MARCH 17//BANK RESCUE OF CREDIT SUISSE AND USA REGIONAL BANKS FAIL AS THEIR STOCKS FALL BADLY AND THAT PROPELS PRECIOUS METALS HIGHER: GOLD CLOSED UP $50.50 TO $1968.70//SILVER FINISHED THE DAY UP 79 CENTS TO $22.38//PLATINUM WAS UP $14.25 WHILE PALLADIUM WAS UP $42.50//UPDATES ON THE CREDIT SUISSE PROBLEMS AS WELL AS PROBLEMS WITH USA BANKS//PAM AND RUSS MARTENS DISCUSS THE DERIVATIVE MESS AT USA AND FOREIGN BANKS: A MUST READ!!//COVID UPDATES//DR PAUL ALEXANDER/DR PANDA/VACCINE IMPACT//SLAY NEWS//UKRAINE VS RUSSIA UPDATE//GREG HUNTER INTERVIEWS BILL HOLTER AND DR PAUL CRAIG ROBERTS A MUST SEE//CHINA REDUCES ITS RR TRYING TO STIMULATE DEMAND/CHINA’S USA DOLLAR RESERVES FALLS TO $859 BILLION//USA DATA RELEASES//SWAMP STORIES FOR YOU TONIGHT//
435 H SCOTIA CAPITAL 97 624 H BOFA SECURITIES 7 657 C MORGAN STANLEY 1 661 C JP MORGAN 175 77 690 C ABN AMRO 21 732 C RBC CAP MARKETS 6 737 C ADVANTAGE 7 3 905 C ADM 24
TOTAL: 209 209 MONTH TO DATE: 4,460
JPMORGAN stopped 77/209 contracts
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GOLD: NUMBER OF NOTICES FILED FOR MAR/2023. CONTRACT: 209 NOTICES FOR 20900 OZ or 0.6500 TONNES
total notices so far: 4450 contracts for 44,600 oz (13.8724 tonnes)
SILVER NOTICES: 31 NOTICE(S) FILED FOR 155,000 OZ/
total number of notices filed so far this month : 3041 for 15,205,000 oz
END
GLD
WITH GOLD UP $50.50
INVESTORS SWITCHING TO SPROTT PHYSICAL (PHYS) INSTEAD OF THE FRAUDULENT GLD
/NO CHANGES IN GOLD INVENTORY AT THE GLD://////
INVENTORY RESTS AT 914.72TONNES
Silver//SLV
WITH NO SILVER AROUND AND SILVER UP 79 CENTS
WHAT????????
AT THE SLV// HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF OF 10.478 MILLION OZ FROM THE SLV: INVESTORS ARE SWITCHING SLV TO SPROTT’S PSLV
CLOSING INVENTORY: 462.748. MILLION OZ
SOMEBODY WAS BADLY IN NEED OF SILVER FROM THE SLV TODAY.
Let us have a look at the data for today
SILVER//OUTLINE
SILVER COMEX OI FELL BY AN GIGANTIC SIZED 1901 CONTRACTS TO 119,412 A NEW RECORD LOW AND FURTHER FROM THE RECORD HIGH OI OF 244,710, SET FEB 25/2020 AND THIS GIGANTIC SIZED LOSS IN COMEX OI WAS ACCOMPLISHED WITH OUR $0.25 LOSSIN SILVER PRICING AT THE COMEX ON THURSDAY. THUS WE ARE NOW RECORDING FOR PROSPERITY OUR NEW LOW COMEX OI SILVER SET AT 119,412 CONTRACTS , MARCH 17/2023. OUR BANKERS WERE SUCCESSFUL IN KNOCKING THE PRICE OF SILVER DOWN (IT FELL BY $0.25). AND WERE SUCCESSFUL IN KNOCKING SOME SPEC LONGS AS WE HAD A VERY STRONG LOSS ON OUR TWO EXCHANGES 1356 CONTRACTS. WE HAD 0 CRIMINAL NOTICES FILED IN THE CATEGORY OF EXCHANGE FOR RISK TRANSFER ( THE TOTAL ISSUED IN THIS CATEGORY SO FAR THIS MONTH TOTAL 1 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( 400 CONTRACTS) iiii) AN INITIAL SILVER STANDING FOR COMEX SILVER MEASURING AT 15.58 MILLION OZ(FIRST DAY NOTICE) FOLLOWED BY TODAY’S QUEUE JUMP TO LONDON OF 110,000 OZ//NEW STANDING: 15.390 MILLION OZ + THE 1.0 MILLION OZ OF EXCHANGE FOR RISK//THUS TOTAL NEW STANDING 16.390 MILLION OZ/ //// V) HUGE SIZED COMEX OI LOSS/ GOOD SIZED EFP ISSUANCE/
I AM NOW RECORDING THE DIFFERENTIAL IN OI FROM PRELIMINARY TO FINAL –145 CONTRACTS
HISTORICAL ACCUMULATION OF EXCHANGE FOR PHYSICALS MAR. ACCUMULATION FOR EFP’S SILVER/JPMORGAN’S HOUSE OF BRIBES/STARTING FROM FIRST DAY/MONTH OF MAR:
TOTAL CONTRACTS for 13 days, total 10,494 contracts: OR 52.470 MILLION OZ . (807 CONTRACTS PER DAY)
TOTAL EFP’S FOR THE MONTH SO FAR: 52.47 MILLION OZ
.
LAST 23 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: 100.105/ MILLION OZ/FINAL//MUCH STRONGER ISSUANCE VS THE LATTER TWO MONTHS.
MARCH 2023: 52.47MILLION OZ//INITIAL//ON PAR WITH LAST MONTH
RESULT: WE HAD A GIGANTIC SIZED DECREASE IN COMEX OI SILVER COMEX CONTRACTS OF 1901 CONTRACTS WITH OUR $0.25 LOSS IN SILVER PRICING AT THE COMEX//THURSDAY.,. THE CME NOTIFIED US THAT WE HAD A GOOD SIZED EFP ISSUANCE CONTRACTS: 400 CONTRACTS ISSUED FOR MAY 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 MAR OF 15.58 MILLION OZ//FIRST DAY NOTICE// FOLLOWED BY TODAY’S 110,000 OZ QUEUE JUMP TO LONDON (WHICH INCREASES THE AMOUNT OF SILVER STANDING) + 1.0 MILLION OF EXCHANGE FOR RISK ISSUED EARLY IN MARCH (INCREASES THE AMOUNT OF SILVER STANDING) //NEW STANDING 16.390 MILLION OZ .. WE HAVE A GIGANTIC SIZED LOSS OF 1501OI CONTRACTS ON THE TWO EXCHANGES
WE HAD 31 NOTICE(S) FILED TODAY FOR 155,000 OZ
THE SILVER COMEX IS NOW BEING ATTACKED FOR METAL BY LONDONERS ET AL.
GOLD//OUTLINE
IN GOLD, THE COMEX OPEN INTEREST ROSE BY A FAIR SIZED 1532 CONTRACTS TO 457,252 AND FURTHER FROM 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 1363 CONTRACTS.
.
WE HAD A FAIR SIZED INCREASE IN COMEX OI ( 1532CONTRACTS) DESPITE OUR $6.95 LOSS IN PRICE. WE ALSO HAD A SMALL INITIAL STANDING IN GOLD TONNAGE FOR MAR. AT 4.9953 TONNES ON FIRST DAY NOTICE FOLLOWED BY TODAY’S HUGE QUEUE JUMP OF 34,300 OZ (1.067 TONNES) //(QUEUE JUMPING = EXERCISING LONDON BASED EFP’S, ATTACHED TO COMEX CONTRACTS ) (EFP is the transfer of COMEX contracts immediately to London for potential gold deliveries originating from London).
YET ALL OF..THIS HAPPENED WITH OUR $6.95 LOSS IN PRICEWITH RESPECT TO THURSDAY’S TRADING
WE HAD A GOOD SIZED GAIN OF 3762 OI CONTRACTS (11.70 PAPER TONNES) ON OUR TWO EXCHANGES
E.F.P. ISSUANCE
THE CME RELEASED THE DATA FOR EFP ISSUANCE AND IT TOTALED A FAIR SIZED 2230 CONTRACTS:
The NEW COMEX OI FOR THE GOLD COMPLEX RESTS AT 457,252
IN ESSENCE WE HAVE A GOOD SIZED INCREASE IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 3762 CONTRACTS WITH 1532CONTRACTS INCREASED AT THE COMEX AND 2230 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS TOTAL OI GAIN ON THE TWO EXCHANGES OF 3762 CONTRACTS OR 11.70 TONNES.
CALCULATIONS ON GAIN/LOSS ON OUR TWO EXCHANGES
WE HAD A FAIR SIZED ISSUANCE IN EXCHANGE FOR PHYSICALS (2230 CONTRACTS) ACCOMPANYING THE FAIR SIZED GAIN IN COMEX OI (1532) TOTAL GAIN IN THE TWO EXCHANGES 3,762 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 MAR. AT 4.9953 TONNES FOLLOWED BY TODAY’S 34,300 OZ QUEUE JUMP//NEW STANDING 14.765 TONNES // ///3) ZERO LONG LIQUIDATION //4) FAIR SIZED COMEX OPEN INTEREST GAIN// 5) FAIR ISSUANCE OF EXCHANGE FOR PHYSICAL PAPER/
HISTORICAL ACCUMULATION OF EXCHANGE FOR PHYSICALS IN 2023 INCLUDING TODAY
MAR
ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF MAR :
TOTAL EFP CONTRACTS ISSUED: 52,743 CONTRACTS OR 5,274,300 OZ OR 164.05 TONNES IN 13 TRADING DAY(S) AND THUS AVERAGING: 4057 EFP CONTRACTS PER TRADING DAY
TO GIVE YOU AN IDEA AS TO THE SIZE OF THESE EFP TRANSFERS : THIS MONTH IN 13TRADING DAY(S) IN TONNES 164.05 TONNES
TOTAL ANNUAL GOLD PRODUCTION, 2022, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 3555 TONNES
THUS EFP TRANSFERS REPRESENTS 164.05/3550 x 100% TONNES 4.61% 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: 151.61 TONNES/FINAL
MARCH: 164.05 TONNES/INITIAL (ANOTHER STRONG MONTH FOR EFP ISSUANCE)
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 APRIL. WE ARE NOW INTO THE SPREADING OPERATION OF GOLD
HERE IS A BRIEF SYNOPSIS OF HOW THE CROOKS FLEECE UNSUSPECTING LONGS IN THE SPREADING ENDEAVOUR ;MODUS OPERANDI OF THE CORRUPT BANKERS AS TO HOW THEY HANDLE THEIR SPREAD OPEN INTERESTS:HERE IS HOW THE CROOKS USED SPREADING AS WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF MAR HEADING TOWARDS THE ACTIVE DELIVERY MONTH OF APRIL., 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 GIGANTIC SIZED 1901 CONTRACTS OI TO 119,412 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 119,412 CONTRACTS MARCH 17/2022
EFP ISSUANCE 400 CONTRACTS
OUR CUSTOMARY MIGRATION OF COMEX LONGS CONTINUE TO MORPH INTO LONDON FORWARDS AS OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE:
MAY 400 and ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE: 400 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 1901CONTRACTS AND ADD TO THE 400 OI TRANSFERRED TO LONDON THROUGH EFP’S,
WE OBTAIN A HUGE LOSS OF 1501 OPEN INTEREST CONTRACTS FROM OUR TWO EXCHANGES.
THUS IN OUNCES, THE LOSS ON THE TWO EXCHANGES //7.505 MILLION OZ
OCCURRED DESPITE OUR $0.25 LOSS 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)FRIDAY MORNING//THURSDAY NIGHT
SHANGHAI CLOSED UP 23.66 PTS OR 0.73% //Hang Seng CLOSED UP 314,68 PTS OR 1.64% /The Nikkei closed DOWN 323.18 PTS OR 1.20% //Australia’s all ordinaries CLOSED UP 0.50% /Chinese yuan (ONSHORE) closed UP 6.8892//OFFSHORE CHINESE YUAN UP TO 6.8904// /Oil UP TO 68.91 dollars per barrel for WTI and BRENT AT 74,58 / Stocks in Europe OPENED ALL MIXED// ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING STRONGER AGAINST US DOLLAR/OFFSHORE STRONGER
a)NORTH KOREA/SOUTH KOREA
outline
b) REPORT ON JAPAN/
OUTLINE
3 C CHINA
OUTLINE
4/EUROPEAN AFFAIRS
OUTLINE
5. RUSSIAN AND MIDDLE EASTERN AFFAIRS
OUTLINE
6.Global Issues//COVID ISSUES/VACCINE ISSUES
OUTLINE
7. OIL ISSUES
OUTLINE
8 EMERGING MARKET ISSUES
COMEX DATA//AMOUNTS STANDING//VOLUME OF TRADING/INVENTORY MOVEMENTS
GOLD
LET US BEGIN:
THE TOTAL COMEX GOLD OPEN INTEREST ROSE BY A FAIR SIZED 1532 CONTRACTS UP TO 457,252 DESPITE OUR LOSS IN PRICE OF $6.95 ON THURSDAY
EXCHANGE FOR PHYSICAL ISSUANCE
WE ARE NOW IN THE NON ACTIVE DELIVERY MONTH OF MAR… THE CME REPORTS THAT THE BANKERS ISSUED A VERY FAIR SIZED TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS.,
THAT IS 2230 EFP CONTRACTS WERE ISSUED: : APRIL 2230 & ZERO FOR ALL OTHER MONTHS:
TOTAL EFP ISSUANCE: 2230 CONTRACTS
WHEN WE HAVE BACKWARDATION, EFP ISSUANCE IS VERY COSTLY BUT THE REAL PROBLEM IS THE SCARCITY OF METAL AND IT IS FAR BETTER FOR OUR BANKERS TO PAY OFF INDIVIDUALS THAN RISK INVESTORS ESPECIALLY FROM LONDON STANDING FOR DELIVERY. THE LOWER PRICES IN THE FUTURES MARKET IS A MAGNET FOR OUR LONDONERS SEEKING PHYSICAL METAL. BACKWARDATION ALWAYS EQUAL SCARCITY OF METAL!
ON A NET BASIS IN OPEN INTEREST WE GAINED THE FOLLOWING TODAY ON OUR TWO EXCHANGES: A GOOD SIZED TOTAL OF 3762 CONTRACTS IN THAT 2230LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE HAD A FAIR SIZED GAIN OF 1532 COMEX CONTRACTS..AND THIS GOOD SIZED GAIN ON OUR TWO EXCHANGES HAPPENED DESPITE OUR LOSS IN PRICE OF $6.95. WE ARE NOW WITNESSING THE BANKERS GOING NET SHORT AND THE SPECS GOING NET LONG.
// WE HAVE A STRONG AMOUNT OF GOLD TONNAGE STANDING: MAR (14.765) (NON ACTIVE MONTH)
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: 47.744 tonnes
MAR: 14.765 TONNES
THE SPECS/HFT WERE SUCCESSFUL IN LOWERING GOLD’S PRICE( IT FELL $6.95) //// BUT WERE UNSUCCESSFUL IN KNOCKING ANY SPECULATOR LONGS AS WE HAD OUR GOOD SIZED GAIN OF 3762 CONTRACTS ON OUR TWO EXCHANGES
WE HAVE GAINED A TOTAL OI OF 11.70 PAPER TONNES OF TOTAL OI FROM OUR TWO EXCHANGES, ACCOMPANYING OUR INITIAL GOLD TONNAGE STANDING FOR MAR. (4.9953 TONNES) FOLLOWED BY TODAY’S HUGE QUEUE JUMP OF 34,300OZ (1.576 TONNES)… ALL OF THIS WAS ACCOMPLISHED WITH OUR GAIN IN PRICE TO THE TUNE OF $18.75
WE HAD -1363 CONTRACTS REMOVED TO THE COMEX TRADES TO OPEN INTEREST AFTER TRADING ENDED LAST NIGHT
NET GAIN ON THE TWO EXCHANGES 3762 CONTRACTS OR 376200 OZ OR 11.70 TONNES
Total monthly oz gold served (contracts) so far this month
4460 notices 446,000 13.8724 TONNES
Total accumulative withdrawals of gold from the Dealers inventory this month
NIL oz
Total accumulative withdrawal of gold from the Customer inventory this month
x
i)Dealer deposits: 0
total dealer deposit: nil oz
No dealer withdrawals
Customer deposits: 0
total deposits: nil oz
customer withdrawals: 1
i) out of BRINKS: 23,417.201 oz
total withdrawals: 23,417.201 oz
in tonnes: 0.728 tonnes
Adjustments; 0
CALCULATIONS FOR THE AMOUNT OF GOLD STANDING FOR MAR.
For the front month of MARCH we have an oi of 496 contracts having LOST 101 contracts. We had 444 notices filed on THURSDAY so we
gained A HUGE 343 contracts or an additional 34,300 oz will stand for metal at the comex
April lost 6260 contracts down to 182,473 contracts
May LOST 3 contracts to stand at 270
We had 209 notice(s) filed today for 20,900 oz
Today, 0 notice(s) were issued from J.P.Morgan dealer account and 209 notices were issued from their client or customer account. The total of all issuance by all participants equate to 209 contract(s) of which 0 notices were stopped (received) by j.P. Morgan dealer and 77 notice(s) was (were) stopped received by J.P.Morgan//customer account and 0 notice(s) received (stopped) by the squid (Goldman Sachs)
To calculate the INITIAL total number of gold ounces standing for the MAR. /2023. contract month,
we take the total number of notices filed so far for the month (4,460 x 100 oz ), to which we add the difference between the open interest for the front month of (MAR. 496 CONTRACTS) minus the number of notices served upon today 209 x 100 oz per contract equals 440,400 OZ OR 13.698 TONNES the number of TONNES standing in this active month of MARCH.
thus the INITIAL standings for gold for the MAR contract month:
No of notices filed so far (4,460 x 100 oz+ 496 OI for the front month minus the number of notices served upon today (209)x 100 oz} which equals 474,700 oz standing OR 14.765 TONNES in this active delivery month of MARCH..
TOTAL COMEX GOLD STANDING: 14.765 TONNES WHICH IS HUGE FOR AN INACTIVE DELIVERY MONTH.
To calculate the number of silver ounces that will stand for delivery in MARCH. we take the total number of notices filed for the month so far at 3041 x 5,000 oz = 15,205,000 oz
to which we add the difference between the open interest for the front month of MAR(68) and the number of notices served upon today 31 x (5000 oz) equals the number of ounces standing.
Thus the standings for silver for the MAR./2023 contract month: 3041 (notices served so far) x 5000 oz + OI for the front month of MAR (68) – number of notices served upon today (31) x 500 oz of silver standing for the MAR. contract month equates 15.390 million oz +the 1.0 million oz of exchange for risk//new total standing 16.390 million oz
the record level of silver open interest is 234,787 contracts set on April 21./2017 with the price on that day at $18.42. The previous record was 224,540 contracts with the price at that time of $20.44
END
GLD AND SLV INVENTORY LEVELS
MARCH 17/WITH GOLD UP $50.50 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 914.72TONNES
MARCH 16/WITH GOLD DOWN $6.95 TODAY: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 1.45 TONNES OF GOLD INTO THE GLD////INVENTORY RESTS AT 914.72 TONNES
MARCH 15/THE IDES OF MARCH: WITH GOLD UP $18.75 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 913.27 TONNES
MARCH 14/WITH GOLD DOWN $4.75 TODAY: HUGE CHANGES: A MONSTER DEPOSIT OF 11.85 TONNES OF GOLD INTO THE GLD//INVENTORY RESTS AT 913.27 TONNES
MARCH 13/WITH GOLD UP $48.85 TODAY: VERY STRANGE HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.73 TONNES OF GOLD FROM THE GLD///INVENTORY REST AT 901.42 TONNES
MARCH 10//WITH GOLD UP $31.60 TODAY: HUGE CHANGES IN GOLD INVENTORY AT THE GLD; A WITHDRAWAL OF 3.47 TONNES OF GOLD FROM THE GLD//INVENTORY RESTS AT 903.15 TONNES
MARCH 9/WITH GOLD UP $16.50 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 906.62 TONNES
MARCH 8/WITH GOLD DOWN $1.15 TODAY: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A MASSIVE WITHDRAWAL OF 5.5 TONNES FROM THE GLD////INVENTORY RESTS AT 906.62 TONNES
MARCH 7/WITH GOLD DOWN $33.20 TODAY:NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 912.12 TONNES
MARCH 6/WITH GOLD UP $0.55 TODAY: SMALL CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF .57 TONNES FROM THE GLD///INVENTORY RESTS AT 912.12 TONNES
MARCH 3/WITH GOLD UP $14,10 TODAY; NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 912.69 TONNES
MARCH 2/WITH GOLD DOWN $4.00 TODAY; HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.61 TONNES OF GOLD FROM THE GLD////INVENTORY RESTS AT 912.69 TONNES
MARCH 1/WITH GOLD UP $18.90 TODAY: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.31 TONNES OF GOLD FROM THE GLD///INVENTORY RESTS AT 915.30 TONNES
FEB 28/WITH GOLD UP $12.10 TODAY: SMALL CHANGES IN GOLD INVENTORY AT THE GLD:A DEPOSIT OF .29 TONNES OF GOLD INTO THE GLD//INVENTORY RESTS AT 917.61 TONNES
FEB 27/WITH GOLD UP $6.95 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 917.32 TONNES
FEB 24/WITH GOLD DOWN $9.10 TODAY:HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.6 TONNES OF GOLD FROM THE GLD///INVENTORY RESTS AT 917.32 TONNES
FEB 23/WITH GOLD DOWN $13.05 TODAY: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY REST AT 919.92 TONNES
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
GLD INVENTORY: 914.72 TONNES
Now the SLV Inventory/( vehicle is a fraud as there is no physical metal behind them
MARCH 17/WITH SILVER UP 79 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A MASSIVE WITHDRAWAL OF 10.478 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 462.748 MILLION OZ//
MARCH 16/WITH SILVER DOWN 25 CENTS TODAY; HUGE CHANGES IN SILVER INVENTORY AT THE SLV A WITHDRAWAL OF 5.009 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 473.226 MILLION OZ//
MARCH 15/WITH SILVER DOWN 7 CENTS TODAY; BIG CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 643,000 OZ INTO THE SLV//INVENTORY RESTS AT 478.235 MILLION OZ/
MARCH 14/WITH SILVER UP 9 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 1.287 MILLION OZ FROM THE SLV////INVENTORY REST AT 477.592 MILLION OZ//
MARCH 13/WITH SILVER UP $1.35 : NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 478.879 MILLION OZ//
MARCH 10.WITH SILVER UP 36 CENTS TODAY; NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 478.879 MILLION OZ…
MARCH 9/WITH SILVER UP 2 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.195 MILLION OZ INTO THE SLV///INVENTORY RESTS AT 478.979 MILLION OZ
MARCH 8/WITH SILVER DOWN 6 CENTS TODAY; HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWALOF 459,000 OZ FROM THE SLV///INVENTORY RESTS AT 477.684 MILLION OZ
MARCH 7/WITH SILVER DOWN 88 CENTS TODAY;HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 920,000 OZ FROM THE SLV/////INVENTORY RESTS AT 478.143 MILLION OZ
MARCH 6/WITH SILVER DOWN 13 CENTS TODAY; NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 479.063 MILLION OZ//
MARCH 3/WITH SILVER UP 67 CENTS TODAY:HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.369 MILLION OZ INTO THE SLV////INVENTORY RESTS AT 479.063 MILLION OZ//
MARCH 2/WITH SILVER DOWN $.16 TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 920,00 OZ OF SILVER FROM THE SLV////INVENTORY RESTS AT 477.694 MILLION OZ
MARCH 1/WITH SILVER UP 4 CENTS TODAY; HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 2.574 MILLION OZ OF SILVER FROM THE SLV////INVENTORY RESTS AT 478.614 MILLION OZ.
FEB 28/WITH SILVER UP 26 CENTS TODAY; HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 1.241 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 481.188
FEB 27/WITH SILVER DOWN 15 CENTS TODAY; HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 1.471 MILLION OZ FROM THE SLV///INVENTORY RESTS AT 482.429 MILLION OZ
FEB 24/WITH SILVER DOWN 46 CENTS TODAY; HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 3.172 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 483.900 MILLION OZ//
FEB 23/WITH SILVER DOWN 32 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 1.379 MILLION OZ INTO THE SLV////INVENTORY RESTS AT 487.072 MILLION OZ//
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 462.748MILLION OZ//
PHYSICAL GOLD/SILVER STORIES
1:Peter Schiff
Chinese Gold Demand Continued To Surge In February
After ending 2022 on an upward trend that continued into January, Chinese gold demand surged again in February as the economy continues to rebound from government-imposed COVID policies.
Gold withdrawals from the Shanghai Gold Exchange (SGE) totaled 169 tons in February. This is a reflection of strong wholesale demand and signals an ongoing rebound in the world’s biggest gold market.
SGE withdrawals in February were up by 30 tons month-on-month and by a healthy 76 tons year-over-year. It was the strongest February for wholesale gold demand since 2014.
The World Gold Council pinpointed two primary drivers of strong demand for gold in February.
Healthy consumption amid the economic recovery and the release of pent-up demand
Retailers’ restocking activities after the Chinese New Year (CNY) holiday
The Shanghai-London gold price premium also continued to pick up in February, reflecting strong Chinese gold demand during the month.
After a weak first half of 2022, gold demand in China surged during the last half of the year as the government relaxed COVID restrictions. With demand rebounding last two quarters, China imported 1,343 tons of gold in 2022, the highest import level since 2018. Total gold imports for the year were up 64% over 2021.
A recovery in the Chinese economy after government COVID restrictions strangled it helped drive the rebound in the gold market last year and into 2023. China experienced a COVID peak in December. According to the World Gold Council, Chinese economic activities revived in January.
The recovery in the Chinese economy was evidenced by the official Comprehensive Purchasing Managers Index (PMI) surging to 56.4 in February. It was the highest PMI on record since 2017. Manufacturing activities expanded the most since April 2012, and the service PMI grew at the fastest pace in 22 months.
Also, as we’ve reported, the People’s Bank of China resumed official gold purchases in November. That continued into February, with the Chinese central bank adding another 25 tons to its reserves. Gold now accounts for 3.7% of China’s total reserves.
Over the last four months, Chinese gold reserves have increased by 102 tons, based on official reported numbers.
There has always been speculation that China holds far more gold than it officially reveals. As Jim Rickards pointed out on Mises Daily back in 2015, many people speculate that China keeps several thousand tons of gold “off the books” in a separate entity called the State Administration for Foreign Exchange (SAFE).
If this apparent rebound in the Chinese gold market continues deeper into 2023, it will drive overall global gold demand higher. Gold demand grew by 18% to 4,741 tons in 2022, the highest demand in 11 years.
2 Lawrie Williams//Pam and Russ Martens/Jim Rickards/Mathew Piepenburg/Von Greyerz//Rickards:
U.S. Treasury Secretary Janet Yellen finds herself in a very dubious position. Under the Dodd-Frank financial reform legislation of 2010, the U.S. Treasury Secretary was given increased powers to oversee financial stability in the U.S. banking system. This increase in power came in response to the 2008 financial crisis – the worst financial collapse since the Great Depression. The legislation made the Treasury Secretary the Chair of the newly created Financial Stability Oversight Council (F-SOC), whose meetings include the heads of all of the federal agencies that supervise banks and trading on Wall Street. The legislation also required the Treasury Secretary’s authorization before the Federal Reserve could create any more of those $29 trillion emergency bailout programs for the mega banks – which had tethered themselves to casino trading on Wall Street since the repeal of the Glass-Steagall Act in 1999.
Yesterday, after the Swiss banking behemoth Credit Suisse had traded at an all-time low of less than two bucks; blown out its credit default swaps to unprecedented levels; and tanked the Dow Jones Industrial Average by more than 700 points intraday, Bloomberg News ran this headline at 12:54 p.m. – “US Treasury Reviewing US Banks’ Exposure to Credit Suisse.” By “exposure,” the Treasury really means how many billions of dollars of underwater derivatives are U.S. banks on the hook for as a counterparty to Credit Suisse. The Treasury also has to worry about U.S. banks’ exposure to Credit Suisse’s other major counterparties that U.S. banks do business with, even if the banks are not direct counterparties to Credit Suisse itself.
If the U.S. Treasury Secretary and her staff at F-SOC were just yesterday getting around to finding out which U.S. banks had counterparty exposure to Credit Suisse’s derivatives, we are all in very big trouble. The serious problems at Credit Suisse have been making headlines for two years, including here at Wall Street On Parade.
In July of 2021, the law firm Paul, Weiss, Rifkind, Wharton & Garrison released a 165-page report on the internal investigation it had conducted for the Board of Credit Suisse into how the bank came to lose $5.5 billion conducting highly-leveraged and dodgy derivative trades for the family office hedge fund, Archegos Capital Management, which went belly-up in March of 2021. The Paul, Weiss lawyers wrote:
“The Archegos-related losses sustained by CS are the result of a fundamental failure of management and controls in CS’s Investment Bank and, specifically, in its Prime Services business. The business was focused on maximizing short-term profits and failed to rein in and, indeed, enabled Archegos’s voracious risk-taking. There were numerous warning signals — including large, persistent limit breaches — indicating that Archegos’s concentrated, volatile, and severely under-margined swap positions posed potentially catastrophic risk to CS. Yet the business, from the in-business risk managers to the Global Head of Equities, as well as the risk function, failed to heed these signs, despite evidence that some individuals did raise concerns appropriately.”
Six months ago, Dennis Kelleher, President and CEO of the nonprofit watchdog, Better Markets, released a statement about the deteriorating condition of Credit Suisse, highlighting the following:
“As the financial condition of Credit Suisse continues to deteriorate, raising questions of whether it will collapse, the world and U.S. taxpayers should be deeply worried as multiple, simultaneous shocks shake the foundations of economies worldwide. Credit Suisse is a global, systemically significant, too-big-to-fail bank that operates in the U.S. and is deeply interconnected throughout the global financial system. Its failure would have widespread and largely unknown repercussions from the inconvenient to the possibly catastrophic.
“That is due, in part, to the failure of the Federal Reserve to properly regulate the activities of foreign banks that have U.S.-based operations. The U.S. has a largely ineffective regulatory framework with gaping loopholes that fail to include some of even the most basic safety and soundness requirements, which incentivizes regulatory arbitrage. As a result, the U.S. financial system and economy are needlessly threatened.
“An effective and appropriate regulatory framework for large foreign banks that covers all of their U.S.-based affiliates should have been established when the Fed set up so-called U.S.-based intermediate holding companies (‘IHCs’) that they regulate. Instead, U.S.-based branches of foreign banks (which are not consolidated within the IHC) face significantly weaker standards than the IHC, remarkably including no specific capital requirements in the U.S. Furthermore, the branches have significantly weaker liquidity requirements. This has resulted in many foreign banks – including in particular Credit Suisse – engaging in regulatory arbitrage by shifting large amounts of assets from their IHCs to their branches, entities that are entirely reliant on the resources of their foreign-based parent companies. The 2008 financial collapse proved that these resources are not available in periods of stress, which is why the U.S. bailed out so many foreign banks operating in the U.S. The Fed should have stopped that long ago.
“As is well-known, risks in the global financial system that materialize elsewhere easily end up becoming risks here in the U.S. and threaten our financial system and economy. Those risks are amplified by the unprecedented fiscal and monetary policies attempting to address the many unexpected shocks from the pandemic and war. The Fed must see Credit Suisse as a warning sign and improve the regulatory framework for large foreign banks and all banks to ensure that the American financial system and economy are properly protected.”
Credit Suisse’s reputation has taken more hits from its involvement in the Greensill Capital scandal and the infamous spy-gate scandal in 2019 where the bank spied on and followed various employees.
Nervousness about Credit Suisse reached a pivotal moment in the fall of last year. On November 30, its 5-year Credit Default Swaps (CDS) blew out to 446 basis points. That was up from 55 basis points in January of 2022 and more than five times where CDS on its peer Swiss bank, UBS, were trading. The price of a Credit Default Swap reflects the cost to traders, or investors with exposure, to insuring themselves against a debt default by the bank.
If all of this didn’t awaken Secretary Yellen from her slumber about the contagion risks posed by a deteriorating Credit Suisse, she should have been jolted upright on December 5 of last year when researchers for the Bank for International Settlement (Claudio Borio, Robert McCauley and Patrick McGuire) released an astonishing report that found that foreign banks had secret derivative debt that is “10 times their capital.”
The report focused on the amount of derivative debt that was not being captured through regular statistical reporting because it is held off the banks’ balance sheets. The researchers refer to this exposure as “staggering” and note the potential for upsets to dollar swap lines to settle it as it comes due.
The report raises further alarm bells with this: “For banks headquartered outside the United States, dollar debt from these instruments is estimated at $39 trillion, more than double their on-balance sheet dollar debt and more than 10 times their capital.” Their on-balance sheet dollar debt is $15 trillion.
The most recent quarterly derivatives report from the U.S. regulator of national banks, the Office of the Comptroller of the Currency (OCC), found that as of September 30, 2022 four U.S. mega banks held 88.6 percent of all notional amounts of derivatives in the U.S. banking system. The total notional amount for all banks was $195 trillion. JPMorgan Chase held $54.3 trillion of that; Goldman Sachs held $50.97 trillion; Citigroup’s Citibank held $46 trillion; and Bank of America held $21.6 trillion. Even though the Dodd-Frank legislation required that most of these derivative trades move to central clearing, as of September 30, 2022 the OCC report found that 58.3 percent of these derivatives were not being centrally-cleared, meaning they were over-the-counter (OTC) private contracts between counterparties, thus adding another layer of opacity to an unaccountable system.
For the role that Citigroup played in keeping these dangerous derivatives inside federally-insured banks, see our December 2014 report: Meet Your Newest Legislator: Citigroup.
end
3. CHRIS POWELL//GATA AND OTHER IMPORTANT GOLD COMMENTARIES
A must read….
Pam and Russ Martens: The next bomb to go off in the banking crisis will be derivatives
Submitted by admin on Thu, 2023-03-16 11:19Section: Daily Dispatches
By Pam and Russ Martens Wall Street on Parade Thursday, March 16, 2023
U.S. Treasury Secretary Janet Yellen finds herself in a very dubious position.
Under the Dodd-Frank financial reform legislation of 2010, the U.S. treasury secretary was given increased powers to oversee financial stability in the U.S. banking system. This increase in power came in response to the 2008 financial crisis — the worst financial collapse since the Great Depression. The legislation made the treasury secretary the chair of the newly created Financial Stability Oversight Council (F-SOC), whose meetings include the heads of all of the federal agencies that supervise banks and trading on Wall Street.
The legislation also required the Treasury secretary’s authorization before the Federal Reserve could create any more of those $29 trillion emergency bailout programs for the mega banks, which had tethered themselves to casino trading on Wall Street since the repeal of the Glass-Steagall Act in 1999.
Yesterday, after the Swiss banking behemoth Credit Suisse had traded at an all-time low of less than two bucks; blown out its credit default swaps to unprecedented levels; and tanked the Dow Jones Industrial Average by more than 700 points intraday, Bloomberg News ran this headline at 12:54 p.m.: “U.S. Treasury Reviewing U.S. Banks’ Exposure to Credit Suisse.”
By “exposure” the Treasury really means how many billions of dollars of underwater derivatives U.S. banks are on the hook for as a counterparty to Credit Suisse.
The Treasury also has to worry about U.S. banks’ exposure to Credit Suisse’s other major counterparties that U.S. banks do business with, even if the banks are not direct counterparties to Credit Suisse itself.
If the U.S. Treasury Secretary and her staff at F-SOC were just yesterday getting around to finding out which U.S. banks have counterparty exposure to Credit Suisse’s derivatives, we are all in very big trouble. The serious problems at Credit Suisse have been making headlines for two years. …
Alasdair Macleod: To rescue markets, pivoting Fed will wreck dollar
Submitted by admin on Thu, 2023-03-16 12:24Section: Daily Dispatches
By Alasdair Macleod GoldMoney, Toronto Thursday, March 16, 2023
Following the day-to-day twists and turns of a banking crisis can make us lose sight of the bigger picture. It is tempting to think that the banking authorities are in control and will secure the integrity of their commercial banking networks. Unfolding events may or may not prove this to be true.
The bigger picture is that the 40-year decline in interest rates is over, as well as the financial bubble that has built up with it. We should also be aware that there is a cycle of bank credit, the downturn of which is long overdue. The two have come together to create chaos in credit markets.
The reality is that central banks have already lost control over monetary policy and interest rates. Interest rates are now being driven by contracting bank credit, not by monetary policy.
The point commonly missed is that contracting credit at a time when credit demand is still increasing inevitably leads to higher interest rates and bad debts.
Having lost control over interest rates, the Federal Reserve has been forced into its much-heralded pivot, not by reducing interest rates, but by offering to buy Treasury and agency debt at face value whatever the coupon and maturity. This rescues banks from the immediate fate that collapsed Silicon Valley Bank. And it makes it easier for the U.S. Treasury to fund its deficit while containing borrowing costs.
But it is highly inflationary.
The pivot has now been made. The Fed has decided to rescue financial markets at the expense of the currency. Other central banks can be expected to follow suit to help rescue their banking systems. But they are writing the death warrants for their fiat currencies. …
The International Atomic Energy Agency (IAEA) has sounded the alarm bells over some 2.5 tons of Ghadafi-era natural uranium that has disappeared from a site in Libya that is not under control of the Tripoli-based Government of National Unity (GNU).
IAEA inspectors“found that ten drums containing approximately 2.5 tons of natural uranium in the form of UOC (uranium ore concentrate) previously declared by (Libya) … as being stored at that location were not present at the location,” the global nuclear watchdog said in a Wednesday statement delivered by IAEA head Rafael Grossi.
“The loss of knowledge about the present location of nuclear material may present a radiological risk, as well as nuclear security concerns,” Grossi added.
Libya’s long-running civil war had prevented the IAEA from inspecting the site earlier.
While the Agency has not indicated the exact location of the site, there is high probability that the site is Sabha, some 400 miles south-east of the western capital, Tripoli. This area is not controlled by the government. Raw uranium, or yellow cake, is also believed to be stored at the Tajura nuclear research facility near Tripoli; however, this area is under control of the GNU.
Sabha was a Ghadafi-era facility that had hoped to eventually enrich uranium for a nuclear weapons program until it was mothballed in 2003.
The IAEA vowed to investigate the circumstances surrounding the disappearance of the uranium.
The concern is that while natural uranium cannot be used either for energy or weapons without a complicated enrichment process, if it ended up in the wrong hands it could be sold to regimes with this capability.
Speaking to the BBC, Scott Roecker from the Nuclear Threat Initiative, said that in its current form, the natural uranium “cannot be made into a nuclear weapon”, but could be used as a “feedstock” for a nuclear weapons program. He also noted that the material “doesn’t really have any radiation in its current form”.
END
Nickel:
More problems for the LME:: bags of stones instead of nickel .
*LME Finds Some Nickel Underlying Its Contracts Is Missing
Problem found at Access World Rotterdam warehouse: sources
Access World spokesperson declined to comment on nickel
1. YOUR EARLY CURRENCY/GOLD AND SILVER PRICING/ASIAN AND EUROPEAN BOURSE MOVEMENTS/AND INTEREST RATE SETTINGS//FRIDAY MORNING.7:30 AM
ONSHORE YUAN: CLOSED UP TO 6.8892
OFFSHORE YUAN: 6.8904
SHANGHAI CLOSED UP 23.66 PTS OR 0.73%
HANG SENG CLOSED UP 314.68 PTS OR 1.64 %
2. Nikkei closed UP 323.18 PTS OR 1.20%
3. Europe stocks SO FAR: ALL MIXED
USA dollar INDEX DOWN TO 103.95 Euro RISES TO 1.0619 UP 5 BASIS PTS
3b Japan 10 YR bond yield: FALLS TO. +.222!!(Japan buying 100% of bond issuance)/Japanese YEN vs USA cross now at 132.56/JAPANESE YEN FALLING 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 UP /JAPANESE Yen UP CHINESE YUAN: UP-// OFF- SHORE: UP
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 UP for WTI and UP FOR Brent this morning
3h European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund DOWN TO +2.1865%***/Italian 10 Yr bond yield FALLS to 4.104%*** /SPAIN 10 YR BOND YIELD FALLS TO 3.289…** DANGEROUS//
3i Greek 10 year bond yield RISES TO 4.146//
3j Gold at $1935,20//silver at: 21.89 7 am est) SILVER NEXT RESISTANCE LEVEL AT $30.00
3k USA vs Russian rouble;// Russian rouble DOWN 0 AND 32/100 roubles/dollar; ROUBLE AT 76.72//
3m oil into the 68 dollar handle for WTI and 74 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 132.56/10 YEAR YIELD AFTER BREAKING .54%, FALLS TO .222% 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 0.9270–as the Swiss Franc is still rising against most currencies. Euro vs SF 0.9842well 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. CREDIT SUISSE IN TROUBLE
USA 10 YR BOND YIELD: 3.4850% DOWN 9 BASIS PTS…GETTING DANGEROUS//
USA 30 YR BOND YIELD: 3.639 DOWN 8 BASIS PTS//INVERTED TO THE 10 YEAR!!
USA 2 YR BOND YIELD: 4.0839 DOWN 5 BASIS PTS
USA DOLLAR VS TURKISH LIRA: 19.01…
GREAT BRITAIN/10 YEAR YIELD: 3.3475% DOWN 2 BASIS PTS
end
i.b Overnight: Newsquawk and Zero hedge:
FIRST, ZEROHEDGE (PRE USA OPENING// MORNING
Futures Slide As $2.9 Trillion OpEx Chaos Clashes With Broke Bank Bailout Bash
FRIDAY, MAR 17, 2023 – 08:25 AM
Similar to Thursday, futures faded an earlier gain which pushed emini futures briefly above 4000 after the index rallied 1.8% yesterday, as investors were assessing whether a $30BN “deposit injection” rescue package for First Republic Bank is enough to ease the risk of financial contagion, with gains reversing after news that China was cutting its bank reserve ratio and injecting over $70BN in liquidity, which was viewed by the jittery, suspicious market that there may be more unpleasant surprises in the banking sector this time in China which was moving to “ringfence its banking sector.” US equity-index futures dropped 0.3%, reversing a similar gain, while the Stoxx Europe 600 index pared an advance and turned negative. A gauge of European banking stocks is heading for a drop of almost 9% this week. Nasdaq 100 futures were flat as the rates-sensitive gauge heads for its best week since November amid expectations the Federal Reserve will temper its tightening path. The 10-year Treasury yield fell eight basis points and a gauge of the dollar declined.
As detailed yesterday, as if the bank bailout bonanza, a larger than expected TLTRO repayment in Europe and China’s RRR cuts weren’t enough, traders are facing fresh turmoil by today’s $2.9 trillion options expiration after a week of bank drama. Such quad-witching days typically involve portfolio adjustments, spikes in volume and price swings, especially on day so near-record low liquidity such as these.
Financial stocks were lower in premarket trading Friday, in line with the broader market, as doubt persists around First Republic Bank despite a $30 billion rescue effort from large lenders and federal regulators. First Republic’s slide continues since market close Thursday, as the California bank discloses its borrowing from the Fed ranged from $20 billion to $109 billion in the last week while billionaire investor Bill Ackman warned the effort to rescue FRC was creating a “false sense of confidence” a remarkable U-turn from him begging for a bailout of SVB. First Republic Bank and PacWest Bancorp are among the most active financial stocks in early premarket trading, falling 11.9% and 4.7%, respectively. FedEx Corp. shares jumped in premarket trading after the parcel company boosted its profit guidance, beating the average analyst estimate. Nvidia Corp. gained slightly as Morgan Stanley upgraded the biggest US chipmaker to overweight from equal-weight. Here are some other notable premarket movers:
US Steel shares rise 5.6%, with analysts saying the company’s new first-quarter earnings guidance was much better than anticipated.
Baidu shares rise 5% in US premarket trading after the Chinese search-engine operator’s newly debuted AI chatbot gained positive reviews from analysts. Other AI-exposed stocks are also higher in premarket trading, with C3.ai (AI US) +3%, BigBear.ai (BBAI US) +8.5%, SoundHound AI (SOUN US) +7.1%.
Cryptocurrency-exposed stocks rose after Bitcoin extended its gains for a second consecutive session, rising back above the $26,000 threshold. Hive Blockchain (HIVE US) climbed 8.7%, Hut 8 Mining (HUT US) +5.8%, Marathon Digital (MARA US) +5.4%, Riot Platforms (RIOT US) +5.7%, Stronghold Digital (SDIG US) +5.1%.
Keep an eye at FMC Corp. stock as it was upgraded to buy from neutral at Redburn, which cites “strong” pipeline-driven growth and an expected further increase in the crop chemical producer’s “industry- leading” margins.
Investors are recovering from a turbulent week that began with banking-sector concerns driving the VIX index of stock volatility to the highest since October and pushing the S&P 500 to the lowest in more than two months. Friday’s quarterly so-called triple witching — where contracts for index futures, equity index options and stock options all expire — could amp up swings in trading. The failure of Silicon Valley Bank prompted the US government to step in, and banks borrowed a combined $164.8 billion from two Federal Reserve backstop facilities in the most recent week.
While that demand for emergency liquidity shows continued caution, the overall rescue efforts have eased the risk of a broader banking-sector contagion, according to Richard Hunter, head of markets at Interactive Investor. “The generally swift and decisive actions which have been taken have removed some of the sting from market volatility,” he said.
“We do not expect a full-blown financial crisis, but one must not dismiss the underlying dynamics,” said Karsten Junius, the chief economist at Bank J Safra Sarasin AG. “Financial conditions will most likely tighten further and increase recession risks. We therefore advocate a defensive positioning with regard to risk assets and a tactically cautious stance on the banking sector, even though the constructive case for banks remains intact over the medium to longer term.”
Bank of America strategist Michael Hartnett said investors should sell any rally in stocks as fund flows don’t yet reflect deep enough concern about a looming recession. The strategist, who correctly warned of a stock exodus in 2022, recommended selling the S&P 500 above 4,100 points, about 3.5% above its last close.
The Stoxx Europe 600 index erased an advance with energy, miners and tech the best-performing sectors. A gauge of European banking stocks is heading for a drop of more than 9% this week as yet another early rally lost steam Friday. Shares in Credit Suisse resumed a decline, falling as much as 10% as the idea of a forced combination with a larger rival UBS Group AG was shot down. The stock had rallied almost 20% Thursday after the Swiss central bank stepped in with support. Bonds across Europe gained, with Germany’s 10-year yield down 10 basis points. Here are the most notable European movers:
European mining stocks rebound from two sessions in the red, with copper, aluminum and steel-exposed names leading the bounce, and Glencore gaining 4.2% as of 10:32 a.m. CET
European logistics and freight stocks gain, after US peer FedEx’s results beat expectations and it upgraded its forecast, sending its shares surging in postmarket trading
Telenor shares rise as much as 3.2%, after a Financial Times report that CK Hutchison is in talks with the Nordic telecom operator about merging their operations in Denmark and Sweden
Webuild shares rise as much as 8.1% to add to a 12% post-earnings jump in the prior session, with Akros raising the Italian construction firm to accumulate from neutral
Nel shares gain as much as 6%, the most since Feb. 7, as Goldman Sachs raises the Norwegian electrolyzer firm to buy, from neutral, on an increasingly strong growth outlook
Enel shares gain as much as 2.4% in early trading. The Italian utility’s FY net income is ahead of expectations, while guidance on its debt and dividend looks robust, analysts say
LSE Group shares rise as much as 3% as UBS upgrades the exchange operator to buy from neutral, saying the risk-reward on the stock is “very favorable”
Credit Suisse fell as investors examine its prospects after a central bank backstop. The firm and UBS are opposed to a forced combination, Bloomberg News reported
Earlier in the session, Asia stocks rebounded, led by Hong Kong-listed shares as risk appetite was helped by a rescue package for First Republic Bank. The MSCI Asia Pacific Index advanced as much as 1.6%, reversing Thursday’s drop. Hong Kong’s Hang Seng China Enterprises Index jumped more than 2%, leading indexes in the region, as Baidu drove China’s artificial intelligence stocks higher after brokers tested its ChatGPT-like service. China’s central bank announced an unexpected cut to its reserve requirement ratio after domestic markets closed. Gains in Asia were broad-based with most markets in the green, after the biggest US lenders agreed to contribute $30 billion in deposits to First Republic. Bank stocks rose as jitters about the health of the US financial system and economy eased. The MSCI Asia gauge was still on track for a second straight week of losses, albeit with smaller declines, as rolling headlines on troubled lenders from Silicon Valley Bank and Signature Bank to Credit Suisse Group AG led to choppy trading. The stock measure came close to entering correction territory prior to Friday’s rebound, with markets also digesting a 50-basis-point rate hike by the European Central Bank ahead of the Federal Reserve’s meeting next week. Shares in Taiwan, South Korea and the tech hardware sector “have over-delivered” this year and are looking particularly vulnerable to shockwaves from the US banking stress, according to Goldman Sachs Group
Japanese stocks rose, following US peers higher, as sentiment improved after Wall Street banks stepped in to rescue First Republic Bank. The Topix Index rose 1.2% to 1,959.42 as of market close Tokyo time, while the Nikkei advanced 1.2% to 27,333.79. Sony Group Corp. contributed the most to the Topix Index gain, increasing 3.5%. Out of 2,159 stocks in the index, 1,567 rose and 509 fell, while 83 were unchanged. Japan equities were also buoyed by growth stocks, which “are outperforming value stocks today, especially tech stocks,” said Rina Oshimo, a senior strategist at Okasan Securities. Meanwhile, the European Central Bank went ahead with a planned half-point rate hike. “The reality of overseas banking problems is still unclear,” said Hajime Sakai, chief fund manager at Mito Securities. “While U.S. seems to be calming down, outlook in Europe remains uncertain.”
Key stock gauges in India advanced on Friday but registered their third weekly drop in four amid risk-off sentiment triggered by worries over global growth and future course of interest rates. The S&P BSE Sensex rose 0.6% to 57,989.90 in Mumbai, while the NSE Nifty 50 Index advanced 0.7% to 17,100.05. For the week, the Nifty 50 fell 1.8%, while the BSE Sensex declined 1.9%. Indian stocks have sharply underperformed Asian and emerging markets, both today and for the week, as investor concerns persist over the South Asian country’s relatively high valuations and slowing growth momentum. HDFC Bank contributed the most to Sensex’s gain, increasing 1.4%. Tata Consultancy Services was among the worst performing NIFTY IT stocks, and underperformed most of its listed Indian peers, as its CEO’s sudden resignation surprised investors. Out of 30 shares in the Sensex index, 21 rose and 9 fell.
In FX, the Dollar Index is down 0.2% as the greenback falls versus all its G-10 rivals to head for a weekly. The New Zealand dollar and Australian dollar are the best performers. US overnight indexed swaps are now pricing for an 80% probability of a quarter-percentage point Fed rate hike next week, up from a coin toss earlier this week.
In rates, treasuries have recouped some of Thursday’s losses, led by bunds and gilts as euro-zone money markets trim rate-hike premium for May after Thursday’s post-ECB selloff. Intermediate sectors lead a limited advance for Treasuries as US stock futures hold most of Thursday’s steep gains. Two-year US yields fell 3bps to 4.11% while the 10-year rate slipped seven basis points to 3.49% vs Thursday’s close and paced by bunds and gilts. Fed-dated OIS contracts price around 20bp of rate-hike premium for next week’s policy decision, in line with Thursday’s close, while around 75bp of rate cuts are priced from May peak into year-end.
Oil headed for the biggest weekly decline this year after investor confidence plunged following the worst banking sector turmoil since the financial crisis. WTI futures in New York were down about 10% this week, even though they edged higher by 1.6% to trade near $69.40 to pare some of the decline. The failure of Silicon Valley Bank and troubles at Credit Suisse Group AG, compounded by oil options covering, triggered a three- day rout earlier this week that sent prices to the lowest in 15 months. Gold is headed for its biggest weekly gain since November after attracting haven demand due to banking turmoil in the US and Europe. U.S. Steel is among the most active resources stocks in premarket trading, gaining about 4%.
Looking to the day ahead now, and data releases from the US include the University of Michigan’s consumer sentiment index for March, industrial production for February, and the Conference Board’s leading index for February. Over in Europe, we’ll get the final Euro Area CPI reading for February. Lastly, central bank speakers include the ECB’s Simkus.
Market Snapshot
S&P 500 futures down 0.3% to 3,981
STOXX Europe 600 up 1.0% to 446.26
MXAP up 1.4% to 157.20
MXAPJ up 1.5% to 506.60
Nikkei up 1.2% to 27,333.79
Topix up 1.2% to 1,959.42
Hang Seng Index up 1.6% to 19,518.59
Shanghai Composite up 0.7% to 3,250.55
Sensex up 0.4% to 57,866.02
Australia S&P/ASX 200 up 0.4% to 6,994.80
Kospi up 0.7% to 2,395.69
Brent Futures up 0.7% to $75.22/bbl
Gold spot up 0.5% to $1,929.89
U.S. Dollar Index down 0.33% to 104.07
German 10Y yield little changed at 2.25%
Euro up 0.4% to $1.0653
Brent Futures up 0.7% to $75.22/bbl
Top Overnight News from Bloomberg
China cut the amount of cash banks must keep in reserve at the central bank in an effort to support lending and strengthen the economy’s recovery from pandemic restrictions and a property market slump: BBG
Central bank interest-rate hikes really started hitting home this week: BBG
Banks borrowed a combined $164.8 billion from two Federal Reserve backstop facilities in the most recent week, a sign of escalated funding strains in the aftermath of Silicon Valley Bank’s failure: BBG
If there’s one lesson from the European Central Bank’s latest monetary policy meeting, it’s that bond market volatility is here to stay: BBG
China’s Xi Jinping will visit Moscow next week for talks with Russian President Vladimir Putin, showcasing the deepening ties between the countries. WSJ
TikTok said that the Biden administration was pushing the company’s Chinese owners to sell the app or face a possible ban. But there are probably few companies, in the tech industry or elsewhere, willing or able to buy it, analysts and experts say. NYT
ECB officials (including Muller, Simkus, and Kazimir) deliver hawkish comments, warning that rates still have further to go on the upside. BBG
Banks borrowed a combined $164.8 billion from two Fed facilities in the week ended March 15, a sign of escalated funding strains. Discount window borrowing shot up to $152.85 billion, eclipsing the prior all-time high of $111 billion in 2008. Another $11.9 billion was borrowed from the new emergency backstop launched Sunday known as the Bank Term Funding Program. BBG
The US is committed to replenishing the Strategic Petroleum Reserve but won’t rush to do so immediately despite the recent decline in oil prices, a top Biden administration official said. BBG
Poland will send four of its MiG fighter jets to Ukraine in the coming days in what amounts to the first shipment of combat aircraft to the Zelensky gov’t. FT
Fresh turmoil for traders may be sparked by today’s options expiration after a week of bank drama. An estimated $2.7 trillion of derivatives contracts tied to stocks and indexes will mature, typically involving portfolio adjustments, spikes in volume and price swings. Demand for bearish options has been on the rise and market makers will be “short gamma,” requiring them to ride the prevailing trend. BBG
PacWest Corp is in talks about a liquidity boost with Atlas SP Partners and other investment firms. RTRS
Charles Schwab saw $8.8 billion in net outflows from its prime money market funds this week as investors rattled by turmoil at US banks plowed even more money into the brokerage’s other portfolios that favor assets with government backing. BBG
A more detailed look at global markets courtesy of Newsquawk
Asia-Pac stocks were positive amid the improved global risk appetite after recent bank lifelines including the SNB liquidity backstop for Credit Suisse and with large US banks teaming up to deposit USD 30bln in First Republic Bank. ASX 200 was marginally higher with the index kept afloat amid outperformance in energy and as the top-weighted financial industry benefitted from the recent banking sector relief, although gains were limited by losses in real estate and the defensive sectors. Nikkei 225 made headway above the psychological 27,000 level with railway stocks among the top gainers, while automakers lagged at the opposite end of the spectrum. Hang Seng and Shanghai Comp. were in an upbeat mood as energy and tech spearhead the advances in Hong Kong and with Baidu eyeing double-digit percentage gains, while the mainland also benefitted from the PBoC’s continued liquidity efforts.
Top Asian News
China Securities Journal noted that the Chinese economy requires more fiscal and monetary support, as well as reiterated that the economic rebound is not yet solid.
Japan’s government and BoJ will hold a meeting on Friday evening after the SVB collapse, with the MoF, FSA and BoJ poised to exchange information on financial markets, according to Nikkei.
Japanese Finance Minister Suzuki said Japanese financial institutions have ample capital base and liquidity, while the financial system is stable as a whole. Suzuki added they are closely coordinating with the BoJ and other central banks regarding responding to financial situations.
Japanese Union Rengo says overall wages to rise 3.8% in Spring wage talks.
European bourses are firmer across the board, Euro Stoxx 50 +0.4%, as recent liquidity action settles sentiment on Quad Witching Friday. Sectors, are all in the green with the defensively-inclined names lagging and upside in Basic Resources and Banking names, SX7P +0.4%; note, Credit Suisse has dropped into negative territory despite opening in the green. Stateside, futures are essentially unchanged having eased from initial best levels around the European open ahead of Michigan data and as attention turns to the upcoming FOMC.
Top European News
UK Chancellor Hunt abandoned plans for sovereign wealth funds to pay corporation tax on property and commercial enterprises, according to FT.
Negotiations for the UK’s re-entry into the EU’s Horizon research scheme may begin within weeks following a resolution, in principle, of the post-Brexit Northern Ireland dispute, according to BBC’s Parker.
German Chancellor Scholz said he does not see the threat of a new financial crisis and the monetary system is no longer as fragile as it was before the financial crisis, according to Handelsblatt. It was also reported that Germany’s Economy Ministry said a technical recession can now no longer be ruled out.
FX
The USD is subdued, though has convincingly reclaimed the 104.00 mark after dropping to a 103.89 low earlier; action which comes to the benefit of G10 peers.
Antipodeans are the stand-out outperformers given their high-beta status amid the improvement in risk appetite, though NZD/USD peaked above 0.6250 and AUD/USD failed to surpass the 0.6720 21-DMA convincingly.
Other G10s are deriving upside, though magnitudes slightly less pronounced, with USD/JPY holding above 133.00, Cable above 1.21 and EUR around 1.0650.
Yuan saw some modest, but ultimately shortlived, pressure on the PBoC’s 25bp cut while the Scandis are benefitting from risk, though the SEK less so given unfavourable unemployment data.
PBoC set USD/CNY mid-point at 6.9052 vs exp. 6.9017 (prev. 6.9149).
Fixed Income
EGBs are markedly more contained thus far, though Bunds have still posted a +100tick range and are currently holding near 136.40 with the 10yr yield around 2.25%.
EGBs have largely disregarded numerous ECB speakers, who overall have added little, and the final EZ HICP reading for February while Gilts are following suit given a lack of specific drivers ahead of next week’s BoE.
Stateside, the direction and magnitude of price action is in-fitting with the above though the US yield curve is slightly mixed with the short-end a touch firmer and the long-end end dipping slightly.
Commodities
Commodities are, generally, deriving support from the firmer risk tone and as the USD remains under pressure; with the crude benchmarks choppy but most recently extending to incremental session highs.
Albeit, this upside places WTI Apr’23 just USD 0.30/bbl above USD 69.00/bbl and as such well within the week’s USD 65.65-77.47/bbl parameters.
Spot gold is similarly bid and at the top-end of USD 1918-1934/oz ranges, with base metals benefitting from the improved tone though the complex is still in the red for the week.
OPEC+ delegates are reportedly still encouraged by Asian demand; Delegates largely blame the recent sell-off on speculative money leaving the derivatives oil market rather than weakness in the physical market, according to Bloomberg.
US energy envoy Hochstein said US President Biden is committed to replenishing the petroleum reserve.
China to lower retail fuel prices from Saturday, according to NDRC.
Increasing oil demand from China has lifted shipping costs markedly, via WSJ; highlighting that the daily chartering cost for VLCC has roughly doubled MM.
Russia’s Kremlin said Russia is extending the Black Sea grain deal for 60 days.
China is reportedly mulling efforts to maintain iron ore supply and prices, according to NDRC; warn iron ore trading firms to avoid hoarding and price gouging.
Geopolitics
North Korea said its missile launch on Thursday was a Hwasong-17 ICBM which sent a warning to enemies and proved the capability to respond overwhelmingly if needed. North Korea added its launch was a response to US-South Korea military drills and its leader Kim called for boosting deterrence of nuclear war, while it noted the launch did not have any negative impact on the safety of neighbouring countries, according to NK News and KCNA.
Chinese President Xi is to visit Moscow on March 20-22, according to state media; Both presidents are set to sign “important documents”, and discuss strategic partnership, according to Tass.
Russia’s Kremlin said President Putin and President Xi will meet on March 20th, hold negotiations on March 21st, and there will be a press statement.
German Federal Education/Research minister is to visit Taipei, Taiwan on Tuesday, via FT citing sources; Foreign Minister Baerbock intends to visit Beijing, China in April/May.
US Event Calendar
09:15: Feb. Industrial Production MoM, est. 0.2%, prior 0%
Feb. Manufacturing (SIC) Production, est. -0.3%, prior 1.0%
Feb. Capacity Utilization, est. 78.4%, prior 78.3%
10:00: March U. of Mich. Expectations, est. 64.8, prior 64.7; Current Conditions, est. 70.5, Sentiment, est. 67.0,
U. of Mich. 1 Yr Inflation, est. 4.1%, prior 4.1%
U. of Mich. 5-10 Yr Inflation, est. 2.9%, prior 2.9%
10:00: Feb. Leading Index, est. -0.3%, prior -0.3%
DB’s Jim Reid concludes the overnight wrap
Some optimism has returned to markets over the last 24 hours, with bank stocks stabilising on both sides of the Atlantic and 2yr yields surging back. Even the ECB’s decision to pursue a 50bp hike went without incident, and investors grew in confidence that the Fed would follow up with their own 25bps hike next week, so we’re starting to see a modest change in the mood music. It’s also telling this morning that in Asia, US yields and equity futures are fairly stable. Well, they were at the time of typing.
As we’ll see below, the concerns haven’t gone away though, as while Credit Suisse saw its equity price increase, its bonds/CDS were generally flat to weaker. Let’s start with the US banks as there was a lot of news surrounding First Republic Bank. The equity opened down a further -12% taking it to its lowest levels since going public, before recovering slowly as reports started filtering out about additional capital injections. Following numerous reports early yesterday that the US government was trying to agree to a rescue package with some of the major US banks, a deal was announced just before the US equity market closed. In a joint statement the consortium of banks including JPMorgan, Citigroup, Bank of America and Wells Fargo tried to reassure the public that their actions, “reflects their confidence in First Republic and in banks of all sizes.” Overall 11 banks are contributing $30bn of uninsured deposits to First Republic, with $5bn coming from JPMorgan, Citigroup, Bank of America and Wells Fargo. The banks’ commitment will extend for 120 days initially and could be extended at that point as necessary. In after-hours trading, First Republic’s shares fell c.-17% as the bank announced that it was suspending its dividend and plans to trim its debt burden. That leaves the stock nearer to where it was trading prior to the news of the deposit injection but still higher.
In terms of bank funding, last night the Fed released the weekly data of how its various lending facilities were used in the week ending March 15. The most anticipated release of the data since Covid did not disappoint in scale. In total, there was $164.8bn of borrowing between the Fed’s discount window ($152.85bn) and the Bank Term Funding Program ($11.9bn) that the Fed announced last week. The discount window figure blows away the previous high of $111bn during the 2008 financial crisis. However, as a function of overall deposits level yesterday’s data was about 1% of deposits, while at the height of the GFC the discount window usage in a week was as much as 1.8% of deposits. This data will be parsed more in coming weeks if stress persists but the 11 bank consortium into First Republic will be hoped to be enough to prevent that.
Nevertheless, we shouldn’t get ahead of ourselves, and it’s worth remembering that we’ve already had a temporary period of stability on Tuesday that was then dented by the Credit Suisse worries on Wednesday. Indeed, their bonds stayed fairly stressed yesterday even with the market bounceback. The 5yr credit default swaps stayed around the +1000 level, whilst there were further declines in the value of their debt – notably their ’29 EUR bonds are trading under €70. That was in spite of the announcement we highlighted yesterday that they’d be using a SNB liquidity facility, which initially saw the share price surge +40% at the open, before paring back around half those gains to “only” close up +19.15%.
With regard to Credit Suisse, if you’re looking for the positives in European banking see my CoTD here yesterday that shows the rest of the sector is more tightly packed together in 5yr CDS terms and that CS has been an outlier for months. So if the authorities manage to contain it, the immediate contagion risk is limited. However, the CoTD also highlights how we think the financial risk will eventually spread to corporates. If relatively lowly levered financials can get hit then highly levered corporates won’t be immune further down the line with the appropriate lag. Our YE targets for US and EU HY for YE 2023 have been around 860bp for 12 months now, but with most of the pain expected to occur in H2 2023. Our US Lev Loan target is +1000bp for the same time period. If you’re not on my CoTD (chart of the day), send an email to jim-reid.thematicresearch@db.com to get added.
Banks in aggregate recovered a bit yesterday, though the CS fallout continued to weigh as Europe’s STOXX Banks was up just +1.16% vs the -8.40% the day before. Meanwhile, the news of the further First Republic support saw the KBW Banks index up +2.57% – roughly 1.4% of that came after news hit that First Republic would get $30bn of deposits. We shouldn’t forget that both are still down more than -10% over the week as a whole, but the more positive tone supported a broader equity rally that left the S&P 500 (+1.76%) and Europe’s STOXX 600 (+1.19%) with solid performances on the day. That’s the best day for the S&P 500 in over 2 months and is entering today up +2.56% through the last four days, while the STOXX 600 is down -2.67% on the week so far.
Whilst all that was going on, the ECB followed through on their previous commitment to hike by 50bps at yesterday’s meeting, which takes the deposit rate up to a post-2008 high of 3%. President Lagarde said this was supported by a “large majority”, but in other respects the decision was a dovish one, and their statement dropped the previous guidance that they expected to raise rates further. Instead, the message was that they’d take a “data-dependent” approach at subsequent meetings, and there wasn’t much indication about what they were planning to do next. Their inflation forecasts (which were finalised before the current turmoil) were also revised down on the back of lower energy prices, and now see inflation falling from +5.3% in 2023 to +2.9% in 2024 and +2.1% in 2025. On the other hand, the core inflation forecast for 2023 was revised up to +4.6%, which shows that they still see underlying price pressures staying resilient.
When it came to the current turmoil, the ECB’s statement said that they were “monitoring current market tensions closely”, and it also affirmed that the “euro area banking sector is resilient, with strong capital and liquidity positions.” President Lagarde went on to deflect comparisons to 2008, saying that “the banking sector is in a much, much stronger position”. Looking forward, our European economists maintain their 3.75% baseline terminal rate call based around a 50bp hike in May and then 25bps in June. That view is predicated on the relatively rapid normalisation of the current global financial shock. Please see their report here for more.
With the ECB hike now delivered, there was a growing expectation among investors that the Fed would similarly follow through with a hike at their own meeting on Wednesday. Futures are now pricing in a +19.2bps move, which is a decent increase from the +11.8bps priced by the previous day’s close. In turn, that confidence led to a rebound in shorter-dated yields, with the 2yr yield up +27.0bps to 4.157%, and the 10yr yield also recovered +12.2bps to 3.577% although it is slightly lower (-2.26bps) in Asia as we go to press. In Europe it was much the same story, with yields on 10yr bunds (+16.0bps), OATs (+13.5bps) and gilts (+10.4bps) all rising. Another key factor behind that was growing scepticism that central banks were about to pursue substantial rate cuts this year. For instance, the futures-implied rate for the Fed’s December meeting rose by +40.7bps on the day to 4.097%, which demonstrates how rate cuts are starting to be priced out again.
The latest data has been far down the agenda lately, but the weekly initial jobless claims from the US for the week ending March 11 came in at 192k (vs. 205k expected). That’s a -20k decline on last week, which had seen the biggest weekly increase since September. Otherwise, the US housing data was more resilient than anticipated in February, with housing starts up by an annualised rate of 1.450m (vs. 1.310m expected), and building permits up by 1.524m (vs. 1.343m expected).
Asian equity markets are higher overnight. As I type, Chinese stocks are advancing with the Hang Seng (+1.85%) emerging as the top performer across the region while the Shanghai Composite (+1.58%) and the CSI (+1.57%) are also sharply higher. Elsewhere, the Nikkei (+1.20%) and the KOSPI (+0.67%) are also trading in the green as risk sentiment improved after the turmoil in the US and European banking sector eased. Outside of Asia, US stock futures are trading flattish with those on the S&P 500 (+0.06%) and NASDAQ 100 (+0.12%) taking a bit of a breather after a hectic week.
In the energy markets, oil prices are slightly higher this morning with Brent futures (+1.04%) trading at $75.48/bbl and WTI (+1.05%) at $69.07/bbl amid positive market sentiment as well as strong China demand expectations.
To the day ahead now, and data releases from the US include the University of Michigan’s consumer sentiment index for March, industrial production for February, and the Conference Board’s leading index for February. Over in Europe, we’ll get the final Euro Area CPI reading for February. Lastly, central bank speakers include the ECB’s Simkus.
AND NOW NEWSQUAWK (EUROPE/REPORT)
Risk appetite returns, though the overall tone is tentative on Quad Witching Friday – Newsquawk US Market Open
FRIDAY, MAR 17, 2023 – 06:56 AM
European bourses are firmer across the board, Euro Stoxx 50 +0.4%, as recent liquidity action settles sentiment on Quad Witching Friday.
Stateside, futures are essentially unchanged having eased from initial best levels around the European open with attention on US banking names
DXY is subdued, though back above, 104.00 to the broad-based benefit of peers; PBoC cut its RRR by 25bp.
EGBs/USTs action has been markedly more contained thus far, though the Bund range is still over 100ticks, while the US yield curve is slightly mixed.
Commodities are, generally, deriving support from the firmer risk tone and as the USD remains under pressure; with the crude benchmarks choppy but most recently extending to incremental session highs.
Looking ahead, highlights include US Industrial Production, Leading Index Change, Univ. of Michigan (Prelim.) and Quad Witching.
Or why not try Newsquawk’s squawk box free for 7 days?
BANKS
PBoC cuts Reserve Requirement Ratio (RRR) by 25bps, effective 27th March; PBoC reiterates prudent and forceful policy. Weighted average RRR for financial institutions at around 7.6% following the cut, RRR cut will exclude financial institutions that have implemented 5% RRR.
US
Fed blocked the mention of regulatory flaws in the SVB rescue, while government officials wanted their joint statement to reference regulatory shortcomings they believed contributed to the demise, according to NYT.
US Senators Sinema and Tillis led a bipartisan group of Senators questioning the Fed regarding its oversight of Silicon Valley Bank and urged the Fed to focus its internal review on how industry concentration within a bank’s customer base could constitute a financial risk.
Charles Schwab (SCHW) clients pulled USD 8.8bln from its prime funds in 3 days, according to Bloomberg.
US regulators confirmed that 11 banks announced USD 30bln in deposits into First Republic Bank (FRC).
S&P affirmed the US at AA+; Outlook Stable, while S&P said US ratings are constrained by a high general government debt burden but the stable outlook indicates an expectation of continued resilience in the US economy.
ECB
ECB convened an ad-hoc supervisory board meeting today to review developments in the banking sector following market turmoil, according to a spokesperson cited by Reuters.
ECB’s Simkus does not believe this was the last rate hike.
ECB’s Villeroy says the priority is to fight inflation; French and European banks are “very solid”.
ECB’s Muller says would not want to forecast the next rate decisions; latest inflation forecasts assume more rate hikes.
ECB’s Kazmir says need to continue with rate hikes, no need to speculate about the May decision; not at the finish line. Core inflation is sticky, upside risks dominate.
HSBC now sees the ECB hiking by 25bps in both May and June (vs prev. forecast of a 50bps hike in May).
EUROPEAN TRADE
EQUITIES
European bourses are firmer across the board, Euro Stoxx 50 +0.4%, as recent liquidity action settles sentiment on Quad Witching Friday.
Sectors, are all in the green with the defensively-inclined names lagging and upside in Basic Resources and Banking names, SX7P +0.4%; note, Credit Suisse has dropped into negative territory despite opening in the green.
Stateside, futures are essentially unchanged having eased from initial best levels around the European open ahead of Michigan data and as attention turns to the upcoming FOMC.
The USD is subdued, though has convincingly reclaimed the 104.00 mark after dropping to a 103.89 low earlier; action which comes to the benefit of G10 peers.
Antipodeans are the stand-out outperformers given their high-beta status amid the improvement in risk appetite, though NZD/USD peaked above 0.6250 and AUD/USD failed to surpass the 0.6720 21-DMA convincingly.
Other G10s are deriving upside, though magnitudes slightly less pronounced, with USD/JPY holding above 133.00, Cable above 1.21 and EUR around 1.0650.
Yuan saw some modest, but ultimately shortlived, pressure on the PBoC’s 25bp cut while the Scandis are benefitting from risk, though the SEK less so given unfavourable unemployment data.
PBoC set USD/CNY mid-point at 6.9052 vs exp. 6.9017 (prev. 6.9149).
EGBs are markedly more contained thus far, though Bunds have still posted a +100tick range and are currently holding near 136.40 with the 10yr yield around 2.25%.
EGBs have largely disregarded numerous ECB speakers, who overall have added little, and the final EZ HICP reading for February while Gilts are following suit given a lack of specific drivers ahead of next week’s BoE.
Stateside, the direction and magnitude of price action is in-fitting with the above though the US yield curve is slightly mixed with the short-end a touch firmer and the long-end end dipping slightly.
Commodities are, generally, deriving support from the firmer risk tone and as the USD remains under pressure; with the crude benchmarks choppy but most recently extending to incremental session highs.
Albeit, this upside places WTI Apr’23 just USD 0.30/bbl above USD 69.00/bbl and as such well within the week’s USD 65.65-77.47/bbl parameters.
Spot gold is similarly bid and at the top-end of USD 1918-1934/oz ranges, with base metals benefitting from the improved tone though the complex is still in the red for the week.
OPEC+ delegates are reportedly still encouraged by Asian demand; Delegates largely blame the recent sell-off on speculative money leaving the derivatives oil market rather than weakness in the physical market, according to Bloomberg.
US energy envoy Hochstein said US President Biden is committed to replenishing the petroleum reserve.
China to lower retail fuel prices from Saturday, according to NDRC.
Increasing oil demand from China has lifted shipping costs markedly, via WSJ; highlighting that the daily chartering cost for VLCC has roughly doubled MM.
Russia’s Kremlin said Russia is extending the Black Sea grain deal for 60 days.
China is reportedly mulling efforts to maintain iron ore supply and prices, according to NDRC; warn iron ore trading firms to avoid hoarding and price gouging.
UK Chancellor Hunt abandoned plans for sovereign wealth funds to pay corporation tax on property and commercial enterprises, according to FT.
Negotiations for the UK’s re-entry into the EU’s Horizon research scheme may begin within weeks following a resolution, in principle, of the post-Brexit Northern Ireland dispute, according to BBC’s Parker.
German Chancellor Scholz said he does not see the threat of a new financial crisis and the monetary system is no longer as fragile as it was before the financial crisis, according to Handelsblatt. It was also reported that Germany’s Economy Ministry said a technical recession can now no longer be ruled out.
NOTABLE DATA
EU HICP Final YY (Feb) 8.5% vs. Exp. 8.5% (Prev. 8.5%); X Food & Energy Final YY (Feb) 7.4% vs. Exp. 7.4% (Prev. 7.4%)
NOTABLE US HEADLINES
China’s Finance Ministry has fined Deloitte’s Beijing unit and suspends its operations for three months, in relation to a Huarong Asset Management auditing issue.
North Korea said its missile launch on Thursday was a Hwasong-17 ICBM which sent a warning to enemies and proved the capability to respond overwhelmingly if needed. North Korea added its launch was a response to US-South Korea military drills and its leader Kim called for boosting deterrence of nuclear war, while it noted the launch did not have any negative impact on the safety of neighbouring countries, according to NK News and KCNA.
Chinese President Xi is to visit Moscow on March 20-22, according to state media; Both presidents are set to sign “important documents”, and discuss strategic partnership, according to Tass.
Russia’s Kremlin said President Putin and President Xi will meet on March 20th, hold negotiations on March 21st, and there will be a press statement.
German Federal Education/Research minister is to visit Taipei, Taiwan on Tuesday, via FT citing sources; Foreign Minister Baerbock intends to visit Beijing, China in April/May.
CRYPTO
Citadel reportedly offered to buy Circle’s SVB deposits that were backing USDC before regulators took control, according to WSJ.
APAC TRADE
APAC stocks were positive amid the improved global risk appetite after recent bank lifelines including the SNB liquidity backstop for Credit Suisse and with large US banks teaming up to deposit USD 30bln in First Republic Bank.
ASX 200 was marginally higher with the index kept afloat amid outperformance in energy and as the top-weighted financial industry benefitted from the recent banking sector relief, although gains were limited by losses in real estate and the defensive sectors.
Nikkei 225 made headway above the psychological 27,000 level with railway stocks among the top gainers, while automakers lagged at the opposite end of the spectrum.
Hang Seng and Shanghai Comp. were in an upbeat mood as energy and tech spearhead the advances in Hong Kong and with Baidu eyeing double-digit percentage gains, while the mainland also benefitted from the PBoC’s continued liquidity efforts.
NOTABLE ASIA-PAC HEADLINES
China Securities Journal noted that the Chinese economy requires more fiscal and monetary support, as well as reiterated that the economic rebound is not yet solid.
Japan’s government and BoJ will hold a meeting on Friday evening after the SVB collapse, with the MoF, FSA and BoJ poised to exchange information on financial markets, according to Nikkei.
Japanese Finance Minister Suzuki said Japanese financial institutions have ample capital base and liquidity, while the financial system is stable as a whole. Suzuki added they are closely coordinating with the BoJ and other central banks regarding responding to financial situations.
Japanese Union Rengo says overall wages to rise 3.8% in Spring wage talks.
DATA RECAP
Singapore Non-Oil Exports MM (Feb) -8.0% vs. Exp. -0.5% (Prev. 0.9%); YY (Feb) -15.6% vs. Exp. -16.0% (Prev. -25.0%)
FRIDAY MORNING/THURSDAY NIGHT
SHANGHAI CLOSED UP 23.66 PTS OR 0.73% //Hang Seng CLOSED UP 314,68 PTS OR 1.64% /The Nikkei closed DOWN 323.18 PTS OR 1.20% //Australia’s all ordinaries CLOSED UP 0.50% /Chinese yuan (ONSHORE) closed UP 6.8892//OFFSHORE CHINESE YUAN UP TO 6.8904// /Oil UP TO 68.91 dollars per barrel for WTI and BRENT AT 74,58 / Stocks in Europe OPENED ALL MIXED// ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING STRONGER AGAINST US DOLLAR/OFFSHORE STRONGER
2 a./NORTH KOREA/ SOUTH KOREA/
///NORTH KOREA/SOUTH KOREA/
END
2B JAPAN
JAPAN/
END
3c CHINA /
CHINA///USA
USA defense intelligence claims China is preparing for war that it does not want to fight
(DeCamp/Antiwar.com)
US Says China Preparing For War It Doesn’t Want To Fight
A Defense Intelligence Agency (DIA) official assesses that China’s growing pessimism over its relationship with the US is making Beijing prepare for a future war it would rather not fight, Voice of America reported Wednesday.
“China doesn’t want to start a fight with us over Taiwan,” Doug Wade, the head of the DIA’s China Mission Group, said at a virtual event hosted by the Intelligence and National Security Alliance.
“They will if they have to … they haven’t ruled it out,” Wade added. China’s official position is that it seeks “peaceful reunification” with Taiwan but doesn’t rule out using force.
While China is reluctant to start a war, Washington’s increasing support for Taipei has led to Beijing putting more military pressure on Taiwan. The US’s overall military buildup in the Asia Pacific is also naturally making China think they have to prepare for a future conflict.
The US has shown no interest in backing off, and US military officials areopenly discussing their plans for a future war with China. Wade warned that the two powers are entering an “increasingly confrontational period,” which he expects to play out across all domains.
“It’ll manifest itself pretty much across the spectrum – every warfighting domain in every sphere of diplomatic, informational, economic, commercial,” Wade said.
Chinese officials have been calling for better relations with the US but have also stepped up their warnings about where the two powers are heading.
“If the United States does not hit the brake, but continues to speed down the wrong path, no amount of guardrails can prevent derailing, and there surely will be conflict and confrontation,” Chinese Foreign Minister Qin Gang told reporters earlier this month.
end
CHINA/ECONOMY
China’s economy is faltering again to which we have pointed out to you on several occasions. Now China unexpectedly cuts its RR ratio by 25 basis points and thus injecting a huge $73 billion USA equivalent into its economy
(zerohedge)
China Unexpectedly Cuts Reserve Ratio For Banks, Injecting $73BN To Stimulate Economy
FRIDAY, MAR 17, 2023 – 07:31 AM
Early Friday, China’s central bank surprised by announcing an unexpected cut to the amount that banks set aside for deposits by 25 basis points, vowing to keep ample liquidity in the interbank system and better fund the real economy.
The People’s Bank of China reduced the reserve requirement ratio for almost all banks by 0.25 percentage points, effective from March 27, it said in a statement on Friday. The PBOC last cut the RRR in December, by the same magnitude. The cut, effective March 27, is expected to inject 500 billion yuan ($72.6 billion) worth of liquidity into the market, while the average reserve requirement ratio of Chinese financial institutions will be lowered to 7.6 per cent.
The RRR cut comes just days after China’s new government took office and the freshly inaugurated Premier Li Qiang pledged to achieve an annual economic growth target of around 5% this year.
“The PBOC will keep monetary policy targeted and powerful,” the central bank said in a statement adding that “We’ll provide better support for key areas and weak links, refrain from a big stimulus … and concentrate on pushing for high-quality development.”
Economists said the cut was aimed at ensuring liquidity in the banking system to sustain the rapid pace of lending seen in January and February, yet which led to modest economic results as discussed earlier this week.
China’s consumer spending and investment rebounded in the first two months of the year after pandemic restrictions were dropped in December, according to recent official data. But the recovery remains uncertain, with unemployment still elevated, property investment continuing to contract and falling exports dragging on industrial output.
“It seems that the central bank is not going to slow the pace of credit growth as people feared,” said Xing Zhaopeng, senior China strategist at Australia & New Zealand Banking Group Ltd.
The timing of the cut could be due to concerns that credit growth could slump in April, following the completion of financing for a number of government-led investment projects early this year, Xing added. The yuan pared an advance of as much as 0.6%, trading 0.1% stronger at 6.89 in the onshore market after the PBOC’s move.
Here are some snap reactions by economists and commentators, courtesy of Bloomberg:
Niu Chunbao, a fund manager at Shanghai Wanji Asset Management:
“The decision by the Chinese central bank to cut reserve requirement ratio signals that authorities are focused on supporting growth, not an indication of any problems in the economy. It could also be meant to give the market a boost after the poor performance in growth stocks this year. I don’t feel excited on the news as the main challenge this year is exports, and liquidity isn’t going to help much on that front”
Huang Yuhang, Fund manager at Lanqern Capital
“I don’t think this has much to do with fears about the banking stress, but rather the recovery seems to need a bit of help, judging by the economic figures this week. The key impediment to the recovery is demand still being weak, as confidence for incomes is still fragile, so liquidity hasn’t been the issue for the economic recovery, hence the market may or may not buy it”
Mingze Wu, a FX trader at StoneX Group in Singapore
“Given that global banks are now on defensive and liquidity is at premium, it make sense for PBOC to start getting ready before real problem arise. Likely Chinese banks have been affected by their bond portfolio losses just like the US bank albeit the impact will be lower but nonetheless still significant since you can’t escape US market”
Xiadong Bao, fund manager at Edmond de Rothschild Asset Management
“The Jan-Feb macro data indicates the recovery is well under way, while the early March high frequency data we’ve seen so far showed a certain weakness, which triggered recent market concerns on a weaker-than-expected recovery. This cut shows the strong commitment of PBOC to support the growth recovery in 2023, especially in the backdrop of a complicated exterior environment”
Mitul Kotecha, head of emerging-markets strategy at TD Securities
“The timing of the cut is a little surprising given the strength of recent data but it is consistent with recent comments by PBOC governor Yi Gang when he highlighted that cuts in the RRR would be an effective way to add liquidity. This is unlikely however, to translate into a cut in Loan Prime rates next week in our view but it does add further, albeit limited support to the economy. CNY trimmed gains on the news but overall we expect the currency to track USD gyrations, with some weakness on a trade weighted basis likely”
Fiona Lim, senior foreign exchange strategist at Malayan Banking Bhd. in Singapore
“A RRR cut at this point will not undermine the yuan much given that it is somewhat expected. USD has also been under pressure with a 25bps hike by the Fed already priced to a significant extent. USDCNH pairing is likely to remain within the 6.83-7.00 range barring fresh signs of bank stress in Europe”
Steven Leung, executive director, UOB Kay Hian
“The global banking crisis, even though it’s been stabilized after the major banks injected money into the banking system but still the situation isn’t yet over. So we really need some more liquidity in the global financial markets since China is in a different cycle – they’ve been loosening the policy. And secondly, if you look at the economic data released in February, it didn’t provide any surprise to the markets. So maybe Beijing recognizes the pace of the recovery is not as strong as they expected”
Shen Meng, director, Chanson & Co.
“China’s CPI is still low, which gives room for adjustment in monetary policy. The increase between M2 money supply and social financing is still notable. The 0.25 percentage cut can inject approximately 500 billion of long-term funds in order to support fiscal expenditure, which would fund state-owned enterprises’ investments. And with expectations of the Fed’s continued rate hikes, this move ensures stable market flows”
Sofia Horta E Cots, Bloomberg Analyst
Ah the classic late Friday RRR cut out of China. This is essentially a cash injection into the financial system — or dare we call it a bit of monetary stimulus. The RRR cut is one of the cheapest types of liquidity the People’s Bank of China can offer banks because it’s not a loan and carries no interest rate (unlike like the MLF or reverse repos instruments.) The PBOC, which also repeated a pledge to not flood the market with liquidity, is trying to keep borrowing costs low across the economy to aid the recovery from Covid Zero. It’s trying to do that without engaging in large-scale stimulus because of Beijing’s obsession with financial risks. Inflation, rapid rate hikes and bank failures are not on President Xi Jinping’s wishlist. Chinese banks are looking relatively resilient right now, as I wrote here. So is the PBOC also getting ahead of a potential spillover of financial-sector stress from the US and Europe? You never know with China’s monetary policy, but the timing is certainly interesting
The yuan pared an advance of as much as 0.6%, trading 0.1% stronger at 6.89 in the onshore market after the PBOC’s move. The move also helped push commodities higher.
end
CHINA/TESLA/RARE EARTHS
Musk is now planning for a zero rare earth EV motor
(Zhang/Li/EpochTimes)
Tesla’s Plans For Zero Rare Earth EV Motor Could Undermine Beijing’s Secret Weapon
At its 2023 Investor Day presentation in Texas, Tesla revealed its plans to produce its next generation EV motor without any rare earth minerals. As a global leader in the electric vehicle market, Tesla’s plan for zero rare earth permanent magnet motors, if successful, could have a significant impact on the rare earth market—particularly China’s rare earth monopoly.
“As the world transitions to clean energy, the demand for rare earths is really increasing dramatically, and not only will it be a little harder to meet that demand, but mining rare earths has environmental and health risks,” said Colin Campbell, VP of Powertrain Engineering at Tesla.
“We have designed our next drive unit, which uses a permanent magnet motor, to not use any rare earth materials at all,” he announced.
Currently, Tesla’s Model Y uses three types of rare earth materials: approximately 500 grams of one, and 10 grams of two others. But in Tesla’s next generation permanent magnet motor, zero rare earths will be used, according to Campbell’s presentation.
Campbell did not specify which materials would be used to replace the rare earth components.
Tesla also stated that from 2017 to 2022, its use of rare earth materials in the Tesla Model 3 had decreased by 25 percent due to improved efficiency in its powertrain system.
Shortly after Tesla’s announcement to remove rare earths from its EVs motors, China’s largest rare earth supplier, Northern Rare Earth (600111.SHA), saw its stock price drop by nearly 10 percent as of March 10. The stock prices of two other major rare earth suppliers, China Rare Earth (0769.HKG) and Shenghe Resources (600392.SHA), also fell by 5.9 percent and 10 percent, respectively.
Compared with the traditional excitation generators, permanent magnet motors—especially rare earth permanent magnet motors—have higher magnetic energy product and coercive force: the ability to resist demagnetization. This makes them reliable and highly efficient. The energy conversion efficiency of rare earth permanent magnet motors typically reaches 90 percent, with the best achieving over 98 percent.
However, the supply of rare earths has been highly monopolized by the Chinese Communist Party (CCP). According to data released this year by the United States Geological Survey (USGS), in 2022, China’s rare earth reserves accounted for 34 percent of the world’s known reserves, and its rare earth production accounts for 70 percent of global production. As a result, the supply and price of rare earths in the global market are largely under the control of the CCP.
In addition, the supply of rare earths may not keep pace with the rapid expansion of the global EV market, especially Neodymium-Iron-Boron (NdFeB) permanent magnets, a key component in advanced electric motors.
In the wake of heightened tensions between the United States and China, minimizing or eliminating the use of rare earth elements without affecting product performance would be beneficial to supply chain stability.
Zero Rare Earth Technology May Have Wide Impact
In 2022, Tesla delivered more than 1.31 million EVs, accounting for 18.2 percent of the global EV market and ranking first in the world. Since 2018, Tesla has taken over more than 60 percent market share of the American EV market. In Europe, Tesla’s Model Y and Model 3 were the two most popular EVs in 2022.
This dominant position gives Tesla tremendous influence in the EV industry.
According to rare earth consulting firm Adamas Intelligence, EV motors account for 12 percent of global consumption of NdFeB magnets, of which Tesla accounts for 15 percent to 20 percent.
If Tesla succeeds in removing rare earths from its motors, Adamas estimates that the global market for NdFeB will lose only 2 to 3 percent of demand in the short term. However, in the long term, it is estimated to lose 3 to 4 percent at most, assuming Tesla can maintain its leadership position in the EV market.
But this analysis did not take into account that other EV companies will likely follow suit if Tesla is successful, as this innovation has cost-saving potential and helps to rid industry reliance on the vulnerable and costly rare earth supply chain.
In addition to new energy vehicles, rare earth permanent magnet motors are also used in several other areas, including wind turbines, traditional automotive motors, home appliances that use frequency conversion technology (air conditioners, refrigerators, washing machines, etc.), industrial robots, and energy-saving elevators. Therefore, the development of zero rare earth permanent magnet motor technology may have broader implications, potentially affecting demand for rare earths from China.
CCP’s Secret Weapon
The CCP sees rare earths as a political bargaining chip.
In 2010, after China escalated its sovereignty dispute with Japan over the Diaoyu Islands, the CCP began restricting the export of all 17 rare earth materials to Japan as a means of coercion. This move alerted Western countries to the risks of relying on Chinese supply chains.
The CCP has been establishing a so-called rare earth strategic reserve system since 2011, treating rare earths as strategic resources, and collecting and stockpiling large amounts of rare earth raw materials.
At the same time, through a quota system that controls the total volume of rare earth mining and smelting in China, the CCP has concentrated rare earth production in the hands of a few government-controlled rare earth groups, further strengthening its control over global rare earth supply and prices.
Beijing began seriously considering rare earth export restriction to the United States in May 2019, amid the escalation of U.S.-China trade war.
“Since the United States announced its decision to include Huawei on its ‘Entity List’, speculation has been rife that China may restrict or even stop its exports of rare earths to the United States,” the CCP’s mouthpiece Global Times warned in a May 2019 article. “We believe that if the White House continues to intensify its pressure on China, it may only be a matter of time before China wields rare earths as a weapon.”
Around the same time, People’s Daily also issued a harsh warning, saying that the United States “should not underestimate China’s ability to counteract.”
end
CHINA/JAPAN USA/USA DOLLAR RESERVES
ROBERT H; TO US/
important….
Interest rate realities vs fiction
China’s holdings of US Treasury debt dropped to $859.4 billion in January, declining for the sixth straight month and falling below $1 trillion, for a long time. Their holdings of US debt is now the lowest since May 2010, when it held $843.7 billion. We have the stupidity of the Biden Administration reading the cue cards ( Biden is incapable of anything beyond reading a teleprompter and even does that poorly) written by the Neocons who have NEVER been concerned with domestic economic policy. They care only about one thing – defeating Russia and then China. They are the real threat to world peace and have no business in government administration anywhere. They are simply blinded by hate and a love of war to achieve their dreams and see death on TV as a sport. Never assuming that perhaps the brutality of war may come to their door.
China still remains the second-largest non-US holder of US debt after Japan, which held $1.104 trillion as of the end of January. I have repeatedly stated that China’s buying of gold WAS NOT because they are bullish on gold. This is their exit strategy from the dollar and the eurozone. And one we should understand because even Bitcoin settled in USD is a political and economic risk they will avoid. Gold always rises when there is uncertainty. Just wait until the BRICS currency hits. Even China recognizes its’ own risk to capital holdings.
Previously written China’s holdings of US Treasuries fell below $1 trillion for the first time in 12 years in April 2022. That demonstrated their keen observation and understanding of the posture the Fed was adopting based entirely on war. Powell has no choice but to raise interest rates since he too is a victim of Neocon madness. Besides Biden slapping China ( in Chinese eyes Biden is already seen as a deadbeat with no face) in the face politically in public, this selling of US debt will put pressure on interest rates and could lead to QE but not to support the domestic economy by expanding the money supply, but having to stand behind the Treasury market and the Fed will be compelled to but in what China sells to prevent a catastrophic collapse in the US debt market. Otherwise they will collapse the balance sheets of all Central Banks who hold treasuries on their balance sheets ( often they hold treasuries to secure USD facilities as do many banks). Today, as we saw with SVB, all such holders of long term treasuries are under water holding mark to market losses if they sell now.
We only have ourselves to blame for allowing the Neocons to seize control of the Biden Administration. We all have allowed politicians to run amuck without accountability. Neocons only care about winning their war – nothing about the economy. And what it takes to win is not understood. Americans need to wake up before their nation is destroyed because American existence in its present form is at stake. And global hegemony is waning quickly as America is reduced to be a pariah, because of a small group making the public pay for their insanity. Yes, insanity because to allow one’s blindness to create self inflected grieve is insane and that is what is happening. This crowd will destroy both America and the rest of the Western world unchecked. We should expect others to be reluctant to hold US Treasuries in a declining market and they too will be compelled to sell off the long-term, if losses continue to pile up. Because holding cash will be preferable to bond losses. Do not expect the Administration to figure that out; they are incapable and simply do not care. As for the Ukraine, endless money into that cesspool of corruption needs to end sooner than later. Leaving Ukrainians to figure out their future. Do you not think that Swiss are not correct and prudent to tell Ukrainians with their fancy cars to lose them if they want refugee money? Yes, there are real Ukrainian refugees with nothing but there is also a great number who prance around Europe living large making Locals feel poor and yet ask for handouts. Talk about entitlement not deserving. Ukrainians need to address that they have government that is consumed with self interest willing to sacrifice them all on the alter of death for sake of money.
This mess left alone to fester will only cause more grieve shortly.
end
4.EUROPEAN AND UK AFFAIRS
FRANCE
The French are angry after Macron bypasses Parliament to pass pension reform
(zerohedge)
Protests Erupt After France’s Macron Bypasses Parliament To Pass Pension Reform
FRIDAY, MAR 17, 2023 – 04:15 AM
French President Emmanuel Macron used special constitutional powers to pass a controversial pension bill through the National Assembly (the lower house) without a vote, a move likely to ignite protests on the streets of Paris.
The New York Times reported that Macron’s government used Article 49.3 of the Constitution to push through the pension reform bill without a parliamentary vote, highlighting the unpopularity of the proposed increase in retirement age by two years to 64.
AFP said there was chaos in the parliament and even outside after the government invoked 49.3:
Lawmakers were shouting, their voices shaking with emotion as Macron made the risky move, which is expected to trigger quick motions of no-confidence in his government. Riot police vans zoomed by outside the National Assembly, their sirens wailing.
Macron’s government has emphasized the need for pension reforms to ensure the sustainability of the pension system for the next ten years, as it is projected to have an annual deficit of 10 billion euros ($10.73 billion) from 2022 to 2032.
Strikes have been increasing since the start of the year in France to protest the reform. Last week, an estimated million people striked.
Protesters have started to assemble.
end
France Burns After Macron Skips Parliament Vote To Ram Through Hated Pension Reform
FRIDAY, MAR 17, 2023 – 01:32 PM
Update (1330ET): The French protests over Macron’s pension debacle have gotten more violent, and fiery.
* * *
French President Emmanuel Macron used special constitutional powers to pass a controversial pension bill through the National Assembly (the lower house) without a vote, a move likely to ignite protests on the streets of Paris.
The New York Times reported that Macron’s government used Article 49.3 of the Constitution to push through the pension reform bill without a parliamentary vote, highlighting the unpopularity of the proposed increase in retirement age by two years to 64.
AFP said there was chaos in the parliament and even outside after the government invoked 49.3:
Lawmakers were shouting, their voices shaking with emotion as Macron made the risky move, which is expected to trigger quick motions of no-confidence in his government. Riot police vans zoomed by outside the National Assembly, their sirens wailing.
Macron’s government has emphasized the need for pension reforms to ensure the sustainability of the pension system for the next ten years, as it is projected to have an annual deficit of 10 billion euros ($10.73 billion) from 2022 to 2032.
Strikes have been increasing since the start of the year in France to protest the reform. Last week, an estimated million people striked.
Protesters have started to assemble.
end
ITALY
Italy refuses open borders and will not bow down to powerful elites (Davos)
(Brooke/Remix)
Italy Won’t Bow To Powerful Elites In Favor Of Open Borders, Insists Meloni
A defiant Giorgia Meloni offered a staunch defense of her government’s handling of the migrant crisis in the Chamber of Deputies this week…
Italian Prime Minister Giorgia Meloni told political opponents she will not bow to the political pressure exerted by powerful elites in favor of open borders.
Speaking during Question Time in the Chamber of Deputies, Meloni responded to questions related to her government’s handling of the ever-increasing migratory pressure in the Mediterranean following government data published this week that revealed more than 20,000 people have now reached the country so far this year.
“As long as there are departures on boats in bad condition, navigating in bad weather conditions, there will be loss of life,” she told parliamentary colleagues.
“We need to invest in legal routes, and that is exactly the job the government is doing. Our conscience is clear. I hope that whoever attacks the government but does not say a word about smugglers can say the same,” she added.
She offered a staunch defense of the country’s coastguard, which came under considerable scrutiny from Italy’s left-wing press in the aftermath of the migrant boat tragedy in the Ionian Sea, which cost several dozen lives.
The Italian premier expressed her amazement that “for political ends, we end up questioning the honor and the work of people who risk their lives every day to save human lives and the honor of Italy.”
On the wider migratory issue gripping the nation, Meloni highlighted that “for several months we have been witnessing a migratory pressure that has few precedents toward Europe and Italy,” and despite calls from humanitarian lobbyists and political opponents, she “has no intention of bowing to the many powerful pressures of those who would like a vision without national borders.”
She reiterated her desire to “firmly combat illegal traffickers and manage immigration in a regular way” through government decree and subsequent legislation. However, she warned that Italy cannot be expected to handle the crisis alone and called for “a framework of responsibility that must also involve the other European states.”
The conservative administration in Rome has been busy tackling the issue facing Italy and wider Europe since its electoral success in September, with Meloni recently introducing legislation to pass tougher sentences on convicted people smugglers. Those found guilty of the offense could soon face up to 30 years in prison should their negligent actions or failure to act result in the death of vulnerable migrants.
Meloni also issued several government decrees that she aims to pass to stifle the operations of humanitarian search-and-rescue vessels operating in the Mediterranean. The decrees, which have caused outrage among the Italian left and European NGOs, call on vessels operating in the area to return to land immediately after a rescue, rather than remaining at sea and effectively becoming a magnet for other prospective migrants encouraged to attempt the perilous journey.
The report accused NGOs of providing “a logistical advantage for the criminal organizations that manage migrant trafficking, allowing them to adapt their modus operandi according to the possibility of reducing the quality of the vessels used, correspondingly increasing illicit profits, and exposing the people on board to a more concrete risk of shipwreck.”
END
SWITZERLAND/CREDIT SUISSE
Credit Suisse deposit runs continue unabated. No doubt release of news of foreign banks (and no doubt Credit Suisse is one of them) have a total of 39 trillion dollars of debt off- balance sheet. Please note that this is off -balance sheet debt and not off -balance derivatives. The total of all derivatives is probably around 2.4 quadrillion but who is counting.
(zerohedge)
“What Else Can It Do?”: Credit Suisse Deposit Run Continues Despite SNB Rescue
FRIDAY, MAR 17, 2023 – 10:30 AM
We knew this was the endgame more than two weeks ago when we reported that “Credit Suisse Crashes To All Time Low After Boosting Deposit Rates To Reverse Bank Run” in which we reported that after a quarter of “staggering” bank runs, the second largest Swiss bank – clearly panicking – was offering a 6.5% annual rate on new three-month deposits of $5 million or above – and a rate as high as 7% for one-year deposits – far above matched maturity Bills, and suggesting that to attract a client, the bank is forced to eat a loss.
The hope, we explained, “was that after it attracts enough new clients, the bank will then be able to quietly lower the rates and make the new accounts profitable, however as the various DeFi blow ups of 2022 showed, it never quite works out that way.”
This time was no different, and as the bank run accelerated, the Swiss bank ended up getting an interim $50 billion rescue funding from the SNB – and it will get much more before it’s all said and done. To underscore this point, two days ago – in our post summarizing the SNB bailout – we said that “this is a last-ditch liquidity infusion, and all it does is prevent forced asset liquidations (a la SVB). Meanwhile it does nothing to halt the depositor flight because once confidence is gone, it rarely returns.“
Again we were right, and one day after the failed bailout attempt, Bloomberg writes that while the $54 billion lifeline won by Credit Suisse on Thursday gives it a fighting chance to rebuild its business, “some clients aren’t waiting around to find out how that goes.” To wit:
In Asia, several ultra-wealthy clients continued to cut back their exposure amid the tumult this week.
In the Middle East, some customers asked the bank to convert cash deposits into treasury bills and bonds.
An executive at a rival European bank said they’re seeing some deposits shifting from Credit Suisse, although the amount isn’t yet sizable.
Such attrition, Bloomberg notes redundantly, “will make the overhaul that Chief Executive Officer Ulrich Koerner and his team are overseeing that much harder.” Because, at its heart, a successful bailout of Credit Suisse means halting the record historic run. Recall, the bank saw net outflows hit 110.5 billion francs ($119 billion) in the fourth quarter…
… and despite this week’s rescue, the bank run is once again picking up, setting up the bank for another bailout because unless the SNB and the Swiss government want a historic bank implosion on their hands, they now have no choice but to keep throwing good money after bad.
For the CEO, hope still lives: “We want to get back all what we lost,” Koerner said at an investor conference on Tuesday. “And once we are there, we go beyond and grow the business again.”
The problem is getting “there.” And while the bank has consistently said it has sufficient liquidity, “it isn’t yet clear what the overall flows are or whether the backstop is helping attract clients back.” Actually, it’s clear it is not, which begs the question: if an SNB rescue isn’t enough, what else can the bank do to restore confidence?
Not much: bankers are calling round clients to reassure them, primed with talking points sent out by executives or communicated at town halls. The lender is offering deposit rates that are significantly higher than rivals to win back funds, and even that is not working.
And as Bloomberg reports today, “some ultra-wealthy families booking out of Asia accelerated their retreat from the Swiss bank this week, according to three large single family offices that collectively manage billions and multiple private bankers based across Hong Kong and Singapore.”
One family office in the region is planning to cut back as much as 30% of its money parked with the embattled bank after the wealth manager was unable to assure it that non-Swiss clients would be protected in the event of a collapse, Bloomberg reports citing an unnamed person.
Some clients in the Middle East asked the bank to convert their cash deposits into fixed income securities, giving them more comfort to keep money with the firm, according to another person familiar with the matter. In Germany, a wealth manager received inquiries from Credit Suisse clients looking to shift deposits to his firm
To be sure, some clients are still optimistic:
Others are less concerned, with one adviser to several trusts saying he’s recommended they keep their deposits at Credit Suisse even though they far exceed the amounts covered by the country’s deposit insurance. He said he’s convinced there’s no risk because the Swiss government will never let the firm fail.
Then again, SVB’s corporate clients were also optimistic the bank would never fail…. until it did.
The bottom line for CS: “outflows haven’t reversed as of this month, though they have stabilized at much lower levels, according to the bank’s annual report released Tuesday, the same day Koerner said on Bloomberg Television that the bank had seen inflows on Monday.”
A day later, his bank’s shares plunged after its biggest shareholder ruled out adding to its stake, unnerving investors already on edge after three regional US banks failed in a span of days. It’s not like the bank won’t lie to restore confidence. Last month Reuters reported that Switzerland’s financial regulator is reviewing comments by Credit Suisse Chairman Axel Lehmann made in December on outflows from the company having “stabilized”, on the basis that they may have been misleading. In other words, the bank’s highest official was lying on the record, just to slow down the bank run.
The support of Credit Suisse’s counterparties will also be critical, and here too cracks are emerging: the biggest banks in the US have been paring down their direct exposure to Credit Suisse for months as it stumbled from one crisis to the next. Firms including JPMorgan, Bank of America and Citigroup have told regulators their exposures are now minimal. And then, earlier this week, Paris-based BNP Paribas also moved to trim its exposure telling clients that it will no longer accept so-called novations where BNP is asked to step in on derivatives contracts where Credit Suisse is a counterparty, Bloomberg reported.
And with every passing day, doubts grow. JPMorgan. analyst Kian Abouhossein wrote in a note (available to pro subscribers) that the “status quo is no longer an option,” laying out three possible scenarios for Credit Suisse and saying that a takeover is the most likely. However, shortly after Bloomberg reported that “both lenders are opposed to a forced combination.”
Any such move could be followed by a listing or spinoff of the Swiss unit. Other possibilities mooted in the note included the Swiss National Bank stepping in with a full deposit guarantee or Credit Suisse’s entire investment bank being shuttered.
While executives insist such drastic solutions aren’t needed now the backstop is in place, they are dead wrong since the deposit run is once again picking up. Meanwhile, the bank is claiming that its strategic revamp announced in October remains the core plan to turn around the bank, they say, with the bank’s offer to buy back debt underlining its core strength.
“We see it as preventive liquidity so that we can carry out the transformation of Credit Suisse and continue to work well in this turbulent situation,” Swiss bank head Andre Helfenstein said in an interview with national broadcaster SRF on Thursday.
It adds up to a finely balanced situation. With camera crews gathering Thursday outside of Credit Suisse’s stone-clad headquarters on Zurich’s moneyed Paradeplatz, CEO Koerner urged staff to stay focused.
“Effective communication is key to ensure that our clients and external stakeholders understand the strengths of the bank, our strategy and the accelerated progress we are making to create the new Credit Suisse,” he said in a memo.
So far the only thing the bank has communicated clearly is that it has no clear vision of how it will emerge from the current crisis while preserving depositor confidence.
end
This is a killer blow: multiple banks curb trading with Credit Suisse //deposit runs continue despite SNB rescue
(zerohedge)
Multiple Banks Curb Trading With Credit Suisse As Deposit Run Continues Despite SNB Rescue
FRIDAY, MAR 17, 2023 – 01:51 PM
Update (1345ET): At least four major banks including Societe Generale and Deutsche Bank have placed restrictions on their trades involving Credit Suisse or its securities, Reuters reports, citing five unidentified people with direct knowledge of the matter.
Another source at a major global bank, who deals directly with Credit Suisse in Asia, said their bank had started asking the Swiss lender to gross settle, a trading scenario where the counterparty demands upfront payment from Credit Suisse instead of collecting later any money the Swiss lender might owe them as a result of the trade.
Another global bank has reduced its unsecured exposure to Credit Suisse, which includes all lending with no collateral, according to a person with knowledge of the matter. The bank is still providing repurchase agreements, which is secured lending.
This likely explains why the classic counterparty-risk hedge (1Y CDS) has barely budged despite the $50 billion liquidity injection from the SNB…
Credit Suisse ADRs are tumbling in the US market (EU closed), down 10% and back near record lows…
* * *
As we detailed earlier, we knew this was the endgame more than two weeks ago when we reported that “Credit Suisse Crashes To All Time Low After Boosting Deposit Rates To Reverse Bank Run” in which we reported that after a quarter of “staggering” bank runs, the second largest Swiss bank – clearly panicking – was offering a 6.5% annual rate on new three-month deposits of $5 million or above – and a rate as high as 7% for one-year deposits – far above matched maturity Bills, and suggesting that to attract a client, the bank is forced to eat a loss.
The hope, we explained, “was that after it attracts enough new clients, the bank will then be able to quietly lower the rates and make the new accounts profitable, however as the various DeFi blow ups of 2022 showed, it never quite works out that way.”
This time was no different, and as the bank run accelerated, the Swiss bank ended up getting an (interim) $50 billion rescue financing from the SNB to cover the most recent deposit run, and it will get much more before it’s all said and done. To underscore this point, two days ago – in our post summarizing the SNB bailout – we said that “this is a last-ditch liquidity infusion, and all it does is prevent forced asset liquidations (a la SVB). Meanwhile it does nothing to halt the depositor flight because once confidence is gone, it rarely returns.“
Again we were right, and one day after the failed bailout attempt, Bloomberg writes that while the $54 billion lifeline won by Credit Suisse on Thursday gives it a fighting chance to rebuild its business, “some clients aren’t waiting around to find out how that goes.” To wit:
In Asia, several ultra-wealthy clients continued to cut back their exposure amid the tumult this week.
In the Middle East, some customers asked the bank to convert cash deposits into treasury bills and bonds.
An executive at a rival European bank said they’re seeing some deposits shifting from Credit Suisse, although the amount isn’t yet sizable.
Such attrition, Bloomberg notes redundantly, “will make the overhaul that Chief Executive Officer Ulrich Koerner and his team are overseeing that much harder.” Because, at its heart, a successful bailout of Credit Suisse means halting the record historic run. Recall, the bank saw net outflows hit 110.5 billion francs ($119 billion) in the fourth quarter…
… and despite this week’s rescue, the bank run is once again picking up, setting up the bank for another bailout because unless the SNB and the Swiss government want a historic bank implosion on their hands, they now have no choice but to keep throwing good money after bad.
For the CEO, hope still lives: “We want to get back all what we lost,” Koerner said at an investor conference on Tuesday. “And once we are there, we go beyond and grow the business again.”
The problem is getting “there.” And while the bank has consistently said it has sufficient liquidity, “it isn’t yet clear what the overall flows are or whether the backstop is helping attract clients back.” Actually, it’s clear it is not, which begs the question: if an SNB rescue isn’t enough, what else can the bank do to restore confidence?
Not much: bankers are calling round clients to reassure them, primed with talking points sent out by executives or communicated at town halls. The lender is offering deposit rates that are significantly higher than rivals to win back funds, and even that is not working.
And as Bloomberg reports today, “some ultra-wealthy families booking out of Asia accelerated their retreat from the Swiss bank this week, according to three large single family offices that collectively manage billions and multiple private bankers based across Hong Kong and Singapore.”
One family office in the region is planning to cut back as much as 30% of its money parked with the embattled bank after the wealth manager was unable to assure it that non-Swiss clients would be protected in the event of a collapse, Bloomberg reports citing an unnamed person.
Some clients in the Middle East asked the bank to convert their cash deposits into fixed income securities, giving them more comfort to keep money with the firm, according to another person familiar with the matter. In Germany, a wealth manager received inquiries from Credit Suisse clients looking to shift deposits to his firm
To be sure, some clients are still optimistic:
Others are less concerned, with one adviser to several trusts saying he’s recommended they keep their deposits at Credit Suisse even though they far exceed the amounts covered by the country’s deposit insurance. He said he’s convinced there’s no risk because the Swiss government will never let the firm fail.
Then again, SVB’s corporate clients were also optimistic the bank would never fail…. until it did.
The bottom line for CS: “outflows haven’t reversed as of this month, though they have stabilized at much lower levels, according to the bank’s annual report released Tuesday, the same day Koerner said on Bloomberg Television that the bank had seen inflows on Monday.”
A day later, his bank’s shares plunged after its biggest shareholder ruled out adding to its stake, unnerving investors already on edge after three regional US banks failed in a span of days. It’s not like the bank won’t lie to restore confidence. Last month Reuters reported that Switzerland’s financial regulator is reviewing comments by Credit Suisse Chairman Axel Lehmann made in December on outflows from the company having “stabilized”, on the basis that they may have been misleading. In other words, the bank’s highest official was lying on the record, just to slow down the bank run.
The support of Credit Suisse’s counterparties will also be critical, and here too cracks are emerging: the biggest banks in the US have been paring down their direct exposure to Credit Suisse for months as it stumbled from one crisis to the next. Firms including JPMorgan, Bank of America and Citigroup have told regulators their exposures are now minimal. And then, earlier this week, Paris-based BNP Paribas also moved to trim its exposure telling clients that it will no longer accept so-called novations where BNP is asked to step in on derivatives contracts where Credit Suisse is a counterparty, Bloomberg reported.
And with every passing day, doubts grow. JPMorgan. analyst Kian Abouhossein wrote in a note (available to pro subscribers) that the “status quo is no longer an option,” laying out three possible scenarios for Credit Suisse and saying that a takeover is the most likely. However, shortly after Bloomberg reported that “both lenders are opposed to a forced combination.”
Any such move could be followed by a listing or spinoff of the Swiss unit. Other possibilities mooted in the note included the Swiss National Bank stepping in with a full deposit guarantee or Credit Suisse’s entire investment bank being shuttered.
While executives insist such drastic solutions aren’t needed now the backstop is in place, they are dead wrong since the deposit run is once again picking up. Meanwhile, the bank is claiming that its strategic revamp announced in October remains the core plan to turn around the bank, they say, with the bank’s offer to buy back debt underlining its core strength.
“We see it as preventive liquidity so that we can carry out the transformation of Credit Suisse and continue to work well in this turbulent situation,” Swiss bank head Andre Helfenstein said in an interview with national broadcaster SRF on Thursday.
It adds up to a finely balanced situation. With camera crews gathering Thursday outside of Credit Suisse’s stone-clad headquarters on Zurich’s moneyed Paradeplatz, CEO Koerner urged staff to stay focused.
“Effective communication is key to ensure that our clients and external stakeholders understand the strengths of the bank, our strategy and the accelerated progress we are making to create the new Credit Suisse,” he said in a memo.
So far the only thing the bank has communicated clearly is that it has no clear vision of how it will emerge from the current crisis while preserving depositor confidence.
END
COURTESY GOLDEN TELEGRAPH
THE RISE AND FALL OF CREDIT SUISSE
A good outline as to how Credit Suisse got into the mess that it is now in;
(and special thanks from Milan S for providing this to us:)
The Rise and Fall of Credit Suisse. Credit Suisse is crumbling. The Swiss banking system is feeling the heat. Top investors are unwilling to invest more. Welcome to 2023. Credit Suisse, recognized as the second-largest financial institution in Switzerland and the seventeenth-largest lender by assets in Europe, has recently caught the world’s attention. Over the past six months, the 166-year-old bank’s valuation has witnessed a staggering 65% decline, reaching an unprecedented low. Let’s dive in. Last October, the company announced a radical restructuring after cutting thousands of jobs, including shrinking its investment bank and raising $4 billion in capital from investors, including the Saudi National Bank, which would make them a 10% owner of the company and the largest shareholder. Coincidently, the Qatar Investment Authority became the second-largest shareholder in Credit Suisse. It is important to recall that Credit Suisse faced a substantial setback in 2021, incurring a loss of $5.5 billion due to its connection to the collapse of Archegos Capital Management. This single event led to the obliteration of five years’ worth of investment banking profits, highlighting its risk management practises’ total and complete failure. Earlier this week, the bank revealed that the unprecedented outflows of client funds in early October had not been recuperated as of this month but had stabilized at lower levels. Credit Suisse saw customer withdrawals of more than 110 billion Swiss francs in the fourth quarter. Additionally, the bank confirmed in its annual letter it had to utilize liquidity buffers to address the consequences of these withdrawals and acknowledged that these circumstances have exacerbated and may continue to exacerbate liquidity risks. Why did people begin to panic? On Tuesday, executives said the bank’s financial reporting was subject to material weaknesses in internal reporting processes for 2022 and 2021 after years of showcasing embarrassing risk management practices and empty promises. This is where things get turned up. The head of Saudi National Bank (the biggest shareholder) chose not to invest more in Credit Suisse due to regulations, sparking liquidity fears alongside European bank instability.
also reported that the bank’s second-largest shareholder, the Qatar Investment Authority declined to comment as the fear started to take flight. This prompted the US Treasury Department to say it was closely monitoring the Credit Suisse situation. Switzerland has a long-standing reputation for stability, neutrality, and a historical role as a tax haven since the mid-20th century, adding a layer of complexity to the matter. Naturally, the Swiss National Bank swooped in like a guardian angel waving a magic wand, eager to save the day for more bankers. What else would a central bank do but tenderly rescue a bumbling institution after a long, steady dance with recklessness? Credit Suisse said it would borrow up to 50 billion Swiss Francs ($53.7 billion) from the Swiss central bank. Yet another bailout. Incompetence bags a prize again. But what happens if this is not enough? In March 2022, the Swiss government indicated it wanted to set up a public liquidity backstop for banks to provide state-guaranteed cash should one of the country’s big banks fail. The proposed backstop would allow the Swiss National Bank to provide funds to any systemically important bank in the event of a failure in the form of a state-guaranteed loan. However, the Swiss central bank recorded a historic loss of 132.5 billion francs ($141.54 billion), echoing Credit Suisse’s reckless risk management skills over the years. The Fed and Swiss central bank’s support for financial institutions illustrates the flawed system of socialized losses and privatized profits in today’s version of capitalism. Expect more volatility and, sadly, more government support in the financial system.
Seymour Hersh is adamant: Biden attacked Nordstream one and two
Robert H comments on the zero hedge article:
Robert H;
“Every one who thinks, knows that Biden and the Neocons did this. To admit it means war. To deny means accusations that stick since denial and blame makes the fool more of a fool. Never own a mistake is a hallmark of politicos in DC. Meanwhile China wins big time as stepping into a hegemony void laid bare by incompetence. Even allies now know their own hegemony and independence is meaningless to the Neocons in control in DC. As Nuland said “fuck the EU”. Perhaps now there is awakening to the fact she meant what she said as Europe is expendable in pursuit of illusions of hegemony. War with Russia will reduce America to a cinder and no one winners will be had. Bet on China using American incompetence to advantage as even in the Middle East nations like Saudi Arabia know they are expendable pawns. And why they have turned away to seek independence and protection from China. Even Mexico no longer trusts DC. And is rumored to have applied formally for BRICS acceptance. “
(Watson/SummitNews)
“I’m Telling You, He Did It”: Seymour Hersh Blames Biden For Nord Stream Attack
Pulitzer Prize-winning journalist Seymour Hersh told the National Press Club in Washington, D.C. that Joe Biden made the decision to blow up Russia’s Nord Stream pipelines because he saw being a war president as giving him a better chance at re-election.
Last month, Hersh published a report asserting that the pipelines were destroyed by the US as part of a covert operation.
According to Hersh’s sources, the explosives were planted in June 2022 by US Navy divers under the guise of the BALTOPS 22 NATO exercise and were detonated three months later with a remote signal sent by a sonar buoy.
One source told Hersh that the plotters knew the covert operation was an “act of war,” with some in the CIA and State Department warning, “Don’t do this. It’s stupid and will be a political nightmare if it comes out.”
Last week, the New York Times reported that a “pro-Ukrainian group” had sabotaged the pipelines, using a team with as few as six people involved in the mission, contradicting previous assumptions that only a state would have had the resources to carry out the operation.
According to Hersh, referring to Biden, “He did it. He did it, I’m telling you, he did it,” adding, “The Biden game is to wait it out and never say yes.”
The journalist claimed that Biden wanted to escalate the conflict in order to position himself as a war president.
“I think Biden also saw beating up Russia as a ticket. Jack Kennedy is a classic example – presidents always did well politically in wars,” he said.
Hersh claimed that Biden made the decision in January 2022 to “see if we can find a way to blow… those pipelines, and put [the Russians] back in the dark ages.”
The Pulitzer-Prize winner went on to savage the legacy media for completely failing to follow up on his report that the U.S. was responsible for the attack, which took out three of the four pipelines.
Meanwhile, China has reacted with skepticism towards the explanation that a pro-Ukrainian group was responsible for the blasts.
During a press briefing, Foreign Ministry spokesman Wang Wenbin called for “an objective, impartial and professional investigation” into the bombing.
“We have noted that some Western media have been mysteriously quiet after Hersh reported that the US was behind the Nord Stream blast. But now these media are unusually simultaneous in making their voice heard. How would the US account for such abnormality? Is there anything hidden behind the scene?” Wang asked.
New reports also reveal that a German spy ship was in the area where the attack occurred at the time of the blasts on September 26.
According to a report by German magazine Der Spiegel, the CIA warned Berlin about a potential attack on gas pipelines in the Baltic Sea weeks before it happened.
As we highlighted yesterday, Russian President Vladimir Putin branded claims that the Nord Stream pipeline attack was the work of pro-Ukrainian activists “nonsense,” arguing the blasts must have been carried out by a state power.
end
SYRIA/RUSSIA/MEDITERANEAN
Syria
to
Assad was in Moscow stressing importance and value. As Syria now gains acceptance from Saudi Arabia and support of Iran and China it becomes a western flank preserve of Russia who can use the airbase and naval base there to act as western flank protection in a open outbreak of hostilities with NATO and America. Logically, if they place their latest hypersonic missiles there the entire Mediterranean will be within their reach making it unsafe for surface vessels. And in a way Syria becomes the western tip of the spear to protect both Iran and Saudi Arabia from western retaliation as they go over to the BRICS in the future. And if rumors of Chinese missile placements take place in other locations further back there will be a new defense line against the West. Thus making it impossible for any aspirations of Sea Power. The reality is that Sea Power for America is on the wane with the avant of hypersonic missiles and bases outside of one’s own land mass. It is why the Chinese have been aggressive in seizing or building new islands at a distance from China itself because these will be their forward hypersonic missile launch sites to protect and exclude intrusions. Freedom of navigation is an illusion. And carrier fleets are becoming obsolete.
end
TURKEY/FINLAND//NATO
Turkey expected to ratify Finland’s NATO membership
(zerohedge)
Turkey Expected To Ratify Finland’s NATO Membership After Friday Summit
FRIDAY, MAR 17, 2023 – 02:45 AM
Despite suspending negotiations with Sweden, Turkey now says it is ready to approve Finland’s bid to join NATO, an approval likely to be formally announced Friday when Finnish President Sauli Niinisto travels to Istanbul to meet with President Recep Tayyip Erdogan.
On Wednesday Erdogan had responded positively to reporters’ questions over whether Turkish parliament stands ready to ratify Finland’s membership after the Niinisto meeting. Erdogan responded: “God willing, if it is for the best.” He also mentioned keeping “our promise”.
“Whatever the process is, the process will function. We will do our part. We will keep our promise. We will meet with the president on Friday and fulfill the promise we made,” Erdogan said.
Perhaps more interesting was the Kremlin’s somewhat softer than expected reaction (given the clear behind-the-scenes positive relations and cooperation between Moscow and Ankara despite the Ukraine war), which said Thursday that Russia is not a threat to Finland.
Kremlin spokesman Dmitry Peskov sought to stress, “We have many times expressed regret over Finland and Sweden’s move toward membership and said many times that Russia does not pose a threat to these countries.”
“We do not have any dispute with these countries… They have never posed any threat to us and, logically, we did not threaten them,” Peskov added.
Finland meanwhile is building a 200km fence along its border with Russia to boost security, also after reporting that Russian men fled into Sweden by the droves in order to escape conscription. The fence will reportedly be 10 feet high and topped with barbed wire.
Sweden’s membership bid is expected to continue to stall, after deteriorating relations with Turkey in the wake of the Quran-burning incident by a far-right activist. Turkey has also demanded Swedish authorities crackdown on Kurdish political groups and operatives while alleging that Stockholm has hosted “terrorists” on its soil.
ISRAEL/
Israel’s relationship with the uSA at an all time low equal to the Carter administration. Netanyahu forbids ministers from meeting USA officials in Washington until he is invited first
(zerohedge)
Netanyahu Forbids Ministers From Meeting US Officials Until Biden Invites Him To DC: Report
Israel’s Prime Minister Benjamin Netanyahu reportedly ordered high-ranking officials and ministers of his coalition government to avoid meeting with US officials in Washington until he receives an invitation to meet with President Joe Biden.
According to an anonymous source who spoke with Israel’s Channel 12, Netanyahu told members of his cabinet, “As long as I don’t visit there [US], nobody does.”
The report further added that Netanyahu has been angry over the fact that since assuming the role of prime minister, he has not been invited to Washington on behalf of the US president. Reports have indicated that initial talks regarding an invitation for the Israeli prime minister to the US haven’t even been discussed.
According to a Reuters review of official visits dating back to the 1970’s, most new Israeli leaders visited the US or met the president by this point in their premierships – and only two out of 13 previous prime ministers heading a new government waited longer.
Over the past few months, several US officials and US-based Jewish groups have criticized Israel’s new far-right government for its brutal suppression of Palestinians and increased settlement expansion into Palestinian territories. Both have heavily denounced Netanyahu’s controversial judicial overhaul, which seeks to limit the power of Israel’s judiciary and Israel’s ‘democracy.’
Earlier this month, the US State Department considered denying Israeli Finance Minister Bezalel Smotrich a visa ahead of his expected visit to the US for encouraging Tel Aviv to “wipe out” the Palestinian town of Huwara. However, last Friday the US administration granted Smotrich a visa, neglecting domestic and international condemnations.
US State Department spokesperson Ned Price also previously condemned Smotrich’s remarks on the recent rampage by Israeli settlers on the Palestinian town of Huwara, calling them “irresponsible, disgusting, and repugnant.”
Left-wing Zionist organizations have typically supported a more gradual expropriation of Palestinian lands, seeing this as a more effective strategy for realizing the Zionist project, as opposed to the abrupt and violent mass displacement of Palestinians advocated by right-wing and revisionist Zionist groups, as represented by Netanyahu and Smotrich.
safety profile”; CDC & FDA pushing vaccine in little kids, meanwhile, the studies of the mRNA vaccine & after 7 months falls to below 0, it is negative, it means people taking shot will get infected
Did Malone do this when he invented mRNA technology & why did he not warn us? Why has he been silent on this fact? What did his research show or did he study this harmful effect? what harms did he study?
As an investigative reporter scientist, this study raises devastating issues for it means in essence that they all lied, CDC, FDA, all of them and this is far riskier to humans than we were led to believe. I want answers for the US population. What else, what OTHER poison pills reside in this mRNA technology?
This reverse transcription was near immediate, 6 hours. Can Dr. Malone help us here with this one. We still await the response to the lies by CDC about vaccine staying at the injection site and being dissolved near immediate coming out in waste. What did Malone know and when? That information would have helped inform the vaccine taking public who took it and are now harmed. Our police, our military etc. Our children.
You would have thought that the pink puff media that runs around with the Freedom fighter group would ask these questions. Proper questions. No. So alas, I await. We wait.
“Our results indicate a fast up-take of BNT162b2 into human liver cell line Huh7, leading to changes in LINE-1 expression and distribution. We also show that BNT162b2 mRNA is reverse transcribed intracellularly into DNA in as fast as 6 hrs upon BNT162b2 exposure.”
124 after dose 2; 86.9% were hospitalized; ‘in boys with prior infection and no comorbidities, even one dose carried more risk than benefit according to international estimates’
Via the Vaccine Adverse Event Reporting System (VAERS), researchers identified Pfizer-BioNTech myocarditis/pericarditis occurrence according to CDC criteria in 12-17 year olds.
Researchers reported: ‘risk-benefit analysis suggests that among 12–17-year-olds, two-dose vaccination was uniformly favourable only in nonimmune girls with a comorbidity. In boys with prior infection and no comorbidities, even one dose carried more risk than benefit according to international estimates’
‘Cases of myo/pericarditis (n = 253) included 129 after dose 1 and 124 after dose 2; 86.9% were hospitalized. Incidence per million after dose two in male patients aged 12–15 and 16–17 was 162.2 and 93.0, respectively. Weighing post-vaccination myo/pericarditis against COVID-19 hospitalization during delta, our risk-benefit analysis suggests that among 12–17-year-olds, two-dose vaccination was uniformly favourable only in nonimmune girls with a comorbidity. In boys with prior infection and no comorbidities, even one dose carried more risk than benefit according to international estimates.’
Project Veritas released internal Pfizer confidential documents which detail Myocarditis/Pericarditis after mRNA vaccination. They admit it happens, mostly in young males 12 through 17, after the 2nd shot – this also happens to be the group with the least risk from the virus. The Pfizer documents are from February 2022 but with data from patients in early 2021.
“There is evidence that suggests patients who receive a COVID-19 vaccine are at an increased risk of myocarditis.”
“Onset was typically within several days after mRNA COVID-19 vaccination (from Pfizer or Moderna), and cases have occurred more often after the second dose than the first dose.” [PAGE 19]
“The reasons for male predominance in myocarditis and pericarditis incidence post COVID-19 vaccination remain unknown.” [PAGE 28]
“The pattern of cases conform, as per the label, to a pattern of myocarditis cases occurring in majority of young males below 29 years of age within the first two weeks postvaccination…” [PAGE 19]
“Since April 2021, increased cases of myocarditis and pericarditis have been reported in the United States after mRNA COVID-19 vaccination (Pfizer-BioNTech and Moderna), particularly in adolescents and young adults (CDC 2021).” [PAGE 18]
“Myocarditis events were defined as encounters with a billing or encounter diagnosis consistent with an ICD10-CM or SNOMED CT code for myocarditis which fell within two weeks of receiving dose 1, 2, or 3 of the Pfizer COVID-19 vaccine.”
“Incidence rates of myocarditis were measured for each vaccine dose with denominator signifying the total number of patients receiving that dose and numerator signifying the total number of patients meeting the above criteria for an encounter for myocarditis following that dose.”
Do you really think they didn’t know about this in the trials?
VACCINE IMPACT/
FDA Continues Infanticide-by-Vaccine Program Giving Emergency Use Authorization for 4th COVID “Vaccine” for Babies and Toddlers Under Age 5
March 16, 2023 3:32 pm
With the financial system on the brink of collapse and the war in Ukraine intensifying and capturing the public’s attention this week, the FDA quietly gave a new emergency use authorization (EUA) for a 4th COVID “vaccine” booster for babies and toddlers under the age of 5. With the EUA COVID shots now being added to the CDC Childhood Vaccination Schedule, a baby born in the United States can now have 42 doses of vaccines injected into them before the age of 5. And if a child misses a few vaccines, or misses their “well-child” appointment with their pediatrician, no problem! As you can see from the image at the top of this article, pediatricians are trained to inject multiple doses into babies and toddlers during a single office visit, even though there are ZERO studies on the effects of injecting multiple doses of vaccines at the same time into babies and toddlers. If the baby or toddler dies after these injections, it will be classified as “SIDS”, sudden infant death syndrome. This is infanticide-by-vaccines, and a way of reducing the population, and it is already happening. Here are a couple of records from the U.S. Government’s own VAERS (Vaccine Adverse Events Reporting System) database where young children were injected with the EUA COVID shots together with other vaccines, and the child died. In the first case, a 6-month-old baby boy from Iowa was injected with 7 doses of vaccines (COVID + DTAP + HEPB + IPV + FLU + PNEUMO + ROTAVIRUS), and then died 10 days later.
COVID-19 Drug Remdesivir Estimated to have Killed 100,000 Americans
March 16, 2023 7:14 pm
John Beaudoin is calling for a criminal investigation into remdesivir citing data that it may have killed 100,000 people in America. The US Food and Drug Administration (“FDA”) authorised the experimental antiviral drug remdesivir, brand name Veklury, for emergency use against covid-19 in May 2020. By October 2020, it had received full approval. It remains a primary treatment for covid-19 in hospitals, despite research showing it lacks effectiveness and can cause high rates of organ failure. In mid-February, Beaudoin called for a criminal investigation into the drug, citing data for Massachusetts he estimates remdesivir may have killed 100,000 people in the US. “They know,” he tweeted, “or they wilfully refuse to know. Either way, it’s homicide.”
The USA/Yuan, CNY: closed ON SHORE (CLOSED UP ..(6.8887)
THE USA/YUAN OFFSHORE: (YUAN CLOSED (UP)…. 6.8906
TURKISH LIRA: 19.01 EXTREMELY DANGEROUS LEVEL/DEATH WISH/HYPERINFLATION TO BEGIN.
the 10 yr Japanese bond yield at +0.247…VERY DANGEROUS
Your closing 10 yr US bond yield DOWN 19 IN basis points from THURSDAY at 3.395% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic
USA 30 yr bond yield 3.591 DOWN 12 in basis points
USA 2 yr bond yield: 3,9438 DOWN 19 basis points
Your closing USA dollar index, 103.74 DOWN 36 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 FRIDAY: 12:00 PM
London: CLOSED DOWN 74.63 PTS OR 1.01%
German Dax : CLOSED DOWN 198.90POINTS OR 1.33%
Paris CAC CLOSED DOWN 100.32PTS OR 1.43%
Spain IBEX DOWN 170.90 POINTS OR 1.92%
Italian MIB: CLOSED DOWN 424.22 PTS OR 1.64%
WTI Oil price 65.91 12: EST
Brent Oil: 72.10 12:00 EST
USA /RUSSIAN /// DOWN TO: 77.07/ ROUBLE DOWN 0 AND 66/100 RUBLES/DOLLAR
GERMAN 10 YR BOND YIELD; +2.069
UK 10 YR YIELD: 3.250 DOWN 18 BASIS PTS
CLOSING NUMBERS: 4 PM
Euro vs USA: 1.0672 UP 0.0058 OR 58 BASIS POINTS
British Pound: 1.2184 UP .0075 or 75 basis pts
BRITISH 10 YR GILT BOND YIELD: 3.3055% DOWN 13 BASIS PTS
USA dollar vs Japanese Yen: 131.80 DOWN 1.566////YEN UP 157 BASIS PTS//
USA dollar vs Canadian dollar: 1.3724 DOWN .0004 (CDN dollar, UP 4 basis pts)
West Texas intermediate oil: 66.23
Brent OIL: 72.35
USA 10 yr bond yield DOWN 19 BASIS pts to 3.391%
USA 30 yr bond yield DOWN 12 BASIS PTS to 3.596%
USA 2 YR BOND: DOWN 35 PTS AT 3.8145%
USA dollar index: 103.44 DOWN 65 BASIS POINTS
USA DOLLAR VS TURKISH LIRA: 19.01
USA DOLLAR VS RUSSIA//// ROUBLE: 77.06 DOWN 0 AND 66/100 roubles
DOW JONES INDUSTRIAL AVERAGE: DOWN 384,57 PTS OR 1.19%
NASDAQ 100 DOWN 86.76 PTS OR 0.74%
VOLATILITY INDEX: 25,91 UP 2.52 PTS (10.96)%
GLD: $183.77 UP 5.20 OR 2.91%
SLV/ $20.63 UP 0.71 OR 3.56%
end)
1 a)USA TRADING TODAY IN GRAPH FORM
Bonds, Bitcoin, & Bullion Soar As Global Bailouts Fail To Stem Bank-Runs
Credit Suisse counterparty risk exploded and is completely ignoring the SNB bailout…
Source: Bloomberg
Still not worried, then how’s this – USA sovereign risk just hit a new record high…
Source: Bloomberg
Simply put: Shit’s breaking …and here is every policymaker everywhere all at once…
…and where do we end up.
US regional banks are down hard-er (as Fed transparency of the massive borrowings last week from their bailout facilities definitely spooked more than a few US investors)…
Source: Bloomberg
European bank stocks collapsed, erasing YTD gains and banking sector credit risk soared to 5-month highs…
Source: Bloomberg
And CS stock price continues to tank to record-er lows…
And First Republic Bank tumbled back down to recent lows, despite billions in handouts from the big banks…
All things considered – the committee to save the world has failed for now as safe-haven flows flooded bonds, bitcoin, and bullion…
A mixed picture for stocks on the week withe Nasdaq the big outperformer while Small Caps were weakest. The Dow ended the week in red and the S&P slipped lower today but ended green…
That huge outperformance of mega-cap tech over small caps is practically unprecedented. As Goldman notes,
1/ over the last 10 sessions, the gs basket of mega cap tech stocks is up 6.2%
2/ over the last 10 sessions, the russell 2000 is down 9.8%
3/ this 16% spread is the second highest of all time (one data point in Mar2020)…
…there has been a clear shift to tech stocks, and an even more clear shift to the ultra high market capitalization names
The S&P was unable to hold above its 200DMA…
Energy and Financials were the week’s ugliest horses in the glue factory while Technology (and Utilities!?) were the biggest gainers…
Source: Bloomberg
Office REITS were monkeyhammered this week…
Source: Bloomberg
VIX has broken up into a new higher-vol regime for now…
All Treasury yields were lower on the week with the short-end massively outperforming…
Source: Bloomberg
The last 7 days in 2Y UST yields (these are just the close-to-close moves) have been unbelievable (and ended below 4.00%): -20bps, -28bps, -61bps, +27bps, -36bps, +27bps, and -30bps
Source: Bloomberg
The UST yield curve steepened dramatically this week, bringing the case for recession even more imminent…
Source: Bloomberg
European sovereign yields plunged this week too…
Source: Bloomberg
The dollar ended the week lower, after a roller-coaster midweek…
Source: Bloomberg
Crypto had a big week as QE is back on the table with Bitcoin dramatically outperforming…
Source: Bloomberg
Bitcoin topped $27,000 today for the first time since June 2022…
Source: Bloomberg
Gold soared this week, back above $1950, to its highest since April 2022…
Silver outperformed Gold on the week but crude, copper, and NatGas all tumbled…
Source: Bloomberg
WTI puked to a $65 handle – its lowest since Jan 2022…
Finally, rate-change expectations have swung violently dovishly and hawkishly all week, but all dramatically more dovish than before SVB’s failure…
Source: Bloomberg
What difference a week makes…
Source: Bloomberg
The terminal rate now appears to be in May (just one rate-hike) and by year-end, rates are expected to be 76bps lower (i.e. more than 4x25bps rate-cuts after May).
The market wants moar free money…
It would appear, if Powell is watching the market, that he is done for now (and that explains why bitcoin and gold are soaring).
i b Morning trading:
Early morning trading:
II) USA DATA
UMich inflation expectations drop to two year lows and overall sentiment weakens
(zerohedge)
UMich Inflation Expectations Drop To 2-Year-Lows, Overall Sentiment Weakens In March
FRIDAY, MAR 17, 2023 – 10:07 AM
The most important aspect of the UMIch sentiment survey continues to be ‘inflation expectations’ which slid further to 3.8% in the next 12 months (lowest since April 2021) and 2.8% for 5-10Y inflation exp…
Source: Bloomberg
However, UMich notes that with ongoing turbulence in the financial sector and uncertainty over the Fed’s possible policy response, inflation expectations are likely to be volatile in the months ahead.
The overall headline sentiment dropped more than expected – down for the first time in four months
Source: Bloomberg
Sentiment declines were concentrated among lower-income, less-educated, and younger consumers, as well as consumers with the top tercile of stock holdings.
Overall, all components of the index worsened relatively evenly, primarily on the basis of persistently high prices, creating downward momentum for sentiment leading into the financial turmoil that began last week.
Buying Conditions also slipped in preliminary March data…
Source: Bloomberg
Finally, UMich notes that this month’s decrease was already fully realized prior to the failure of Silicon Valley Bank, at which time about 85% of our interviews for this preliminary release had been completed.
END
USA industrial production shrinks in February
(zerohedge)
US Industrial Production Shrinks In Feb – First YoY Drop In 2 Years
FRIDAY, MAR 17, 2023 – 09:24 AM
US Industrial Production is down 0.25% YoY in February – its first YoY drop since Feb 2021…
Source: Bloomberg
Additionally, Manufacturing output rose 0.1% MoM (better than the 0.3% drop expected, but offset by the upward revision from 1.0% to 1.3% MoM in January). That left Manufacturing output down 1.0% YoY…
Source: Bloomberg
Overall Capacity Utilization remains subdued…
Source: Bloomberg
It looks like the ‘long and variable lags’ of monetary policy are starting to hit…
END
USA leading economic indicators tumble for 11th straight month: depression imminent
(zerohedge)
US Leading Economic Indicators Tumble For 11th Straight Month, Signal Recession Imminent
FRIDAY, MAR 17, 2023 – 10:50 AM
The Conference Board’s Leading Economic Indicators (LEI) continued its decline in February, dropping 0.3% MoM (vs -0.3% exp).
The biggest positive contributor to the leading index was building permits at +0.39
The biggest negative contributor was average consumer expectations at -0.24
This is the 11th straight monthly decline in the LEI (and 12th month of 14) – the longest streak of declines since ‘Lehman’ (22 straight months of declines from June 2007 to April 2008)
“The LEI for the US fell again in February, marking its eleventh consecutive monthly decline,” said Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board.
“Negative or flat contributions from eight of the index’s ten components more than offset improving stock prices and a better-than-expected reading for residential building permits.
While the rate of month-over-month declines in the LEI have moderated in recent months, the leading economic index still points to risk of recession in the US economy.
The most recent financial turmoil in the US banking sector is not reflected in the LEI data but could have a negative impact on the outlook if it persists.
Overall, The Conference Board forecasts rising interest rates paired with declining consumer spending will most likely push the US economy into recession in the near term.”
Despite ‘soft landing’ hype, the LEI is showing no signs at all of ‘recovering’, hitting its lowest since Jan 2021…
And on a year-over-year basis, the LEI is down 6.60% (worse than the 6.03% YoY in January) – but still close to its biggest YoY drop since 2008 (Lehman) outside of the COVID lockdown-enforced collapse…
Not a good sign for GDP.
The trajectory of the US LEI continues to signal a recession over the next 12 months
Is this the cleanest view of The Fed’s tightening impact on the US economy?
iii) USA ECONOMIC NEWS//
Regional banks falling this morning as Ackman correctly warns of a false sense of confidence.
Credit Suisse falls to new all time lows:
Deposit-Based Bailout Is “Bad Policy” – Regional Banks Continue Slump After Ackman Warns Of “False Sense Of Confidence”
FRIDAY, MAR 17, 2023 – 08:38 AM
For a few brief hours yesterday, some market participants breathed a sigh of relief as the ‘big banks’ threw $30 billion of deposits to the ‘small banks’ (specifically First Republic Bank) and saved the world.
This morning, despite a surprise RRR cut from the Chinese, reality is setting in with FRC -20%, PacWest -10% and the rest of the sector sliding fast…
Goldman notes that retail is starting to participate in this: Obviously a massive uptick in volumes across the regional banks… but it’s also become a retail hunting ground this past week. FRC topped the “most actively traded names” on Fidelity today. Are these the new AMCs and GMEs?
The problem, that Pershing Square’s Bill Ackman highlighted in a tweet is simple: “spreading the risk of financial contagion to achieve “a false sense of confidence” in First Republic Bank is “bad policy”.
He has a point – if this ‘plan’ was working’ why are all the regional banks still down so hard post-SVB?
The $30 billion deposit infusion by the ‘big banks’ “raises more questions that it answers” he explained, adding that “I have said before that hours matter. We have allowed days to go by. Half measures don’t work when there is a crisis of confidence.”
While he claims he has no direct investment ‘skin in this game’ in the banking sector, he would clearly – like many of us, prefer the world didn’t implode:
“I am simply extremely concerned about financial contagion risk spiraling out of control and causing severe economic damage and hardship,” he said.
@SecYellen has apparently pushed the SIBs to recycle some of the deposits they received from @firstrepublic back into FRB for 120 days. The result is that FRB default risk is now being spread to our largest banks.
Spreading the risk of financial contagion to achieve a false sense of confidence in FRB is bad policy. The SIBs would never have made this low return investment in deposits unless they were pressured to do so and without assurances that FRB deposits would be backstopped if it failed.
The market has responded to this fictional vote of confidence with a 35% after-market decline in FRB stock.
FRB is no SVB. It is a well-managed, well-capitalized, high-service bank with good assets that is beloved by its clients. It is caught up in a bank run due to no fault of its own. It does not deserve to fail.
We need a temporary systemwide deposit guarantee immediately until expanded and modernized @FDICgov insurance system is made widely available.
The press release announcing the $30B of deposits raised more questions than it answers. Lack of transparency causes market participants to assume the worst.
I have said before that hours matter. We have allowed days to go by. Half measures don’t work when there is a crisis of confidence.
Again, I have no investments long or short in the banking sector. I am simply extremely concerned about financial contagion risk spiraling out of control and causing severe economic damage and hardship.
We need to stop this now. We are beyond the point where the private sector can solve the problem and are in the hands of our government and regulators. Tick-tock.
One thing is for sure – this is far from over as Credit Suisse – a real SIFI and something everyone should be worried about – is tanking to fresh lows this morning despite over $50bn from the SNB.
Bonds. Bitcoin, and Bullion are seeing safe-haven bids.
As Deutsche Bank notes, the spillover from financial contagion fears is dramatic to say the least: “Only four times in the last 40 years have we seen movements in the bond market like we did this week”
“We’re gonna need a bigger boat!”
end
Very important; Peter explains perfectly why the new facility BTLP is not being used and only the DISCOUNT WINDOW
(Peter Tchir)
Fed Balance Sheet, Deposits, Hotel California & TINA
FRIDAY, MAR 17, 2023 – 09:36 AM
By Peter Tchir of Academy Securities
This is, broadly speaking, a follow-up to yesterday’s Liquency & Solvidity piece, where we took a hard close look at what the U.S., Europe and Switzerland have done so far in response to pressures on banks.
No surprise here, but while banks borrowed a record $152 billion from the discount window, they “only” borrowed $11.9 billion from the new Bank Term Lending Program (BTLP).
I expect BTLP to get little use, because it is a bit like the Hotel California, you can check out any time you like, but you can never leave.
Using that facility means that you are replacing low cost deposits for roughly market priced funding. A strain on NIM that erodes capital – not ideal. It also means that you have long dated, low dollar price bonds, presumably long enough and in big enough size, that this method of funding is preferable to others. Not a winning combination. The discount window, is temporary and a true “stop gap” measure, so it makes sense banks use that, rather than the new BTLP.
I could be wrong on BTLP, but if I see that increase, I would be selling bank shares, because that really is a facility of last resort, as it is currently designed, and I believe users will experience a Hotel California type of existence.
Which brings us to deposits.
A consortium of banks are going to deposit $30 billion with FRC. This is interesting on many levels, and there are a lot of details that I don’t know, but here are the quick takes:
FRC, from various reports, didn’t have many assets eligible for BTLP, which is maybe why they needed an alternative source? So it doesn’t prove my point that BTLP takedown will be low, but it doesn’t refute it either.
We don’t know the rate FRC is paying on the deposits. If it is a rate typical of deposits, then it might demonstrate how unappealing it is for banks to have to replace deposits with high cost funds. IF it is a rate that low, then the banks providing the deposits are foregoing significant interest (in addition to in theory taking credit risk, as the point was made that these are “unsecured” deposits). If it is a market rate, then that has some different implications.
We don’t know if this provides money to buy new assets, or merely covers deposits that have been removed from FRC. New deposits, at low rates, letting them buy more assets to generate NIM would help generate equity capital for the bank and be interesting.
Lots we don’t know about the deposits and the details will be important to determining the impact. The deposits, in any case, are a new and interesting twist to this period of banking weakness and are a step towards the “private solution” that I think will be needed to really get us over the hump.
Fed Balance Sheet, FOMC and TINA
The Fed balance sheet has grown, significantly, even with QT continuing.
Rate hike probabilities for the FOMC have dropped from a split between 25 & 50, to a split between 0 and 25. I’m leaning towards zero, but a lot can change between now and then (let’s be honest, with current headlines and low liquidity, things can change between the time I hit send and the time you receive this in your inbox!).
There is some discussion that the Fed could suspend the current balance sheet reduction activity (or maybe it is just me musing on it). I doubt this happens, but they could mention it as a tool, during the press conference, which would be “risk-on”.
So, is it back to TINA (There Is No Alternative)?
Yes, the balance sheet has grown, but using the discount window has nothing like the impact large scale asset purchases had.
Yes, the Fed is close to being done hiking, but rates are nowhere near zero, so are not the headwind they were.
I think the TINA case is weak at best. Any balance sheet growth is likely to be temporary. There are legitimate concerns that financial conditions will tighten. While the SVB depositors were saved, I’m seeing little evidence of a rush to fund and to spend money (the drumbeat of tech layoffs continues).
This is still a trader’s market and it is time to be cautious on risk broadly after the strength of yesterday.
END
Target shutters its downtown Philadelphia location citing declining performance
Not unlike many other corporations with retail locations in cities nationwide, Target is calling it quits on Philadelphia. They follow in the footsteps of Wawa, who we noted last year had enough of Philadelphia’s crime and also picked up and left shop at several locations in Center City.
Target, located just blocks from one Wawa that recently closed, is taking the same action, according to the Philadelphia Business Journal. Its store at 12th and Chestnut streets in Center City will be closing after 7 years of operation.
The 19,000 sq. foot store is going to be closing “due to several years of declining performance”, the report says. The company plans on attempting to relocate its 45 part and full time employees at the store.
Kayla Castañeda, a spokesperson for Target, commented: “The decision to close one of our stores isn’t something we take lightly. It’s an action we take only after multiple years of working to improve performance.”
Target is also going to be closing three other stores, one in its hometown of Minneapolis and two in the Washington, D.C., area, the report continued. The company is also looking to open a massive 22,000 sq. foot store near 37th and Chestnut – basically in the middle of U Penn’s campus – which will help it replace its presence lost in Center City.
The Center City store had just opened in July 2016 as part of an apartment building, and its across the street from a brand new $762 million Jefferson Health facility that is nearing the end of construction. On the south side of the closing Target store, additional commercial and residential buildings are being erected.
But the influx of new buildings onto the block wasn’t enough for the company to want to keep its store open. In addition to Wawa stores that have closed, a Marshalls located at 10th and Market street – just blocks away from Target – also closed earlier this year.
END
Silicon Valley financial files for chapter 11 bankruptcy
(zerohedge)
SVB Financial Files For Chapter 11 Bankruptcy
FRIDAY, MAR 17, 2023 – 08:30 AM
SVB Financial Group, the company whose former subsidiary Silicon Valley Bank was taken over by the Federal Deposit Insurance Corporation last week, filed a voluntary petition for a court-supervised reorganization under Chapter 11 in the Bankruptcy Court for the Southern District of New York to “preserve value.”
SVB Financial said it has approximately $2.2 billion of liquidity and cash and its interests in SVB Capital and SVB Securities. It also said it has “other valuable investment securities accounts and other assets for which it is also exploring strategic alternatives.”
SVB Financial listed assets and liabilities of up to $10 billion each in the filing.
SVB Financial said SVB Securities, SVB Capital, and other connected entities aren’t included in the Chapter 11 filing. It said those entities would continue to operate normally as “SVB Financial Group proceeds with its previously announced exploration of strategic alternatives for these valuable businesses.”
The failed bank already said the potential sale of its alternatives has “attracted significant interest:”
SVB Financial Group intends to use the court-supervised process to evaluate strategic alternatives for SVB Capital, SVB Securities and the company’s other assets and investments. As previously announced, this process is being led by a five-member restructuring committee appointed by the SVB Financial Group Board of Directors. Centerview Partners LLC is assisting the restructuring committee with the strategic alternatives process, which is already underway and has attracted significant interest.
SVB Financial noted that funded debt is approximately $3.3 billion in aggregate principal amount of unsecured notes.
“The Chapter 11 process will allow SVB Financial Group to preserve value as it evaluates strategic alternatives for its prized businesses and assets, especially SVB Capital and SVB Securities,” said William Kosturos, Chief Restructuring Officer for SVB Financial Group.
Read the full filing here//zerohedge
end
USA COVID//
END
SWAMP STORIES
Jacob Chansley’s lawyers confront the Dept of Justice claim that they did not suppress evidence
I beg to differ.
(EpochTimes
Jacob Chansley’s Lawyers Confront DOJ’s Claim It Didn’t Suppress Jan. 6 Evidence
The Department of Justice’s (DOJ) latest objection to allegations that it suppressed evidence in its prosecution of Jan. 6 defendant Jacob Chansley flies in the face of the Sixth Amendment, current and former attorneys of Chansley told The Epoch Times in separate interviews this week.
“They are hiding. They affirmatively are electing not to disclose [exculpatory evidence],” Albert Watkins, Jacob Chansley’s former attorney that negotiated the navy veteran’s 41-month sentencing agreement in 2021, told The Epoch Times on Tuesday, referring to the DOJ.
“They’re doing so in a fashion which, in my opinion, gives rise to an inescapable conclusion that the Department of Justice has done more damage to our democracy by how it has treated Jan. 6 defendants than anything that had occurred on January 6.”
Watkins was reacting to the DOJ’s Sunday court filing on another Jan. 6 defendant’s case, in which the government confronted, for the first time in court, the newly surfaced surveillance tapes of the Jan. 6, 2021, Capitol breach aired by Fox News’s Tucker Carlson Tonight show.
Among these tapes was a clip showing Chansley, unarmed, walking along with several Capitol Police officers who did not attempt to remove him from the Capitol building, which Carlson said showed that Chansley was less violent on Jan. 6 than described by the government.
Despite the video records of the navy veteran’s behaviour, Chansley’s current and former lawyers argued that the government violated Chansley’s rights by suppressing this evidence during his trial, in response to the DOJ’s claims to the contrary on Sunday.
The answer to this debate is important because it shines a light on the government’s prosecutorial conduct in handling Jan. 6 cases, many of which have ended with swift sentencing.
Chansley is currently serving a 41-month sentence in federal prison after pleading guilty to an obstruction charge in September 2021.
Government Shared All Evidence: DOJ
In a filing on Sunday, the DOJ said it provided the tapes to Chansley’s attorney during the discovery phase of Chansley’s trial in 2021, therefore satisfying the requirement of producing exculpatory evidence, or evidence favoring the defendant, to the defense counsel.
The filing was in response to a motion to dismiss filed by the attorneys of Dominic Pezzola, a Jan. 6 defendant currently on trial, which alleged that the tapes shown on Tucker Carlson show the government “withheld” evidence in prosecuting participants of the Jan. 6 Capitol breach.
“The CCTV footage is core evidence in nearly every January 6 case, and it was produced en masse, labeled by camera number and by time, to all defense counsel in all cases,” the DOJ wrote in its filing.
The department cited Brady v. Maryland, a 1963 case in which the Supreme Court held that prosecutors must make available to the defense counsel exculpatory evidence. As a part of that requirement, the DOJ cited Brady’s text establishing that a Brady violation requires the material in question to be “something that is being ‘suppress[ed] by the prosecution.’”
“Pezzola’s Brady claim therefore fails at the threshold, because nothing has been suppressed,” the DOJ wrote, basing it on the claim that it had provided Watkins with the “necessary tools” to identify relevant CCTV evidence notwithstanding the voluminous discovery.
“Accordingly, the volume of discovery does not excuse defense counsel from making reasonable efforts to ascertain whether an item has been produced, let alone before filing inaccurate and inflammatory allegations of discovery failures,” the DOJ wrote.
DOJ Suppressed Evidence: Chansley’s Lawyers
Chansley’s lawyers disagreed with the DOJ’s claims, saying that the bar for suppression is lower than what the government claims it to be.
“Suppression … is not the nefarious burying of evidence,” Bill Shipley, Jacob Chansley’s current counsel, said in an interview with The Epoch Times on Monday. “It just means it wasn’t brought to light by the government. The government knew what was there and did not illuminate the fact that it was there.”
Shipley says that the government may have violated Brady because they did not identify the tapes and their nature as potentially exculpatory evidence during Chansley’s trial. Making them available without making sure the defendant knows of the existence of the tapes may constitute suppression, according to Shipley.
“Suppression simply means it went undiscovered by the defendant beyond a point at which it could be made use of,” Shipley, who was a federal prosecutor for 21 years, said. “If the government produced thousands of hours of video and said, ‘There’s a minute of evidence that’s favorable to Jacob Chansley—good luck,’ that production is not an effective Brady disclosure.”
The tapes are relevant for reasons beyond proving Chansley’s innocence or guilt, Shipley told The Epoch Times, noting that they are important to answering the question of whether Chansley’s sentence was fair under due process considerations.
“The question is: were Jacob Chansley’s rights to due process and effective assistance of counsel violated? Were the procedural requirements complied with such that the process and outcome of his case was a fair proceeding?” Shipley challenged.
“They’re clearly the kinds of videos that, had Judge [Royce Lamberth] seen them at sentencing, he might have concluded that Mr. Chansey is not the personification of evil in the way the government has made him out to be,” the attorney added. Judge Royce Lamberth presided over Chansley’s trial.
“That might have caused Judge Lambert to think that maybe 41 months was too much time to give him, taking into consideration all of his conduct, as opposed to just the precise conduct the government gave,” Shipley said.
The ECB: Inflation is projected to remain too high for too long. Therefore, the Governing Council today decided to increase the three key ECB interest rates by 50 basis points… ECB staff now see inflation averaging 5.3% in 2023, 2.9% in 2024 and 2.1% in 2025. At the same time, underlying price pressures remain strong. Inflation excluding energy and food continued to increase in February and ECB staff expect it to average 4.6% in 2023, which is higher than foreseen in the December projections. Subsequently, it is projected to come down to 2.5% in 2024 and 2.2% in 2025, as the upward pressures from past supply shocks and the reopening of the economy fade out and as tighter monetary policy increasingly dampens demand… Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be increased to 3.50%, 3.75% and 3.00% respectively, with effect from 22 March 2023… https://www.ecb.europa.eu/press/pr/date/2023/html/ecb.mp230316~aad5249f30.en.html
Feb Housing Starts 1.450m (+9.8), 1.31m (+0.1%) expected; Jan revised to -2.0% from -4.5% Housing Permits 1.524m (+13.8%), 1.343m (+0.3%) consensus Multi-family +24%; Single family +1.1% (Welcome Renter Nation!)
Credit Suisse to Borrow up to CHF50B from Swiss National Bank – BBG 20:49 ET Wednesday
Credit Suisse Press Release: Credit Suisse is taking decisive action to pre-emptively strengthen its liquidity by intending to exercise its option to borrow from the Swiss National Bank (SNB) up to CHF 50 billion under a Covered Loan Facility as well as a short-term liquidity facility, which are fully collateralized by high quality assets. Credit Suisse also announces offers by Credit Suisse International to repurchase certain OpCo senior debt securities for cash of up to approximately CHF 3 billion… https://www.credit-suisse.com/about-us-news/en/articles/media-releases/csg-announcement-202303.html
While the SNB now borrow funds from the Fed via currency swaps?
@jsblokland: Credit Suisse’s Total Deposits declined by a whopping CHF 140 billion, or 37%, in Q4. That is disturbing, and it seems unlikely that the deposit outflow will stop. Who would want to bring their money to Credit Suisse now? More likely, everybody wants out. https://twitter.com/jsblokland/status/1636080275359690753
ESMs (June is the front month) jumped 12 handles while Euro Stoxx Futures soared 2% on the above report on Wednesday night. ESMs peaked (3947.50) at 11:05 ET. ESMs and stocks then traded sideways until they broke down after the 1:00 ET Nikkei close. The decline persisted until Europe opened at 3 ET.
After a 19-handle rally, ESMs and stocks peaked at 4:05 ET. A 35-handle ESM decline ended shortly after the US repo market open at 7 ET. The ensuing 19-handle ESM rally ended near 8:30 ET. ESMs and stocks then declined into the NYSE open. Of course, the usual suspects bought the down opening.
First Republic Bank crashed 35% on the open. The bank announced it is exploring strategic options.
ESMs and stocks surged higher; but peaked within 30 minutes. Fundamentals be damned! Many traders are conditioned to buy dips, and there was an expiration manipulation to exploit!
After a sharp decline, ESMs soared 80.75 from 10:20 ET to 11:57 ET on this: JPMorgan, Morgan Stanley in Talks to Bolster First Republic – WSJ First Republic Gets $30 Billion of Bank Deposits in Rescue (11-bank consortium) – BBG
ESHs and stocks retreated until 14:34 ET; they then rallied and peaked at 15:44 ET.
Banks Initial Commitment to First Republic at Least 120 Days BBG – 16:00 ET (Waited for the NYSE close to announce the time-sensitive, qualified bailout?)
As we keep harping, traders keeping pouring into ESMs and stocks on the flimsiest excuse. Fangs led the rally, which is a characteristic of the expiry-week manipulation.
Historical note: NY money center banks rescued Texas banks after the energy and real estate depression of the ‘80s. Chemical Bank rescued Manny Hanny in 1992, and then bought Chase in 1996. Four years later, JP Morgan bought Chase-Chemical. Deutsche Bank took over Bankers Trust in 1999.
Retailers see a tough year ahead, so they’re rolling out the recession playbook Stocking up on high-frequency items like food, becoming more strategic about discounts and winning more of loyal customers’ wallets… https://www.cnbc.com/2023/03/16/retailers-recession-playbook.html
McDonald’s is facing rising unrest among its US franchisees, and they’re taking their concerns to the board – Squeezed by higher costs and grumbling at new operating rules, franchisees are joining a meeting this month with the company’s board to press their case in person. The session will give US operators “an opportunity to share with the board of directors why we believe we are on a destructive path,” one group of owners said in an emailed newsletter to about 1,000 members… https://t.co/fUIxWGzTJX
Positive aspects of previous session The NY Fang+ Index soared 3.66% on the expiry manipulation Stocks soared on a 120-day or so FRC bailout and the expiry manipulation
Negative aspects of previous session Stocks tumbled after the ECB rate hikes Gasoline and oil declined sharply early on Thursday due to recession fright 2-year note yields jumped as much as 32bps; bonds declined sharply
Ambiguous aspects of previous session Who else is in trouble? How many more ‘problems’ are lurking?
First Hour/Last Hour Action [S&P 500 Index]: 1st Hour from NYSE open: Up; Last Hour: Up
Pivot Point for S&P 500 Index [above/below indicates daily trend to traders]: 3929.69 Previous session High/Low: 3964.46; 3864.11
FED DISCOUNT WINDOW BORROWING SOARS TO ALL-TIME HIGH – BBG 16:30 ET BANKS BORROW $164.8B FROM FED FACILITIES IN WEEK TO MARCH 15 – BBG 16:30 ET
Today is March options and futures’ expiration. Usually there is stock to buy on the NYSE open to replace expiry equity futures contracts. Trades are exceedingly bullish; and the Fed is juicing again!
ESHs are -4.50 at 21:20 ET. QT is over. Has QE returned? Most of the Fed loans occurred in 3 days. Are they insurance or a necessity? How much higher will Fed loans go? Where will inflation go?
The surging US stock market, led by trading sardines (NY Fangs+ Index +33% YTD!) and Nasdaq (+11.95% YTD!) should force the Fed to hike rates next week. Whether the hike is 25bps or 50bps could depend on how much stocks rally into the FOMC Meeting next week.
Expected economic data: Feb. Industrial 0.2% m/m, Mfg -0.3%, Capacity Utilization 78.4%; February LEI -0.3%; March UM Sentiment 67, Current Conditions 70.5, Expectations 64.8, 1-yr Inflation 4.1%
GOP Rep Comer says ‘6 or 7 Biden family members’ may have been involved in overseas business schemeshttps://t.co/kN6MqIwnR5
Hallie Biden revealed as ‘new’ Biden family member who got China cash House Oversight Committee Chairman James Comer revealed Thursday that subpoenaed bank records identify President Biden’s daughter-in-law Hallie as the previously unknown family recipient of Chinese cash in 2017, The Post can exclusively reveal… The records show Hallie Biden received $35,000 over two transfers in 2017, Comer revealed to committee members in a Thursday morning memo. The first transfer was for $25,000 on March 20 of that year… “Over the course of several years, members of the Biden family and their companies received over $1.3 million in payments from accounts related to their associate, Rob Walker,” Comer said. “Most of this money came as a result of a wire from a Chinese energy company and went not only to Hunter and James Biden but also to Hallie Biden and an unknown ‘Biden.’”… https://nypost.com/2023/03/16/comer-reveals-new-biden-family-member-who-got-china-cash-prez-dined-with-her-friday/
CDC Bought Phone Data to Monitor Americans’ Compliance with Lockdowns, Contracts Showhttps://t.co/aWQk5IKt6g
House Democrat Caught Running $30 Million Offshore Nonprofit in Tax Haven Islands Rep. Goldman just last week issued a statement supporting President Joe Biden’s plan to raise taxes on corporations and wealthy Americans as part of his annual budget… Tax havens in the Cayman Islands became a focal point of Democrats’ attacks against Republican presidential nominee Mitt Romney in 2012… Rep. Goldman is an heir to the Levi Strauss company with a net worth estimated between $64 million and $253 million… https://trendingpoliticsnews.com/breaking-house-democrat-caught-running-30-million-offshore-nonprofit-in-tax-haven-islands-mstef/
@bennyjohnson: Tucker Carlson commits wrong-think, IMPLODES approved narrative on Ukraine: “If you want an audit of where your money is going into the most corrupt country in Europe, you’re a tool of Putin.” https://twitter.com/bennyjohnson/status/1636384888504074243
Greta Thunberg reportedly deletes 2018 tweet claiming ‘climate change will wipe out all of humanity’ by 2023https://trib.al/Sm4JaJ9
“In my many years, I have come to a conclusion that one useless man is a shame, two is a law firm and three or more is a congress.” – Fictitious John Adams in the Broadway musical “1776”.
GREG HUNTER REPORT//
Greg Hunter INTERVIEWING BILL HOLTER/AND DR CRAIG PAUL ROBERTS
This Weekly News Wrap-Up is featuring a double header of expert guests. Dr. Paul Craig Roberts (PCR), former Assistant Treasury Secretary in the Reagan Administration, and Bill Holter, who is a financial writer and precious metals expert. First up: PCR weighs in on possible nuclear war with Russia and the possibility of a total collapse of the financial system. PCR, who is also an award-winning journalist, says, “Five banks have derivative exposure of $188 trillion. That is twice the Gross Domestic Product (GDP) of the entire world. How can that happen? Where were the regulators that let this type of situation develop? It’s mindless, and no one can know what the consequences are. How are you going to examine these derivatives? . . . . This is just as dangerous, in its own way, as the fact that Putin allows this Ukraine war to drag on and on and on. It’s mindless. Both bets are mindless, and in the mindlessness is the danger. In the Ukrainian danger, it could end in nuclear war, and the financial danger is the entire western world financial system could collapse. . . . Nobody is watching anything. It’s just one stupidity after another.”
Bill Holter also has dire warnings about the ongoing banking crisis. They want the public to think all is under control, but that is not the truth. The idea of control and calm is coming at a very high price. Holter explains, “The U.S. has on-book debt of $31 trillion . . . it has to borrow $1 trillion a year to keep the doors open. . . . That tells you we have already stepped through the door of banana republic land. . . . Now, they are going to take on a $17 trillion obligation to cover the entire banking system (meaning all U.S. bank deposits). That is ridiculous. This is like one drunk trying to hold up another drunk. They have now put the balance sheet of the U.S. Treasury in the crosshairs . . . of speculators, which will destroy the Treasury’s balance sheet.
This is an ongoing collapse, and I think they believe they still have control. . . .This is like a giant 1993 when George Soros broke the Bank of England. That’s where this is headed. It also ends up with the dollar no longer being the world reserve currency.”
There is much more in the 1-hour newscast.
Join Greg Hunter of USAWatchdog.com as he interviews two heavy weights. You are getting analysis from Dr. Paul Craig Roberts and Bill Holter in the Weekly News Wrap-Up for 3.17.23.
Credit Suisse is crumbling. The Swiss banking system is feeling the heat. Top investors are unwilling to invest more. Welcome to 2023. Credit Suisse, recognized as the second-largest financial institution in Switzerland and the seventeenth-largest lender by assets in Europe, has recently caught the world’s attention. Over the past six months, the 166-year-old bank’s valuation has witnessed a staggering 65% decline, reaching an unprecedented low. Let’s dive in. Last October, the company announced a radical restructuring after cutting thousands of jobs, including shrinking its investment bank and raising $4 billion in capital from investors, including the Saudi National Bank, which would make them a 10% owner of the company and the largest shareholder. Coincidently, the Qatar Investment Authority became the second-largest shareholder in Credit Suisse. It is important to recall that Credit Suisse faced a substantial setback in 2021, incurring a loss of $5.5 billion due to its connection to the collapse of Archegos Capital Management. This single event led to the obliteration of five years’ worth of investment banking profits, highlighting its risk management practises’ total and complete failure. Earlier this week, the bank revealed that the unprecedented outflows of client funds in early October had not been recuperated as of this month but had stabilized at lower levels. Credit Suisse saw customer withdrawals of more than 110 billion Swiss francs in the fourth quarter. Additionally, the bank confirmed in its annual letter it had to utilize liquidity buffers to address the consequences of these withdrawals and acknowledged that these circumstances have exacerbated and may continue to exacerbate liquidity risks. Why did people begin to panic? On Tuesday, executives said the bank’s financial reporting was subject to material weaknesses in internal reporting processes for 2022 and 2021 after years of showcasing embarrassing risk management practices and empty promises. This is where things get turned up. The head of Saudi National Bank (the biggest shareholder) chose not to invest more in Credit Suisse due to regulations, sparking liquidity fears alongside European bank instability.
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