Thursday, April 9, 2020

Now That The Government Has Shut Down, Here’s What Actually “Shuts Down”

0

from ZeroHedge:

It’s official: as of midnight Saturday, the US government has shut down following a failure in the Senate to strike a funding deal. Government funding was due to run out after Dec. 8 but was twice extended, most recently through Jan. 19, at which point the US encountered what’s officially called a “spending gap,” which triggers an official halt to Washington’s work.

In retrospect, this is hardly a novel development, as history shows there have been 18 previous closures starting in 1976, with the last one taking place in September 2013. Almost all of the funding gaps occurred between FY1977 and FY1995. During this 19-fiscal-year period, 15 funding gaps occurred.

Additionally, seven of the funding gaps commenced with the beginning of the fiscal year on October 1. The remaining 11 funding gaps occurred at least more than one day after the fiscal year had begun. Ten of the funding gaps ended in October, four ended in November, three ended in December, and one ended in January.

According to the CRO, funding gaps have ranged in duration from one to 21 full days, with six of the eight lengthiest funding gaps, lasting between eight days and 17 days, occurred between FY1977 and FY1980—before the Civiletti opinions were issued in 1980 and early 1981. After the issuance of these opinions, the duration of funding gaps in general shortened considerably, typically ranging from one day to three days. Of these, most occurred over a weekend.

* * *

So now that the US government is taking some time off for only the second time this century, here is a summary of what actually is shut down until the funding gap is closed, courtesy of Bloomberg.

1. What happens if the government shuts down?

Many, though not all, federal government functions are frozen, and many, though not all, federal employees are furloughed. Agencies in the executive branch, the one with the largest workforce and budget, regularly review shutdown plans that spell out what work must continue, and how many employees will be retained, during a “short” lapse (one to five days) and one that lasts longer.

Read More @ ZeroHedge.com

“Mother Of All Blow-Offs?”

0

by Dave Kranzler, Investment Research Dynamics:

People who look for easy money invariable pay for the privilege of proving conclusively that it cannot be found on this earth. – Jesse Livermore

Boeing’s stock has gone parabolic. It’s doubled since April 2017:

The stock now trades at a 31x PE ratio, for whatever that’s worse. I’m sure if I went through the numbers closely, I could find numerous accounting manipulations which added a copious amount of non-cash income to BA’s numbers. BA’s revenues on a trailing 12 month basis are flat. From 2015 to 2016, its revenues declined 1.7%. On a trailing twelve month basis vs. 2016, its revenues have dropped 3.2%.

Historically paying a nose-bleed PE ratio for a company with deteriorating revenues and an enormous amount of debt does not produce a good result. Chasing the price-momentum higher and waiting for a bigger idiot to buy shares from you works well until the music stops. Then everyone gets hurt.

The Dow moved up an average of 120 pts per day in the nine trading days since the end of 2017. This includes one day in which the Dow dared to close 12 pts lower. That one day felt like a bear market. Over this entire period the Dow has appreciated 4.4%. Since the election, including the 1,000 pt plunge in the Dow futures that occurred when it was apparent Trump would win, the Dow has soared nearly 50%.

What’s driving this? Since late August, the public has literally thrown money blindly into passively managed ETFs which automatically distribute the cash inflow by market cap weighting into the stocks in the index that underlies the ETF. This means that most of the gains are concentrated in the stocks in the Dow/SPX with the largest market caps, which then drives the Dow/SPX higher. For instance, last Friday, the Dow was up 0.89% but AMZN was up 2.2%, Netflix was up 1.8%, GOOG was up 1.5% etc.

There’s no telling how much longer this can persist without some type of accident. Judging by the data on cash in customer brokerage accounts at the big online brokers , I would have to believe that this last push from the retail investor is nearing its completion. Data from the fund industry has shown a massive migration of investor cash moving out of actively managed mutual funds and into passive index funds. This would include money managed on behalf of individuals by registered investment advisors.

Most investor sentiment indicators are showing extreme levels of bullishness – historically unprecedented levels.  The short interest on the NYSE has melted down nearly to zero.   The Acting Man blog has written an excellent post which details the sentiment indicators flashing bright red warning lights – I recommend a perusal:   Mother Of All Blow-Offs

For now, the raging bulls chasing momentum conveniently ignore  the deterioration in “new orders” and “employment” numbers in deference to the statistically manipulated headline reports that purport to show economic growth. Most of the bullish reports are overweighted with “sentiment” and “hope” metrics that offset declining real economy statistics.  Credit card and auto loan delinquencies – both subprime and “prime” –  continue to increase a double-digit rates (see WFM or COF’s latest quarterlies, for instance).  As for the “prime” credit rating designation of 2017, it’s not your mother’s “prime” credit rating.

At this point I don’t want to speculate on how much longer that Dow/SPX/Naz can go straight up. Historically this is the type of market behavior which has marked the blow-off top of speculative manias and has preceded serious market accidents.

Read More @ InvestmentResearchDynamics.com

Rickards: Next Financial Panic Will Be the Biggest of All, with Only One Place to Turn…

by Mike Gleason, Money Metals:

Welcome to this week’s Market Wrap Podcast, I’m Mike Gleason.

Coming up we’ll hear another amazing interview with Jim Rickards. Jim examines what the next financial crisis will look like and how it will be different from previous panics, gives us his outlook for gold and the key drivers for the yellow metal in part one of a tremendous two-part interview. Don’t miss my conversation with Jim Rickards, coming up after this week’s market update.

As the White House and Congressional leaders scramble to avert a government shutdown, investors are bracing for possible market gyrations. Historically, government shutdowns have tended to produce only minor selling in the stock market – in part because no essential functions of government ever actually shut down.

Click HERE to listen

Read More @ MoneyMetals.com

A Cover Up Turns 50: Unpopular Reflections on the MLK Assassination

0

from The Sleuth Journal:

Not enough Americans know that in 1999 a jury in a civil suit brought by the family of the Rev. Dr. Martin Luther King, Jr., ruled that a retired Memphis cafe owner was part of a conspiracy in his 1968 assassination.

During the trial, which received almost no media attention, the legal team representing the King family also implicated the U.S. intelligence apparatus. Among the startling and provocative assertions made in the courtroom, included the claim that the U.S. 111th Military Intelligence Group were at Dr. King’s location during the assassination, and that the 20th Special Forces Group had an 8-man sniper team there as well. What is more, the King’s legal team presented a number of questions regarding the unusual behavior of the Memphis Police special body guards, who were advised they “weren’t needed” that day. Across the board, regular and constant police protection for King was removed, so that at the time of the shooting he had almost no official shield of defense.

The lawyers also set out to demonstrate that military intelligence set up photographers on a roof of a fire station with a clear view to Dr.

SPECIAL:

CHARMING ST. JOHANN IN TYROL: PERFECT SLOPES AND COSY SKI HATS

Charming holiday region St. Johann in Tirol – In the in the heart of the biggest winter areas of the world! – The villages of the region …

King’s balcony; that Dr. King’s room was changed from a secure 1st-floor room to an exposed balcony room; and that the Memphis police ordered the cutting down of bushes that could have hid a sniper. Along with sanitizing the crime scene, the police also neglected to carry our ordinary investigative procedures such as interviewing witnesses who lived by the scene of the shooting.

After four weeks of testimony from over 70 witnesses and just three hours of deliberation, the jury of six whites and six blacks in the wrongful-death case found that Loyd Jowers, as well as “others, including governmental agencies” had been part of a conspiracy. The jury awarded the King family the damages they had sought: $100, which was then donated to charity.

Rather than explain and inform the public about the jury’s decision, mainstream news outlets such as the New York Times merely summarized the purpose behind the lawsuit in the first place. According to their feature story, the King family had long questioned Mr. Ray’s conviction and hoped the suit would change the legal and historical record of the assassination. “This is a vindication for us,” said Dexter King, MLK’s youngest son.

It has now been almost 50 years since the execution of America’s greatest citizen and the truth about his murder has continued to be covered up by almost every institution in our society. To be fair, hardly any of these institutions (e.g., universities, high schools, churches, museums, historical societies)  know that they are part of a cover up, they just believe and teach what they have been allowed to know.

But what they “know” about the MLK assassination is mostly false. There can be no peace without justice. Until the nation is able to come to terms with the facts of MLK’s murder, our nation cannot properly honor his legacy.

Service projects are wonderful. Candlelight vigils are beautiful.

Concerts and fundraisers are inspiring. I am sure that Dr. King would be pleased with all of these positive actions to help build the “Beloved Community.” But until our country is able to come to terms with the real circumstances of his death, we will not be able to fight for what he stood for-at least not with the fortitude needed.

Read More @ TheSleuthJournal.com

GOLD UP $6.00 TO $1333.15/SILVER IS UP 9 CENTS TO $17.03/GOLD EFP ISSUANCE: 5867 CONTACTS

by Harvey Organ, Harvey Organ Blog:

SILVER EFP ISSUANCE: 1597/ AT COMEX A HUGE 125,850 OZ ADDED INTO INVENTORY BY JPMORGAN/IN SILVER JPMORGAN ADDED ANOTHER 503,791.OZ/A HUGE RISE IN THE 10 YR USA BOND YIELD TO 2.659%/THE 30 YR BOND YIELD RISES TO 2.932

GOLD: $1333.15 UP $6.00

Silver: $17.03 UP 9 cents

Closing access prices:

Gold $1331.70

silver: $17.03

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: $1338.44 DOLLARS PER OZ

NY PRICE OF GOLD AT EXACT SAME TIME: $1331.40

PREMIUM FIRST FIX: $7.04

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

SECOND SHANGHAI GOLD FIX: $1339.81

NY GOLD PRICE AT THE EXACT SAME TIME: $1331.60

Premium of Shanghai 2nd fix/NY:$8.21

SHANGHAI REJECTS NY /LONDON PRICING OF GOLD

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

LONDON FIRST GOLD FIX: 5:30 am est $1335.80

NY PRICING AT THE EXACT SAME TIME: $1336.10

LONDON SECOND GOLD FIX 10 AM: $1334.95

NY PRICING AT THE EXACT SAME TIME. $1334.00

For comex gold:

JANUARY/

NUMBER OF NOTICES FILED TODAY FOR JANUARY CONTRACT: 4 NOTICE(S) FOR 400 OZ.

TOTAL NOTICES SO FAR: 472 FOR 47200 OZ (1.4681 TONNES),

For silver:

jANUARY

5 NOTICE(S) FILED TODAY FOR

25,000 OZ/

Total number of notices filed so far this month: 688 for 3,440,000 oz

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

Bitcoin: BID $11,227/OFFER $11,327  UP 27 (morning)

 Bitcoin: BID   11,327/OFFER  $11,427 UP  $120(CLOSING)

 

end

Let us have a look at the data for today

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

In silver, the total open interest FELL BY A SMALL  1615 contracts from 196,423 FALLING TO 194,808 WITH YESTERDAY’S DEEP 23 CENT FALL IN SILVER PRICING.  WE THUS HAVE SOME 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:  1597 EFP’S FOR MARCH AND ZERO FOR OTHER MONTHS  AND THUS TOTAL ISSUANCE OF 1597 CONTRACTS. HOWEVER THE MOVEMENT ACROSS TO LONDON IS NOT AS SEVERE AS IN GOLD AS THERE SEEMS TO BE  MAJOR PLAYERS WILLING TO TAKE ON THE BANKS AT THE COMEX. STILL, WITH THE TRANSFER OF 1597 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.

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

33,424 CONTRACTS (FOR 14 TRADING DAYS TOTAL 33,424 CONTRACTS OR 167.120 MILLION OZ: AVERAGE PER DAY: 2387 CONTRACTS OR 11.937 MILLION OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SUPPLY THIS MONTH IN SILVER:  SO FAR THIS MONTH:  167.120 MILLION PAPER OZ HAVE MORPHED OVER TO LONDON. THIS REPRESENTS AROUND 23.8% OF ANNUAL GLOBAL PRODUCTION

RESULT: A SMALL SIZED LOSS IN OI COMEX DESPITE THE 23 CENT FALL IN SILVER PRICE WHICH USUALLY INDICATES ANOTHER FAILED BANKER SHORT-COVERING. WE ALSO HAD A HUGE SIZED EFP ISSUANCE OF 1597 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 . FROM THE CME DATA 1573 EFP’S WERE ISSUED FOR TODAY  FOR A DELIVERABLE FORWARD CONTRACT OVER IN LONDON WITH A FIAT BONUS. WE REALLY LOST ONLY 42 OI CONTRACTS i.e. 1573 open interest contracts headed for London (EFP’s) TOGETHER WITH A DECREASE OF 1615  OI COMEX CONTRACTS. AND ALL OF THIS HAPPENED WITH THE FALL IN PRICE OF SILVER OF 23 CENTS AND A CLOSING PRICE OF $16.94 WITH RESPECT TO YESTERDAY’S TRADING. YET WE STILL HAVE A GOOD 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. 0.974 BILLION TO BE EXACT or 139% of annual global silver production (ex Russia & ex China).

FOR THE NEW FRONT JANUARY MONTH/ THEY FILED: 5 NOTICE(S) FOR 25,000 OZ OF SILVER

In gold, the open interest SHOCKINGLY ROSE BY A CONSIDERABLE 3953 CONTRACTS UP TO595,151 DESPITE THE LARGE  FALL IN PRICE OF GOLD WITH YESTERDAY’S TRADING ($11.85). THUS ANOTHER FAILED BANKER SHORT COVERING.  IN ANOTHER HUGE DEVELOPMENT, WE RECEIVED THE TOTAL NUMBER OF GOLD EFP’S ISSUED FOR TODAY AND IT TOTALED A GOOD SIZED  5867 CONTRACTS OF WHICH THE MONTH OF FEBRUARY SAW 5867 CONTRACTS AND APRIL SAW THE ISSUANCE OF 0 CONTRACTS   The new OI for the gold complex rests at 595,151. 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 JANUARY 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 WE HAVE ANOTHER MONSTROUS GAIN OF 9820 OI CONTRACTS: 3953 OI CONTRACTS INCREASED AT THE COMEX AND AN GOOD SIZED  5867 OI CONTRACTS WHICH NAVIGATED OVER TO LONDON.

YESTERDAY, WE HAD 6902 EFP’S ISSUED.

ACCUMULATION OF EFP’S/ GOLD(EXCHANGE FOR PHYSICAL) FOR THE MONTH OF JANUARY STARTING WITH FIRST DAY NOTICE: 134,717 CONTRACTS OR 13.4717 MILLION OZ OR 419.02 TONNES(14 TRADING DAYS AND THUS AVERAGING: 9622 EFP CONTRACTS PER TRADING DAY OR 962,200 OZ/DAY)

TO GIVE YOU AN IDEA AS TO THE HUGE SIZE OF THESE EFP TRANSFERS :   SO FAR THIS MONTH IN 14 TRADING DAYS: IN  TONNES: 419 TONNES

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

THUS EFP TRANSFERS REPRESENTS 419/2200 TONNES =  19.04% OF GLOBAL ANNUAL PRODUCTION SO FAR IN JANUARY ALONE.

Result: A SHOCKINGLY STRONG SIZED INCREASE IN OI AT THE COMEX DESPITE THE LARGE  FALL IN PRICE IN GOLD TRADING ON YESTERDAY ($11.85). WE HAD ANOTHER GOOD SIZED NUMBER OF COMEX LONG TRANSFERRING TO LONDON THROUGH THE EFP ROUTE: 5867. 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 5867 EFP CONTRACTS ISSUED, WE HAD A NET GAIN IN OPEN INTEREST OF9820 contracts ON THE TWO EXCHANGES:

5867 CONTRACTS MOVE TO LONDON AND  3953 CONTRACTS INCREASED AT THE COMEX. (in tonnes, the gain in total oi equates to 33.85 TONNES)

we had: 4 notice(s) filed upon for 400 oz of gold.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

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

GLD

With gold up $6.00, we had no change in gold inventory at the GLD/

Inventory rests tonight: 840.96 tonnes.

SLV/ 

NO CHANGES IN SILVER INVENTORY AT THE SLV/

INVENTORY RESTS AT 315.500 MILLION OZ/

end

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

1. Today, we had the open interest in silver FELL BY A SMALL 1615 contracts from 196,423 DOWN TO 194,808 (AND now A LITTLE FURTHER FROM THE NEW COMEX RECORD SET ON FRIDAY/APRIL 21/2017 AT 234,787) DESPITE  THE HUGE  FALL IN PRICE OF SILVER TO THE TUNE OF 23 CENTS WITH RESPECT TO  YESTERDAY’S TRADING.   OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE ANOTHER GOOD 1597 PRIVATE EFP’S FOR MARCH (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 LOSS AT THE COMEX OF 1615 CONTRACTS TO THE 1597 OI TRANSFERRED TO LONDON THROUGH EFP’S WE OBTAIN A SMALL LOSS OF 42 OPEN INTEREST CONTRACTS.  WE STILL HAVE A GOOD AMOUNT OF SILVER OUNCES THAT ARE STANDING FOR METAL IN JANUARY (SEE BELOW). THE NET LOSS TODAY IN OZ ON THE TWO EXCHANGES: 0.210 MILLION OZ!!!

RESULT: A SMALL SIZED DECREASE IN SILVER OI AT THE COMEX WITH THE GOOD SIZED FALL OF 23CENTS IN PRICE (WITH RESPECT TO YESTERDAY’S TRADING). BUT WE ALSO HAD ANOTHER 1597 EFP’S ISSUED TRANSFERRING COMEX LONGS OVER TO LONDON. TOGETHER WITH THE GOOD  SIZED AMOUNT OF SILVER OUNCES STANDING FOR JANUARY, 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 UP 13.11 points or 0.38% /Hang Sang CLOSED UP 132.95 pts or 0.41% / The Nikkei closed UP 44.69 POINTS OR 0.19%/Australia’s all ordinaires CLOSED DOWN 0.18%/Chinese yuan (ONSHORE) closed WELL UP at 6.4035/Oil DOWN to 63.54 dollars per barrel for WTI and 68.69 for Brent. Stocks in Europe OPENED ALL GREEN.   ONSHORE YUAN CLOSED UP AGAINST THE DOLLAR AT 6.4035. OFFSHORE YUAN CLOSED UP AGAINST  THE ONSHORE YUAN AT 6.4003//ONSHORE YUAN MUCH STRONGER AGAINST THE DOLLAR/OFF SHORE STRONGER TO THE DOLLAR/. THE DOLLAR (INDEX) IS  MUCH WEAKER AGAINST ALL MAJOR CURRENCIES. CHINA IS VERY  HAPPY TODAY.(GOOD MARKETS )

Read More @ HarveyOrganBlog.com

What Will Rising Mortgage Rates Do to Housing Bubble 2?

0

by Wolf Richter, Wolf Street:

Oops, they’re already rising.

The US government bond market has further soured this week, with Treasuries selling off across the spectrum. When bond prices fall, yields rise. For example, the two-year Treasury yield rose to 2.06% on Friday, the highest since September 2008.

In the chart, note the determined spike of 79 basis points since September 8, 2017. That was the month when the Fed announced the highly telegraphed details of its QE Unwind.

September as month of the QE-Unwind announcement keeps cropping up. All kinds of things began to happen, at first quietly, without drawing much attention. But then the trajectory just kept going.

The three-year yield, which had gone nowhere for the first eight months of 2017, rose to 2.20% on Friday, the highest since October 1, 2008. It has spiked 82 basis points since September 8:

The ten-year yield – the benchmark for financial markets that most influences US mortgage rates – jumped to 2.66% late Friday.

This is particularly interesting because the 10-year yield had declined from March 2017 into August despite the Fed’s three rate hikes last year, and rising short-term yields.

At 2.66%, the 10-year yield has reached its highest level since April 2014, when the “Taper Tantrum” was winding down. That Taper Tantrum was the bond market’s way of saying “we’re shocked and appalled,” when Chairman Bernanke dropped hints the Fed might eventually begin tapering what the market had called “QE Infinity.”

Read More @ WolfStreet.com

Gallup Poll: U.S. Is Dramatically Losing Global Respect

0

by Pam Martens and Russ Martens, Wall St On Parade:

Since the inauguration of Donald Trump on January 20, 2017, the stock market has performed as if it is operating in an alternative universe, regularly setting new record highs despite unprecedented chaos coming from the White House. Now, a new Gallup poll is calling into question how long the divergence between the market’s view of Trump and the world view of Trump can continue.

A new Gallup poll released yesterday puts global approval of US leadership at just 30%, behind China at 31% and Russia at 27%. Germany has moved into the top slot in the world with a leadership approval rating of 41%.

One of the most striking findings from the poll is how far America’s leadership approval has fallen among our closest neighbors. According to Gallup, Canada led declines with U.S. leadership approval sinking 40 points from 60% in 2016 to 20% in 2017. America’s neighbor to the south, Mexico, registered a record low approval rating of U.S. leadership, falling 28 points from 44% in 2016 to 16% in 2017, eight points lower than the previous decade low of 24% in 2008.

Approval rankings in Europe were only slightly less abysmal. Europe now registers a 25% approval and 56% disapproval. The poll notes that these ratings were actually worse during the last year of the George W. Bush administration. (The last year of the Bush administration was 2008, a time when Wall Street was causing cataclysmic financial disasters around the globe.)

Showing a broad consensus across Europe, U.S. leadership approval ratings declined significantly in 21 out of the 28 members of the European Union. The poll notes that “NATO member states led the fall in approval ratings across Europe and the world, with Portugal posting a 51-point decline in approval ratings, followed by a loss of 44 points in Belgium and a 42-point drop in Norway.”

Four of the five countries with the world’s lowest approval ratings of U.S. leadership are in Europe; Portugal (12%), Sweden (11%) join Russia and Iceland (both at 8% approval).

Additional regional highlights from the poll include the following:

  • Approval of U.S. leadership dropped to new record lows in Mexico, Haiti, Peru, Chile, Panama, Colombia, Nicaragua, Costa Rica and Guatemala.
  • Residents of Canada and Mexico are now more likely to approve of China’s leadership than U.S. leadership.
  • Argentines, Chileans and Uruguayans are the least likely among 21 populations in the Americas to approve of U.S. leadership, with 13% in each country approving.

The poll was conducted between March and November 2017 and released yesterday. Its results were based on face-to-face and telephone interviews with approximately 1,000 adults, aged 15 and older, in each country or area.

Europe’s handwringing over the Trump presidency began the very day after his win. On November 9, 2017, Michael Knigge, writing on the digital front page of Germany’s Deutsche Welle, critiqued Trump’s victory as follows:

“Trump’s success is a victory for an inflammatory, partly dehumanizing, vulgar populism. It is a sharp slap in the face to the establishment and the political elite in the United States and its representative, Hillary Clinton. As an opponent, Clinton was almost equally as unpopular as Trump. Through her own carelessness, her use of a private email server provided her critics with the ammunition they needed for their constant attacks. But Clinton’s unpopularity alone does not explain Trump’s dramatic election victory.

“Trump’s victory brings to light a long-term and deep dissatisfaction — if not actual hate — present in large sections of the populace. It is a hatred of the status quo, of globalization and the political system in Washington. In numerous polls, many Americans have repeatedly stated that they believe their standard of living and future prospects are worse than they were in their parents’ generation. Trump was the right vehicle and outlet to harness such views, which were especially held by the white working class. And Hillary Clinton was the right opponent.”

On May 19, 2017, two weeks before President Donald Trump announced the U.S. withdrawal from the Paris Climate Accord, Der Spiegel, one of the most influential news magazines in Europe, published a breathtaking assessment of the sitting President of the United States. Written by its Executive Editor, Klaus Brinkbäumer, the editorial read in part:

“Donald Trump has transformed the United States into a laughing stock and he is a danger to the world. He must be removed from the White House before things get even worse…

“Donald Trump is not fit to be president of the United States. He does not possess the requisite intellect and does not understand the significance of the office he holds nor the tasks associated with it. He doesn’t read. He doesn’t bother to peruse important files and intelligence reports and knows little about the issues that he has identified as his priorities. His decisions are capricious and they are delivered in the form of tyrannical decrees…

“Crises, including those in Syria and Libya, are escalating, but no longer being discussed. And who should they be discussed with? Phone calls and emails to the U.S. State Department go unanswered. Nothing is regulated, nothing is stable and the trans-Atlantic relationship hardly exists anymore…”

The hard assessments made early on in Europe about the Trump presidency are now being conveyed by U.S. television anchors on a nightly basis. Trump’s approval ratings among U.S. voters are also at a record low.

The question of how a billionaire real estate mogul who had filed business bankruptcies six times; had zero military or government experience; had a string of women accusing him of sexual assaults; refused to release his tax returns; was caught on audio tape stating that he could grab women by the “p***y” because he was a celebrity – rose to the highest office in the United States is a matter that must be investigated with all the tenacity of a skilled surgeon’s scalpel seeking to eradicate a malignant tumor from a failing patient.

Read More @ WallStOnParade.com

US Gold Reserves, Of Immense Interest to Russia and China

0

by Ronan Manly, BullionStar:

Recently, Russian television network RT extensively quoted me in a series of articles about the US Government’s gold reserves. The RT articles, published on the RT.com website, were based on a series of questions RT put to me about various aspects of the official US gold reserves. These gold reserves are held by the US Treasury, mostly in the custody of the US Mint. The US Mint is a branch of the US Treasury.

The first of these articles, published by RT on 30 December 2017, is titled “US gold of low purity & that’s why audit of reserves will never be allowed – expert tells RT”.

The second article was published by RT on 8 January 2018 and is titled “Russia-China combined gold reserves could shake US dominance in global economy – expert tells RT

As the subject matter of US gold reserves is broad and wide-ranging, the RT questions and my answers and opinions covered a lot of material and RT therefore decided to divide it’s coverage into 2 articles. The first RT article covered the lack of transparency into the US gold reserves, the fact that has never been any of independent audits of the gold, and the fact that a lot of gold bars that the US claims to hold are actually low purity gold bars which do not conform to international industry standards on tradable wholesale gold bars (i.e. Good Delivery standards).

The first article also touched on the international reaction to and the effects on the US dollar that might unfold if the US gold reserves were found to be less than they are claimed to be.

The second RT article looked at the gold holding strategies of China and the Russian Federation, where the central banks of both nations have been actively accumulating their national gold reserves over the last 10-15 years, and where both central banks have been vocal about this monetary gold accumulation, possibly in preparation for a future return to a gold-backed monetary standard.

The second RT article also explored the scenario under which both China and Russia could have significantly more gold accumulated than they have publicly divulged, a situation which if revealed would put the spotlight back on to the claimed gold holdings of the US Treasury.

Following the RT articles, on 11 January, Beijing-based Chinese business and financial website BWChinese picked up on my quotes in the second RT.com article, and in a geo-political article about oil, the Renminbi, the US Dollar and gold (written in Chinese), the Chinese website linked the gold accumulation of China and Russia to part of a strategy of moving away from the dominance of the US dollar. The BWChinese article (in Chinese) can be seen here.

Then finally on 16 January, Moscow headquartered Sputnik news agency, in an article titled “Chinese Media Explain How Russia & China Can Escape ‘Dollar Domination”, profiled the BWChinese article, and essentially (and conveniently) summarized the entire Chinese article back into English. Interestingly, there was therefore coverage of the topic of official US gold reserves from Moscow across to Beijing, and back to Moscow again, all within the space of a week and spanning 3 media publications, namely RT, BWChinese and Sputnik.

Read More @ BullionStar.com

GOLD WILL SURGE AS THE WORLD HITS A ROCK OR A HARD PLACE

0

by Egon von Greyerz, Gold Switzerland:

The world is now between Scylla and Charybdis or between two evils. Thus, there is no solution or positive outcome of the present state of the world economy. Scylla is the rock or the six headed monster whilst Charybdis is a whirlpool or a black hole (a hard place).

BETWEEN SCYLLA (A ROCK) AND CHARYBDIS (A HARD PLACE)

Since 2006-9, governments and central banks believe that they have got through the strait of Messina passing through Scylla and Charybdis but sadly they are mistaken. The world is still desperately trying to get through the inescapable passage that would lead to safety. By printing unlimited amounts of money and thus doubling global debt, there is a general belief that the world has passed the dangers. But sadly that is not the case. We are still in very dangerous waters.

Will the world economy be trapped by Scylla, the rock, and incur damages that will have severe consequences for the world economy for years or decades. Or will we be unlucky to be caught by the whirlpool or black hole of Charybdis. Let’s hope not since that would be the end of the world as we know it for a very, very long time.

In the Greek mythology, Odysseus managed to pass by Scylla according to Homer. So instead of losing the ship and the crew, Odysseus just lost a number of his men rather than everything by being caught by Charybdis. Hopefully the world will be just as fortunate.

Last week I discussed the inevitable trends that the world would encounter in 2018 – a final hurray for stocks, a falling dollar, rising interest rates and higher gold and silver prices as well as higher commodity prices. Well, one week later it is all happening.

But this is just the beginning. We are now entering a period when governments and central banks will totally lose control of markets as their manipulation fails.

I have long maintained that the laws of nature will prevail and that the manipulation we have have seen in markets in the last couple of decades would fail.

In the last week I had an experience that confirmed the power of the laws of nature. This is a power that is so strong that once it is triggered, no government or central bank can stop it however much fake news, trillions of money printing or market manipulation they throw at the problem.

AN UNSTOPPABLE AVALANCHE WILL HIT THE WORLD

Last weekend I was in the Swiss Alps in the village of Zermatt at the base of the famous Matterhorn. For several days we had a relentless snowfall not seen for decades. The snow blocked the access to the village both by train and road for several days. The force of this avalanche was of a magnitude that destroyed everything in its way.

This is exactly what we will experience in the world economy and financial markets in coming years. Most avalanches occur spontaneously due to the increased load of snow. Eventually that last snowflake and the weight of the snow triggers the avalanche. Money printing, fake news, and government manipulation has temporarily managed to set aside the laws of nature but eventually the truth will win. The force of the financial avalanche coming will be similar to the the avalanche we just had in Zermatt. It is so powerful that everything in its way will be destroyed. And no human intervention can stop it. At the end of this article there is a link to the avalanche in Zermatt.

THE LAWS OF NATURE WILL PREVAIL

The truth is that a manipulative elite has managed to totally destroy the natural forces of ebb and tide. There are natural cycles in nature that move gently between peaks and troughs. These cycles are self-correcting without any human interference or manipulation. But there are times in history when mankind want to play god and endeavour to set aside the laws of nature. This is what the world has experienced in the last 100 years with an elite interfering with the natural forces of supply and demand by manipulating the economy and financial markets. They have skilfully done this for a century without taking responsibility for the consequences.

In the next few years, the world will experience the repercussions of the disastrous mismanagement of the world economy that governments and the elite have inflicted.

We are now reaching the point when lies, money printing, artificial interest rates or any other form of manipulation will cease to have any effect. The sheer force of the avalanche will kill all fake manoeuvres. And as the avalanche crushes anything in its way, it will pulverise the financial system, stock markets, bond markets as well as all markets that have been inflated or manipulated by a crooked elite. This means that banks will either go bust or that the money will be worthless due to unlimited money printing. Stocks will go down by 90% or more in real terms, bonds will be worthless, social security will not exist, pensions will be wiped out and property values will decline by 75% to 95% in real terms.

This is the magnitude of the avalanche that the world is likely to experience in coming years. Could I be wrong. Well, I hope I will be. But sadly I fear I will be right. The only question is if governments and central banks can delay it for another few years or if the force of the avalanche is too strong this time.

GLOBAL DEBT AND ASSET BUBBLES WILL IMPLODE

One thing is certain, global debt at $240 trillion plus unfunded liabilities of $250 trillion and derivatives of $1.5 quadrillion which is risk totalling $2 quadrillion can never be repaid. However it happens and however long it takes, the debt must be eliminated. And once it is, all the assets linked to this debt will also implode. But before the implosion, we are likely to have hyperinflation as desperate governments hopelessly attempt to inflate the debt away.

The world can never start a new growth phase without first having got rid of the debt. That will inevitably lead to poverty, famine, social unrest, war and misery. But unfortunately that is the consequence of the disastrous mismanagement of the world economy in the last 100 years.

CRITICAL STEPS TO TAKE

So what can we all do in the meantime. Here are a few tips:

  • Get out of the stock market on the coming final rally
  • Get out of the bond market
  • Get out of debt
  • Get out of investment property
  • Don’t depend on a pension system which is likely to fail
  • Don’t expect the government to look after you
  • If you lose your job, plan how you can survive. There are lots of services that are in demand in a depression.
  • If you have savings, don’t keep them in the banking system
  • Hold gold and silver outside the banking system
  • Family and friends are extremely important in difficult times. Create a circle of mutual dependence and trust.

There is of course a lot more people can do to prepare. Jim Sinclair has covered it very well in his GOTS (get out of the system) on the JSMineset.com site.

All of this might sound depressing. As I said, let’s hope it won’t happen but be prepared for that it could.

Remember that the world has survived unlimited crises throughout history and whatever happens in the coming years is not going to be the end of the world. But be prepared for the coming avalanche and try to navigate carefully to avoid the worst risks of Scylla and Charybdis. Remember that bad times have many benefits also. The golden calf or material things become less important. Instead relationships, friendship, and helping others become a priority. This will alleviate the hardship that most of us will suffer.

The trends that I discussed in last week’s article are now accelerating. Over the last few weeks, we have seen very significant moves in the dollar index and the precious metals. The dollar index is now under 91 and has broken support. Next major support is 70 but that will also be broken on the way to at least 40.

DOLLAR INDEX 1998 – 2018

GOLD – NEW HIGH IN 2018

Gold is in a hurry and has moved up $100 in the last 30 days. Gold was at $1,237 on December 12th and is now $1,337. On the quarterly chart, gold has broken all resistance and the next target is new highs above $1,920. That is very likely to happen in 2018. Thereafter gold will reach my old standing forecast of at least $10,000 in today’s money and multiples of that price in hyperinflationary money.

Read More @ GoldSwitzerland.com