Thursday, May 23, 2019

GOLD UP 25 CENTS TO $1353.20/SILVER DOWN 7 CENTS AS GOLD/SILVER HOLD DESPITE CHINESE HOLIDAY WEEK COMMENCING TODAY

by Harvey Organ, Harvey Organ Blog:

MUELLER FILES RIDICULOUS INDICTMENTS AGAINST 13 RUSSIAN INDIVIDUALS AND COMPANIES./ROSENSTEIN ADMITS NO AMERICAN INVOLVED

GOLD: $1353.20 UP $0.25

Silver: $16.77 DOWN 7 cents

Closing access prices:

Gold $1348.20

silver: $16.67

SHANGHAI GOLD FIX: FIRST FIX 10 15 PM EST (2:15 SHANGHAI LOCAL TIME)

SECOND FIX: 2:15 AM EST (6:15 SHANGHAI LOCAL TIME)

SHANGHAI FIRST GOLD FIX: $XXXX DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME: $XXXX

PREMIUM FIRST FIX: $3.78

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SECOND SHANGHAI GOLD FIX: $XXXX

NY GOLD PRICE AT THE EXACT SAME TIME: $1333.50

discount of Shanghai 2nd fix/NY:$1.20

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LONDON FIRST GOLD FIX: 5:30 am est $1358.60

NY PRICING AT THE EXACT SAME TIME: $1359.10

LONDON SECOND GOLD FIX 10 AM: $1352.10

NY PRICING AT THE EXACT SAME TIME. $1352.00

For comex gold:

FEBRUARY/

NUMBER OF NOTICES FILED TODAY FOR FEBRUARY CONTRACT: 0 NOTICE(S) FOR nil OZ.

TOTAL NOTICES SO FAR:1784 FOR 178400 OZ (5.5489 TONNES),

For silver:

FEBRUARY

1 NOTICE(S) FILED TODAY FOR

5,000 OZ/

Total number of notices filed so far this month: 309 for 1,5455,000 oz

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Bitcoin: BID $9768/OFFER $9,838: down $213(morning)

Bitcoin: BID/ $9,974/offer $10,044: DOWN $7  (CLOSING/5 PM)

 

end

Let us have a look at the data for today\

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In silver, the total open interest ROSE BY A GOOD SIZED 2604 contracts from 197,126  RISING TO 199,730 DESPITE  YESTERDAY’S   8 CENT LOSS IN SILVER PRICING.  WE  HAD ZERO COMEX LIQUIDATION. HOWEVER, WE WERE AGAIN NOTIFIED THAT WE HAD ANOTHER GOOD SIZED NUMBER OF COMEX LONGS TRANSFERRING THEIR CONTRACTS TO LONDON THROUGH THE EFP ROUTE:  1247 EFP’S FOR MARCH AND AND 0 EFP’S FOR MAY AND ZERO FOR ALL  OTHER MONTHS  AND THUS TOTAL ISSUANCE OF 1731 CONTRACTS.  WITH THE TRANSFER OF 1247 CONTRACTS, WHAT THE CME IS STATING IS THAT THERE IS NO SILVER (OR GOLD) TO BE DELIVERED UPON AT THE COMEX AS THEY MUST EXPORT THEIR OBLIGATION TO LONDON. ALSO KEEP IN MIND THAT THERE CAN BE A DELAY OF 24 HRS IN THE ISSUING OF EFP’S. THE 1247 CONTRACTS TRANSLATES INTO 6.23 MILLION OZ DESPITE  WITH THE CONTINUAL DROP IN OPEN INTEREST IN SILVER AT THE COMEX.

ACCUMULATION FOR EFP’S/SILVER/ STARTING FROM FIRST DAY NOTICE/FOR MONTH OF FEBRUARY:

38,099 CONTRACTS (FOR 13 TRADING DAYS TOTAL 38,099 CONTRACTS OR 190.495 MILLION OZ: AVERAGE PER DAY: 2930 CONTRACTS OR 14.653 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH:  190.495 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 27.14% OF ANNUAL GLOBAL PRODUCTION

ACCUMULATION IN YEAR 2018 TO DATE SILVER EFP’S:  438.83 MILLION OZ.

ACCUMULATION FOR JAN 2018: 236.879 MILLION OZ

RESULT: A GOOD SIZED GAIN IN OI SILVER COMEX WITH THE   8 CENT GAIN IN SILVER PRICE.  WE ALSO HAD A GOOD SIZED EFP ISSUANCE OF 1247 CONTRACTS WHICH EXITED OUT OF THE SILVER COMEX AND TRANSFERRED THEIR OI TO LONDON AS FORWARDS. SPECULATORS CONTINUED THEIR INTEREST IN ATTACKING THE SILVER COMEX FOR PHYSICAL SILVER . FROM THE CME DATA 1247 EFP’S  FOR  MONTHS MARCH AND MAY WERE ISSUED FOR TODAY  FOR A DELIVERABLE FORWARD CONTRACT OVER IN LONDON WITH A FIAT BONUS.   WE GAINED  3851 OI CONTRACTS i.e. 1247 open interest contracts headed for London (EFP’s) TOGETHER WITH A INCREASE OF 2604  OI COMEX CONTRACTS. AND ALL OF THIS HAPPENED WITH THE FALL IN PRICE OF SILVER OF  8 CENTS AND A CLOSING PRICE OF $16.84 WITH RESPECT TO YESTERDAY’S TRADING. YET WE STILL HAVE A FAIR AMOUNT OF SILVER STANDING AT THE COMEX.

In ounces AT THE COMEX, the OI is still represented by just UNDER 1 BILLION oz i.e. 0.998 BILLION TO BE EXACT or 143% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT FEBRUARY MONTH/ THEY FILED: 1 NOTICE(S) FOR 5,000 OZ OF SILVER

 

In gold, the open interest  ROSE BY A GOOD 3,678 CONTRACTS UP TO 532,060 DESPITE THE FALL IN PRICE OF GOLD WITH YESTERDAY’S TRADING ($2.45). HOWEVER, IN ANOTHER DEVELOPMENT, WE RECEIVED THE TOTAL NUMBER OF GOLD EFP’S ISSUED FOR TODAY AND IT TOTALED AN ATMOSPHERIC SIZED  21,324 CONTRACTS OF WHICH  APRIL SAW THE ISSUANCE OF 21,324 CONTRACTS AND  JUNE SAW THE ISSUANCE OF 0 CONTRACTS AND THEN ALL OTHER MONTHS ZERO.    The new OI for the gold complex rests at 528,382. ALSO REMEMBER THAT THERE WILL BE A DELAY IN THE ISSUANCE OF EFP’S.  THE BANKERS REMOVE LONG POSITIONS OF COMEX GOLD IMMEDIATELY.  THEN THEY ORCHESTRATE THEIR PRIVATE EFP DEAL WITH THE LONGS AND THAT COULD TAKE AN ADDITIONAL 48 HRS SO WE GENERALLY DO NOT GET A MATCH WITH RESPECT TO DEPARTING COMEX LONGS AND NEW EFP LONG TRANSFERS. DEMAND FOR GOLD INTENSIFIES GREATLY AS WE CONTINUE TO WITNESS A HUGE NUMBER OF EFP TRANSFERS TOGETHER WITH THE MASSIVE INCREASE IN GOLD COMEX OI  TOGETHER WITH  THE TOTAL AMOUNT OF GOLD OUNCES STANDING FOR FEBRUARY COMEX. EVEN THOUGH THE BANKERS ISSUED THESE MONSTROUS EFPS, THE OBLIGATION STILL RESTS WITH THE BANKERS TO SUPPLY METAL BUT IT TRANSFERS THE RISK TO A LONDON BANKER OBLIGATION AND NOT A NEW YORK COMEX OBLIGATION. LONGS RECEIVE A FIAT BONUS TOGETHER WITH A LONG LONDON FORWARD. THUS, BY THESE ACTIONS, THE BANKERS AT THE COMEX HAVE JUST STATED THAT THEY HAVE NO APPRECIABLE METAL!! THIS IS A MASSIVE FRAUD: THEY CANNOT SUPPLY ANY METAL TO OUR COMEX LONGS BUT THEY ARE QUITE WILLING TO SUPPLY MASSIVE NON BACKED GOLD (AND SILVER) PAPER KNOWING THAT THEY HAVE NO METAL TO SATISFY OUR LONGS. LONDON IS NOW SEVERELY BACKWARD IN BOTH GOLD AND SILVER (BIG RISE IN BOTH GOFO AND SIFO) AND WE ARE WITNESSING DELAYS IN ACTUAL DELIVERIES. IN ESSENCE TODAY DESPITE YESTERDAY’S TRADING IN GOLD,  WE HAVE A GAIN OF 25,002 CONTRACTS: 3,678 OI CONTRACTS INCREASED AT THE COMEX AND A GIGANTIC SIZED  21,324 OI CONTRACTS WHICH NAVIGATED OVER TO LONDON.(25002 oi gain in CONTRACTS EQUATES TO 77.76 TONNES)

YESTERDAY, WE HAD 22,672 EFP’S ISSUED.

ACCUMULATION OF EFP’S/ GOLD(EXCHANGE FOR PHYSICAL) FOR THE MONTH OF FEBRUARY STARTING WITH FIRST DAY NOTICE: 152,754 CONTRACTS OR 15,275,400  OZ OR 475.12 TONNES (13 TRADING DAYS AND THUS AVERAGING: 11,750 EFP CONTRACTS PER TRADING DAY OR 1,175,000 OZ/ TRADING DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :   SO FAR THIS MONTH IN 13 TRADING DAYS: IN  TONNES: 475.12 TONNES

TOTAL ANNUAL GOLD PRODUCTION, 2017, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 2200 TONNES

THUS EFP TRANSFERS REPRESENTS 475.12/2200 x 100% TONNES =  21.59% OF GLOBAL ANNUAL PRODUCTION SO FAR IN FEBRUARY ALONE.

ACCUMULATION OF GOLD EFP’S YEAR 2018 TO DATE:  1108.53 TONNES

ACCUMULATION OF GOLD EFP’S FOR JANUARY 2018: 653.22  TONNES

Result: A  GOOD SIZED INCREASE IN OI AT THE COMEX WITH THE  FALL IN PRICE IN GOLD TRADING YESTERDAY ($2.45). IT IS WITHOUT A DOUBT THAT MANY OF THE DEPARTED COMEX LONGS  RECEIVED THEIR PRIVATE EFP CONTRACT  FOR EITHER  APRIL OR JUNE. HOWEVER, WE HAD ANOTHER GOOD SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 21,324 CONTRACTS AS THESE HAVE ALREADY BEEN NEGOTIATED AND CONFIRMED.   THERE OBVIOUSLY DOES NOT SEEM TO BE MUCH PHYSICAL GOLD AT THE COMEX AND YET WE ALSO OBSERVED A HUGE DELIVERY MONTH FOR THE MONTH OF DECEMBER. I GUESS IT EXPLAINS THE HUGE ISSUANCE OF EFP’S…THERE IS HARDLY ANY GOLD PRESENT AT THE GOLD COMEX FOR DELIVERY PURPOSES. IF YOU TAKE INTO ACCOUNT THE 21,324 EFP CONTRACTS ISSUED, WE HAD A NET GAIN IN OPEN INTEREST OF 25,002 contracts ON THE TWO EXCHANGES:

21,324 CONTRACTS MOVE TO LONDON AND  3,678 CONTRACTS INCREASED AT THE COMEX. (in tonnes, the GAIN in total oi equates to 77.76 TONNES).

we had: 0 notice(s) filed upon for NIL oz of gold.

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With respect to our two criminal funds, the GLD and the SLV:

GLD

WITH GOLD UP $0.25 TODAY, THE CROOKS DECIDED TO RAID THE COOKIE JAR (WITHDREW) 2.36 TONNES OF GOLD FROM THE GLD

 

Inventory rests tonight: 821.30 tonnes.

SLV/ 

NO CHANGES IN SILVER INVENTORY AT THE SLV/

/INVENTORY RESTS AT 314.045 MILLION OZ/

end

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

1. Today, we had the open interest in silver ROSE BY A CONSIDERABLE 2604  contracts from 197,126 UP TO 199,730 (AND now A LITTLE FURTHER TO THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) DESPITE  THE FAIR SIZED FALL  IN PRICE OF SILVER  (8 CENTS WITH RESPECT TO  YESTERDAY’S TRADING).   OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE ANOTHER GOOD 1731 PRIVATE EFP’S FOR MARCH AND 0 EFP CONTRACTS OR MAY  (WE DO NOT GET A LOOK AT THESE CONTRACTS AS IT IS PRIVATE BUT THE CFTC DOES AUDIT THEM) AND 0 EFP’S FOR ALL OTHER MONTHS .  EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. WE HAD SOME COMEX SILVER COMEX LIQUIDATION. IF WE TAKE THE  OI GAIN AT THE COMEX OF  2604 CONTRACTS TO THE 1247 OI TRANSFERRED TO LONDON THROUGH EFP’S, WE OBTAIN A GAIN OF  3851  OPEN INTEREST CONTRACTS .  WE STILL HAVE A GOOD AMOUNT OF SILVER OUNCES THAT ARE STANDING FOR METAL IN JANUARY (SEE BELOW). THE NET GAIN TODAY IN OZ ON THE TWO EXCHANGES:  19.255 MILLION OZ!!!

RESULT: A HUGE SIZED INCREASE IN SILVER OI AT THE COMEX WITH THE FAIR SIZED FALL OF 8 CENTS IN PRICE (WITH RESPECT TO YESTERDAY’S TRADING ). BUT WE ALSO HAD ANOTHER GOOD 1247 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE GOOD  SIZED AMOUNT OF SILVER OUNCES STANDING FOR FEBRUARY, DEMAND FOR PHYSICAL SILVER INTENSIFIES AS WE WITNESS MAJOR BANK SHORT COVERING ACCOMPANIED BY INCREASES IN GOFO AND SIFO RATES INDICATING SCARCITY.

(report Harvey)

.

2.a) The Shanghai and London gold fix report

(Harvey)

2 b) Gold/silver trading overnight Europe, Goldcore

(Mark O’Byrne/zerohedge

and in NY: Bloomberg

3. ASIAN AFFAIRS

i)Late THURSDAY night/FRIDAY morning: Shanghai closed /Hang Sang CLOSED / The Nikkei closed UP 255.27 POINTS OR 1.19%/Australia’s all ordinaires CLOSED DOWN 0.07%/Chinese yuan (ONSHORE) closed UP at 6.3415/Oil DOWN to 61.36 dollars per barrel for WTI and 64.45 for Brent. Stocks in Europe OPENED DEEPLY IN THE GREEN  .   ONSHORE YUAN CLOSED UP AGAINST THE DOLLAR AT 6.3415. OFFSHORE YUAN CLOSED UP AGAINST  THE ONSHORE YUAN AT 6.2980//ONSHORE YUAN /OFFSHORE YUAN NOT TRADING

Read More @ HarveyOrganBlog.com

The Worst Threat We Face Is Right Here At Home

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by Chris Martenson, Peak Prosperity:

Last week, volatility made a long-overdue return to the US and global equity markets.

It began with a 2-day back-to-back violent drop. Day 3 saw a big rebound, swiftly followed by two more days of gut-wrentching losses. And then finally, last Friday, the day saw massive swings both high and low, ending with a huge upside run.

During this period the S&P 500 lost more than 300 points.  Since then, though, the market has been steadily rising.

Is the danger past?  Are the markets safe once more?  

And if so, did the markets recover organically? Or were they rescued by The Plunge Protection Team (PPT)?

The answer matters.

If such intervention was rare we could almost justify it, if it took the form of simple, pre-arranged circuit breakers that shut the market down for a “cooling off” after they’ve moved too far, too fast. Indeed, these already exist, and are sufficient in our view.

But if such market interventions are routine, persistent, and generally depended on by the major market participants, then they’re highly destructive over the long term. 

Sadly, we live with the latter.

Insiders get stinking rich by front-running the scheme (check). Normal adjustments are prevented (check), allowing dangerous bubbles of extreme overvaluation to form (check), while fostering malinvestment (check).

Do this long enough and you end up with a deformed economy, an eroded social structure, and markets that no longer function as appropriate mechanisms for capital distribution and economic signaling. 

This is where we find ourselves today.

Modern-Day Soviet Crop Reports

In the former Soviet Union, the communist method of assuring economic progress was to set targets for production. Famous among them were the crop reports.

In these, year after year, the various regional oblast (province) authorities would declare having met or exceeded the crop targets, despite rarely ever truly doing so. 

These crop reports were so famously unreliable that the Kremlin leadership eventually took to obtaining their information from US satellite reconnaissance data rather than their own internal reporting from local Communist Party bosses.

Basing next year’s crop planting decisions on these reports often led to famines, and sometimes even mass starvation of entire regions.

Poor data = Bad decisions. 

The Soviet crop reports are now a famous example of an unreliable measure that led to disastrous consequences. Because of the false reporting, poor decisions were made. Eventually it became clear to even the Soviets that attempting to centrally micro-manage a major economy is an act of folly.   

Too much of this and too little of that were produced.  Cement, steel, and auto quotas harmed rather than helped for obvious reasons; poor information flows assured that production decisions were late or flawed or both. All this contributed dearly to the Soviet economy’s collapse.

The lessons here are instructive and simple:

  1. centralized management of complex systems doesn’t work, and
  2. bad data leads to bad outcomes

Today’s stock and bond markets are no different than the Soviet crop reports of old.  They mainly represent what a small committee of central planners believe are the right numbers to achieve very broad macro-economic goals. 

Enormous damage has already been done by the interventions and distortions resulting from the pursuit of the delusional aims of todays central planners (with the world’s central banking cartel being the most culpable).

But it’s poised to get a lot worse from here.

A Great Irony

The ironic parody of all the current US concern over the possibility of Russian meddling in US elections is that virtually nobody from either political party seems the slightest bit concerned that the US is actually recreating the very worst mistakes of the now-defunct Soviet empire. 

In point of fact, the Federal Reserve has done far more self-inflicted harm to long-term US interests than anything that Russia has been accused of, let alone been proven to have done. At this point, there’s no contest between the two. 

If the damage inflicted by the Federal Reserve had been done by a terrorist organization, it would for certain be public enemy #1.

Consider that, under the Greenspan/Bernanke/Yellen Federal Reserve, the following has occurred:

  • Pension plans, both public and private have been ruined.  Millions of future retirees and taxpayers will not have trillions of dollars they would and should otherwise have to support them in their later years.
  • Income inequality is at the highest its been in over 100 years
  • Wealth inequality is also at historical extremes
  • Student debt is now nearly $1.5 trillion, up ~ $1 trillion since 2007
  • More than a trillion dollars of interest payments on savings accounts has been forfeited  — denying funds to the next generation for use in business creation, household formation, and education.
  • Total debt in the US and globally is up massively since the 2008 Great Recession (itself a central banking accident), and now stands at more than $233 trillion worldwide.

These are among a few of the destructive results of the Federal Reserve’s decision to lower interest rates to 0% in order to reward the big banks, well connected private equity firms, and unrestrained government borrowing.

Of course, when you print money (as the Fed does) you cannot create wealth; you only transfer it from one party to another. 

Put another way, the Federal Reserve and its foreign partners (the BoJ, ECB, etc.) have been picking winners and losers.

Losers have been seniors dependent on a fixed income, Millennials and every generation following them, and savers, pensioners, and taxpayers. The winners have been the banks, the ultra-rich, entrenched political parties, rentiers, and baby boomers with sizable financial portfolios.

Here’s just one example of the kind of devastation the Fed’s deeply unfair actions have wrought. A simple Google search on “pension” brings up the following spate of alarming headlines:

The catastrophic losses that will result from these massive pension shortfalls is nothing less than an act of domestic terrorism by the Federal Reserve. They will haunt the US for generations.

Read More @ PeakProsperity.com

THE 2007-9 CRISIS WILL RETURN IN 2018 – WITH A VENGEANCE

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by Egon von Greyerz, Gold Switzerland:

US economics is extremely predictable. It doesn’t matter who is President and what party he comes from. Because every president will spend more money than the US can afford. On average, US Federal debt has doubled every 8 years since Reagan came to power in 1981. And Trump has just fulfilled the prediction. The budget deal that has been agreed is guaranteed to produce substantial deficits in coming years. The current year’s deficit might be just under $1 trillion but thereafter it is virtually guaranteed that the US will not have a budget deficit under $1 trillion for many, many years.

US FEDERAL DEBT $40 TRILLION BY 2025

During Bush Jr, debt went form $10T to $ 20T. Whether Trump will manage to keep it below $28T by 2021 is questionable. What is more certain is that by 2025, whoever is president, debt will most certainly fulfil the historic trend of doubling every 8 years. That means a $40T debt in 2025.

The scenario to cause this huge debt is straightforward. Crashing bond and stock markets, high interest rates, high inflation leading to hyperinflation and defaults in the financial system. All that will result in massive money printing on a scale that has never been done in history. It would actually be a miracle if the US debt is only $40T in 2025. With hyperinflation, it could be multiples of that sum.

BUBBLES ARE BURSTING

The signals that the markets have given in the last few weeks are a clear indication that the euphoric stage of the economy is coming to an end. It began with the biggest bubble in history starting to burst – Cryptocurrencies. In one month the market cap of this market more than halved from $835 billion to $395 billion.

Cryptos have been a wonderful speculation for the few that managed to cash in. But for many it has been a disastrous Ponzi scheme that will end in tears. Cryptos have nothing to do with real investments and even less to do with wealth preservation. There is nothing wrong with having a small flutter in a speculative instrument. Sadly though, many buyers of cryptos have been tempted to buy on credit and are sitting on major losses.

The fall in Cryptos is symptomatic of the end of an era. Compared to $80 trillion global stock markets, cryptos are insignificant. Stocks and cryptos have one thing in common, they both have a long way down from here. Whilst cryptos will go to zero, stocks will go down in real terms by at least 90%. I say real terms because hyperinflation can take the nominal level of stocks a lot higher. Between 1929 and 1932 the Dow fell by 90%. On any criteria, the stock bubble is so much greater today so once this market has topped, the coming fall will shock the world.

Stock market investors have had the most fantastic ride for over 100 years. $100 invested in 1913 when the Fed was created would today be worth $2.8 million. That assumes all dividends reinvested and no tax paid. This is a remarkable return and only achieved thanks to a group of bankers who decided to take control of the Western world’s financial system in 1910 on Jekyll Island. This was one of the most remarkable financial coups in the financial history for the world. As the famous banker Mayer Amshel Rothschild said over 200 years ago: “Permit me to issue and control the money of a nation, and I care not who makes its laws”.

Since the Fed was created in 1913 for the purpose of controlling the money, Global Debt has gone from virtually nothing to $250 trillion today. Add unfunded liabilities of $250 trillion and derivatives of $1.5 quadrillion and we are looking at a total risk for the world economy of $2 quadrillion.

A MERE 1% INCREASE IN RATES WILL CREATE A BLOOD BATH

Governments and central banks have mortgaged the future for generations to come. Nobody must believe that this money will ever be repaid or that the liabilities can be met. Thus, there will not be an orderly outcome of the greatest financial bubble in history. Central banks are now reversing their expansionary policies. The combination of tapering and interest rate hikes are guaranteed to pop the bubble. The global economy is totally dependent on their daily dose of fresh money and zero interest rates. A 1% increase in interest rates would according to the US Treasury’s Office of Financial Research (OFR) lead to a bloodbath in the US high-grade bond market. This would then spread to junk bonds, fixed rate mortgages and derivatives to further spread the crisis. A rise in rates will also affect the offshore dollar funding market which has risen 5 fold this century to $10 trillion. With over Yen 1 quadrillion in debt, Japan could not survive rates rising above zero.

The OFR Stress Index below is a daily market based snapshot of stress in global financial markets. It is constructed from 33 financial market variables such as yield spreads, valuation and interest rates. The index is now at a similar risk level as before the 2007- 9 financial crisis.

RISK IS AT AN EXTREME

As I have discussed in recent articles, risk is currently at an extreme in most sectors of the financial world. The main indicators which are now signalling a turn in markets are interest rates and inflation going up and the dollar falling. These moves will accelerate in coming months and years until we see both interest rates and inflation in the teens, at least, and the dollar finishing the 100 year move to zero.

The volatility in stock markets that we have seen in recent days is another indication of a turn in the economy. In 5 of 6 trading days last week, the Dow moved 500 to over 1,000 points per day. We are likely to see further pressure in the short term before either the market turns up again to finish the melt-up move sometime this year. Or alternatively we have now seen the top and markets move down strongly from here. Either way, stocks are now very high risk and investors should either reduce positions or get out of the market.

With stocks falling and cryptos halving in value, the precious metals are now starting to react. As is common when stocks fall, metals also go down initially before they resume the uptrend. Gold in dollars is now up $120 since early December. For gold to really move, it must move in all currencies. But that has not been the case. Gold in Euros, Swiss francs and Pounds are just slightly above the early December levels. This means that it is actually not gold which has moved up since December. Instead, what we have seen is dollar weakness.

Read More @ GoldSwitzerland.com

Mueller’s Investigation A Farce: Files Joke Indictment Against Russian Trolls

by Elizabeth Vos, Disobedient Media:

If one needed proof that Mueller’s investigation was an utter farce, they were in for a treat this morning when the Deputy Attorney General announced the indictment of thirteen “Russian trolls,” for allegedly interfering in the 2016 Presidential election by posting on social media accounts.

Laying Mueller’s disregard of the First Amendment aside, the indictment is blatantly hypocritical in light of active social media intervention by pro-Clinton David Brock and his multi-million dollar efforts to ‘Correct The Record.’

The indictment alleges that: “Beginning in or around June 2014, the ORGANIZATION obscured its conduct by operating through a number of Russian entities, including Internet Research LLC, MediaSintez LLC, GlavSet LLC, MixInfo LLC, Azimut LLC, and NovInfo LLC.”

The indictment further alleges that: “The ORGANIZATION sought, in part, to conduct what it called information warfare against the United States of America through fictitious U.S. personas on social media platforms and other Internet-based media.”

According to the indictment, the co-conspirators “engaged in operations primarily intended to communicate derogatory information about Hillary Clinton, to denigrate other candidates such as Ted Cruz and Marco Rubio, and to support Bernie Sanders and then-candidate Donald Trump.”

The indictment represents the latest mutation of Russian interference allegations that have dragged on for over a year. As this author previously noted, the definition of Russian interference has shifted from unsubstantiated claims of Russian hacking, to Russian collusion, and finally to Russian social media trolling.

The Washington Post reported in 2015 that David Brock’s Correct The Record would work directly with the Clinton Campaign, “testing the legal limits” of campaign finance in the process. How did Correct The Record skirt campaign finance law? The Washington Post tells us: “by relying on a 2006 Federal Election Commission regulation that declared that content posted online for free, such as blogs, is off-limits from regulation.” And post online, Brock’s PAC did: “disseminating information about Clinton on its Web site and through its Facebook and Twitter accounts, officials said.”

Read More @ DisobedientMedia.com

Why Even Pretend There’s A Debt Ceiling Limit?

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by Dave Kranzler, Investment Research Dynamics:

The current “debt ceiling” has been suspended until March 2019. The current amount of Treasury debt outstanding is $20.681 trillion. It has been estimated that the amount of Treasury outstanding by March 2019 will be as high as $22 trillion. U.S. Government has, for all intents and purposes, operated without a constraint on debt issuance since 2013:

Beginning in 2013, Congress has taken to temporarily suspending the debt limit, rather than raising it directly. The debt limit has now been suspended on five occasions, most recently as part of the Bipartisan Budget Act of 2018, which suspends the debt limit through March 1, 2019. When that suspension expires, the debt limit will be reinstated at a new, higher level. – Bipartisan Policy Center

Note that the estimate of $22 trillion in Treasury debt outstanding by March 2019 is just an estimate from the Committee for a Responsible Federal Budget. But the suspension of the debt ceiling gives the Government carte blanche to spend as much as it wants without restraint. In theory, the amount of Treasury debt could me much higher than $22 trillion by March 2019.

Furthermore, based on the track record of Congress and the President since 2013, the debt ceiling will likely be waived once again. Why even bother playing this game? The Treasury debt doubled under Bush II from $5.7 trillion to $11.2 trillion. Under Obama the debt outstanding nearly doubled again. If this pattern simply repeats, the debt will double again under Trump or under Trump + Trump’s successor after four years.

But it will likely more than double. The cost of interest on the Treasury debt in 2017 was $458 billion. This was 11.5% of the Government’s total expenditures in FY 2017. Already in the first four quarters of FY 2018, the Government has spent $174.8 billion in interest expense – a run-rate of $524.4 billio – 12.8% of the Government’s FY 2018 budget . By the end of FY 2018, the total interest expense will be even higher because the amount of debt outstanding will be have increased over the year by at least $1 trillion and probably more.

The question, then, is why even bother with the debt ceiling?  What’s the point of pretending?  The debt ceiling was meant to act as a “brake” on the Government’s fiscal recklessness.  But now it’s so easy to suspend the ceiling it makes no sense to waste time going through the formality of suspending it.  The U.S. is on debt-driven suicide path anyway.

Read More @ InvestmentResearchDynamics.com

Five ‘Dry Runs’ Successfully Completed As China Prepares To Launch Its Gold Convertible Petro-Yuan

from SilverDoctors:

New reports are coming in on the extensiveness of the testing for the oil-for-yuan contract. Here’s the details…

March 26th is the tentative date. We’ve got our calendars marked, but first, an attempt to clarify some confusion people have about the petro-yuan.

Why?

Because discussing the petro-yuan, and the convertibility of yuan into gold, either in Shanghai or on the LBMA where gold is priced in Yuan, is about as polemic in the gold & silver community as Bitcoin. Perhaps even more so than Bitcoin.

As you will see below, it’s not even us saying the oil-for-yuan contract is convertible to gold, but a well respected news agency.

Regardless, to help clarify some of the confusion, here’s two points I argued pertaining to what everybodyseems to be missing about the whole oil-for-yuan/oil-for-gold contract:

The first point is a counter to this statement which everybody accepts as doctrine: Anybody can buy gold with dollar at any time – no gold-backed oil contract needed.

Let’s think about “anybody can buy gold with dollars now” for a moment.

Dollars come from the United States. The benchmark global gold price in dollars comes from the United States.

It makes sense that if a company/country is selling a crap-ton of barrels of oil for dollars, said company/country would be most efficient in purchasing their physical gold on the COMEX with those dollars.

It’s not like a company or country can walk into some local coin shop with $350,000,000 in U.S. dollars and scoop up a 259,259 Chinese Gold Pandas.

They need the COMEX.

Here’s the problem: If the U.S. futures market price of paper gold is nothing more than a debt based fiat currency price for something that never actually gets delivered, but rather, gets cash settled with more debt based fiat currency, then the company/country that just sold their oil for dollars is not really able to just take those dollars and buy gold as the “matter-of-fact” statement claims.

Secondary note to the first point:

We see what happens to world leaders when they announce or  begin to sell their oil for something other than dollars.

Anybody who is not familiar with this, the answer is death of said leader and destruction/plundering of the country by the war machine.

There is a flip-side to the oil-for-gold proclamations that we are missing:

Say Oil producers Canada or Mexico, or pick some non-bedfellow countries that attract the war machine, such as Turkey, Syria, Iraq, or Venezuela, who all of the sudden decide, “We are selling our oil for dollars, but we will immediately take them and buy physical gold from the COMEX with all the proceeds.”

Are the neo-cons, the deep state, the ESF, the Fed, the gold cartel and the other nefarious players just going to sit by and say:

“sure dude, whatever floats your boat”.

Not a chance. Said groups will spring into action, most likely of the swift and violent type.

To say “anybody can buy gold now” with their dollars misses the point.

The second point is even simpler:

The bigger picture that everybody keeps missing has to do with one of the principle reasons that people will use an un-backed, debt based fiat currency: CONFIDENCE

Whether the oil for gold contract is true or false, myth or fact, it misses the point that China is looking for confidence in something other than the dollar.

So back to the new details on the oil-for-yuan contract. 

Here’s the latest from RT (bold added for emphasis):

The petroyuan is seen as Beijing’s challenge to the US dollar, the dominant global currency in oil contract settlements.

The contract could reportedly be launched on March 26 on the Shanghai International Energy Exchange (INE). The exchange has recently received the approval from China’s State Council.

In December, the INE announced a successful completion of the fifth dry run in yuan-backed oil futures contract trading. It said that 149 of its members traded 647,930 lots in the rehearsal with a total value of 268.2 billion yuan. The exchange said the system met the listing requirements of crude futures after the exercise.

The Chinese government announced plans last year to start a crude oil futures contract priced in yuan and convertible into gold. The contract will enable the country’s trading partners to pay with gold or to convert yuan into gold without the necessity to keep money in Chinese assets or turn it into US dollars.

Now, tie this latest new with what Russia just said yesterday:

Russian financial institutions are prepared to survive without access to SWIFT (The Society for Worldwide Interbank Financial Telecommunication) – the global dollar-based interbank payments network – should the US and European Union follow through with threats to cut it off, according to Deputy Prime Minister Arkady Dvorkovich.

“Certainly, it is unpleasant, as it will prove a stumbling block for companies and banks, and will slow down work. It will be inevitable to deploy some aged technologies for information transfer and calculations. However, the companies are technically and psychologically ready for the shutdown as this threat was repeatedly voiced,” Dvorkovich said, according to TASS and RT, adding that such a dramatic step would negatively corporations doing business in the US and Europe.

“In general, disconnecting Russia from SWIFT would be a crazy step on the part of our Western partners. It is obvious that for the companies which work in Europe and the US it would be harmful. And this applies not only to the shutdown of the service,” he said.

Read More @ Silverdoctors.com

The Stock Market Is Not Out of the Woods

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by Jim Rickards, Daily Reckoning:

As the Dow Jones industrial average fell over 2,600 points between Feb. 2 and Feb. 8, 2018, a decline of over 10% from the all-time high of 26,616 on Jan. 25, and officially a market “correction” as defined by Wall Street, one question kept repeating in investors’ minds: Where is the “Powell Put?”

A bit of explanation may be in order.

The name “Powell” is a reference to Jay Powell, the newly installed chairman of the Federal Reserve Board. The term “put” comes from options trading. The holder of a put has protection from market declines. When markets are collapsing, put owners can close out stock positions at levels set by the put contract and avoid losses below those levels.

The Powell Put is simply a reference to the fact that Jay Powell and the Fed will bail out stock investors at some level to avoid extreme losses.

Jay Powell was selected by President Donald Trump to be the new chairman of the Board of Governors of the Federal Reserve. Now that Powell has been confirmed and sworn in, stock markets are looking to Powell for relief from the current turmoil.

The Powell Put is the latest in a long line of bailouts offered to the stock market by the Fed.

The “Greenspan Put,” named after Fed Chairman Alan Greenspan, was exhibited in September and October of 1998 when Greenspan cut interest rates twice in three weeks, including an emergency rate cut not at a scheduled FOMC meeting, to control the damage from the collapse of hedge fund Long-Term Capital Management.

The “Bernanke Put,” named after Fed Chairman Ben Bernanke, was exhibited on numerous occasions, including the launch of QE2 in November 2010 after QE1 had failed to stimulate the economy and the delay of the taper in September 2013 after the emerging markets meltdown resulting from Bernanke’s “taper talk” in May 2013.

The “Yellen Put,” named after Fed Chair Janet Yellen, was also on display many times. Yellen delayed the “liftoff” in rate hikes from September to December 2015 or order to calm markets after the Chinese shock devaluation and U.S. market meltdown in August 2015.

The Yellen Put was used again starting in March 2016 when the Fed delayed expected rate hikes until December 2016 to deal with another China devaluation shock and U.S. market meltdown in January–February 2016.

In short, there is a long history of the Fed cutting rates, printing money, delaying rate hikes or using forward guidance to calm nervous markets and pump up asset prices. Over the past 20 years, the Fed has practiced the mantra of ECB head Mario Draghi, “Whatever it takes,” as its response to disorderly market declines.

Now that U.S. stock markets have experienced a drawdown as severe as those of August 2015 and January 2016, the need for the Fed to possibly exercise the Powell Put is back on the table.

There can be no doubt that the Powell Put exists. The Fed will not stand idle as markets collapse and the 401(k)s of Americans are wiped out.

The Fed’s actions in fall 2008 in response to Lehman Bros. and AIG were an extreme example of the “whatever it takes” philosophy of modern central bankers. The idea of free markets finding a level at which markets clear and rotten banks and bad loans are allowed to fail is passé.

These continual Fed bailouts will prove to be cancerous in the fullness of time. By creating asymmetric markets that only go up and are never allowed to fall too far, the Fed is disguising the true risks and encouraging investors to overallocate to highly risky assets.

The time will come, sooner than later, when the asset bubbles are so large and the resulting collapse so catastrophic that it will exceed the capacity of central bankers to stop the panic.

For now, the Fed put is still relied upon by investors to prop up asset prices.

But at what level? When does the Powell Put come into effect? Answering these questions is critical before investors can decide if it’s safe to go back in the water.

Based on my personal conversations with Ben Bernanke, recent remarks by New York Fed President Bill Dudley and the actual interventions of the Fed over the past 20 years, we actually have good transparency as to how and when the Powell Put will come into play.

The put operates based on a two-factor formula. The first factor is the size of the market decline measured in percentage terms, and the second factor is the speed with which the market declines.

The combination of the two factors — speed and percentage decline — determine when the put is activated.

Read More @ DailyReckoning.com

Is The Fed Back To “Quantitative Easing?”

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by Dave Kranzler, Investment Research Dynamics:

The Fed added $11 billion to its SOMA account for the week ending yesterday. It purchased $11 billion in mortgage securities directly from banks. This injects $11 billion into the banking system. Cash is “high powered” money, meaning it can be leveraged 10x (banks need to hold 10% in reserves against “high powered” money. $11 billion is $110 billion of leverage for the banks to use for activities such as propping up the stock market.

This certainly explains why there appears to be another “V” recovery in the stock market after a near-10% drawdown in the Dow and the SPX. This is very similar to the 10% market plunges in August 2015 and January 2016, both of which were followed with highly unusual “V” recoveries.

This is also likely the catalyst that powered gold’s $41 rise since February 9th.

Clearly the Federal Reserve – not withstanding the fecal odor that emanates from Fed officials’ mouths when they speak – has an implicit monetary policy that targets the stock prices.

Furthermore, the Fed must be getting worried about the housing market. Removing $11 billion in mortgage securities from the banking system and replacing those securities with cash was likely a move targeting the rate spread between conventional mortgages and the 10-yr Treasury. Mortgage purchase applications plunged 6% last week. This was without question in response to mortgage rates pushed meaningfully higher by the rising 10yr Treasury yield and the widening of spreads associated with higher volatility in the markets.

Read More @ InvestmentResearchDynamics.com

Keiser Report: Do No Harm (E1189)

from RT:

Max also interviews Patrick Byrne about the regulatory landscape as his own ICO for tZero draws to a close.