop two completion crews in 2Q/3Q while maintaining 1-2 crews within each basin during the year.
The scaled-back operations equate to a 2023 natural gas production guidance of 3.4-3.5 Bcf/d and a first-quarter guidance of 3.55-3.65 Bcf/d. That guidance would equate to 2Q-4Q gas production averaging a reduced 3.4 Bcf/d, and all quarters this year are lower than the 4Q22 gas production of 3.65 Bcf/d.
Current Breakeven & Free Cash Flow Guidance for 2023-2027
There have been numerous questions surrounding breakeven economics amid the recent collapse in gas prices, and Chesapeake provided a bit of insight on that front within their slide deck.
The firm reported that the next five years of their activity in the Marcellus & Haynesville shale include a $2.07/Mcf breakeven on operations. Interestingly, Chesapeake reported that their base dividend breakeven is $2.40/Mcf for natural gas, assuming $75 WTI oil prices.
However, Chesapeake’s free cash flow guidance for 2023-2027 included some loftier assumptions for strip prices, with the projections formulated with an adjusted strip deck of “$3.25 HHUB 2023, $3.75 HHUB for 2024, and $4.00 thereafter, $75 WTI for all years.”
With that in mind, CHK gave a 2023-2027 free cash flow guidance that included $6.1 billion in cash flow via natural gas production and $2.5 billion in proceeds from asset sales. Chesapeake plans to direct $3.9 billion of that FCF towards the base + variable dividend while also utilizing $4.7 billion for buybacks and net debt reductions.
CHK Has Added 360 Bcf in Hedges Since October 2022, +240 Bcf in Financial Basis Positions
Since Chesapeake’s last public disclosure of hedges on October 27, 2022, they bolted on +360 Bcf in new NYMEX positions. That marked a +40% increase in hedged volumes for 2023/2024 via a split of 75% collars and 25% swaps. The weighted average floor of the new positions was $4.15 and the ceiling was $5.40/Mmbtu.
Chesapeake’s hedges now cover 55-60% of their production in 2023, with floor prices varying by quarter at $3.01-$3.58/Mmbtu. The 2024 positions cover 30-45% of volumes at floor prices of $3.61-$3.84/Mmbtu.
CHK also added incremental basis protections since October 2022. The basis positions now cover 30% of Marcellus & 54% of Haynesville basis for 2023. Since October, they added 170 Bcf for 2023 gas and 70 Bcf for 2024 gas.
Chesapeake Highlights the Importance of Incremental LNG Demand Moving Forward
Chesapeake included a slide on their 4Q22 earnings highlighting that “being LNG ready” would help “create meaningful value and enhance returns” looking forward. Similar to Criterion’s recent update on projected LNG feed gas growth through the second half of this decade, Chesapeake cited expectations for the addition of +6.7 Bcf/d in incremental LNG export demand by 2025 and then a further +24.5 Bcf/d after 2026, depending on future FID’s.
CHK reiterated that the newly announced activity reductions across their holding will not impede the “ability toBe LNG Ready.” The company reported that a gas-directed fleet of 10-12 rigs in the Haynesville & Marcellus would allow for a 3% production compound annual growth rate.
In 2023, ten rigs would equate to 3.5 Bcf/d in gas production and then ramping to 11 rigs in 2024 would limit the production decline to 3.4 Bcf/d. By running 11 rigs in 2024 and then 12 rigs in 2025-2027, CHK would grow output to 3.9 Bcf/d by 2027.
Meanwhile, on an oil-barrel-equivalent basis, US NatGas is trading at around a $40 discount to WTI Crude (the ‘cheapest’ since 2013)…
The prospect of producers throttling future production has excited the market. The question is if this is enough to reverse the crash in prices that hit the one-handle earlier this morning.
8. EMERGING MARKETS//AUSTRALA NEW ZEALAND ISSUES
END
YOUR EARLY CURRENCY/GOLD AND SILVER PRICING/ASIAN AND EUROPEAN BOURSE MOVEMENTS/AND INTEREST RATE SETTINGS WEDNESDAY MORNING 7;30AM
EURO VS USA DOLLAR:1.0643 DOWN .0008
USA/ YEN 134.60 DOWN 0.378/NOW TARGETS INTEREST RATE AT .50% AS IT WILL BUY UNLIMITED BONDS TO GETS TO THAT LEVEL…//YEN STILL FALLS//
GBP/USA 1.2104 DOWN 0.0006
Last night Shanghai COMPOSITE CLOSED DOWN 15.38 PTS OR 0.47%
Hang Sang CLOSED DOWN 105.65 PTS OR 0.45%
AUSTRALIA CLOSED DOWN 0.36% // EUROPEAN BOURSE: ALL RED
Trading from Europe and ASIA
I) EUROPEAN BOURSES ALL RED
2/ CHINESE BOURSES / :Hang SANG CLOSED DOWN 105.65 PTS OR 0.45%
/SHANGHAI CLOSED DOWN 15.78 PTS OR 0.47%
AUSTRALIA BOURSE CLOSED DOWN .36%
(Nikkei (Japan) CLOSED DOWN 368.78 PTS OR 1.34%
INDIA’S SENSEX IN THE RED
Gold very early morning trading: 1835.70
silver:$21.81
USA dollar index early WEDNESDAY morning: 104.14 UP 2 BASIS POINTS from TUESDAY’s close.
The USA/Yuan, CNY: closed ON SHORE (CLOSED DOWN ..(6.8922)
THE USA/YUAN OFFSHORE: (YUAN CLOSED (DOWN)…. 6.8999
TURKISH LIRA: 18.88 EXTREMELY DANGEROUS LEVEL/DEATH WISH/HYPERINFLATION TO BEGIN.
the 10 yr Japanese bond yield at +0.500…VERY DANGEREOUS
Your closing 10 yr US bond yield DOWN 5 IN basis points from TUESDAY at 3.908% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic
USA 30 yr bond yield 3.921 DOWN 6 in basis points
USA 2 yr bond yield: 3.656 DOWN 5 basis points
Your closing USA dollar index, 104.28 UP 17 BASIS PTS ON THE DAY/1.00 PM/
Your closing bourses for Europe and the Dow along with the USA dollar index closing and interest rates WEDNESDAY: 12:00 PM
London: CLOSED DOWN 34.51 PTS OR 0.68%
German Dax : CLOSED DOWN 10.95 POINTS OR 0.09 %
Paris CAC CLOSED DOWN 15.95PTS OR 0.22%
Spain IBEX DOWN 83.80POINTS OR 0.91%
Italian MIB: CLOSED DOWN 212.22 PTS OR 1.05%
WTI Oil price 7446 12: EST
Brent Oil: 81.14 12:00 EST
USA /RUSSIAN /// UP TO: 75.00/ ROUBLE UP 0 AND 5/100 RUBLES/DOLLAR
GERMAN 10 YR BOND YIELD; +2.512
UK 10 YR YIELD: 3.6179 UP 1 BASIS PTS.
CLOSING NUMBERS: 4 PM
Euro vs USA: 1.0606 DOWN 0.0046 OR 46 BASIS POINTS
British Pound: 1.2047 DOWN .0062 or 62 basis pts
BRITISH 10 YR GILT BOND YIELD: 3.697% DOWN 1 BASIS PTS
USA dollar vs Japanese Yen: 134.94 DOWN .054////YEN UP 5 BASIS PTS//
USA dollar vs Canadian dollar: 1.3559 UP .0026 (CDN dollar, DOWN 26 basis pts)
West Texas intermediate oil: 73.91
Brent OIL: 80.51
USA 10 yr bond yield DOWN 3 BASIS pts to 3.923%
USA 30 yr bond yield DOWN 5 BASIS PTS to 3.931%
USA 2 YR BOND: DOWN 2 PTS AT 2.697%
USA dollar index: 104.47 UP 35 BASIS POINTS
USA DOLLAR VS TURKISH LIRA: 18.88
USA DOLLAR VS RUSSIA//// ROUBLE: 75.00 U0 0 AND 5/100 roubles
DOW JONES INDUSTRIAL AVERAGE: DOWN 697.89 PTS OR 2.06%
NASDAQ 100 DOWN 297.89 PTS OR 2.41%
VOLATILITY INDEX: 22.82 UP 1.59 PTS (7.49)%
GLD: $170.62 DOWN 0.64 OR 0.37%
SLV/ $20.07 UP 0,06 OR 0.30%
end)
USA TRADING TODAY IN GRAPH FORM
Bonds & Dollar Bid As Fed Minutes Spark Selloff In Stocks & Gold
Y TYLER DURDEN
WEDNESDAY, FEB 22, 2023 – 04:01 PM
St.Louis Fed’s Jim Bullard buoyed the market briefly ahead of the cash open by being slightly less hawkish than his usual full hawktard self, but that didn’t last. The cash open saw the ubiquitous bid evaporate quickly to the lows of the day but the dip-buyers ramped back in to lift stocks into the Fed Minutes.
And while macro data has soared since the last FOMC meeting, so have inflation expectations…
Source: Bloomberg
The biggest takeaway from the Minutes appeared to be the contradiction of Fed Chair Powell’s nonchalance at the easing of financial conditions, which is in itself a hawkish shift (despite an overall sentiment gauge suggesting this was a notably dovish minutes):
“Participants noted that it was important that overall financial conditions be consistent with the degree of policy restraint that the Committee is putting into place in order to bring inflation back to the 2 percent goal.”
The markets have a long way to go catch up to that reality…
All of which left stocks lower (but not dramatically so) on the day with The Dow and S&P the biggest losers…
The S&P broke 4,000 and tested the 200DMA before bouncing late on…
The cash open short squeeze faded really fast…
Source: Bloomberg
Notably, using information from SpotGamma’s Hiro Indicator, the opening bounce was all call-buying (momentum ignition) and the rebound around 1030ET was also heavy call buying (and put covering). But once the Fed Minutes hit, a wave of heavy put buying came in (but even more notably, call buying was consistent – though smaller in magnitude – all the way down in the stock slide)…
VIX spiked up to the highs of the year this morning before fading back and then rallying once again as stocks sold off…
Treasury yields ended the day lower with the belly underperforming (7Y -1bps, 2Y -2.5bps, 30Y -4bps) leaving the belly lagging the long-end on the week so far.Yields did rise after the Minutes. The yield curve reversed all of yesterday’s steepening…
Source: Bloomberg
Ahead of the Minutes, the market’s expectation for the Fed’s terminal rate was 5.33% (July) and 13bps of rate-cuts priced-in for H2 2023. Both shifted hawkishly after the Minutes…
Source: Bloomberg
The dollar extended yesterday’s gains, erasing the majority of Friday’s losses…
Source: Bloomberg
Bitcoin slipped lower again, back below $24,000…
Source: Bloomberg
NatGas prices (Henry Hub) tumbled to $1 handle for the first time since Sept 2020 before ripping higher on reports that Chesapeake Energy will slow production…
And for context, US NatGas is trading at its biggest discount (on an oil barrel equivalent basis) to WTI Crude since 2012…
Source: Bloomberg
Oil prices are down for the 6th straight day with WTI back to a $73 handle
Gold slipped lower today, unable to hold $1850 again…
Finally, we note that The Mortgage Bankers Association data this morning showed the weakest level of Purchase Applications since August 1995…
Source: Bloomberg
Additionally, The Cleveland Fed’s own inflation forecasting model shows that the disinflation of the past few months has now come to an end (or a pause)…
Source: Bloomberg
Not exactly answering the ‘pivot’-positioned prayers.
LATE AFTERNOON TRADING//FOMC MINUTES
FOMC Minutes Suggest Fed Fears Financial Conditions Decoupling, Warns About High Equity Valuations
WEDNESDAY, FEB 22, 2023 – 02:07 PM
Tl:dr: Fed Minutes appear to argue against what Powell said during the presser on the decoupling of financial conditions from monetary policy:
Powell declined to try to talk down financial markets, pointedly noting that it wasn’t up to him to persuade people, saying:
“We’re just going to have to see.”
By contrast, it seems like there were others on the panel that were concerned.
“Participants noted that it was important that overall financial conditions be consistent with the degree of policy restraint that the Committee is putting into place in order to bring inflation back to the 2 percent goal.”
Additionally:
“several participants observed that some measures of financial conditions had eased over the past few months.”
While Powell said at the meeting
“Financial conditions didn’t really change much from the December meeting to now.”
And there’s a long way to go to catch up…
Overall, Bloomberg’s sentiment model suggests the Minutes were more dovish than the last…
That is the most dovish statement in at least two years.
But, David Wilcox of Bloomberg Economics noted on BTV, there is only a single mention of a “pause” in rates — and that one is in reference to other central banks!
* * *
Since the last FOMC meeting (on Feb 1st) when Chair Powell dismissed any fears about loosening financial conditions, prompting a panic-bid in stocks, financial conditions have done nothing but tighten as the FedSpeak along with ‘good’ economic news has nuked the ‘Fed pivot’ narrative…
Source: Bloomberg
That is even more evident in the hawkish explosion higher in the market’s expectation for The Fed’s terminal rate and the collapse in hopes of a H2 2023 rate-cut…
Source: Bloomberg
With the odds of 25bp hikes in March, May, and June all rising rapidly…
Source: Bloomberg
All of which has prompted chaos across asset classes with gold and bonds down notably, bitcoin and the dollar stronger and stocks fading fast in the last few days…
Source: Bloomberg
And if there is one final thing to consider before The Minutes come out, it’s the fact that US macro data has dramatically surprised to the upside (and sticky inflation expectations along with it):
the 517,000 surge in January payrolls that blew away estimates
the re-acceleration of month-on-month CPI inflation in January
the biggest jump in the ISM services gauge since mid-2020
the largest increase in retail sales in nearly two years
…making the Minutes very stale.
Source: Bloomberg
As a reminder, Fed Chair Powell actually told us during the press conference on Feb 1st that:
“The minutes will come out in three weeks and will give you a lot of detail. We spend a lot of time talking about the path ahead and the state of the economy. And I wouldn’t want to start to describe all the details there, but that was — the sense of the discussion was really talking quite a bit about the path forward.”
While the biggest issue to watch for is just how dovish sentiment really is within The Fed, we already know that at least two Fed members pushed for 50bps (Mester and Bullard) at the last meeting, so what will The Minutes tell us (now that they are so stale)…
On 25 or 50 bps
In their consideration of appropriate monetary policy actions at this meeting, participants concurred that the Committee had made significant progress over the past year in moving toward a sufficiently restrictive stance of monetary policy. Even so, participants agreed that, while there were recent signs that the cumulative effect of the Committee’s tightening of the stance of monetary policy had begun to moderate inflationary pressures, inflation remained well above the Committee’s longer-run goal of 2 percent and the labor market remained very tight, contributing to continuing upward pressures on wages and prices.
Against this backdrop, and in consideration of the lags with which monetary policy affects economic activity and inflation, almost all participants agreed that it was appropriate to raise the target range for the federal funds rate 25 basis points at this meeting. Many of these participants observed that a further slowing in the pace of rate increases would better allow them to assess the economy’s progress toward the Committee’s goals of maximum employment and price stability as they determine the extent of future policy tightening that will be required to attain a stance that is sufficiently restrictive to achieve these goals.
A few participants stated that they favored raising the target range for the federal funds rate 50 basis points at this meeting or that they could have supported raising the target by that amount. The participants favoring a 50-basis point increase noted that a larger increase would more quickly bring the target range close to the levels they believed would achieve a sufficiently restrictive stance, taking into account their views of the risks to achieving price stability in a timely way.
All participants agreed that it was appropriate to continue the process of reducing the Federal Reserve’s securities holdings, as described in its previously announced Plans for Reducing the Size of the Federal Reserve’s Balance Sheet.
On Risk Management
“Almost all participants observed that slowing the pace of rate increases at the current juncture would allow for appropriate risk management.”
On Inflation
“A number of participants observed that a policy stance that proved to be insufficiently restrictive could halt recent progress in moderating inflationary pressures.”
The Fed staff doesn’t see inflation moving back to 2% until 2025:
“With steep declines in consumer energy prices and a substantial moderation in food price inflation expected for this year, total inflation was projected to step down markedly this year and then to track core inflation over the following two years. In 2025, both total and core PCE price inflation were expected to be near 2 percent.”
On market valuations
“The staff judged that asset valuation pressures remained notable. In particular, the staff noted that measures of valuations in both residential and commercial property markets remained high, and that the potential for large declines in property prices remained greater than usual. In addition, the forward price-to-earnings ratio for S&P 500 firms remained above its median value despite the decline in equity prices over the past year.”
On Household Spending Slowdown
“In their discussion of the household sector, participants noted that growth in consumer spending had softened recently. Several participants remarked that there had been a reduction in discretionary expenditures, especially among lower- and middle-income households, whose purchases were shifting toward lower-cost options.”
On Labor Hoarding
“A number of participants remarked that some businesses were keen to retain workers after their recent experiences of labor shortages and hiring challenges. These participants noted that this consideration had limited layoffs even as the broader economy had softened”
On The Debt Limit
“A number of participants stressed that a drawn-out period of negotiations to raise the federal debt limit could pose significant risks to the financial system and the broader economy.”
On financial conditions
…officials said it was important “that overall financial conditions be consistent with the degree of policy restraint that the Committee is putting into place in order to bring inflation back to the 2 percent goal.”
Additionally:
“several participants observed that some measures of financial conditions had eased over the past few months.”
While Powell said at the meeting
“Financial conditions didn’t really change much from the December meeting to now.”
Still a long way to go to normalize back to monetary policy…
But, David Wilcox of Bloomberg Economics noted on BTV, there is only a single mention of a “pause” in rates — and that one is in reference to other central banks!
end
FOMC COMMENTARY
Fed minutes show ‘some’ officials thought easier financial conditions could mean tighter monetary policy
Feb. 22, 2023 at 2:04 p.m. ET
MarketWatch
All officials backed continued interest rate hikes in coming meetings, but some divergence of view was emerging
Minutes of the Federal Reserve’s meeting in early February show that some officials were worried about recent easing in financial conditions.
Ahead of the Jan. 31- Feb.1 meeting, stocks had strengthened and bond yields had slipped after three months of good inflation news.
In their discussion, a “number” of Fed officials noted that financial conditions had eased, “which some noted could necessitate a tighter stance of monetary policy,” the minutes showed.
When asked about easier financial conditions at his press conference after the meeting, Fed Chairman Jerome Powell did not register alarm.
“Our focus is not on short-term moves but on sustained changes to broader financial conditions” which “have tightened very significantly over the past year,” he said.
At the meeting, the Fed hiked its benchmark rate by 25 basis points to a range of 4.5%-4.75%. Only a”few” Fed officials wanted a 50 basis point move. Cleveland Fed President Loretta Mester and St. Louis Fed President James Bullard have already said they were in that small camp.
Overall, the minutes show that all Fed officials were supporting further increases in the interest rates.
There were signs of some divisions emerging.
“Several” Fed officials thought the risks to the economic outlook “were becoming more balanced,” suggesting high inflation was not the single focus.
On the other hand “a number” of Fed officials said that if the level of interest rates was not high enough to slow the economy, it could halt recent progress in moderating inflation and lead inflation to remain above the Fed’s target for a longer period. The public might start to expect higher inflation, these officials said.
-END-
iii) USA ECONOMIC NEWS
Updates on the East Palestine disaster
(Roberts/EpochTimes)
Over 1 Million Gallons Of Contaminated Water Excavated From Ohio Train Derailment Site
Around 15,000 pounds of contaminated soil and 1.1 million gallons of contaminated water have been excavated from the site of a train derailment earlier this month in East Palestine, Ohio, train operator Norfolk Southern said on Feb. 20.
The announcement comes shortly after a state senator warned people living in close proximity to the derailment not to drink or bathe in the water.
Norfolk Southern said that the excavated contaminated soil and water will be transported to landfills and disposal facilities that are “designed to accept it safely in accordance with state and federal regulations.”
“Additionally, a series of pumps have been placed upstream to reroute Sulphur Run around the derailment site,” the carrier said. “The affected portion of Sulphur Run has been dammed to protect water downstream.”
“Environmental teams are treating the impacted portions of Sulphur Run with booms, aeration, and carbon filtration units,” Norfolk Southern said, adding that those teams are “also working with stream experts to collect soil and groundwater samples to develop a comprehensive plan to address any contamination that remains in the stream banks and sediment.”
The train, carrying about 50 freight cars, was traveling from Madison, Illinois, to Conway, Pennsylvania, on Feb. 3 when it derailed in East Palestine.
State officials ordered the evacuation of a 1-mile radius surrounding the crash site shortly after the incident but lifted those evacuation orders after crews burned the chemicals onboard, which included vinyl chloride, ethylhexyl acrylate, ethylene glycol monobutyl ether, and butyl acrylate, in a controlled release on Feb. 6.
Concerns over Cancer-Causing Pollutants
The controlled release also sent phosgene and hydrogen chloride into the air.
At the time the order was lifted, officials declared that it is safe for residents to return to the area after monitoring the air and water in surrounding communities and claiming they were not affected.
Trump Heads To East Palestine To Capitalize On Biden’s ‘Failed’ Toxic Train Derailment Response
WEDNESDAY, FEB 22, 2023 – 09:20 AM
Former President Donald Trump is expected to visit East Palestine, Ohio, Wednesday and donate pallets of water and other supplies to the small town grappling with the toxic aftermath of the train derailment earlier this month.
Trump will meet with East Palestine Mayor Trent Conaway; Sen. J.D. Vance, R-Ohio; Rep. Bill Johnson, R-Ohio; State Rep. Monica Robb-Blasdel; and Ohio State Sen. Michael Rulli.
“President Trump is meeting with the citizens of East Palestine and will never forget them and what they are going through.
“Contrast that with Biden and the federal government who has failed them from the beginning,” a Trump advisor told Fox News.
On Monday, President Biden, who has barely mentioned East Palestine, decided to visit Ukraine instead of East Palestine. During an appearance on Fox News that same day, Mayor Trent Conaway said the president’s visit overseas was the “biggest slap in the face” as his town continues to suffer following a freight train crash carrying hazardous materials, including vinyl chloride.
“That was the biggest slap in the face that tells you right now, he doesn’t care about us,” Conaway told Fox’s Jesse Watters. He added: “So … he can send every agency he wants to but I found that out this morning and one of the briefings that he was in the Ukraine giving millions of dollars away to people over there, not to us and I’m furious.”
Fox’s Tucker Carlson recently said:
“East Palestine is a poor, white town that voted for Trump. So honestly, who cares? No one in the Biden administration did care and that’s an atrocity.”
We told readers days ago: Trump wants to capitalize on what Legal Insurrection noted, “Ohio’s toxic train derailment is Biden’s Katrina.”
end
AND NOW THIS:
WHAT IS GOING ON?????
(COURTESY SLAY NEWS)
Huge Explosion Destroys Ohio Manufacturing Plant
Frank BergmanFebruary 21, 2023 – 7:46 am3 Comments
Multiple fire crews in Ohio have been battling a large blaze after a huge explosion destroyed a Cleveland-area manufacturing plant.
According to Fox 8, witnesses said an explosion occurred at the I Schumann & Co. metal and paint plant in Bedford just after 2 pm on Monday.
The factory produces copper alloys.
Authorities have confirmed that the explosion killed one person and injured several more people.
13 people were injured and taken to a nearby hospital, the Oakwood Village Fire Department said.
At least one person is in critical condition, the news report said.
Fire Capt. Brian DiRocco said he saw some burn victims at the scene and that at least one person had to be pulled from the rubble before being taken to the hospital.
A large plume of smoke coming from the building could be seen in the air.
Ohio explosion at a metal factory is being reported as a ‘mass casualty incident.’ Pray for Ohio
.
Ohio explosion at a metal factory is being reported as a ‘mass casualty incident.’
Another strong indicator showing that the global economy is faltering hugely: Intel, one of the largest chip manufacturers is cutting
its dividend due to poor guidance/losses
(zerohedge)
Struggling Intel Cuts Dividend By 66% To Conserve Cash
WEDNESDAY, FEB 22, 2023 – 08:40 AM
Another day, another cold shower for long-suffering investors in what was once upon a time a greatly respected chip company.
On Wednesday morning, Intel Corp., the biggest maker of computer processors whose stock price has been eviscerated in the past two years, slashed its dividend payment to preserve cash for investment.
The company will reduce it’s quarterly payout to investors by 66% to 12.5 cents a share for holders payable June 1 – the lowest quarterly dividend since 2011 – the chipmaker said in a statement on Wednesday. Intel’s current quarterly dividend is 36.5 cents and was projected to cost more than $6 billion in 2023.
Intel also reaffirmed its adjusted revenue forecast for the first quarter, which as noted below, is hardly something to be proud of. The company also reiterated that…
Still sees adjusted revenue $10.5 billion to $11.5 billion, estimate $11.08 billion
Still sees adjusted loss per share 15c, estimate loss/shr 15c
As reported last month, in its latest catastrophic earnings report Intel forecast one of the worst quarters in its history projecting revenue that would be the smallest since 2010, as a slowdown in personal-computer sales ravages the semiconductor industry.
Commenting on the dividend cut, Bloomberg Intelligence says that the move was not a surprise and had been widely expected. It notes that the cut “reflects the company’s challenge to improve cash flow despite its announced $3 billion in operational cost cuts”, and the problem is that Intel’s capex intensity leaves “little room to generate positive free cash flow for at least the next two years”
Wells Fargo also chimed in, saying that because this had been widely expected, “this announcement, while negative, will not materially change investor sentiment.”
While the dividend cut may have been expected, INTC stock still dropped, sliding to the lowest level since the end of 2022.
USA COVID//
SWAMP STORIES
Biden’s student loan forgiveness plan will be in trouble at the Supreme Court according to lawyers
(Vadum/EpochTimes)
Biden Student Loan Forgiveness Plan In Trouble At Supreme Court, Lawyers Say
President Joe Biden’s sweeping plan to partially forgive student loans will likely receive a cool reception when the Supreme Court hears challenges to the program on Feb. 28, legal experts told The Epoch Times.
Biden introduced the plan in August 2022 in a move that critics decried as a constitutionally dubious attempt to shore up Democrats’ fortunes ahead of the November 2022 congressional elections. While the Congressional Budget Office said the plan could cost about $400 billion, the Wharton School at the University of Pennsylvania estimates the price tag could exceed $1 trillion.
The student loan relief program is premised on the existence of the emergencies the Trump administration declared in March 2020 to combat the COVID-19 virus. The national emergency and the public health emergency enabled federal agencies to exercise expansive powers in managing the government’s pandemic response.
In a move that could undermine the government’s legal arguments in the pending court cases, Biden’s Office of Management and Budget said in a Jan. 30 press release (pdf) that it would extend the soon-to-expire emergencies to May 11 “and then end both emergencies on that date.”
The federal government put a pause on student loan payments and interest during the recent pandemic but then claimed in 2022 that the pandemic gave it emergency authority under the law to proceed with partial loan forgiveness. Republicans, who took the majority in the House of Representatives in January, say the emergencies aren’t justified and should be ended sooner.
About 26 million people reportedly applied under the program before courts blocked it last year. Of those 26 million, 16 million were said to have been approved before the government stopped accepting applications.
The Department of Education claims that it has the authority to move forward with the debt relief proposal, which would cancel as much as $20,000 in loan principal for 40 million borrowers, under the Higher Education Relief Opportunities for Students Act of 2003 (HEROES Act).
But lawmakers involved in the passage of the HEROES Act say the statute was enacted after the 9/11 terror attacks to provide student loan relief to military service members and their families and was never intended to be used to cancel debts en masse.
The court is scheduled to hear two related cases dealing with the program, Biden v. Nebraska (court file 22-506) and Department of Education v. Brown (court file 22-535), back-to-back on Feb. 28.
The Biden student loan forgiveness plan is flatly unconstitutional, attorney Caleb Kruckenberg of the Pacific Legal Foundation, a national nonprofit public interest law firm, told The Epoch Times.
He said Biden unveiled the debt relief program not long after the pandemic “was over anyway [and] we all sort of understood what that meant.”
Kruckenberg said that even if the Biden administration were successful at the Supreme Court, which he doubts, their stated authority would expire May 11.
Putin goes nuclear: Russian president raises the stakes as he reveals he is pulling out of nuclear arms treaty and accuses the West of starting Ukraine war in bid to achieve ‘limitless power’ Late in his rambling near two-hour address, Putin announced Russia was suspending its participation in the New Start programme with the US, which limits the two sides’ strategic nuclear arsenals… https://www.dailymail.co.uk/news/article-11774773/Putin-update-Russia-Ukraine-war-major-speech-morning.html
US slams Putin’s ‘irresponsible’ decision to suspend nuclear arms treaty as Biden meets Polish President Duda in Warsaw – New Start Treaty… last major arms control treaty… https://t.co/ckQacMyXKh
U.S. Warnings to China on Arms Aid for Russia’s War Portend Global Rift – NY Times China’s entry into the war in that manner would transform the nature of the conflict, turning it into an epochal struggle involving all three of the world’s largest superpowers and their partners on opposing sides: Russia, China, Iran and North Korea aligned against the United States, Ukraine and their European and Asian allies and partners, including Japan and South Korea. Warnings to China from Antony J. Blinken, the U.S. secretary of state… revealed that the Biden administration believes Beijing is close to crossing the line. And the fact Mr. Blinken spoke out publicly shows the desperation of the United States as it tries to dissuade Mr. Xi and his aides from doing so… China has deepened its ties with Russia during the war. And last Thursday, on the eve of the security conference, Wang Wenbin, a spokesman for the Chinese Foreign Ministry, said, “China stands ready to work with Russia to further advance our comprehensive strategic partnership of coordination for a new era.”… https://www.nytimes.com/2023/02/19/world/europe/us-china-weapons-russia-ukraine.html
China’s Xi Jinping is preparing to visit Moscow — WSJ
China warns U.S. to suffer ‘consequences’ if it escalates balloon incident – Reuters Beijing will “follow through to the end” in the event “the U.S. insists on taking advantage of the issue”, the foreign ministry said in a statement… https://t.co/CmP6VlQd8k
In Munich, China slapped away America’s outstretched hand – The Washington Post The Biden administration came to Munich this weekend eagerly courting a reset with China, but in public and in private, China’s top diplomat rejected the overture. Secretary of State Antony Blinken’s contentious meeting with Wang Yi, China’s top diplomat, showed that Beijing is in no mood for detente… Despite administration claims to the contrary, the evidence suggests that the Biden team was doing the chasing. For one thing, in the days leading up to the conference, U.S. officials were publicly playing down the incident that started the latest crisis, when a Chinese spy balloon entered U.S. airspace and was subsequently shot down by a U.S. fighter jet… President Biden barely mentioned it in his State of the Union address. Vice President Harris said before arriving in Germany she didn’t think it would negatively affect U.S.-China relations. (She was wrong.)… The Chinese government, perhaps looking to pounce on the Biden team’s perceived weakness, responded by ramping up its bellicose rhetoric… As of Friday evening, the Chinese side was still refusing to agree to the meeting, fueling the notion that Blinken was the pursuer… The Chinese readout bragged that the United States requested the meeting and stated that Wang told Blinken he should “acknowledge and repair the damage that its excessive use of force caused to China-U.S. relations,” essentially demanding that the United States apologize…When the Biden administration is in courtship mode, the aides said, it backs off from applying pressure on China on a range of issues… https://t.co/QtVin1iwa8
Kissinger/Nixon drove a wedge between China and Russia; Team Obama/Biden is uniting them! Nuclear inspectors in Iran find uranium enriched to 84-percent purity: reportshttps://trib.al/f5mHapN To create a nuclear weapon, uranium must be enriched to at least 90 percent… https://trib.al/f5mHapN
Natsec advisor to Sen Cruz @omriceren: When Biden was elected in Nov. 2020 Iran’s nuclear program was in a box. Despite Trump withdrawing from the nuclear deal in 2018, Iran had not even enriched past 5%.The Biden admin dismantled pressure. Iran enriched to weapons-grade uranium.
The international problems that the US faces are now more severe than at any time since WWII. China and Russia are now FDR’s Japan and Germany. North Korea is a belligerent nuclear power with ICBMs. Iran is on the threshold of being a nuclear power with ICBMs. All possess a deep hatred of the USA.
US leadership (Team Obama/Biden) is weaker and more craven than Team Carter – and every major global player knows it! There is little respect or regard for Biden or his puppet masters. The Pentagon is a menagerie of Obama installed wokesters that inspire ridicule, not fear or awe. NATO is effete due to France and Germany’s fecklessness and the diminution of UK might.
American money managers have been conditioned over the past few decades to ignore the impact and consequences of geopolitical developments and problems. Everything in US money management and trading has been condensed to the behavior of the Fed and to a lesser degree, US fiscal policy.
At some point, it might already be occurring, the premium for US financial assets due to its military majesty, will shrink. The most vulnerable US financial asset is, of course, US government bonds. Thirty-something trillion in ‘official’ debt and tens of trillions of dollars more in unfunded liabilities is NOT priced into US bonds. It’s well past time to contemplate the geopolitical risks for financial assets.
Coming PCEs and CPIs suddenly don’t seem to be as critical as Masters of the Universe believe.
“Compared to war all other forms of human endeavor shrink to insignificance.” – Gen. George S. Patton
S&P Global Flash US Composite PMI™Flash US PMI Composite Output Index 50.2 [47.5 exp] (January: 46.8) 8-month highFlash US Services Business Activity Index 50.5 [47.3 exp] (January: 46.8) 8-month highFlash US Manufacturing Output Index 48.4 [47.2 exp] (January: 46.9) 4-month highFlash US Manufacturing PMI 47.8 (January:46.9) 4-month highData were collected 10-20 February. https://www.pmi.spglobal.com/Public/Home/PressRelease/1a48b2fdf6114741aade2fd71f25f4a6
Home Depot warns of weak 2023 profit as rising prices hurt demand Rising wages, weak consumer sentiment also led Walmart to take a cautious stance for 2023 The company said it would spend $1 billion more in annualized compensation for its frontline, hourly associates, a move that Wells Fargo analysts said could raise doubts around the profitability of Home Depot… https://www.foxbusiness.com/markets/home-depot-warns-of-weak-2023-profit-as-rising-prices-hurt-demand
Walmart Conference Call: If things are tougher, they come to us for value. With today’s inflation, we’re continuing to see that happen. We’re gaining share across income cohorts, including at the higher end which made up nearly half of the gains we saw in the U.S. again this quarter… Walmart U.S. comps increased 8.3%, including 17% growth in e-commerce with a combination of pricing due in part to inflation and share gains. Sam’s Club U.S. delivered its 12th consecutive quarter of double-digit comps with growth of 12.6% … Inflation remained high, up mid-teens in food categories, which was similar to Q3 levels. E-commerce sales were led by continued strong growth in store-fulfilled pickup and delivery in Q4…We expect full year EPS of between $5.90 and $6.05, including a $0.14 headwind from LIFO… we’re not providing quarterly guidance beyond Q1… https://seekingalpha.com/article/4580280-walmart-inc-wmt-q4-2023-earnings-call-transcript
US January Existing Home Sales fell to a 12-year low of 4m (Dec 4.03m); 4.1m was consensus.
ESHs traded moderately lower during early Nikkei trading. From 20:00 ET until 2 ET, ESH traded with 5 handles. After a modest decline into the European open, ESHs sank until 4:05 ET. ESHs then surged 23 handles by 4:54 ET. That was the last meaningful rally attempt until a rally appeared after the NYSE open. The rally ended by 9:45 ET. ESHs and stocks then tumbled until 14:25 ET.
A lackluster 14-handle ESH rally ended at 15:33 ET. ESHs and stocks declined into the close. USHs traded similarly to ESHs.
Positive aspects of previous session The dollar rallied only moderately
Negative aspects of previous session Stocks and bonds tumbled; the US 10-yr yield hit 3.958% Fed Futures see 3 additional rate hikes with a July peak Gasoline and copper rallied sharply
Ambiguous aspects of previous session How big of a risk is the ugly geopolitical situation to dollar-denominate assets?
First Hour/Last Hour Action [S&P 500 Index]: 1st Hour from NYSE open: Down; Last Hour: Down
Pivot Point for S&P 500 Index [above/below indicates daily trend to traders]: 4014.98 Previous session High/Low: 4052.35; 3995.19
Food additives banned in Europe are ‘certainly’ making Americans sick: experts Potassium bromate (bread/dough)isn’t the only potentially toxic chemical in our store-bought products. Other substances banned in Europe and allowed in the US are titanium dioxide (candy), brominated vegetable oil (Gatorade & some sodas), azodicarbonamide and propylparaben… Earlier this month, a new study suggested that the colorful chemicals used in popular food dyes could have adverse health effects on consumers’ guts. Researchers from Cornell and Binghamton University found that common coloring agents can wreak havoc on the digestive tract. https://trib.al/wKo8JfO
Pfizer Knowingly Allowed Dangerous Components in Its VaccinesPfizer’s COVID-19 vaccine contains truncated mRNA, which the EMA flagged as a reason for its “major objection,” indicating a preclusion of their approval.Pfizer has not investigated the detrimental outcomes of truncated mRNA in its vaccines.Pfizer submitted Western blot figures to the Food and Drug Administration (FDA) and the EMA that were digitally generated—not from actual experiments.There has been an alarming lack of action taken by health authorities on this issue.Truncated mRNA potentially contributes to multiple vaccine-related injuries, including misfolded spike protein-induced fibrous blood clots, autoimmune disorders, and cancer.These problems with the Pfizer vaccine could have resulted in drastic product quality variations from batch to batch. This could explain the difference in adverse events experienced by vaccine recipients… https://www.zerohedge.com/covid-19/pfizer-knowingly-allowed-dangerous-components-its-vaccines “The Trials Should Have Been Halted”: Rate Of ‘Serious Adverse Events’ Closely Tracks Spike In Post-Vax Disabilities – Thanks to people like former Blackrock portfolio manager Ed Dowd, who has devoted the last several years to deep-dive research and analysis of pandemic-related data… Dowd, along with partners Carlos Alegria and Yuri Nunes, launched Phinance Technologies – where, aside from traditional macroeconomic analysis, they have produced comprehensive reports on pandemic-related disabilities and excess deaths using official data. Their latest analysis reveals that the rate of Serious Adverse Events in the mRNA Covid-19 vaccine clinical trials closely tracks a spike in disabilities reported after the vaccine rollout…we provide further evidence that the most likely cause of the rise in disabilities is the Covid-19 vaccines… https://www.zerohedge.com/covid-19/trials-should-have-been-stopped-rate-serious-adverse-events-closely-tracks-spike-post-vax
@btysonmd: So….this is why they said the biggest concern of making a vaccine to Coronavirus was inflammation. We knew this since 2005… Here is the proof: Vaccine design for severe acute respiratory syndrome coronavirus 2005. Caution should be taken with the safety of whole virus or full-length S protein-based immunogens in humans because they may induce harmful immune or inflammatory responses… https://pubmed.ncbi.nlm.nih.gov/16035944/
@Mayhem4Markets: The S&P Global US equity premium index is at its highest level over a decade From S&P Global: “The index measures the spread of returns of U.S. stocks over long term government bonds. Constituents include the S&P 500® Futures Excess Return Index and the S&P U.S. Treasury Bond… https://twitter.com/Mayhem4Markets/status/1627878557702664194
Bloomberg @business: In a selloff that engulfed every major group in the S&P 500, the gauge wiped out its monthly advance and had its worst slump since mid-December.
McKinsey will cut ~2k jobs, one of the largest employment cuts in its history.
Today – The large declines in stocks and bonds have turned technical indicator and market psychology decisively negative. Bloomberg Trender is now on a daily sell signal. Bonds have broken down. Self-reinforcing selling momentum in equities is a high probability. Do not try to catch a falling knife!
ESHs are +8.00 and USHs are +7/32 at 20:40 ET on the BoJ’s emergency ¥400B debt monetization. The 10-year JGB rose (0.5bps) above the BoJ’s 0.50% ceiling for the 2nd straight session. The BoJ also monetized ¥400B of CP. Japan’s Services PPI registered 1.6% in January; 1.5% was consensus.
Expected economic data: FOMC Minutes from Feb 1 meeting 14:00 ET
Biden Appointee’s Firm Admits He Belonged to Alleged Chinese Intel Operation President Joe Biden’s appointee to represent the U.S. at the Asia-Pacific Economic Cooperation (APEC) formerly served as a member of an organization which experts have identified as a Chinese Communist Party (CCP) intelligence front group… six Republican members of Congress… sent a letter to FBI Director Christopher Wray on Wednesday demanding an investigation into Ng’s reported ties to the CCP… https://dailycaller.com/2023/02/20/biden-dominic-ng-apec-lance-gooden-judy-chu-ccp-ufwd/
@paulsperry_: Congressional investigators have learned that Biden kept a personal diary that includes entries detailing his Beijing meetings as Veep and spans critical periods covering the removal and storage of classified papers and his meeting with Tony Bobulinki re the CEFC deal.
US military investigating leak of emails from Pentagon server – CNN The leaked Department of Defense email data spanned three terabytes (the equivalent of dozens of standard smartphones’ storage), most of it belonging to SOCOM… Special Operations Command is an elite Pentagon command responsible for counterterrorism and hostage rescue missions around the globe. https://www.cnn.com/2023/02/21/politics/us-military-leaked-emails-server-special-operations/index.html
Trump Lashes Out at New York Post Over Profile on Ron DeSantis “In writer Salena Zito’s fake news’ puff piece’ about DeSantis, which supposedly appeared in the dying New York Post, which is way down in readership just like FoxNews is way down in ratings. Why doesn’t she mention that he wants to cut social security and medicare, loves losers like Jeb Bush, Paul Ryan, and Karl Rove, and it getting clobbered in the polls by me?” Trump wrote on Sunday on Truth Social. “DeSantis is a RINO [Republican in Name Only] who is trying to hide his past. I don’t read the New York Post anymore. It has become fake news, just like Fox and WSJ!”… https://www.theepochtimes.com/trump-lashes-out-at-new-york-post-over-profile-on-ron-desantis_5070764.html
Ann Coulter: ‘I Didn’t Know How Profoundly Stupid Trump Is’ “I don’t, I think you’re giving him more – I don’t even think it’s knowing how to be – I think he is a narcissistic, I, I, I didn’t – the one thing I didn’t know when I wrote In Trump We Trust is how profoundly stupid he is. Um, I made very clear in the book the only thing he could do – we will forgive him for anything. And I defended him,” Coulter recalled… “And, and, you know, I said, ‘we’ll, forgive him for anything, but unless you betray us on immigration,’ and oh, oh, guess what he did?”… https://www.nationalmemo.com/donald-trump-2659439511?s=02
@RubinReport: The point is if Trump wants to be president again he has to change tactics. This trolling nonsense is only gonna play to the base of the base. It’s not 2015 anymore. And I say this as someone who proudly voted for him and would again depending on how it all shakes out.
@AmFirebrand: Tucker on Nikki Haley: “She is fundamentally indistinguishable from the neoliberal donor base of the Democratic party. She thinks Ukraine’s borders are more important than our own. She believes identity politics is our future.”https://t.co/kVWLAj2jWF
Kamala Harris blasted for posting photo of herself with masked child: ‘The rage I feel’ Social media users piled on Vice President Kamala Harris’ tweet from Sunday that featured an unmasked Harris posing with a young Black girl wearing a mask… https://t.co/VRYYrpGv19
@mtaibbi: My old employer, Rolling Stone, won a National Magazine Award once for investigating the same topic — U.S. information operations. Now the magazine won’t touch any story that they can’t pin entirely on Republicans. A “counterculture” mag is protecting FBI, DHS, DOD.
George Orwell, “1984”: “Every record has been destroyed or falsified, every book has been rewritten, every picture has been repainted, every statue and street and building has been renamed, every date has been altered. And that process is continuing day by day and minute by minute. History has stopped. Nothing exists except an endless present in which the Party is always right.”
Legendary financial and geopolitical cycle analyst Martin Armstrong said at the end of last year the U.S. is being set up for a “nightmare fall.” Train derailments and political problems are spinning out of control, but the biggest threat is war. Armstrong explains, “They want a war, but they also need it because the monetary system is collapsing. . . . You have had interest rates at negative since 2014. So, suddenly interest rates are rising. Any bond owned by any institution in Europe is a loser. They have lost so much money, it’s incredible. What happens? Nobody is interested in long term debt – period. . . . If you have interest rates rising, and rates are going to be going up because the Fed cannot stop this kind of inflation. Then, you got war. You have untold billions of dollars being shipped into Ukraine which is absurd. This is what you have. . . . You also have to look at what Janet Yellen said, and she was concerned with the tons of new debt coming out. You are exceeding the balance sheets of the Primary Dealers. To be a Primary dealer you have to be able to guarantee you will be able to buy X amount of debt. If you can’t sell it, what happens? The bank is stuck with the debt, and then, they go bust. So, we have a real problem here. They cannot continue to issue this kind of debt in perpetuity. They have been borrowing money since WWII with no intention of paying anything off. . . . The Fed is independent, and they don’t want the long term debt. They have been moving towards the short end of the curve. How do you continue to fund a government if there are no buyers for the debt? This is on a global scale.”
So, war checks all the boxes? Armstrong says, “Absolutely. They get to default on all this debt which is the real objective. That’s why (Klaus) Schwab is out there saying you’ll own nothing and be happy. He’s trying to make it sound like they are doing this for you. We are going to default on all debt and relive you of all your debt. This is because they are going to wipe out everything. Pension funds will be all gone. That’s why they are coming out with guaranteed basic income to replace your pension. They’ve got this all worked out. That’s what the end goal is here because they cannot continue to function this way. They cannot continue to borrow whatever they need with no intention of ever paying it back.”
Armstrong reveals why the 2024 elections may not happen. Can the Deep State commit enough voter fraud to keep Biden and the rest of the Neocons in power? Armstrong says most of what is happening today is the fault of the Neocons, and they have control of both parties. Armstrong points out Democrat Hillary Clinton paid for the phony Trump/Russia dossier, and Republican John McCain delivered it to the FBI. Armstrong calls it the “Uni-party,” and goes deep on the problems the Neocons are causing on purpose.
Armstrong also talks about the dollar, gold, civil unrest, tangible assets and the Ukraine war. Armstrong’s sources say the real number of casualties of Ukraine Army stands at a whopping 250,000 dead. Armstrong says Russia is NOT losing the war. It is winning.
I wish this were a joke, but it’s not… https://t.co/FNhBWYck9O” / Twitter
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