“Extremely Greedy” Traders ‘Shocked’ As Stocks Stumble Most Since Election, Dollar Dumps

After exhibiting “Extreme Greed”
A down day!!!
Sentiment for the day started off strong thanks to OPEC/NOPEC and Saudi comments sparking a buying panic in crude to 17-month highs…
But it didn’t help China… (worst stock drop in 6 months) after Trump’s questioning “One China Policy” and a crackdown on insurers and liquidity…
The bond market was never really buying the opening spike in equity futures overnight…

This post was published at Zero Hedge on Dec 12, 2016.

The Narrative Changes: Republicans “Pour Cold Water” On Trump’s Massive Stimulus, Will Block Tax Cuts

The driving catalyst behind the furious market rally since the presidential election has been the market’s hope that Trump will unleash a “huge”, still undetermined, debt-funded financial stimulus package, which will grease the volatile handover from monetary to fiscal policy, boosting inflation and rerating risk assets higher. Indeed, the market was so transfixed by this hope, that it has so far ignored all warning signs, duly noted previously on this website.
Nearly a month ago, we warned that when comparing Trump’s proposed budget and the House’s own budget blueprint, “An Unexpected $12 Trillion Hole Emerges In Donald Trump’s Plan To “Make America Great Again“.”
As we first demonstrated, there was a massive $12 trillion debt difference between the plan that Trump espoused, which envisioned a $5 trillion cumulative increase in debt…
… compared to the budget blueprint approved by the house earlier this year, which in turn seeks to reduce the deficit versus current projections by $7 trillion over the next ten years, mainly through spending cuts: the result is a $12 trillion “hole” between the Trump and the House budgets.

This post was published at Zero Hedge on Dec 12, 2016.

US Budget Deficit Doubles As November Spending Hits All Time Monthly High

While it is unclear if the recent increase in government spending and the resulting increase in the budget deficit, has been a factor in the recent string of better than expected US economic data, at 2pm on Monday the US Treasury announced that in November, the government’s budget deficit rose to $136.7 billion, nearly double the $64.5 bilion deficit reported in the same month of 2015, which however was largely a function of a calendar quirk.
Not only was November total more than double the amount reported a year ago, but the $136.7 billion deficit, was also the highest going back all the way to February of 2016, when it jumped by $192.6 billion. February is traditionally the most spending-intensive month for the US government.

This post was published at Zero Hedge on Dec 12, 2016.


Gold at (1:30 am est) $1163.50 UP $4.10
silver at $17.12: UP 22 cents
Access market prices:
Gold: 1162.30
Silver: 17.07
The Shanghai fix is at 10:15 pm est last night and 2:15 am est early this morning
The fix for London is at 5:30 am est (first fix) and 10 am est (second fix)
Thus Shanghai’s second fix corresponds to 195 minutes before London’s first fix.
And now the fix recordings:
MONDAY gold fix Shanghai
Shanghai morning fix Dec 12 (10:15 pm est last night): $ 1188.15
NY ACCESS PRICE: $1159.85 (AT THE EXACT SAME TIME)/premium $28.30
Shanghai afternoon fix: 2: 15 am est (second fix/early morning):$ 1187.22
China rejects NY pricing of gold as a fraud
London Fix: Dec 12: 5:30 am est: $1154.40 (NY: same time: $1155.30 5:30AM)
London Second fix Dec 12: 10 am est: $1156.10 (NY same time: $1159.80 10 AM)??
It seems that Shanghai pricing is higher than the other two , (NY and London). The spread has been occurring on a regular basis and thus I expect to see arbitrage happening as investors buy the lower priced NY gold and sell to China at the higher price. This should drain the comex.
Also why would mining companies hand in their gold to the comex and receive constantly lower prices. They would be open to lawsuits if they knowingly continue to supply the comex despite the fact that they could be receiving higher prices in Shanghai.

This post was published at Harvey Organ Blog on December 12, 2016.

Party On

A year that started with a bust sure does look like it will end with a bang. The major indices have been in a party mode since Election Day while the Russell 2000 specifically has been the life of the party.
The gains have been extraordinary. Since November 8, the Nasdaq Composite is up 4.4%, the S&P 500 is up 5.1%, the Dow Jones Industrial Average is up 7.1%, the S&P Midcap 400 Index is up 12%, and the Russell 2000 is up 15.7%.
It is a move that few, if any, people saw coming, which is exactly why it came.
Can it continue? No one can say for sure, yet the prospects for a continuation look good on paper.
The Nag
There are multiple factors working in the stock market’s favor right now and one nagging factor working against a further extension. Nobody likes a nag, so let’s get that explanation out of the way first.
Complacency is the nagging factor.
It seems that everyone went from fearing the election result to now cheering the unfulfilled prospects of pro-growth policies discussed in its wake.

This post was published at FinancialSense on 12/12/2016.

Exposing The “Mystery” Of Last Week’s “Massive” E-Mini Trade

Last Wednesday we reported that between 13:21:14 and 13:21:15 ET, an interval of less than two seconds, something snapped in the market, as both E-mini futures…
… and the SPY ETF exploded in volume and surged higher, as the S&P took out all time highs.
We further showed, that in those few seconds 2 million SPY shares went through (around $450 million)…
… and 32,000 e-mini contracts (around $3.5 billion notional) screamed through the markets.
As Nanex noted at the time, “a record, monster tsunami of 16,000 S&P futures contracts at once through 3 handles!” The block trade promptly soaked up half the available liquidity in the E-mini…

This post was published at Zero Hedge on Dec 12, 2016.

How Millennials Are Reshaping the Survivalism Industry

With Donald Trump’s stunning victory, a sense of change is sweeping across nations and financial markets worldwide – change that has citizens feeling more unsettled than ever about the future. This is likely to further boost an industry with a uniquely dark outlook on America’s future. Although ‘survivalism’ (a movement defined by active disaster preparation) has been around since the 1930s, the latest wave has reached a fever pitch thanks to two distinct drivers. The first is widespread anxiety about the future. The second is generational change. Boomers and Xers have created today’s survivalist frenzy – marked by extreme individualism and institutional distrust. But as Millennials age, this version will give way to a more community-oriented one. Looking back, the ebb-and-flow of survivalism should hardly come as a surprise – it’s been years in the making.
Since the Great Depression, survivalism has gone through three waves. The first began in the late ’60s and ’70s, when rampant inflation fueled fears of economic collapse and energy shortages, and peaked in the ’80s as concerns shifted to nuclear war. The second wave peaked in 1999 – coinciding with the impeachment of Bill Clinton, the Y2K scare, and the deepening of the ‘Culture Wars.’ The third wave was triggered by 9/11 and has continued to surge with every natural disaster, national tragedy, and presidential election.
The latest wave has transformed survivalism from a hobby to a lifestyle. Survivalists (or ‘preppers’) take disaster preparation seriously. Some own bunkers located ‘off the grid’ (particularly in Idaho, Montana, and Wyoming) stockpiled with MREs, gold, weapons, and alternative power sources. Others simply keep a stash of canned goods, water, and medical supplies – usually in a ‘bug out bag’ – and take wilderness training courses.

This post was published at FinancialSense on 12/12/2016.

Is it Just Trump Tower? Or is the Entire New York City Housing Bubble Unwinding?

Not all is well at this glamorous piece of real estate.
The iconic mixed-use 58-story Trump Tower, on 721 Fifth Avenue, in Midtown Manhattan, with top-dollar retailers such as Tiffany’s nearby, was the ultimate in condo living when it was built in 1983. Now it’s even more iconic as President Elect Donald Trump holds court there, among enormous security measures and the daily flow of potentates, moguls, Big Oil CEOs, the occasional Silicon Valley wunderkind, billionaires, Goldman Sachs folks, and the like.
But not all is well at this piece of glamorous real estate.
Of its 238 apartments – located on the top 38 floors, including nine duplex and triplex penthouses on the top nine floors – 11 are actively listed for sale, according to CityRealty, and another 12 are listed for rent. Asking prices and asking rents have been slashed to get the units to move, and it’s not working very well.
The table below shows the 11 apartment listed for sale. Three of them consist of two units that have been combined: 42BC, 58CD and 37D/38D. Five sellers have cut their asking prices, with reductions ranging from -7.8% to -26.8%. And note for how long they’ve been on the market (right column), in a market that isn’t exactly ideal:

This post was published at Wolf Street by Wolf Richter /Dec 12, 2016.


As mentioned in Part I of this series, the U. S. is (even after the election) on the cusp of a revolution. The potential for revolution exists in all countries at any given time. We will first list some of the factors that cause an uprising to transform into an all-encompassing revolution.
1. Economic Factors: This could take the form of an economic collapse and/or runaway inflation/devaluation of a nation’s currency, as well as chronic or acute unemployment, lowered manufacturing base accompanied by firings or closure of positions or plants.
2. Warfare: can lead to a country’s dissolution either by insurgency or occupation, followed by an attempt to resist (revolt) either against a foreign oppressor or a country that has (in the manner of the Hessians in the Revolutionary war) ‘invited in’ an occupying army.
3. Religious/Theological: in the form either of persecution of a culture’s predominant religion or factions/schisms leading to confrontation of conflict between two different religious groups.
4. Government Oppression: in the form of excessive taxation, taxation with either no representation (as when an executive branch secures a ruling outside of actual legislative bodies or processes) or misrepresentation (a tax is declared for one thing and ends up being ‘sequestered’ for another. Other forms of oppressive acts from a ‘legitimate’ established government include martial law declarations or unlimited police power in the hands of the State.

This post was published at The Daily Sheeple on DECEMBER 12, 2016.

Disappointing 3 Year Auction Prices At Highest Yield Since 2010, Lowest Bid To Cover Since 2009

The result of today’s 3 Year auction, coming at a time when the When Issued was printing above auction stops since April 2010, would be closely watched as a critical test of demand, particularly foreign demand, following selloff sparked by U. S. presidential election, strategists quoted by Bloomberg said. At the same time, they added that the condensed auction schedule, December seasonality, proximity to the Dec. 14 FOMC decision and today’s oil-driven UST selloff, which helped push UST yields above last year’s highs for the first time, may muddy the analysis.
‘This month’s supply could be somewhat more challenging to underwrite relative to recent averages,’ JPM strategist Jay Barry said in note.
Further factors limiting foreign demand could be the recent USD strength, which has widened the cross-currency basis swap, increasing hedging costs for foreign private investors, Citi strategist Jabaz Mathai said in note. Positives for the auctions include repo value as both the 3Y and 10Y have recently traded special, indicating a short base which may support demand.
With that out of the way, here are the results as reported moments ago by the US Treasury.
The high yield on the 3Y auction printed at 1.452%, 0.1bps higher than the 1.451% When Issued, and as expected, the highest since April 2010, indicating further weakness into the auction despite the substantial short base.

This post was published at Zero Hedge on Dec 12, 2016.

Bonds and Gold in Unusual Correlation

Gold prices have shown an unusually strong correlation to bond prices this year. This is not normal, and the two are not usually marching in lockstep like this.’
See Gold Market Hanging on a Razor’s Edge
The strong correlation began around May 2016. It may just be a coincidence that May 2016 was when Saudi Arabia started selling off the holdings of T-Bonds from its sovereign wealth fund, an effort to fund their governmental expenditures in an era of low profits on oil sales. See Whatever the explanation is, the phenomenon is real, down to even a day to day basis. So if you are a trader or investor who is interested in gold, you had better also be interested in T-Bonds, at least for as long as this correlation lasts.

This post was published at FinancialSense on 12/12/2016.

Weakest Demand For 3-Y Treasury Notes Since 2009 (Money Market Net Shorts Crash)

The Fed’s anticipated rate hike at the next FOMC meeting is causing a stir in money markets and Treasury auctions.
Monday’s $24 billion three-year U. S. note sale drew the weakest demand for the maturity since 2009, even as it yielded 1.452 percent, the highest in six years. The bid-to-cover ratio fell to 2.65, compared with an average of 2.8 for the last 10 sales. Indirect bidders, a class of investors that includes foreign central banks and mutual funds, stepped back, buying 42.6 percent, compared with an average of about 50 percent. Primary dealers, which are obligated to bid at auctions, filled the void, taking 48.5 percent, compared with a 39 percent average.

This post was published at Wall Street Examiner on December 12, 2016.

Gold and Silver Market Morning: Dec 12 2016 – Gold and Silver break down again!

Gold Today – New York closed at $1,159.00 Friday after closing at $1,172.40 on the 8th December. London opened again at $1,155.00today.
Overall the dollar is stronger against global currencies today.
– The $: was stronger at $1.0589: 1 from $1.0615: 1 Friday.
– The Dollar index was stronger at 101.40 from 100.11 Friday.
– The Yen was weaker at 115.76: $1 from Friday’s 114.41 against the dollar.
– The Yuan was weaker at 6.9138: $1 from 6.9033: $1 Friday.
– The Pound Sterling was weaker at $1.2585: 1 from Friday’s $1.2602: 1.
Yuan Gold Fix
While Shanghai prices fell, they did not follow New York leaving New York at a higher discount to Shanghai of $29.21. London opened at a higher discount to Shanghai of $33.21. This further emphasizes that the two markets are structurally different to each other. The physically settled Shanghai transactions and the paper transactions of New York and London. The London OTC [over the counter] markets is one where well over 95% of transactions are closed out before maturity.
In New York and London players will move prices around faster and further than in Shanghai because they know that they will not have to deliver.
As we were saying last week, gold sold from the SPDR gold ETF is to HSBC who can sell it, take it onto their books or export it to China to be sold there.

This post was published at GoldSeek on 12 December 2016.

Rickards and Paul on Trump’s ‘Cabinet’ Government and the Coming Recession

Economist and author Jim Rickards and former presidential contender Ron Paul appeared on RT television recently to discuss their 2017 economic and political predictions. Rickards laid out his idea of Trump’s administration forming a ‘cabinet government,’ that might work to decentralize executive power, which has become more concentrated over the last 15 years. Paul looked to another inevitable US recession fueled by runaway inflation and the bursting of economic bubbles artificially propped up by failed monetary policies.
Here are the time codes for each interview: Jim Rickards: 6:17-11:02; Ron Paul: 13:24-21:30.
Rickards said he sees Trump’s cabinet selection process will be driven by a business mentality rather than promises made or past relationships. It’s a style of governing Rickards compares to past US administrations of the 1950s and 1960s or within other countries today like the UK, Australian, and Canada.
‘What I expect is that Trump will name a strong cabinet… I think Trump will wear his CEO hat since he’s not a traditional politician but a CEO. Good CEOs are delegators. They hire good teams. They put them in charge of different divisions. If they do well, they get promoted. If they don’t do well, they may get fired … So we might see something like cabinet government instead of highly centralized power. I think it’s very healthy.’

This post was published at Schiffgold on DECEMBER 12, 2016.

New York Times Slams “Liberal Bubble” Safe Spaces Across America’s College Campuses

After Donald Trump’s election, some universities echoed with primal howls. Faculty members canceled classes for weeping, terrified students who asked: How could this possibly be happening?
I share apprehensions about President-elect Trump, but I also fear the reaction was evidence of how insular universities have become. When students inhabit liberal bubbles, they’re not learning much about their own country. To be fully educated, students should encounter not only Plato, but also Republicans.
We liberals are adept at pointing out the hypocrisies of Trump, but we should also address our own hypocrisy in terrain we govern, such as most universities: Too often, we embrace diversity of all kinds except for ideological. Repeated studies have found that about 10 percent of professors in the social sciences or the humanities are Republicans.
We champion tolerance, except for conservatives and evangelical Christians. We want to be inclusive of people who don’t look like us – so long as they think like us.

This post was published at Zero Hedge on Dec 12, 2016.