This Oil Sector Hasn’t Crashed Yet… But It’s About to

Unlike the rest of the oil industry – which has been decimated by lower oil prices – U. S. oil refiners have marched on to new highs. But the five-year-long bull market for these companies is about to come crashing down. Let me explain…
You can see the incredible uptrend in the following chart of refining giant Valero Energy (VLO). Its shares are trading near an all-time high…

This post was published at Wolf Street by Matt Badiali ‘ March 22, 2016.

Just 3 Charts

Earlier today Fed President Evans said this “I think the economic fundamentals [of the US] are really quite good.” As the following three charts show, there is only one thing that looks “quite good” and it is not ‘economic fundamentals’…
Federal Reserve Bank of Chicago President Charles Evans says ‘we expect 2016 growth will be 2 to 2.5 percent and I think the fundamentals are really quite good for the economy going forward.’ ‘Joint economic outlook numbers weren’t really all that different’ in latest SEP compared to December
Macro-economy? Nope…

This post was published at Zero Hedge on 03/22/2016.

It Starts: San Francisco Office Boom Deflates, but Fitch Says It’s ‘Unlikely to Collapse’ this Time

Other tech-heavy office markets too.
For some time, we’ve heard through the rumor mill that commercial real estate brokers in San Francisco are getting nervous. Then Savillis Studley released its report on the San Francisco office market for the fourth quarter. A very mixed bag for the first time since 2009. And now even Fitch Ratings is getting antsy.
‘Overall vacant availability posted its first material increase since 2009, rising by 0.6 percentage points to 8.0%,’ Savillis Studley reported for Q4. ‘The Class A rate spiked by 0.8 pp to 8.5%.’ And worse: ‘More sublet space hit the market.’
A prominent sublet space to hit the market is an entire floor at Twitter’s headquarters. Twitter has been laying off, and it won’t need this space. This comes after Twitter abandoned plans to lease an additional 100,000 square feet at the nearby headquarters of Square, the other company where Twitter CEO Jack Dorsey is the CEO. Those 100,000 sf then came on the market as well.
Yet, according to Savillis Studley, overall asking rent in Q4 ‘spiked’ 14.1% year-over-year to $63.87 per square foot. Class A asking rent ‘jumped’ 11.7% to $65.94 per square foot.

This post was published at Wolf Street by Matt Badiali – March 22, 2016.


Gold: $1,248.20 up $4.40 (comex closing time)
Silver 15.87 up 3 cents
In the access market 5:15 pm
Gold $1248.40
silver: 15.87
Let us have a look at the data for today.
At the gold comex today, we had a good delivery day, registering 61 notices for 6100 ounces and for silver we had 65 notices for 325,000 oz for the active March delivery month.
Several months ago the comex had 303 tonnes of total gold. Today, the total inventory rests at 212.48 tonnes for a loss of 90 tonnes over that period.
In silver, the open interest rose by 487 contracts up to 177,016 despite the fact that the silver price was up by 3 cents with respect to yesterday’s trading . In ounces, the OI is still represented by .885 billion oz or 127% of annual global silver production (ex Russia ex China).
In silver we had 65 notices served upon for 325,000 oz.
In gold, the total comex gold OI rose 840 contracts to 504,152 contracts despite the fact that the price of gold was DOWN $10.00 with yesterday’s trading.(at comex closing). .
No changes tonight in the GLD/ thus the inventory rests tonight at 821.66 tonnes. The appetite for gold coming from China is depleting not only gold from the LBMA and GLD but also the comex is bleeding gold. Our 670 tonnes of rock bottom inventory in GLD gold has been broken. It looks to me that China has taken the last amounts of physical gold from the GLD. I guess the only place left for China to receive physical gold, after they deplete the GLD will be the FRBNY and the comex. In silver,/we had a huge deposit of 1.809 million oz in inventory, and thus the Inventory rests at 330.342 million oz.
First, here is an outline of what will be discussed tonight:

This post was published at Harvey Organ Blog on March 22, 2016.

Former Goldman Employee Avoids Prison, Gets $5,000 Fine For Stealing Secret NY Fed Documents

One week ago we were stunned to learn, and report, that as part of the “sentencing” of former NY Fed employee Jason Gross who had admitted to stealing confidential Federal Reserve information and passing it on to his former boss Rohit Bansal, then employed at Goldman Sachs, in hopes of generating goodwill and a comfortable post-Fed job at 200 West, he somehow managed to avoid any jail time and instead was slapped with a draconian penalty: a $2,000 fine…. oh and some community service.

This post was published at Zero Hedge on 03/22/2016.

Bubbles Are About To Pop As Smart Money Leaves The Market – Episode 925a

The following video was published by X22Report on Mar 22, 2016
US Manufacturing PMI misses expectations. Baltic Dry Index has not changed. The auto bubble is about to pop. Central banks trying to keep the economy moving along and are planning to print currency just like in the Weimar Republic. Moody’s cut the rating on Deutsche Bank, we have seen this prior to Lehman. Smart money is continually leaving the market for the 8 straight week.

Wall Street’s Pile of Unwanted Treasuries Exposes Market Cracks (After The Thrill Is Gone?)

The once mighty Treasury market is beginning to show cracks in its foundation. As in bond dealers are having difficulty getting rid of their inventories.
(Bloomberg) – The world’s biggest bond dealers are getting saddled with Treasuries they can’t seem to easily get rid of, adding to evidence of cracks in the $13.3 trillion market for U. S. government debt.
The 22 primary dealers held more Treasuries last month than any time in the last two years, Federal Reserve Bank of New York data show. While at first glance that may suggest a bullish stance, the surge in holdings is more likely the result of investors including central banks dumping the debt on the firms, said JPMorgan Chase & Co. strategist Jay Barry. Foreign official accounts sold a net $105 billion of the securities in December and January, an unprecedented liquidation, Treasury Department data show.
Strategists say there are signs that the buildup of Treasuries held by dealers is having a ripple effect, mucking up the plumbing of the financial system. While the holdings show they did their job by soaking up the supply from central banks raising cash to support their currencies, it’s adding to questions about the resilience of the world’s most important market. The Treasury Department is already looking into whether the market isn’t operating as smoothly as it should.

This post was published at Wall Street Examiner by MallardFillmore ‘ March 22, 2016.

Trade Myths That…Aren’t

To say it’s been a bad week at the Washington Post for trade policy coverage and commentary would be a gross understatement. As I pointed out over the weekend, columnist Colbert King on Sunday tried to sell the contemptible idea that many critics of job- and wage-killing American immigration and even trade policies are motivated by racism. Yesterday, no one at the Post sank nearly that low, but the economic ignorance put on full display by two of its leading lights was nearly as depressing.
First came the latest offering by economics columnist Robert Samuelson, describing as ‘myths’ the claims that ‘Persistent U. S. trade deficits reflect recent free trade agreements’ and that ‘The large trade deficit ($540 billion in 2015) is an important cause of the U. S. economy’s slow growth.’
It seems that Samuelson isn’t familiar with the Census Bureau’s data on America’s non-petroleum goods trade flows. These measure imports and export flows that strip out oil trade (which hasn’t been an issue in trade negotiations and, until recently, in any aspect of trade policy) and services trade (where trade agreements have made only modest liberalization progress.)

This post was published at Wall Street Examiner by Alan Tonelson ‘ March 22, 2016.

Gold Daily and Silver Weekly Charts – Nothing Has Changed

Just the usual nonsense from these jokers today.
The box scores are all in the reports below.
Not one thing has changed, except we are in a period of extended shenanigans as the pros attempt to push more bad paper out to the public before things take a turn down again.
You will forgive the brevity of the posting this week, but it is an especially important one to me.

This post was published at Jesses Crossroads Cafe on 22 MARCH 2016.

BofA Explains Why The ECB Will Be Forced To Buy Junk Bonds

In April of last year we said the ECB would soon end up buying corporate bonds.
We’re not sure if one year later counts as ‘soon’ or not, but ultimately, we were proven correct when, earlier this month, Mario Draghi announced a new easing ‘package’ that includes IG non-fin EU corporates as part of a plan to increase monthly asset purchases by 20 billion.
While our call may have been prescient given that it came 11 months ago and just one month after the ECB implemented PSPP, by the time this month’s ECB decision rolled around the market generally suspected that Draghi might take the plunge. After all, he massively disappointed in December and if the 5yr-5yr swap is supposed to be the benchmark by which success or failure is judged, well then there’s plenty more room to ease.
Just as there was no reason to believe the ECB would stop at sovereign debt when PSPP was launched last March, there’s no reason to believe Draghi will stop at IG debt going forward. There’s a kind of one-upmanship going on among DM central bankers and with his massive book full of Japanese ETFs not to mention his monetization of the entirety of JGB gross issuance, Kuroda is still the archetype against which all Keynesian craziness is measured. When judged against the BoJ, the ECB probably still has a ways to go before hitting the limits of central banker insanity and so, we think it’s entirely possible that Draghi moves into HY next.

This post was published at Zero Hedge on 03/22/2016.

Stranger Than Fiction: The System Is On Full Retard

I said half-facetiously in early 2004 that if a small nuke detonated in Times Square that the Dow would probably shoot up 200 points. Today I reiterate that assertion with full sincerity. All of the markets, but especially the stock market, are now openly manipulated. The Fed and the Treasury never bother even to tacitly deny it.
Yesterday in our conversation with Paul Craig Roberts, Dr. Roberts rhetorically asked, ‘why does the Fed operate a massive and highly sophisticated trading desk in New York?’ I add to that question, rhetorically of course, why does the U. S. Treasury’s Working Group On Financial Markets office in the same building as the NY Fed in NYC?
The Fed officials are back at it threatening us with interest rate hikes in April once again after weeks of bluffing before blinking at the March FOMC meeting. If these guys can’t raise rates just one quarter of one percent – if for no other reason than to avoid looking like village idiots – then the true condition of the underlying economic system must be far worse than any of us can imagine.

This post was published at Investment Research Dynamics on March 22, 2016.

The High Yield Bond ‘Emperor’ Has No Clothes, BofA Warns 1 In 3 Firms Face Default Threat

The market reaction from last week’s dovish FOMC statement took many by surprise, including BofAML’s HY Strategy team, but as they say the High-Yield Emperor has no clothes, warning that the underlying commentary provided by Chair Yellen shows the vulnerability for high yield issuers to longer-term growth trends. Couple the deteriorating fundamentals for HY issuers with downgrades outpacing upgrades by a ratio of 3.5:1 and a worsening of global growth potential, and they believe the recent rally, though boosted by strong inflows and cash generation, will ultimately fade.
Bad news is bad news, until it’s suddenly good
The market reaction from last week’s dovish FOMC statement took us by surprise. Due to risks stemming from global economic and financial developments, Chair Yellen kept the target range for the federal funds rate unchanged at to percent. And although this outcome was largely expected by markets, the Fed also cited global growth concerns and subsequently reduced their growth and inflation forecasts for this year and next. Under normal conditions, the mentioning of global growth concerns by the Fed has been met with a market selloff as a negative economic outlook brings concerns of lower corporate earnings. In fact, the last two times the Fed indicated global risks to the domestic economy, while holding rates steady, high yield declined 4.5% and 4% over the next 13 days (Chart 1).

This post was published at Zero Hedge on 03/22/2016.

Europe: How’s That ‘Migration’ Working Out?

Yet again we see the results of “open borders”, no cultural requirement for assimilation and allowing anyone, including people who may be terrorists, into your nation.
It would be heartbreaking if it wasn’t the easily-foreseen consequence of rampant stupidity.
But because this event in Brussels was the result of said stupidity it’s not heartbreaking — it’s infuriating.
It is up to the people of Europe to stand up and say not only “no more damnit” to people like Merkel, they must demand that those who came in get the hell out.
This applies to the United States as well.

This post was published at Market-Ticker on 2016-03-22.

Two Fed Officials Point to Possibility of April Rate Hike (Lockhart And Williams)

I always get the Atlanta Fed’s Dennis Lockhart confused with Calista Flockhart.
Until now!
Bloomberg – Two Federal Reserve officials said interest-rate increases may be warranted as soon as the central bank’s meeting next month, citing solid readings on the U. S. economy despite headwinds from abroad.
‘There is sufficient momentum evidenced by the economic data to justify a further step at one of the coming meetings, possibly as early as the meeting scheduled for end of April,’ Federal Reserve Bank of Atlanta President Dennis Lockhart said Monday in Savannah, Georgia.

This post was published at Wall Street Examiner on March 21, 2016.

Trump Calls For Waterboarding And “A Lot More,” Clinton Says Torture “Not Effective”

Earlier today, Donald Trump phoned into Fox News and delivered his initial reaction to this morning’s tragic events in Belgium where dozens of people were killed in a series of terrorist attacks on the Brussels airport and Maelbeek metro station.
Needless to say, these type of catastrophes play right into Trump’s hands. That’s not to say he isn’t genuinely perturbed and/or saddened by what happened. He probably is. But Trump has repeatedly proven to be far more savvy politically than anyone gives him credit for and one rule in politics is that you never, ever let a good crisis go to waste. Especially when your message is border security and the crisis in question has a definitive connection to migration.
“We cannot let these people into our country,” Trump told Fox, referencing Muslims, who he says are “having a hard time assimilating” into Western society. “They have to let people know when they see people making bombs on the first floor of an apartment,” he added for emphasis, in an apparent reference to the home of Syed Farook and Tashfeen Malik in San Bernardino.

This post was published at Zero Hedge on 03/22/2016.