Summer of 17: LBMA Confirms Upcoming Publication of London Gold Vault Holdings

Just over a week ago I wrote an article highlighting that the Bank of England has begun publishing monthly data on the total quantity of gold bars held within the Bank of England vaults in London. See ‘Bank of England releases new data on its gold vault holdings’.
This new gold vault data was first released in early April 2017 and covers gold bar holdings at the Bank of England for every month-end for the last 6 years. Going forward, the Bank will publish updates to this dataset every month, on a 3-month lagged basis.
The move by the Bank of England to publish this data was first reported by the Financial Times in February and was supposedly part of a broader gold vault reporting initiative which was to include vault holdings for all 7 of the London Bullion Market Association (LBMA) commercial precious vaults in London. These commercial vaults are run by HSBC, JP Morgan, Brinks (on behalf of itself and ICBC Standard), Malca Amit, Loomis and G4S. While the Bank of England had single-handedly gone ahead with its side of the reporting initiative, the precious metals vault holdings data from the LBMA was conspicuously absent when the Bank of England made its move. As I wrote in my article last week:
‘The London Bullion Market Association was also expected to publish gold vault holdings data for the commercial gold vaults in London, but as of now, this data has not been published, for reasons unknown.’
‘While the Bank of England has now followed through with its promise to publish its gold vault holdings, the LBMA has still not published gold vault data for the commercial gold vault providers, i.e. its members HSBC, JP Morgan, ICBC Standard Bank, Brinks, Malca Amit, Loomis and G4S. Where is this data, why is there a delay, and why has it not yet been published?’

This post was published at Bullion Star on 9 May 2017.

Jeff Gundlach Explains Why It’s Time To Sell US Stocks, Buy Emerging Markets

One year ago at the Ira Sohn investor conference, DoubleLine CEO Jeffrey Gundlach caused a stir when he predicted that Donald Trump would win the presidential election, something virtually no other asset manager or pundit agreed with. Gundlach was right.
This year, Gundlach’s Sohn presentation was more whimsical and eclectic even if he focused on more mundane financial topics, touching on the recent scramble into passive investing via ETFs and indexes, then turning to markets and observing that US equity valuations have become stretched on numerous metrics, one of which is the value of the S&P 500 relative to US GDP which has risen to historic highs that have even exceeded the dot-com bubble…

This post was published at Zero Hedge on May 8, 2017.

Silver Investment Case Remains Extremely Compelling

Silver Investment Case Remains Very Compelling
Are we near a turning point in silver’s relentless decline?
Avert your eyes – this is one ugly silver chart
Gold silver ratio at 75 shows real value of silver
Mining CEO explains why silver could reach $136.67
Buy silver low, sell high
The silver price has been in sharp decline for three weeks and silver prices have fallen from $18.61 on April 16 to $16.20/oz today.
However, every cloud has a silver lining and for Dominic Frisby writing in Money Week, silver is the silver lining and the silver investment case remains compelling.

This post was published at Gold Core on May 9, 2017.

Yates / Clapper Hearing: Flynn In Deep Trouble But Still “No Evidence” Of Trump Collusion With Russia

Below is a summary of some of the key topics covered during today’s Senate Judiciary Committee hearing with former DNI Director Clapper and Former Acting Attorney General Sally Yates.
Yates On Flynn Warnings To The White House:
With regards to General Flynn, Yates testified that she had two in-person meetings and 1 phone call with the White House out of concerns that Vice President Pence was unknowingly making false statements in the media about Flynn’s interactions with Russian officials…false statements that Yates alleged were the result of Flynn interntionally lying to the Vice President.
Yates also testified that “potential prosecution” of Flynn was discussed at the second in-person meeting at the White House.

This post was published at Zero Hedge on May 8, 2017.

European Manufacturers on a Tear on Weaker Euro

At the start of the second quarter, the eurozone’s manufacturing sector grew at its fastest pace in six years, climbing from 56.2 in March to 56.7 in April and marking the eighth straight month of expansion. Of the eight eurozone countries that IHS Markit surveys, only Greece failed to show any improvement during the month.
Growth was spurred by new orders, output and job creation, and companies are benefiting from both the historically weak euro and the European Central Bank’s ongoing stimulus, including low interest rates. Factory jobs are currently seeing one of their strongest upticks in the survey’s 20-year history.
Ahead of France’s presidential election this past weekend – polls heavily favored the victor, 39-year-old Emmanuel Macron, over far-right candidate Marine Le Pen – the country showed impressive momentum, rising from 53.3 in March to 55.1 in April. New orders grew at their sharpest pace in six years. Meanwhile, the United Kingdom’s manufacturing sector continued to expand post-Brexit, rising to a three-year high of 57.3.

This post was published at GoldSeek on 9 May 2017.

Macron’s Victory May Be Disaster for Merkel

Angela Merkel was the first phone Emmanuel Macron made after the election. My point about the election for Macron was the worst possible outcome for the Euro was not just reflected in yesterday’s outside reversal to the downside. Merkel has already made it clear that she will not relax Eurozone spending rules to help Macron. The defeat of Le Pen has sealed the fate of Europe because there will be no reflection upon how to reform the EU to save Europe.
Only a sublime idiot would now think everything in Europe will be just great. We are looking at a major hard landing for Europe. Keep in mind that local governments even in the USA are doomed for all they can do is raise taxes further crushing their population and destroying their own economy.

This post was published at Armstrong Economics on May 9, 2017.

Half Of Canadians Have $200 Or Less In Savings

Two months ago, when quoting the CEO of cell phone insurer Assurant, who appeared on Bloomberg TV to discuss business trends, one of his quotes caught our attention: ‘the reality is, half of Americans can’t afford to write a $500 check,’ Colberg said. We decided to look into the CEO’s claim about the woeful state of US finances. What we found is that according to a recent Bankrate survey of 1,000 adults, 57% of Americans don’t have enough cash to cover a mere $500 unexpected expense. Turns out the CEO was right. And while that may appear dire, it is a slight improvement from 2016, when 63% of U. S. residents said they wouldn’t be able to handle such an expense.
The Bankrate survey findings echoed research published last year by the Federal Reserve, which found that 46% of respondents said they would be challenged to come up with even less, or $400, to cover an emergency expense, and would likely borrow or sell something to afford it. When the Fed asked what types of emergency expenses Americans had actually faced in the last year, more than one out of five cited a major unexpected medical expense. The average expense: $2,782, or almost seven times higher than the Fed’s hypothetical $400 surprise bill.
How does this stunning statistic compare to some other developed nations?
It turns out that the state of half of US finances, deplorable as it may be is positively shining, not to mention “twice as good”, when compared to the country’s neighbor to the north, where a recent Ipsos survey on behalf of accounting firm MNP, found that more than half of Canadians are living within $200 per month of not being able to pay all their bills or meet their debt obligations. Needless to say, if $500 in savings is bad, half that amount is outright bizarre.

This post was published at Zero Hedge on May 9, 2017.

What’s Killing the Middle Class? (Part 2)

The Powers That Be are perfectly fine with your transition to proletarian debt-serf. Yesterday we covered the usual suspects in the decline of the middle class as a financial-political bulwark against oligarchy / dominance of rentier elites: globalization, automation and the asymmetric distribution of rewards favoring the few over the many. Today, let’s cover the politically explosive systemic dynamics behind the erosion of middle class income, wealth and political influence. 1. I hope you won’t be too shocked that the core dynamic driving middle class decline is the way we create and distribute money, i.e. central-planning by central banks. As I have explained many times, those closest to the central bank money spigots can borrow essentially unlimited sums at near-zero interest rates.

This post was published at Charles Hugh Smith on MONDAY, MAY 08, 2017.

Robert Mercer, Co-CEO Of Renaissance, Sued By Former Employee Alleging Retaliation Over Trump

Back in February we reported of a striking development taking place at Renaissance, arguably the world’s most successful (and according to many, politically connected and powerful) hedge fund, where one of its key employees, David Magerman, “mutinied” against co-CEO Robert Mercer, the man who together with his daughter Rebekah have been instrumental in getting Trump elected, accusing him of engaging in actions that would harm the future of America.
Following Trump’s election Magerman – a research scientist who worked at the hedge fund for two decades and a registered Democrat who calls himself a centrist, and who had complained to colleagues about Mercer’s role as a prominent booster of Donald Trump’s presidential campaign – started to become more vocal at the office about his disdain for Mercer’s activities, which resulted in this awkward phone call with his boss, as reported by The Wall Street Journal
Magerman says he was in his home office in suburban Philadelphia earlier this month when the phone rang. His boss, hedge-fund billionaire Robert Mercer, was on the line.’I hear you’re going around saying I’m a white supremacist,’ Mr. Mercer said. ‘That’s ridiculous.’ ‘Those weren’t my exact words,’ Mr. Magerman said he told Mr. Mercer, stammering and then explaining his concerns about Mr. Trump’s policy positions, rhetoric and cabinet choices.
‘If what you’re doing is harming the country then you have to stop.’

This post was published at Zero Hedge on May 8, 2017.

Emerging Market Debt Expanding Twice the Rate of 2016

The view that BREXIT is a passing phase and Europe will extinguish the swell of populism, has led to more debt in dollars being racked up at a faster pace than ever in US dollars among emerging markets, which stood at about 50% of the US National Debt. The debt in new offering has exploded as bears continue to say the Dow will crash and the dollar with it. This had led to an extraordinary offering of new dollar debt which is close to $160 billion by the 1st of May, 2017. This represents more than twice the dollar value reached by May 1st last year.
The willingness of investors to buy debt securities is rooted in these bearish forecasts. I was recently asked to do an interview because they said they were desperate to find someone who was bullish on the equities market long-term. The vast majority keep touting the dollar will crash with the share market and this is fueling the explosion in new debt along with the expectation that interest rates will rise – not fall.

This post was published at Armstrong Economics on May 9, 2017.

Paris Post-Mortem – The Journey To ‘A Reality Check’ Has Already Begun

First mistake: Emmanuel Macron’s handlers played Beethoven’s ‘Ode to Joy’ instead of the French national anthem at the winner’s election rally. Well, at least they didn’t play ‘Deutschland ber Alles.’
The tensions in the Euroland situation remain: the 20 percent-plus youth unemployment, the papered-over insolvency of the European banks, and the implacable contraction of economic activity, especially at the southern rim of the EU.
The clash of civilizations brought on by the EU’s self-induced refugee glut still hangs over the continent like a hijab. That there was no Islamic terror violence around the election should not be reassuring. The interests of the jihadists probably lie in the continued squishiness of the status quo, with its sentimental multiculture fantasies – can’t we all just get along? – so En Marche was their best bet. LePen might have pushed back hard. Macron looks to bathe France’s Islamic antagonists in a nutrient-medium of Hollandaise lite.
The sclerosis of Europe is assured for now. But events are in charge, not elected officials so much, and Europe’s economic fate may be determined by forces far away and beyond its power to control, namely in China, where the phony-baloney banking system is likely to be the first to implode in a global daisy-chain of financial uncontrolled demolition. Much of that depends on the continuing stability of currencies.

This post was published at Zero Hedge on May 8, 2017.

Former Fed Governor: The Last Time I Saw Such Uniformity Of Opinion Was Just Before The 2007 Crash

Former Fed Governor Kevin Warsh last week slammed the Fed, during a speech delivered at the Hoover Fed Conference, admitting the central bank had no real “normalization” strategy aside from jawboning, and accused his former co-workers of potentially terminal groupthink.
Changes are in order to how the Fed organizes itself, conducts its business, deliberates policy choices, and makes its monetary policy decisions. In short, deliberations should be more robust, and decisions less constrained. The existing governance structure reinforces a groupthink of the guild. It places the Fed at considerable institutional risk when the next crisis strikes. And it makes the next crisis more likely to be more harmful to the economy.
As a former Fed governor, he would know. On Monday, Warsh appeared again at the Ira Sohn conference in his capacity as consultant to Stan Druckenmiller’s family office, and was the third in a row just this morning (after Goldman and Citi) to warn that he believes the market is risky when measures of risk are as low as they are currently (the VIX is currently trading at 9.72, and grinding lower).

This post was published at Zero Hedge on May 8, 2017.

Harvard Endowment Liquidating $2.5 BIllion In Assets

Back in January, Harvard’s Endowment stunned the investing world when it announced that the investing vehicle which manages $36 billion in assets, would undergo a “radical overhaul” in the way the world’s wealthiest school invests its money by outsourcing management of most of its assets and lay off roughly half the staff in the process. As the WSJ reported at the time, about half of the 230 employees at Harvard Management Company would depart as part of a sweeping change by the university’s new endowment chief, N. P. ‘Narv’ Narvekar.
The endowment would also shut down its internal hedge funds and let go traders by the middle of the year. Additionally, the internal team in charge of direct real-estate investments was expected to spin out into an independent entity that Harvard would invest with. Following the restructuring, only management of Harvard’s natural resources portfolio and passively managed exchange-traded funds will remain in house.
So with this major overhaul taking place, it is hardly a surprise that the Harvard Endowment is quietly seeking to liquidate some $2.5 billion in private equity, venture capital and real estate investments, as Axios reported on Monday. The website notes that the secondary offerings include just under $1 billion of PE/VC partnership positions plus around $1.6 billion of real estate positions. Harvard has hired Cogent Partners, a unit of Greenhill to seek bidders in the secondary market and to executive the sale.

This post was published at Zero Hedge on May 8, 2017.