China Orders No Market Selloffs During President’s Davos Trip

As we observed in yesterday morning’s market wrap, while US traders took the day off for the MLK holiday, China was busy defending an accelerating selloff across its stock markets.
During Monday trading, having traded quietly lower for the past few days, Chinese stocks tumbled in early trading on the mainland and in Hong Kong’s offshore market amid weakness in Asian equities. The Shanghai Composite Index dropped as much as 2.2% to head for its fifth loss in as many days, its longest losing streak since Aug. 2015. However a sudden bout of late afternoon buying sent the loss down to just -0.3%, on speculation China’s national team was once again back in the markets.

This post was published at Zero Hedge on Jan 17, 2017.

US Financial Markets – Alarm Bells are Ringing

A Shift in Expectations
When discussing the outlook for so-called ‘risk assets’, i.e., mainly stocks and corporate bonds (particularly low-grade bonds) and their counterparts on the ‘safe haven’ end of the spectrum (such as gold and government bonds with strong ratings), one has to consider different time frames and the indicators applicable to these time frames. Since Donald Trump’s election victory, there have been sizable moves in stocks, gold and treasury bonds, as the election result has strongly boosted certain market expectations.
The chart below compares three of the associated ETFs, namely SPY, TLT and GLD:

This post was published at Acting-Man on January 18, 2017.

Why the Price of Gold Will Rise 15.2% This Year [CHART]

The sharp drop in the price of gold during the last two months of 2016 destroyed traders’ faith in the gold market.
As gold prices fell 10.9% to $1,151.70 from Nov. 1 to Dec. 30, traders and analysts surveyed by Bloomberg grew increasingly bearish. On Nov. 25, the percentage of bearish traders and analysts was roughly 19%. That climbed to 35% on Dec. 2 when the gold price hovered near a 10-month low of $1,177.80. While that bearishness retreated back to about 19% on the Dec. 23 survey, this was still a large percentage of gold traders who saw gold continuing to fall.
But that bearish sentiment wouldn’t last, and by Jan. 6, roughly 70% of those surveyed had turned bullish. Now, this increasing bullishness will push the price of gold up 15.2% from their current $1,215 level by the second half of 2017.

This post was published at Wall Street Examiner on January 17, 2017.

Life-Saving Device Could Transform the Medical Market in 2017

A small biotech company tries to move to the next level: jump through the final hoops with the FDA and bring its product to market. This is its story. It’s a sponsored post, part of our series where we highlight small companies on the move [Wolf].
A little-known biotech company is poised to potentially produce millions in revenue with the planned release of a breakthrough technology that could prevent strokes with a test that is affordable and accessible.
A Multi-Billion-Dollar Problem with a $49,000 Answer
Stroke statistics are shocking: Globally, every year 15 million people suffer a stroke. Of these, some 6 million die from it, while 5 million are rendered permanently disabled. In the U. S. alone, nearly 800,000 people suffer from strokes annually – and someone dies of a stroke every 4 minutes.
Until now, there has been no cost-effective way to screen for Ischemia, the leading indicator of a stroke, which cost the U. S. government alone tens of billions of dollars a year. That could be about to change, thanks to a breakthrough technology from CVR Medical (TSX:CVM. V ; OTC:CRRVF. The company’s debut, game-changing medical device has been quietly in development for 10 years, and now it’s about to charge out of the gate, hoping to take the market by storm upon FDA market clearance.
What 3D seismic imagery did for super quick discoveries in the oil and gas industry, CVR’s sensory system could do for the medical industry.

This post was published at Wolf Street By James Burgess, Sponsored Post ‘ Jan 17, 2017.

Runaway Credit Card Debt Makes 2017 Look Like 2007

As we prepare to close the book on another $100 billion holiday shopping season and our seventh consecutive year of economic growth, it’s worth taking stock of where the U. S. consumer currently stands as well as what 2017 likely has in store. Because while things might seem peachy now, they always do until they’re not.
With that in mind, WalletHub put together some personal-finance predictions for 2017 in consultation with a panel of leading industry experts. And without further ado, here’s what we expect to go down.
1. Runaway Credit Card Debt Makes 2017 Look Like 2007
Consumer overleveraging is poised to be one of the biggest themes in personal finance in 2017. WalletHub projects we will end 2016 with a net increase of $80 billion in credit card debt, which would bring outstanding balances to a level not seen since the Great Recession.
Our saving grace so far has been the charge-off rate stubbornly hovering near historical lows, which means people are still able to pay their monthly minimums on time. But delaying what seems inevitable might only make matters worse, giving cardholders more time to rack up debt and positioning us to fall from a greater height. Our spending habits show no signs of slowing, after all, and we certainly aren’t repaying more of what we owe.

This post was published at FinancialSense on 01/17/2017.

Video Exposes Anti-Trump Group Plans To Shut Down DC Bridges And Highways With “Clusterfuck Blockades”

Yesterday we noted Part I of a new Project Veritas undercover series that exposed the efforts of several protest groups to disrupt the Trump inauguration by deploying butyric acid (aka “stink bombs”) at the National Press Club during the Deploraball event scheduled for January 19th. Part II of that series was just released and exposes further plotting by a group know as “DisruptJ20” to completely paralyze various modes of transportation on inauguration day.
Among other things, the protesters in the video plot to shut down surface traffic with “checkpoint blockades” and “a series of clusterfuck blockades” intended to shut down “all the major ingress points in the city.”
“So simultaneous to the checkpoint blockades in the morning, we are also doing a series of clusterfuck blockades, where we are going to try to blockade all the major ingress points in the city.”

This post was published at Zero Hedge on Jan 17, 2017.


Gold at (1:30 am est) $1212 UP $9.10 (FROM YESTERDAY/UP $16.70 FROM FRIDAY)
Access market prices:
Gold: $1217.30
Silver: $17.23
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:
TUESDAY gold fix Shanghai
Shanghai FIRST morning fix Jan 17/17 (10:15 pm est last night): $ 1222.43
NY ACCESS PRICE: $1205.75 (AT THE EXACT SAME TIME)/premium $16.68
Shanghai SECOND afternoon fix: 2: 15 am est (second fix/early morning):$ 1236.47
China rejects NY pricing of gold as a fraud/arbitrage will now commence fully
London Fix: Jan 17/2017: 5:30 am est: $1217.50 (NY: same time: $1214.00 (5:30AM)
(???? why the discrepancy)
London Second fix Jan 17.2017: 10 am est: $1216.05 (NY same time: $1216.40 (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 January 17, 2017.

Trump and the Four Levers of Government Policy

As Don Rissmiller of Strategas Research Partners succinctly points out, ‘There are four types of government policy that can be used to steer the economy: 1) monetary policy, 2) fiscal policy, 3) regulatory policy, and 4) trade policy.’
We will use Don’s framework for today’s discussion. Monetary comes first.
After eight years of zero-interest-rate policy, the United States’ central bank finally raised its policy interest rate by a quarter point in 2015 and by a second quarter point in 2016. For the last 10 years, the Fed has missed on all of its forecasts of inflation (PCE) and unemployment (U3) and growth (GDP). The originally famous dot plot has become infamous, and one member of the FOMC did not even hazard a forecast as of the last meeting. (See ‘December FOMC Minutes,’ by Bob Eisenbeis.)
Markets seem to be expecting two Fed hikes in 2017. So our base-case forecast for the end of 2017 is a policy rate range of 1.25% to 1.5%. That would put three-month LIBOR at about 2%. We expect the 10-year US Treasury note to yield around 3% or so. We believe the tax-free bond market sell-off was wildly overdone, and we expect the present 4% level on tax-free high-grade Munis to give way to the 3% handle level. Beyond 2017 is still guesswork, since the details of Trump policies are only guesses. We think this will change quickly, and then markets can refine estimates of Fed policies and rate forecasts.
This lack of clarity and base-case assumption about the Fed was well articulated by Phillipa Dunne & Doug Henwood in the Liscio Report:

This post was published at FinancialSense on 01/17/2017.

How Morgan Stanley “Discovered” The Identity Of The Biggest Bond Buyer In The Past Two Years

Analyzing intraday time series in various markets is a familiar strategy, and has usually been applied to markets which have liquidity 24 hours of the day, such as FX. A good recent example was Deutsche’s report on “How To Make Money Trading FX? Just Wake Up At 3AM.” And while such regional time-series comps have been mostly conducted with currencies, over the weekend Morgan Stanley’s Matthew Hornbach did a similar analysis with rates.
What he found was startling.
As Hornbach explains, a key feature of his team’s work over the years has been to what extent and when have investors in Japan placed downward pressure on Treasury yields. This led him to consider whether or not the effect occurred during the Tokyo trading day or outside of the Tokyo trading day. Morgan Stanley then created 4 indexes to track the changes in 10y rates during 4 sessions of the global trading day: (1) the Tokyo session, (2) the London session, (3) the NY morning session, and (4) the NY afternoon session.

This post was published at Zero Hedge on Jan 17, 2017.

Is Trump’s Strategy To Trap The Central Bank? – Episode 1180a

The following video was published by X22Report on Jan 17, 2017
Walmart, GM, Ford and many other companies are preparing to bring back jobs and build factories under President Trump. Empire State Manufacturing declines. Trump is planning to cut spending and reduce the size of the US Government. Fed Brainard warns that Trumps policies might have an adverse effect on the economy. Comptroller General Gene Dodaro warns the government is on a unsustainable path. Theresa May will make a complete break with the EU.

David Einhorn Explains How He Is Trading The “Trump Presidency”

In David Einhorn’s fourth quarter letter to investors (which reveals a respectable net return of 4.5% for Q4 and 8.4% for 2016), the avid poker player reveals himself as yet another closet supporter of Trump policies, stating that he expects the economy to “accelerate” once Trump’s still undetermined policies are implemented.
Looking back, Einhorn writes that “since Election Day, the market appears to have changed its macroeconomic outlook and is reevaluating the prospects for many companies accordingly.” This, of course, is the so-called Trumpflation rally, which however may have fizzled overnight with Trump’s stated opinion that the USD is now overvalued. Nonetheless, Einhorn points out that “this change in tone has been favorable to our style, and we generated a good result in the quarter despite our low net exposure and a decline in gold.”
But, as he then breaks, “rather than look backward, we’d like to share our views of what a Trump Presidency (TP) might look like and why we believe we are well-positioned for 2017. In short, we believe that the post-Great Recession easy money policies have been good for Wall Street but bad for Main Street. It’s possible that the TP reverses these policies, which would be good for Main Street but rough on Wall Street.”
So looking forward, Einhorn is, for now at least, that the fiscal stimulus emerging from the Trump presidency will be favorable both for the economy…

This post was published at Zero Hedge on Jan 17, 2017.

Admin Note – No Updates Tonight – Waiting For Reform and Other Things

‘Let no man pull you so low as to hate him.’
Martin Luther King
Or to become what you purportedly hate about them.
I will be out of pocket much of today, sitting in waiting rooms for the usual healthcare testing things. Sometimes the tests are far enough apart. But at other times they come in flurries as the interpretation of the results demands it.
Just as a reminder, my wife has a rare form of cancer that has been showing up here and there. There is no way to cure it, but the thing is to manage it as best as one can. And so we have been doing for the past five or six years now, with the usual ups and downs.
As I told her when we received the initial diagnosis, which was a bit shocking considering her otherwise perfect health and habits, that ‘this is our life now, and I will be with you every step of the way.’
Consequently there will be no chart updates tonight, although I am reading mails and posting links.
Trump sent the dollar reeling with some interview comments, and the metals responded.
Economics, journalism, and politics are among the ‘disgraced professions’ that resent their bad reputations these days. It seems that when things start going really wrong, the ‘professions’ always seem to be playing a key role. And as the locus of the conscience and voice of society, that is quite understandable.

This post was published at Jesses Crossroads Cafe on 17 JANUARY 2017.

Gold Price Up Through ‘Key’ $1207 Level as ‘Brexit Means UK Out of Single Market’

Gold prices hit new 8-week highs at $1218 per ounce on Tuesday as world stock markets fell for the second day but the British Pound surged as UK prime minister Theresa May said Britain “cannot possibly” stay within the European single market when Brexit takes it out of the political European Union.
That defied many analysts’ expectations of a fresh shock to Sterling if May said Brexit means quitting the free-trade zone‘s existing treaties.
“Gold still in demand ahead of Brexit speech,” said a note from German financial services giant Commerzbank this morning, pointing to rising inflows to European trust funds backed by bullion.
New York’s giant SPDR Gold Trust (NYSEArca:GLD) saw its shares in issue grow on Friday – requiring more metal to back them – for the first time since Donald Trump won the US election in early November.
US investors would today return from the Martin Luther King Day holiday to find gold prices trading 1.3% above Friday’s finish in Dollar terms.

This post was published at FinancialSense on 01/17/2017.

This is definitely an asset that you want to own

I’ve got auditors sitting in my office here in Santiago right now.
No, not those auditors. Not the kind from the IRS that strike fear in the hearts of taxpayers.
The auditors in our office are from one of the big international accounting firms, and we invited them to review our agriculture company’s 2016 financials.
This is something that nearly all large, responsible businesses do in order to provide their shareholders with a comprehensive annual report.
I wear multiple hats; as an entrepreneur who has started a few large companies, I have shareholders that I need to keep updated.
But as an investor, I’m a shareholder in a multitude of businesses, and I need to be updated about how those investments are performing.
So this is an especially busy time of year… writing and reviewing multiple reports and business plans.
If that sounds boring, I assure you it’s not. There are few things more interesting to me than creating something valuable and tangible out of nothing.
And that’s ultimately what business is: value creation.
Great entrepreneurs come up with big ideas to solve problems for their customers.
And through sheer willpower, talent, and persistence, they birth their ideas into existence. If enough value is created, the rewards can be incredible.
The same goes for investors.

This post was published at Sovereign Man on January 17, 2017.

Gundlach: The Biggest Risk to the Current Rally Is Donald Trump

With the S&P 500 trading at all-time highs, NYSE Short Interest down 20% over the past 12 months and what can only be described as a highly optimistic view of Donald Trump’s presidency, one does wonder if the markets are in their final stage of euphoria before the crash many bears have long been waiting for.
The massive shift in sentiment has taken place over the past three or four months has been nothing short of outstanding. But what will happen if this air of optimism suddenly evaporates overnight? Investors seem to have suddenly flipped to positive in just a few days after Trump’s election, and nothing is stopping them from flipping the other way if he fails to meet their expectations.

This post was published at FinancialSense on 01/17/2017.

Trump Trounces Yellen – Dollar Dumps, Erases All Post-Fed Gains

It appears The Donald is stronger than The Fed (for now). The president-elect’s comments that the dollar is “too strong” have accelerated the weakness from his press conference last week, and erased all the “well the dollar is up because the US economy is so strong” gains in the greenback since The Fed hiked interest rates for the second time in a decade…

This post was published at Zero Hedge on Jan 17, 2017.

Markets Shudder Under Threat of Hard Brexit

Theresa May has been the conservative leader and Prime Minister of the UK for just over 6 months following the Brexit vote in June of last year. Since then, the discussion over just how the UK might go about the Brexit from the European Union has left markets, the pound sterling and multinationals focused on trade in the dark.
That is all about to change.
The Prime Minister will meet in front of a scattered mix of government members, press and European diplomats at London’s Lancaster House to outline Brexit priorities going forward on Tuesday. The house was once the location in which the UK signed over independence to Zimbabwe (then Rhodesia), Malaya and began negotiations with South Africa to become a republic – so it is only fitting that such a public speech would take place in front of the London mansion.
Prior to the scheduled speech, Mrs. May had only given one major public address covering Brexit and expectations, while standing in front of her fellow conservative party members. There she announced that she would be working toward EU migration controls and directly working toward the legalities surround the European Court of Justice.

This post was published at Wall Street Examiner on January 16, 2017.