Posts Categorized: In The News

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Bill Holter’s Commentary

Get ready for the flood of liquidity because there is no other tool left.

This Wasn’t Supposed To Happen: One Day After Fed Rate Cut, Repos Signal Record Liquidity Shortage
March 4, 2020

Yesterday morning, when we discussed the sudden spike in liquidity shortage that resulted in both a (record) oversubscribed term repo and the first oversubscribed overnight repo since the start of the repo crisis last September that spawned QE4 and helped its culprit, JPMorgan report record annual revenues, we said that “if going solely by the amount of securities submitted between the term and overnight repo, the overall liquidity shortage today was nearly $180BN, the highest since the start of the repo crisis, and a clear signal to the Fed that it needs to do something to further ease interbank lending conditions.”

Less than an hour later the Fed cut rates by 50bps in its first emergency intermeeting action since the financial crisis.

So with its emergency action now in the rearview mirror, did the Fed manage to stem the funding panic that has gripped repo markets following last week’s market bloodbath? The answer, if based on the latest overnight repo results, is a resounding no.

Moments ago, the Fed announced that its latest repo operation was once again oversubscribed, with the full $100 million amount of repo accepted.

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Bill Holter’s Commentary

Posted without comment because every thought that comes to mind is either politically incorrect or offensive to someone…especially Californians.

Los Angeles DA’s Husband Pulled Gun On Black Lives Matters Protesters
March 2, 2020

LOS ANGELES — The husband of Los Angeles County’s district attorney pulled a gun on Black Lives Matter protesters, telling them to back off, during a tense, crack-of-dawn demonstration Monday outside the prosecutor’s home.

Protesters knocked on the front door of L.A. County District Attorney Jackie Lacey at 5:40 a.m. PT when her husband, David Lacey, opened up and pointed a weapon, according to Melina Abdullah, a professor of Pan-African studies at Cal State Los Angeles, and protest organizer Justin Marks.

“We heard the gun cocking, and I thought I was being paranoid,” Abdullah told NBC News. “But then he opened the door, leading with the gun. He saw me and lowered it, pointing it at my chest.”

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Bill Holter’s Commentary

It doesn’t matter whether coronavirus is a killer or just a garden variety flu bug, there are real world financial ramifications. Some companies just cannot sustain a drop in cash flow like this…the tide is going out so we will soon see who’s naked.

Macau Gaming Revenue Suffers Record Plunge From Virus Blow
February 29, 2020

Casinos in Macau, the Chinese territory that’s the world’s biggest gambling hub, reported a record drop in gaming revenue, as they grappled with the cost of closing down their businesses for 15 days to help contain the deadly coronavirus outbreak.

Gross gaming revenue was 3.1 billion patacas ($386.5 million) in February, down 87.8% from a year earlier, according to data from the Gaming Inspection & Coordination Bureau. In a survey, analysts had predicted a median 90% slide.

The slump follows a decision by Macau’s government to suspend casino operations from Feb. 5 for just over two weeks, dealing another blow to the gambling mecca that’s already struggling to recover from a revenue decline in 2019. The closure was the longest on record and only the second such instance, after a typhoon in 2018 forced a 33-hour shutdown.

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Bill Holter’s Commentary

Real time updates on coronavirus.

Real-Time Update On Coronavirus Outbreak

Source:Global Times Published: 2020/1/22 21:15:00 Last Updated: 2020/3/1 20:33:06

302

8:32 pm Mar 1

South Korean officials said that a number of members of Shincheongji Church, causing over 1,500 COVID-19 cases in S. Korea, visited Wuhan in January. The authorities will try to find out how many had been to the central Chinese city, epicenter of the virus.

7:36 pm Mar 1

Iran has reported 385 new COVID-19 cases on Sunday, making the Middle East country’s total infected cases to 978. Among them, 54 died.

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Bill Holter’s Commentary

As we tried to relay to subscribers earlier today. “It is ALL about credit”! You will understand this shortly…

Coronavirus Paralyzes Global Credit Market As New Issuance Crashes To Zero

February 26, 2020

In the early days, when virtually nobody paid attention to the coronavirus pandemic which China was doing everything in its power to cover up, markets were not only predictably ignoring the potential global plague – after all central banks can always print more money, or is that antibodies – but until last week, were hitting all time highs. All that changed when it became apparent that for all its data manipulation, China was simply unable to reboot its economy as hundreds of millions of workers refused to believe the government had the viral plague under control, starting a potentially catastrophic 2,3 month countdown to millions of small and medium Chinese businesses going bankrupt, resulting not only in untold devastation in the world’s 2nd largest economy but paralyzing and crippling supply chains across the world. Worse, it also triggered the biggest equity selloff in years.

And now, the coronavirus pandemic is about to leave yet another market in critical condition as the global credit machine is grinding to a halt.

As Bloomberg points out, the $2.6 trillion international bond market, where the world’s biggest companies raise money to fund everything from acquisitions to factory upgrades, came to a virtual standstill as the coronavirus spreads panic across company boardrooms.

While hardly a surprise with US equity markets suffering one of their worst selloffs since the great depression, Wall Street banks recorded their third straight day without any high-grade bond offerings, an unheard of event – especially in this day and age of ravenous yield apetite – outside of holiday and seasonal slowdowns. Across the Atlantic, European debt bankers had their first day of 2020 without a deal on Wednesday. And bond issuance in Asia, where the virus first emerged, has also slowed to a trickle.

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Bill Holter’s Commentary

GATA has been all over this since 1999. they are correct!

How Gold Is Manipulated
February 25, 2020

Is there gold price manipulation going on? Absolutely. There’s no question about it. That’s not just an opinion.

There is hard statistical evidence to make the case, in addition to anecdotal evidence and forensic evidence. The evidence is very clear, in fact.

I’ve spoken to members of Congress. I’ve spoken to people in the intelligence community, in the defense community, very senior people at the IMF. I don’t believe in making strong claims without strong evidence, and the evidence is all there.

I spoke to a PhD statistician who works for one of the biggest hedge funds in the world. I can’t mention the fund’s name but it’s a household name. You’ve probably heard of it. He looked at COMEX (the primary market for gold) opening prices and COMEX closing prices for a 10-year period.

He was dumbfounded.

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Bill Holter’s Commentary

As we have been stressing for several weeks, economic contraction due to slack demand and supply chain issues. Central banks do not have a tool to create an antidote, nor can they “print” people back to work. Be assured, there will be credit market ramifications, and we all know it is all about credit!

China Mobile Phone Sales Crash Most On Record
February 24, 2020

China’s mobile phone industry cratered in January as shipments plunged by more than a third, according to a new report from China Academy of Information and Communications Technology (CAICT).

China shuttered dozens of cities, closed major manufacturing hubs, shutdown retail stores, and placed more than 700 million people in lockdown for virus containment purposes, creating one of the most massive demand shock the country has ever seen, resulting in the bust of the mobile phone industry in January.

CAICT reported domestic mobile phone shipments were around 20.8 million units, down 38.9% year-over-year.

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Bill Holter’s Commentary

In the best interest of our country or not? And why would it need to be secret?

Source: Democrat Senator Held Secret Meeting In Munich With Iranian Foreign Minister Zarif
February 17, 2020

Sen. Chris Murphy of Connecticut and other Democratic senators had a secret meeting with Iranian Foreign Minister Mohammad Javad Zarif during the Munich Security Conference last week, according to a source briefed by the French delegation to the conference. Murphy’s office did not respond to repeated requests for comment by press time.

Such a meeting would mean Murphy had done the type of secret coordination with foreign leaders to potentially undermine the U.S. government that he accused Trump officials of doing as they prepared for Trump’s administration. In February 2017, Murphy demanded investigations of National Security Advisor Mike Flynn because he had a phone call with his counterpart-to-be in Russia.

“Any effort to undermine our nation’s foreign policy – even during a transition period – may be illegal and must be taken seriously,” Murphy said in 2017 after anonymous leaks of Flynn’s phone call with Russian ambassador Sergey Kisylak were published. He also strongly criticized the open letter some Republican senators sent Iranian leaders during the Obama administration’s campaign for a nuclear agreement.

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Bill Holter’s Commentary

And this was BEFORE the coronavirus…

Largest Shipping Decline Since 2009 and That’s Before Coronavirus
February 18, 2020

The January Cass Freight Shipping Index is more bad news for the global economy.

The Cass Freight Shipping Index is down 9.4% year-over-year, the largest decline since 2009. And this is for January, before the Coronavirus disruption.

The turn of the calendar didn’t leave the bad news in 2019, as the Cass Freight Index showed continued weakness in the U.S. freight market. Both the shipments and expenditures components of the Cass Freight Index worsened sequentially and showed decelerating y/y growth. According to the broader stock market levels, there is still optimism out there, but the freight trends have yet to turn. And the Covid-19 coronavirus case count continues to grow, creating uncertainty around containment and eventual impact on global supply chains. Some Chinese factories resumed operation this past week, but they are still not close to 100% production levels. Others have pushed re-opening back to March 1.

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Bill Holter’s Commentary

The latest from John Williams’ www.shadowstats.com

– January 2020 CASS Freight Index Dropped by 9.4% (-9.4%) Year-to-Year
– Current, Deepening Annual Declines in Freight Activity Increasingly Resemble the Onset of the Great Recession
– Deepening Annual Declines in Freight Activity Are Not Consistent With a Booming Economy
– They Also Do Not Support FOMC Claims of Sustainable Moderate Economic Growth in Place
– They Are Consistent With Fourth-Quarter Contractions Seen in Industrial Production and Real Retail Sales

“Flash Update No. 23”

www.shadowstats.com