Is it the bears turn now?
Chinese bonds and stocks were ugly overnight as the calm of the congress came to an end…
Small Caps were slammed today – worst day since August. Nasdaq managed to scramble back to green in the last few mins, but failed to hold it…
This post was published at Zero Hedge on Oct 30, 2017.
GOLD: $1276.15 UP $5.30
Silver: $16.83 UP 8 cents
Closing access prices:
Gold $1276.20
silver: $16.86
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: $1287.00 DOLLARS PER OZ
NY PRICE OF GOLD AT EXACT SAME TIME: $1271.87
PREMIUM FIRST FIX: $15.13(premiums getting larger)
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
SECOND SHANGHAI GOLD FIX: $1288.17
NY GOLD PRICE AT THE EXACT SAME TIME: $1270.30
Premium of Shanghai 2nd fix/NY:$17.87 PREMIUMS GETTING LARGER)
CHINA REJECTS NEW YORK PRICING OF GOLD!!!!
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
LONDON FIRST GOLD FIX: 5:30 am est $1272.75
NY PRICING AT THE EXACT SAME TIME: $1271.15
LONDON SECOND GOLD FIX 10 AM: $1272.00
NY PRICING AT THE EXACT SAME TIME. 1273.70 ??
For comex gold:
OCTOBER/
NOTICES FILINGS TODAY FOR OCT CONTRACT MONTH: 82 NOTICE(S) FOR 8200 OZ.
TOTAL NOTICES SO FAR: 3332 FOR 333,200 OZ (10.326TONNES)
For silver:
OCTOBER
1 NOTICE(S) FILED TODAY FOR
5,000 OZ/
Total number of notices filed so far this month: 1095 for 5,475,000 oz
This post was published at Harvey Organ Blog on October 30, 2017.
The revelation last week that the Washington Free Beacon, a conservative news website largely funded by Republican megadonor and hedge fund billionaire Paul Singer, hired Trump dossier firm Fusion GPS to conduct opposition research into Trump has inspired Steven Bannon to declare war on the mega doner. But while Singer has reportedly warmed to the president in the months since he took office, many of his peers are growing increasingly cynical. To wit, New York Magazine reports that other pro-establishment donors are growing increasingly skeptical of the administration’s ability to pass comprehensive tax reform – the one issue that convinced many in the donor class to abandon their reservations and support Trumpism.
Now, in a story published in New York Magazine on Monday, Michelle Celarier reports that many of Singer’s fellow donors have soured on the commander-in-chief just nine months into his term.
But these men (and they were almost exclusively men) were hoping that a Republican agenda would give them a big tax cut, if nothing else. Now, after almost a year of congressional inaction and new fears that even the tax cut is slipping away, many are privately shunning the president. Like powerful Republicans in Washington, behind closed doors they are expressing disgust, disappointment, trepidation – and deploying no small amount of black humor.
This post was published at Zero Hedge on Oct 30, 2017.
Are you ready to pay 37 percent more for health insurance in 2018? Obamacare is imploding faster than most of us imagined, and these rate increases are absolutely killing hard working middle class families all across the country. I wrote about the steady erosion of the middle class yesterday, and health insurance is one of the main reasons why the cost of living is increasing at a much faster rate than our paychecks are. It greatly frustrates me that we have given the Republicans control of the White House, the Senate and the House of Representatives and Obamacare still has not been repealed. The truth is that should have happened on day one of the Trump presidency.
Monday’s news was dominated by headlines about the indictments of Paul Manafort and Robert Gates, but a new round of Obamacare rate increases is going to have much more of a direct impact on the lives of ordinary Americans. According to CNN, premiums for silver Obamacare plans will increase by an average of 37 percent next year…
Premiums for the benchmark silver Obamacare plan will soar 37%, on average, for 2018, according to federal data released Monday.
And remember, this 37 percent increase is on top of all of the other yearly increases that we have seen so far. Many families have already seen their health insurance premiums more than double since Obamacare became law, and now things are going to get even worse.
This post was published at The Economic Collapse Blog on October 30th, 2017.
Weinstein Co’s panicked assurances that the firm is in good financial health aside, evidence of the financial fallout from the Harvey Weinstein scandal is finally beginning to emerge. And as it turns out, being exposed for tacitly condoning the behavior of an alleged sexual predator is really, really rough on the bottom line.
To wit, the Weinstein Co.’s first movie to be released since more than 50 women came forward to accuse former studio head Harvey Weinstein of sex crimes ranging from harassment to groping to assault grossed less than $800 during a one-day theatrical release, according to Variety.
While we don’t have the data handy, that’s got to be some kind of record – even when factoring in that it was a limited release. Making matters worse, the movie featured an all-star cast including Bella Thorne (who played the protagonist) and Jennifer Jason Leigh.
Here’s Variety:
This post was published at Zero Hedge on Oct 30, 2017.
Notice that The Fed doesn’t talk much about inflation anymore since it doesn’t fit the narrative anymore. Just as well since their measure of inflation, Core PCE Prices YoY, remained the same at 1.3%. Well below their 2% target rate.
This post was published at Wall Street Examiner on October 30, 2017.
‘Like a snake eating its own tail, the equity market cannot rely on share buybacks indefinitely to nourish the illusion of growth.”
Chris Cole, Artemis Capital
“Of course big bank stocks are ‘overvalued’ in terms of earnings or revenues, but do such measures really matter in a world without value? When you have global central banks gunning all asset prices in a desperate effort to avoid a sovereign debt default starting in Japan and then Europe, pedestrian metrics like price/earnings ratios and net-present value have little relevance…
The growing pile of public debt in the US is why price stability will never be part of the mix – unless and until the Treasury is forced to live within its means. This is also why dollar-alternatives like bitcoin, imperfect and even fraudulent as they may be, will continue to capture the attention of those seeking to escape the economic tyranny of fiat paper money.”
Chris Whalen, Institutional Risk Analyst
If you did not watch the World Series game last night, with the walkoff 13-12 win by the Astros, you missed one of the best offensive battles in postseason play that I have ever seen.
This post was published at Jesses Crossroads Cafe on 30 OCTOBER 2017.
Before I get started, I’d like to share a few important things that will help bring perspective to my analysis.
Eighty-six percent of consumers purchasing a new vehicle use financing. The frequency of replacement (trade cycles) by this group significantly impacts the velocity of new-vehicle sales. Under normal conditions, vehicles financed for 60 or 72 months are traded at 36 or 42 months, respectively. Most leases have a 36-month duration and are held till maturity. Think of new-vehicle sales as potential used-vehicle supply. The moment the ownership paperwork is completed on a new vehicle, it becomes a used vehicle. Why used vehicle values?
Only jobs and credit are more important than used-vehicle values are to the health of the auto industry. Fully 86% of new-vehicle sales are financed, and under normal conditions the majority of those vehicles are traded within three years. Knowing that most car loans have a 60 – 72-month duration, we can assume that the majority of vehicles traded at the three-year mark are not paid off. The level of equity in these loans directly affects consumer behavior and in large part determines when the vehicle will be traded for another new vehicle. The frequency with which this very large group of consumers trades vehicles on which they still carry loans is one of the most important factors in new-vehicle sales velocity. I can make a strong argument that when used-vehicle values decline sufficiently, they can outweigh the positive effects of strong jobs and easy credit – we’ve seen this already this year.
This post was published at Zero Hedge on Oct 30, 2017.
The reflation trade has taken hold of the stock market again, and, to a certain extent, it has taken hold of the Treasury market.
The reflation hold on the Treasury market is plain to see at the front end of the curve, where the yield on the 2-yr Treasury note has soared 32 basis points since September 11 to 1.58%. Similarly, the yield on the 10-yr Treasury note has jumped 38 basis points over the same period to 2.43%.
That adjustment, however, isn’t a purebred reflation trade. If it were, the yield on the 10-yr Treasury note would be much higher and the spread between the 2-yr note yield and the 10-yr note yield would be much wider.
Melting Away
As it so happens, the 10-yr note yield is five basis points less than where it started the year while the spread of 85 basis points between the 2-yr note yield and the 10-yr note yield is 37 basis points less than the spread seen at the start of the year and 49 basis points less than its post-election peak.
This post was published at FinancialSense on 10/30/2017.
Update: … or maybe not, because shortly after S and TMUS tumbled, CNBC denied the original Nikkei report:
SOFTBANK DOESN’T HAVE PLAN TO WITHDRAW FROM SPRINT TALKS: CNBC It is unclear if this announcement was made as a favor to some of the deal’s M&A arbs who are painfully blowing up today, but for what it’s worth, it managed to send the stocks sharply higher.
Sprint stock plunged, and was halted by the exchange volatility trigger, when the Nikkei reported moments ago that Japan’s SoftBank Group plans to break off negotiations on the long-awaited merger between its subsidiary Sprint and T-Mobile US due to a failure to agree on ownership of the combined entity, “dashing the Japanese technology giant’s hopes of reshaping the American wireless business.”
This post was published at Zero Hedge on Oct 30, 2017.
There’s been a lot of focus on the Federal Reserve lately.
Earlier this month, the central bank launched efforts to shrink its balance sheet after years of quantitative easing. Most analysts also expect one more interest rate increase this year. Then there is rampant speculation about who will take the reins at the Fed when Janet Yellen’s term ends early next year. Many observers think Trump will pick a more hawkish Federal Reserve chair who will increase the pace of ‘normalization.’
But Peter Schiff has said ultimately the Fed doesn’t want to do anything to upset the status quo. And at this point, the central bank is between a rock and a hard place. It can normalize, which will ultimately pop the bubble, or it can continue with its easy money policies and wreck the dollar. Peter has said the Fed will ultimately sacrifice the dollar on the altar of the stock market.
In a recent article published on the Mises Wire, economist Ryan McMaken weighs in, arguing along these same lines. He says the Fed won’t do anything that will spook the markets. That means we can expect more ‘easy money.’ But this raises a question – what happens when the next recession rolls along?
This post was published at Schiffgold on OCTOBER 30, 2017.
With WTI prices holding at 6-month highs around $54 (and Brent at $60), Reuters’ John Kemp notes that hedge funds have never, ever been more bullishly positioned in the entire energy complex.
Hedge Funds have accumulated a record 1.189 billion bbl of long positions in the five major petroleum contracts (Brent, WTI (x2), RBOB, HO)…
This surge in buying is coming as analysts once again follow the trend and begin raising oil price forecasts.
As OilPrice.com’s Tsvetana Paraskova notes, just a few of months ago, analysts and investment banks slashed their oil price forecasts as OPEC’s production cuts drew down the global oil oversupply slower than initially expected, and rising U. S. shale production capped any short-lived oil price gains.
But at the end of the summer, as OPEC and the International Energy Agency (IEA) started reporting stronger-than expected global oil demand growth and an accelerated pace of inventory declines, the market sentiment began to change. As 2018 and the November 30 OPEC meeting draw nigh, the cartel is said to be favoring a 9-month extension of the deal through the end of next year.
This post was published at Zero Hedge on Oct 30, 2017.
‘Successful investing is anticipating the anticipations of others’
The actual private object of most skilled investment today is to ‘beat the gun.’ As Americans so well express it, to outwit the crowd and to pass the bad, or depreciating halfcrown, to the other. For it is, so to speak, a game of Snap, of Old Maid, of Musical Chairs – a pastime in which he is the victor who plays ‘snap’ neither too soon nor too late, who passes the old maid to his neighbor before the game is over, who secures a chair for himself when the music stops. Or to change the metaphor slightly, professional investment may be likened to those newspaper competitors in which the competitors have to pick out the six prettiest faces from a hundred photographs, the prize being awarded to the competitor whose choice most nearly corresponds to the average preferences of the competitors, as a whole; so that each competitor has to pick not those faces which he himself finds prettiest, but those which he thinks likeliest to catch the fancy of the other competitors, all of whom are looking at the problem from the same point of view. We have reached the third degree where we devote our intelligences to anticipating what the average opinion expects the average opinion to be. And there are some, I believe, who practice the fourth, fifth and higher degrees.’
John Maynard Keynes, The General Theory of Employment, Interest and Money – 1935
This post was published at FinancialSense on 10/30/2017.
This confirms what many Americans feel in their wallets.
In the data today on personal income and outlays for September was a hefty shot of reality that many Americans have been feeling in their wallets on a daily basis: On a personal level, per individual, or ‘per capita,’ the disposable income adjusted for inflation looks lousy. In fact, it declined in September and has been declining since May.
At first glance, as per headlines, the data looked pretty good. For example:
WSJ: ‘U. S. Consumer Spending Rose Robustly in September: Personal income, which includes wages and government assistance, was up 0.4% from August.’ New York Times: ‘U. S. Consumer Spending Grows at Fastest Pace Since 2009, Savings Drop.’ It pointed out that ‘the drop in savings suggests that September’s robust pace of consumer spending is probably unsustainable.’ But it’s not the drop in savings that’s the problem; it’s the drop in disposable income per capita.
First consumer spending, because that’s what grabbed the headlines. Personal Consumption Expenditures rose 2.7% from a year ago, adjusted for inflation, according to the Bureau of Economic Analysis. That’s smack dab in the middle of the range since 2010, whose low point was +1% (October 2012 and April 2013) and whose peak was +4.2% in January 2015.
Consumer spending was what the media focused on. But the report’s larger section on ‘real’ disposable income wasn’t pretty: it rose only 1.2% compared to a year ago.
This post was published at Wolf Street on Oct 30, 2017.
Having recently passed a budget as a result of communal efforts between the House and Senate which were notably absent during healthcare reform efforts earlier this year, the stage is set for Congress to enter a very intense multi-week period leading up to Thanksgiving, filled with headlines on tax reform. From a market standpoint, the outcome of this process will determine whether US interest rates continue to go up or retrace the recent increase. Meanwhile, from a purely political perspective, from here the two main questions surrounding tax reform are: what is the process to get from these budget resolutions to actual tax reform and what are the potential pitfalls that Congress needs to avoid in order to successfully pass the bill.
In terms of next steps, the progression from budget resolutions to tax reform is as follows:
Having recently passed a 2018 budget, an important step which unlocks “budget reconciliation”, or the process by which tax reform can be passed with a simple majority vote, the next step is to write the actual bill; this will be done by the Ways and Means Committee in the House and the Senate Finance Committee in the Senate, likely in unison (much like with the budget resolutions) in an effort to speed up the process. After it passes the committee vote, it will be brought to the floor for a full vote in the House, which will then be sent to the Senate upon approval. At this point, the Senate can vote for the bill as is and send to the president’s desk, vote to kill the bill, or they can add amendments to the bill and vote on their new version. In the latter case where the Senate adds amendments, the new bill will be sent to a ‘conference committee’ of both Senators and House Representatives, in which they would reconcile the bill and send it back to House/Senate for passage and then sent to the President’s desk.
This post was published at Zero Hedge on Oct 30, 2017.
Having continued Friday’s melt-up as soon as US equity markets opened this morning, headlines from Washington that the corporate tax cuts may be enacted “gradually” reaching 20% in 2022.
As Bloomberg reports, House tax writers are discussing a gradual phase-in for the corporate tax-rate cut that President Donald Trump and Republican leaders want — a schedule that would have the rate reach 20 percent in 2022, according to a member of the chamber’s tax-writing committee and a person familiar with the discussions.
The phase-in plan has been considered, but may not yet be final, said a member of the House Ways and Means Committee, who asked not to be named because the discussions are private.
Under that plan, the rate may be reduced from its current 35 percent rate by three percentage points a year starting in 2018.
This is clearly not what the ‘Veruca Salt’ market demands… “I want it all.. and I want it now.”
This post was published at Zero Hedge on Oct 30, 2017.
The Loonie is tumbling and Canadian bonds rallying as the Bank of Canada backs away from its rate hiking plans in ‘surprise’ over the slowing Canadian economy.
Meanwhile, a new report from the National Energy Board brings good news for the planet (that is bad for Canadian GDP in the short and medium run). See: Canada’s demand for fossil fuels will max out in 2 years: NEB
The National Energy Board says Canada’s addiction to fossil fuels will peak in two years… The board’s annual energy futures report for the first time says with climate change policies and growth in clean energy, Canada’s consumption of fossil fuels to run cars and heat homes will max out before 2020, start to decline slightly and then flatline over the next two decades. Here is a direct video link.
At the same time, the NEB says it thinks (hopes) that falling domestic oil demand will be offset by increasing oil exports, and thus not hurt Canadian GDP. This is unlikely.
In reality, it’s not just domestic demand that will peak much sooner than previously estimated. The trend towards higher efficiency, renewable energy, and electric transportation, is global and only just getting started. In addition, new oil production technologies are enabling increased supply in most countries, including our historical oil export buyers.
This post was published at FinancialSense on 10/30/2017.
Gold prices are coming off their second straight weekly loss as the dollar continues to rally from its Sept. 8 bottom. The metal dropped 0.7% from Friday, Oct. 20, to Friday, Oct. 27.
But you can’t say I didn’t warn you. I’ve been telling you for some time that the U. S. dollar had likely bottomed at that two-and-a-half-year low on Sept. 8 after an eight-month sell-off that began early this year.
Simply put, the dollar bear trade had gotten overly crowded and was due for a countertrend rally. That’s why the U. S. Dollar Index (DXY) is up from 91.35 on Sept. 8 to 94.75 today (Monday, Oct. 30).
The index is up an impressive 3.7% over nearly two months, and I think it will likely run even higher. Its momentum has been the biggest obstacle keeping gold from regaining – and holding – the $1,300 level.
We also have Trump’s new tax cuts, which could make their way through Congress soon. The Dow Jones is up 2.2% in the last two weeks in anticipation of lower taxes, sucking away investor interest from precious metals and dragging prices lower.
This post was published at Wall Street Examiner on October 30, 2017.
Just a day after Puerto Rico’s cash-strapped power authority on Sunday canceled its controversial $300 million contract with Whitefish Energy, a small Montana company tasked with rebuilding the island’s power grid after it was completely destroyed by Hurricanes Maria and Irma, the WSJ is reporting that the FBI is looking into the circumstances surrounding the contract.
The contract was canceled on orders from Puerto Rico Gov. Ricardo Rossello, who pointed to the burgeoning controversy surrounding the company – including its relationship with Secretary of the Interior Ryan Zinke, who is from the same small Montana town where Whitefish is based.
This post was published at Zero Hedge on Oct 30, 2017.
Strengths
The best performing precious metal for the week was palladium, down slightly by 0.42 percent. Germany’s BASF noted that the automotive industry appears to be responding to the price surge in palladium this year and are slowing down purchases. According to Bloomberg, gold traders and analysts are bearish for the first time in four weeks as the dollar strengthens. The passing of the U. S. budget by the Senate lifted hopes by boosting risk sentiment and pushing yields higher. Joni Teves of UBS says a large fiscal package is a key downside risk for gold as it would result in a higher policy rate path. Even though there has been a pullback in gold prices, large buy orders came into the market two times this week and spiked prices higher. On Monday, 18,1792 gold contracts were traded in a span of five minutes and on Wednesday another 21,129 contracts were traded. Tai Wong, head of base and precious metals trading at BMO Capital Markets, bets the dollar is going to retrace and it will be good for gold. Paul Wright, former CEO of Eldorado Gold Corp., will resign from his board position after 20 years at the company and just months after resigning as CEO. Although stock value tripled during his tenure, Wright’s late career was marked by a high-profile dispute with the Greek government after investing over $2 billion in the country. Following the results of the European Central Bank meeting, gold is seeing some selling pressure and trade surging after the dollar index rallied.
This post was published at GoldSeek on 30 October 2017.
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