Posts Categorized: In The News

Posted by & filed under In The News.

J. Johnson’s Latest – Another Reason to Hold Precious Metals?
October 10, 2019

Great and Wonderful Thursday Morning Folks,   

      Gold was doing a lot better earlier with the trade now at $1,513.30, up 50 cents after hitting $1,522.30 with the low at $1,508.80. Silver is showing the “weak” signal with its trade at $17.795 down 1.5 cents after the high of $17.935 was reached at the restart of trade last night with the low at $17.695. The US Dollar finally has some movement in it, with its trade down 35.5 points at 98.46, recovering from the low at 98.37 with the high at 98.795. All of this was done before 5 am pst, the Comex open, and the London close.   

      Gold’s value under the Venezuelan Bolivar gained 60.92 overnight with its trade at 15,114.08 Bolivar with Silver losing a little, with its price at 177.728 dropping 0.399 Bolivar. In Argentina, the Peso now has Gold pegged at 87,377.44 Pesos showing a gain of 188.46 with Silver at 1,027.56 Pesos, proving a drop-in value of 4.17 Pesos. In Turkey, the Lira has Gold valued at 8,916.51 Lira giving those that hold a 125.25 T-Lira gain with Silver at 104.849 proving a gain of 0.832 in T-Lira value.   

      October Silver’s Delivery requests are now at 339 fully paid for (5,000 ounce) contracts waiting for receipts and again with zero Volume up on the board so far this morning. During yesterday’s trade 4 purchases showed up with prices yet, as of this morning, the delivery count was only reduced by 4 from yesterday’s numbers. So, where there 4 more purchases bringing the delivery total to 8 receipts or was it only 4? This is the problem in the ledgers the Comex numbers give with their lack of information regarding spreads entering or exiting inside the delivery month.      

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Bill Holter’s Commentary

Maybe not THE most insolvent nation on the planet but certainly the most insolvent in the EU… now issues bonds with a negative yield?  Umm, have the buyers never heard of the concept of “risk premium”?  Absolutely nuts and the entire episode will end as THE biggest credit collapse in all of history,  And remember, when credit goes, so do fiat currencies as they all have one thing in common…they have value because “credit” is their foundation!

For The First Time Ever, Greece Issues Negative Yielding Debt
October 10, 2019

As armies of fixed income strategists battle over whether US Treasuries are facing higher or lower yields, Greece has no such qualms and in a historic shift today, the former bond market pariah and Eurozone’s most indebted nation, joined the exclusive club of negative-yielding European nations when bond investors lined up to pay the nation that was at the heart of Europe’s sovereign debt crisis.

A sale of €487.5 million of 13-week bills on Wednesday drew Greece’s first-ever negative yield of minus 0.02% as investors now pay Athens for the privilege of lending it cash, as Bloomberg first reported. Greece joins the likes of Ireland, Italy and Spain – not to mention virtually all core Eurozone nations – which benefit from the ECB’s insane monetary policy and deepening fears of a global recession.

It’s been an unprecedented turnaround for twice bankrupt Eurozone member, whose bondholders suffered massive losses back in March 2012 when the country was forced to accept the biggest bond restructuring in history, bringing the Eurozone to the verge of collapse.

Just a few years and several trillions in bond purchases by the ECB later, the region is grappling with an altogether different problem – the spread of negative yields, which reduces borrowing costs for governments in a form of soft default, one which is crushing savers, pension funds and insurers, and which has prompted some of the most respected names in finance to shriek in terror as the cost of money in even Europe’s most insolvent nations is now negative.

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Posted by & filed under In The News.

Bill Holter’s Commentary

An excellent article by Ronan Manly. “Transparency” will not just destroy the paper gold markets but the entire system as we know it!

LBMA Needs Reform To Serve The Physical Precious Metals Market
October 8, 2019

Among the wider precious metals community, it would be fair to say that the London Bullion Market Association (LBMA) has always been looked upon with a degree of suspicion. The reasons for the suspicion include:

    That the LBMA banks created and unleashed on to the world the concept of fractional-reserve bullion banking, unallocated precious metal accounts, and synthetic cash-settled paper gold products unbacked or fractionally-backed by physical metal.

    That the founding members of the LBMA were a group of powerful bullion banks and brokers.

    That the LBMA was founded “at the behest” of the Bank of England.

    That the LBMA operates at the nexus of secretive central bank gold lending transactions where transparency is, to say the least, non-existent.

All of these reasons would be valid concerns, but they are not getting to the heart of the issue. The heart of the issue is that the LBMA does not represent the physical gold and silver markets nor does it champion the interests of physical precious metals savers and investors.

Rather, the LBMA promotes and protects and paper gold and silver markets and works on behalf of the bullion banks which operate and control these derivative paper markets through OTC precious metals trading, the London daily price fixings, and COMEX precious metals futures trading. All the while the LBMA with a straight face claims to be the “

” and ““. A global authority appointed by who you might ask? Well, the banks of course!

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J. Johnson’s Latest – Politics And Governments Shutting Down Is Nothing To Worry About (Until?)
October 9, 2019

Great and Wonderful Wednesday Morning Folks,   

      Gold is trading higher but not like earlier with the right now price at $1,507.20, up $3.30 after reaching $1,516.90 with the low close by at $1,505.10. Silver lead the charge and may be leading the calm with the trade at $17.835, up 13.5 cents with the low at $17.72 after hitting $18 before the story about China agreeing again, and again, and again, hit the tape. The US Dollar is stagnated with the trade at 98.745, down 7.7 points with the high at 98.865 and the low at 98.595. All this was done before 5 am pst, the Comex open, and the London close.    

      In our emerging markets currency watch we see a pullback in Gold’s prices but a good strong rally in Silver. In Venezuela, Gold is now priced at 15,053.16 Bolivar proving a reduction of 31.96 in value with Silver at 178.127 giving Silver a 0.703 Bolivar gain. In Argentina, Gold is now priced at 87,188.98 Pesos, it too losing 167.22 Pesos with Silver at 1,031.73 Pesos, a gain of 13.62. The Turkish Lira now has Gold priced at 8,791.26 Lira showing a loss of 25.32 with Silver at 104.017 showing a gain of 1.268 in T-Lira value.    

      October Silver Deliveries now show a request count of 343 fully paid for demands for physical and with zero Volume up on the board so far this morning. This proves a reduction of 5 contracts from yesterday’s early morning quote that either got their physicals here or in London (paper or physical?). Silver’s Overall Open Interest shows a gain as 2,840 more contracts were added to the mix in order to keep liquidity happy giving us an early count of 214,136 Overnighters keeping Silver in place.    

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Jim Sinclair’s Commentary

More than half of the amount of munis held by households—a third of the $4 trillion market—now sits in separately managed accounts or mutual funds, a trend that has changed the way the bonds are sold.

This trend exists not only in the muni market but has just been accelerated in the equity market. The idea of trading for free has eliminated the broker dealer leaving only major funds and EFTs as equity traders. This has very significant implications for what future markets will look like along with future implications of AI.

Money Managers Gain Sway Over Muni Market [Subscription Required]
October 9, 2019

A larger-than-ever share of municipal bonds is being managed by professionals, shaking up a market that has traditionally been the domain of mom- and-pop investors.

The rapid expansion of muni money managers, under way for more than a decade, reached a milestone in the past year: More than half of the total amount of muni bonds held by households—a third of the $4 trillion market—now sits in separately managed accounts or mutual funds.

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Jim Sinclair’s Commentary

Even with a rebound on trade hopes, the KBW Nasdaq Bank Index of large bank stocks has fallen more than 4% this month, compared with a 2% decline for the S&P 500

Apparently, more people understand the genesis of the problem in the repo market than before.

The Rebound in Bank Stocks Was Short-Lived
October 9, 2019

Bank stocks have erased much of their September rally and are sliding once again in October, hurt by bets on lower interest rates and expectations for a turbulent earnings season.

Even with a rebound on trade hopes Wednesday, the KBW Nasdaq Bank Index of large bank stocks has fallen 4.7% so far this month, compared with a 1.9% decline for the S&P 500. In the past 12 months, the gauge of lenders has slid 11%, while the S&P is slightly higher.

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Jim Sinclair’s Commentary

So far, trade talks have resume multiple times and in all probability will continue that partner?

Trade Talks Resume at Pivotal Moment in U.S.-China Relations
October 9, 2019

WASHINGTON—Senior U.S. and Chinese officials will square off for trade talks Thursday at a pivotal moment in the countries’ relationship, with higher tariffs looming if negotiators fail to break a five-month stalemate.

The backdrop for the talks has become more complicated. What started as a U.S. assault on Chinese trading practices has become muddied by other issues, from China’s repression of its Muslim minorities to the possible impeachment of President Trump.

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Posted by & filed under In The News.

J. Johnson’s Latest – Silver’s Open Interest Keeps Dropping but Not Their Call Options….
October 8, 2019

 Great and Wonderful Tuesday Morning Folks,   

      Gold is trading higher after yesterday’s game of shorts went bust with the trade now at $1,510.40, up $6 from the low at $1,492.10 with the high close by at $1,512.40. Silver is following along with the trade at $17.605, up 6.5 cents after being dipped down to $17.305 with its high close by at $17.65. The US Dollar is down 6 points at 98.605 with its high at 98.73 and the low at 98.54. All of this reversal happened during London’s play time, before 5 am pst, the Comex open, and before London is done.    

      Our Emerging Markets Currency Watch is proving how right we are about the fiat crisis with Gold under the failed currency called the Venezuelan Bolivar now trading at 15,085.12 showing a gain of 56.93 Bolivar with Silver now at 175.830 giving the people a 0.899 Bolivar profit. In Argentina, the failed currency called the Peso now has Gold valued at 87,356.20 Pesos, proving a gain of 567.31 overnight with Silver’s gain posting a 7.91 A-Peso profit with the price at 1,018.11 Pesos. The Turkish Lira now has Gold priced at 8,816.58 showing what Gold can do when their president decides to make the value of its currency, umm unstable, proving 176.06 T-Lira gain in Gold’s value with Silver now at 102.749 T-Lira proving a gain of 2.176 in the overnight.    

      October Silver Deliveries keeps chugging along with the total request count now at 348 demands for physical and with Zero Volume up on the board so far this morning. Yesterday’s activity proved 8 contracts traded “with a price” yet the total count dropped 17 giving us the understanding that some of these demands were either settled out here at the COMEX or got papered over in London. Until we know for a fact (a full untampered viewable paper trail) what has happened to the supposed deliveries in London, we will continue to challenge the idea that these are actual physical deliveries of real product or it’s just paper transferred from one failed institution going to another on the verge of bankruptcy.     

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Posted by & filed under In The News.

Bill Holter’s Commentary

Please keep in mind that no Ponzi scheme can survive (period!) without new money…think the Fed is going to need a bigger hose? QE to infinity was correct when Jim coined the term and is extremely correct now with the Fed’s back against the wall.

Velocity of M2 Money Stock

 

 

 

 

 

 

 

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Bill Holter’s Commentary

…in a year or two this will look like a GREAT DEAL for pensioners as the piper arrives demanding payment!

GE To Freeze Pensions For 20,000 Workers
October 7, 2019

General Electric Co. said it was freezing its pension plan for about 20,000 U.S. workers and offering pension buyouts to 100,000 former employees, as the conglomerate joins the ranks of U.S. companies phasing out a guaranteed retirement.

GE is one of the rare big U.S. manufacturers that still allows salaried workers to accrue traditional pension payments, though it closed its plan to new participants in 2012. The company’s profits have evaporated in recent years, prompting GE to slash its dividend and Chief Executive Larry Culp to look for ways to pare it debts.

Some Expected Larry Culp to Break Apart GE. Instead, He’s Trying to Fix It.

GE’s traditional pension plans, which were underfunded by $27 billion as of the end of 2018, are one of the company’s biggest liabilities. The company said the latest changes could reduce its pension deficit by as much as $8 billion.

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Bill Holter’s Commentary

Negative interest rates? The snake eats its own tail!

“Money’s Not Worth Anything Anymore” – Ex-Credit Suisse CEO Blasts “Crazy” Negative Rates
October 7, 2019

Oswald Gruebel, who served as Credit Suisse CEO from 2004 to 2007 and as UBS Group AG’s top executive from 2009 to 2011, has slammed ECB policy in an interview with Swiss newspaper NZZ am Sonntag.

“Negative interest rates are crazy. That means money is not worth anything anymore,” Gruebel exclaimed.

“As long as we have negative interest rates, the financial industry will continue to shrink.”

Who can blame him – judging by the all-time low in European inflation expectations, ECB policy has been an utter failure…

 

 

 

 

 

 

 

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J. Johnson’s Latest – Silver’s December Call Options Stand Out Like a Sore Thumb!
October 7, 2019

Great and Wonderful Monday Morning Folks,  

     Even though there is every reason in the world to see the precious metals skyrocket this morning we are seeing it once again being held back with Gold now at $1,504.70 down $8.20 with the London low at $1,502.80 with the start pretty much being the high at $1,518.80. Silver is down but not like Gold with its trade at $17.515 down 11 cents after dropping to $17.435 during the London trade with its high at $17.70, its starting price as well. The US Dollar, which seems to be in the hands of the international print controllers, is still being supported with the trade at 98.55, up 6.2 points after reaching up to 98.68 with the low at 98.43. All of this was done starting Sunday Night at 3pm pst, before 5 am, the Comex Open, and the London close.  

     In Venezuela, Gold is now trading at 15,028.19 Bolivar showing a drop of 94.88 from Friday mornings write up with Silver at 174.931 Bolivar losing 1.199 over the weekend. In Argentina, Gold is now valued at 86,788.89 Pesos showing a reduction of 526.44 Pesos with Silver at 1,010.20 Pesos dropping 6.78 in Peso value. Over in Turkey, the Lira now has Gold valued at 8,640.52 giving the noble metal a 16.02 T-Lira gain with Silver at 100.573 Lira showing a slight gain of 0.127 in T-Lira value.  

October Silver Deliveries continue with the demand count now at 365 fully paid for (5,000 ounces) contracts and with a Volume of 1 up on the board so far this morning with the buy price at $17.45. The Demand Count was reduced by 85 contracts that either received their receipts here or in London on the last trading day before the Chinese Golden Week ends. Silver’s Overall Open Interest, the game we’ve been focusing on for the past 3+ years now, has a total count of 211,678 Overnighters proving another 1,477 Obligations have left the field of play as we slowly see the game players reduce their risks.    

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Bill Holter’s Commentary

This ex bartender could never have come up with this herself, the ghosts of Marx and Salinsky must have helped out? Some truly crazy stuff but at least she does not promise a free “unicorn in every pot”!  Additionally, I mentioned this to my Costa Rican horse this morning and he is pissed, he wonders why he had to enter the US legally and without promises of “free shit”?

Congresswoman Alexandria Ocasio-Cortez

Representative Ocasio-Cortez believes that we must build a just society to protect our communities and uplift our neighbors. A Just Society legislation aims to combat one of the greatest threats to our country, our democracy, and our freedom: economic inequality.

It is for that reason that Representative Ocasio-Cortez introduced these measures, to fight to address economic injustice. These stark inequalities are being used by those in power to amplify fear and anger in our communities and further divide us. We must act boldly and swiftly to reverse the corrosive effects extreme inequality and poverty are having on our society.

A Just Society aims to ensure that we are on a path towards shared prosperity for all. A just society provides a living wage, safe working conditions, and healthcare. A just society acknowledges the value of immigrants to our communities. A just society guarantees safe, comfortable, and affordable housing. By strengthening our social and economic foundations, we are preparing ourselves to embark on the journey to save our planet by rebuilding our economy and cultivate a just society.

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Jim Sinclair’s Commentary

The last political speech in the US dealt with how high the US economy was…?

Stocks Tick Lower as Investors Await Trade Developments
October 7, 2019

U.S. stocks inched lower Monday, weighed down by declines among shares of consumer staples companies.

Trading was relatively quiet with no data of note released in the U.S. and few developments on the U.S.-China trade front. Major indexes flitted between small gains and losses for much of the session before turning lower in the afternoon.

As the week progresses, traders say they will be keeping their eyes on headlines emerging from Washington, where high-level officials are set to meet to discuss the U.S. and China’s trade relationship.

With expectations low among investors, even a partial deal might be enough to help keep things on track, said Geoffrey Yu, head of the U.K. investment office at the wealth-management arm of UBS.

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Jim Sinclair’s Commentary

Some investors are concerned that recent turmoil in a key short-term cash market, where banks borrow to fund operations that could exacerbate difficulties in trading bonds.

Behind every event in interest rate markets, there is a cost. The cost can easily be manipulation but not in this case. The cause is the hidden failure of a financial institution , replacing the financial institution with a problem, and the support of that problem through the near term cash market in the form of a beard.

Wild Swings in Repo Rates Raise Concerns About Bond Market’s Liquidity
October 7, 2019

Some investors are concerned that recent turmoil in a key short-term cash market where banks borrow to fund operations could exacerbate difficulties trading bonds.

Spikes in the cost of overnight loans using repurchase agreements, or repos, could hit bond trading in two ways, investors and analysts said. Rising repo rates make it more expensive for securities dealers to borrow money and to hold government bonds—actions they take frequently to facilitate client trades and manage their risks.

In the repo market, where banks and money-market mutual funds typically lend cash for periods as short as one night in exchange for safe collateral such as Treasurys, rates surged as high as 10% last month from about 2.25% amid an unexpected shortage of available cash in the financial system.

Bond investors tend to worry about liquidity, or the ability to buy or sell a particular security, because the market doesn’t have a central exchange and a lack of trading partners could create wide gaps in prices at times of market stress. Differences in the various features of corporate bonds, which are often issued in relatively small sizes, can also make trading difficult.

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Jim Sinclair’s Commentary

If they got any looser, they’d come untied.

Investors Should Fear More Competition Among Ratings Companies
October 7, 2019

Inflated ratings on complex debt structures were one of the culprits of the 2008 financial crisis. While standards have since tightened a lot, new ratings companies threaten to loosen them again.

Back in August, an exhaustive data analysis by The Wall Street Journal found that the three challenger ratings companies—DBRS, Kroll Bond Ratings Agency and Morningstar—tend to rate bonds more highly than the three established ones— Moody’s, S&P Global and Fitch Ratings.

Now, there are signs that the arrival of Kroll into Europe’s structured credit market this summer also is starting to push down credit standards.

Collateralized loan obligations, or CLOs, have experienced a boom over the past few years, as record-low interest rates have pushed investors into all sorts of higher-yielding paper. CLOs are portfolios of bank loans to heavily indebted corporations that are sliced into tranches with different levels of risk. Despite the scary acronym, they actually withstood the financial crisis even as the market for other types of complex debt collapsed.

But signs of frothiness are slowly creeping in. Companies are getting more indebted and lenders’ ability to attach conditions to the loans underpinning CLO portfolios—so-called covenants—has waned.

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Posted by & filed under In The News.

Bill Holter’s Commentary

“ECB’s aggressive stimulus was unjustified, inflated property prices and could even sow the seeds of the next crisis.”…ya think? Central bankers have created a monetary nuclear bomb mathematically guaranteed to go off!

ECB’s Old Guard Attack Draghi’s Long-Term Easy Money Policy
October 4, 2019

FRANKFURT (Reuters) – Six former euro zone central bankers on Friday criticized the European Central Bank’s ultra-easy monetary policy under the presidency of Mario Draghi, saying it has been unsuccessful and probably aimed at bankrolling indebted governments.

In a two-page document, former ECB board members Juergen Stark and Ottmar Issing, along with former rate setters from Germany, France, Austria and the Netherlands, also argued that the ECB’s aggressive stimulus was unjustified, inflated property prices and could even sow the seeds of the next crisis.

Their attack came at a time of discord inside the ECB, where more than a third of policymakers opposed more money printing last month, and reflected the radical overhaul of the once conservative institution’s policies under Draghi.

The memorandum was released to journalists less than a month before Draghi makes way for incoming ECB president Christine Lagarde.

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J. Johnson’s Latest – Silver Prices Stagnated for Today’s Preplanned Attack
October 4, 2019

Great and Wonderful Friday Morning Folks,    

      Gold continues to trade higher, but barely this time, with the price at $1,514.20 up 40 cents after reaching $1,516.30 and with the low at $1,510.40. Silver is signaling with a negative price, which took the place of text messages and those well-known bar room discussions, with the trade at $17.635, down 4.1 cents after reaching $17.705 with the low close by at $17.600.  The US Dollar is still over elevated and is trading at 98.435, down 10.5 points and close to the low at 98.410 with the high at 98.600. All of this non activity happened before 5 am pst, the Comex open, the London close, and our Unemployment Report.    

      In Venezuela, Gold is now trading at 15,123.07 Bolivar giving the noble metal a 34.95 Bolivar boost with Silver losing 0.649 Bolivar with its price at 176.130 Bolivar. Argentina’s Peso now has Gold valued at 87,315.33 showing a loss of 43.37 Pesos with Silver at 1,016.98 Pesos, losing 6.67 since yesterday morning’s big gain. The Turkish Lira now has Gold valued at 8,624.50 Lira’s showing us a gain of 23.51 in the overnight with Silver at 100.446 proving the most manipulated metal on the planet lost 0.327 in T-Lira value.    

      October Silver Deliveries shows us a 41-count drop from yesterday’s demands providing us a total of 450 fully paid for 5,000-ounce contracts waiting for receipts either here or in London and with zero Volume up on the board so far this morning. Silver’s Overall Open Interest is still elevated with the total now (in the early morning) at 213,155 Overnighters proving no one left the field of play but 497 more contracts had to be added in order to keep Silver prices stagnant for today’s preplanned attack at the time of the report.    

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Bill Holter’s Commentary

71% is a mere flesh wound …

September Class 8 Heavy Duty Truck Orders Collapse 71%
October 4, 2019

Preliminary Class 8 order data for September is starting to trickle in and, like the data preceding it so far this year – it’s ugly.

Class 8 orders were crushed 71% in September, reaching 12,600 units, according to Baird and Morgan Stanley.

This follows a 79% plunge in August.

This makes September the 11th consecutive month of YOY order declines and the 9th consecutive month of orders below 20,000.

Class 8 orders are often seen as a pulse on the U.S. economy. Morgan Stanley analyst Courtney Yakavonis wrote in a note that she expects YOY order declines to continue into the year’s end. But Baird analyst David Leiker said he was gaining “increased confidence” that a bottom in declines was likely near – but that’s a story we have heard from ACT Research analysts all year and orders just continue to collapse. 

The blame continues to fall on the trade war.

    “Little has changed since August with respect to the freight market and freight rates, while uncertainties surrounding trade and tariffs continue to weigh on truck buyers’ psyches,” said Steve Tam, ACT vice president, according to FreightWaves.

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Jim Sinclair’s Commentary

Zero bound here we come!

The Fed Will Give the Market What It Wants. Again
October 4, 2019

Jobs Report Still Boring, Fed Still Cutting

Once upon a time, monthly jobs reports were exciting. Nobody knew whether they’d be good or bad. And when they were good they became political footballs, leading Jack Welch to tweet wild conspiracy theories and Herman Cain to call this newsletter writer stupid.

But after 108 straight months of job growth, the thrill is gone. September’s numbers, released today, were as vanilla as most of the 107 months that came before. Headline payroll numbers, which will be revised a million times and so are basically meaningless, weren’t as good as expected. Unemployment was lower than expected. Wage growth — the number that really matters these days — wasn’t great.

I see you nodding off there! Such boring numbers were manna for the stock market, though, which found them not too weak to amplify recession fears and not too strong to put the Fed off raising interest rates again. Traders still seem to believe the Powell Put — an implied guarantee that Fed Chairman Jerome Powell will always ride to the stock market’s rescue — is alive and well, writes John Authers. Before the report, in fact, the bond market had priced in at least a quarter-percentage-point rate cut later this month, notes Brian Chappatta. The Fed usually does what the market wants, and today’s numbers would have had to be truly exciting to change that.

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Jim Sinclair’s Commentary

Fat chance with the majors.

Gold Supply Heading For Peak Unless Miners Ramp Up Exploration Spending, Resource Consultancy Wood Mackenzie Says
October 4, 2019

Gold, one of the more popular risk-hedging tools in the past two months of global turbulence, may see supply peak if miners do not increase their spending on exploration, according to Wood Mackenzie.

The London-based natural resources consultancy said gold producers have kept their spending on discovering new resources under tight control.

The word of caution on supply would support analysts’ prediction that the gold price will head higher in the next two years, having gained 23 per cent in the past 12 months as investors parked more money in the traditional safe-haven asset.

“While the resurgent gold price has garnered a renewed sense of optimism in the industry, it has also shone a light on a structural issue that has been brewing for some time,” said the consultancy’s analysts in a note last week.

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Jim Sinclair’s Commentary

The greatest spin ever done in the equity markets was today where a cruddy jobs report sends people flying into stocks at higher prices!

Hiring Slowed In September As Unemployment Rate Fell To A 50-Year Low
October 4, 2019

The cavalcade of payroll gains continued for the 108th month in September, pushing down the jobless rate to a half-century low and countering anxieties that had been piqued by slowing global growth, declining factory orders and a jittery stock market.

Employers kept hiring at a steady if unremarkable pace, adding 136,000 jobs, the Labor Department reported on Friday. And the unemployment rate fell to 3.5 percent.

The report capped a week of otherwise disappointing economic news. Manufacturing activity in the United States fell for the second month in a row, while the World Trade Organization predicted that the growth in global trade would slacken significantly. A key measure of activity in the services sector — which accounts for two-thirds of the country’s output — also cooled.

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Posted by & filed under In The News.

J. Johnson’s Latest – Our Currency Watch Continues To Prove The Precious Metals Rally
October 3, 2019

Great and Wonderful Thursday Morning Folks,   

      Day 4 of the week still shows positive price movements for both precious metals (at least in the very early morning) with Gold leading the way at $1,510.70, up $2.80 and close to the high at $1,511.70 with the low at $1,501.70. Silver is flat to higher at $17.70, up 1.7 cents with the high close by at $17.795 with the low down at $17.55. The US Dollar is flat to lower with the value pegged at 98.66, down 2.9 points closer to the low at 98.62 than the high at 98.875. All of this flatness happened before 5am pst, the Comex open, and the London close.   

      Our emerging markets currency watch continues to prove the rally and now shows Gold trading under the Venezuelan Bolivar at 15,088.12 showing a gain of 185.77 Bolivars with Silver at 176.779 Bolivar showing it too gained 3.546 Bolivars since yesterday morning. In Argentina, Gold holders now see its price at 87,358.71 Pesos, adding another 4 digits of value (1,229.73 Pesos) to the left of the decimal with Silver now trading at 1,023.65 Pesos proving it too gained 2.3653 Pesos in the overnight. The Turkish Lira now has Gold priced at 8,600.99 showing it gained 55.33 Liras with Silver at 100.773 showing it gained 1.4339 in T-Lira value.      

      Our October Silver Delivery Demands lost a little ground yesterday but nowhere near earlier with the total count now at 491 Demands for physical and with Zero Volume posted up on the board so far this morning. This demand count proves 54 Obligations where delivered upon either here or in London with no trading range to view so far today. Even though Silver rallied a little yesterday, the shorts didn’t leave nor did any longs as the Overall Open Interest gained 359 more positions giving us 212,658 Overnighters duking it out in the arena of play as the deliveries continue to dry up supply of the real all the while cash is being printed in order to keep the markets moving.   

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Jim Sinclair’s Commentary

Is the dollar up or are all other currencies down?

The Euro Has Kept Falling. Investors Wonder How Low It Can Go.[Subscription Required]
October 3, 2019

The euro has drifted toward its lowest levels against the dollar in years as Europe takes the brunt of a global growth slowdown. Investors are now questioning: How low can it go?

The currency briefly sank below $1.09 this week, the lowest since May 2017 and not far off the levels below $1.04 last reached in 2003.

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Jim Sinclair’s Commentary

The key to a currency union is a predetermined method of exit. Major countries in Africa are considering a single currency. I rather hope they learn the lesson of the Euro and write into the agreement the method, means, and agreement also for an exit.

U.K. Farmers Rush to Sell Produce Ahead of October Brexit Deadline .[Subscription Required]
October 3, 2019

British farmers are racing to ship this year’s abundant harvest out of the U.K. by Halloween, when Brexit could pull the country out of the world’s biggest free-trade zone overnight.

Leaving the European Union without a deal—as Prime Minister Boris Johnson has pledged to do at the end of October if the bloc doesn’t meet certain demands—would hit British agricultural exports with customs duties, extra paperwork and checks on animal and plant health.

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Jim Sinclair’s Commentary

The bottom line, who decides what constitutes illegal content? It is a broad definition. This is a difficult question because who decides? Who watches the watchmen? Who decides what is illegal? Who censors the censors?

EU’s Top Court Backs Global Removal Of Illegal Content On Facebook.[Subscription Required]

Jim Sinclair’s Commentary

Anybody who puts a tariff on, taxes themselves. Tariffs do nothing but backfire until everything is more expensive. Since we have a currency that has a number before the decimal point, everybody pours in the dollar. When the dollar rises is more than 20%, all the prices of our goods and services go up 20%.

U.S. to Put Tariffs on European Planes, Whiskey, Cheese After WTO Ruling
October 3, 2019

The price of Scotch, French wine, cheese and other European exports is about to go up in the U.S. after the Trump administration announced new tariffs on billions of dollars of EU products starting Oct. 18.

President Donald Trump got the go-ahead from the World Trade Organization to impose tariffs on as much as $7.5 billion worth of European exports annually in retaliation for illegal government aid to Airbus. The award is the largest in WTO history.

However, there was relief for some firms as the U.S. removed leather goods from its original proposed list and measures on wine and spirits weren’t as severe as some expected. Shares of European luxury companies gained after a Wednesday slide on concerns about tariffs and falling sales in the key Hong Kong market. LVMH gained as much as 2.4%, Kering SA ticked up as much as 1.7%, and Hermes International by 1.4% in European trading on Thursday.

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A Second Day Price Rise In Silver And Gold, Plus Another Nuthingburger!
October 2, 2019

Great and Wonderful Wednesday Morning Folks,   

      This is the second day in a row where we see Gold trading higher than the previous day with the price at $1,492.10, up $3.10 after reaching up to $1,494.10 with the low at $1,480.50. Silver is tagging along today with the trade at $17.345, up 4.8 cents and closer to the high of $17.395 than the low at $17.240. The US Dollar is also under support (for different reasons) with its value pegged at 98.865 up 8.8 points after stretching up to 99.08 with the low close by at 98.740. All of this was done, before 5 am pst, the Comex open, and the London close.    

      We have nothing but solid gains in our emerging markets overnight currency watch with Gold trading at 14,902.35 Bolivar in Venezuela showing a healthy gain of 181.77 in Bolivar value with Silver at 173.233 Bolivar showing a gain of 1.847 over the past 24 hours. Argentina’s Peso now has Gold priced at 86,128.98, gaining 1,250.94 Pesos with Silver gaining 11.873 in Peso value with the price at 999.997 Pesos. The Turkish Lira now has Gold valued at 8,545.66 showing a gain of 162.72 in the overnight with Silver gaining 1.7339 Lira with the value pegged at 99.3391 Liras.    

      Silver Deliveries for the month of October really took a hit in count with the demands for physical now at 545 fully paid for contracts involving 5,000 ounces each proving a drop of 519 Obligations that where either delivered here or in London since yesterday’s early morning count. This morning’s trading range is in between $17.285 and $17.155 so far and with a Volume of 6 up on the board with the highest price being the last trade. Silver’s Overall Open Interest is continuing to drop in count as well. If the option numbers are any indication that an exit plan has been arranged a few years ago, we will see a slow and continuing drop in count from this point forward with the total Open Interest tally now at 212,299 Overnighters, proving a reduction of 1,068 from yesterday’s early morning count.    

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Bill Holter’s Commentary

This is only the beginning…!

NYC Housing Prices In Near ‘Free Fall,’ Conditions Mirror Recession Era Following Tax Hikes
October 1, 2019

NEW YORK – The Manhattan real estate market stumbled in the third quarter of 2019, new reports show, as prices plunged and fewer buyers were willing to purchase higher-priced properties in the wake of two recent tax increases.

The median sales price for properties fell 17 percent from the same quarter last year, to $999,950, according to new data from CORE. The average sales price dropped 12 percent, to $1.64 million.

Condo sales fell 8 percent, logging 946 transactions. Co-op sales, on the other hand, were up a modest 2 percent year over year.

“The third quarter of 2019 was undoubtedly the most challenging quarter in recent memory, especially for condo sales,” Garrett Derderian, managing director of market analysis at CORE, said in a statement. “Market prices have gone from what was once described as the kindest, gentlest correction to a near free-fall. The last time conditions were described in such a way was in the height of the recession.”

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J. Johnson’s Latest – The World Seems To Be On The Verge Of Change
October 1, 2019

Great and Wonderful Tuesday Morning Folks,   

      October 1st greets us with a positive price for the precious metals with Gold trading at $1,473.90, up $1 after reaching up to $1,480.90 with the low at $1,465.00. Silver is leading the trade at $17.16, up 16.2 cents and close to its high of $17.185 with the low at $16.940. The currency that’s keeping it all together is the US Dollar, with its value pegged at 99.10, up 7.9 points after reaching up to 99.235 with the low that is too high at 99.030. All of this was done before 5 am pst, the Comex open, and the London close.    

      In Venezuela Gold is now priced at 14,720.58 Bolivar, still losing value as their currency strengthens with Silver priced at 171.386 Bolivar showing a reduction of 0.699 in value. Argentina’s Peso now has Gold priced at 84,878.04 showing a 521.40 Peso reduction with Silver at 988.124, proving a gain of 0.462 in A-Peso value. The Turkish Lira now prices Gold at 8,382.94 shaving off 28.28 T-Lira with Silver at 97.6052 gaining 0.3333 Lira’s.   

      October Silver Deliveries now show the demand count at 1,064 fully paid for contracts waiting for receipts proving a reduction of 109 obligations during yesterday’s trade and with a Volume of 2 up on the board so far this morning with a trading range between $16.96 and $16.925 with the last trade the high so far. Silver’s Total Open Interest drives the direction with the count now at 213,367 Overnighters showing a reduction of 5,465 from yesterday’s early morning count which may be proving some of the paper longs exiting but with the way things are these days who really knows?      

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Bill Holter’s Commentary

The bottom line is this, no paper currency can or will survive the fire of the coming defaults. The dollar may be the cleanest dirty shirt in the laundry basket today but the entire basket will catch fire. It is the dollar system (post 1971) itself that allowed the over use of debt in all currencies. As an aside, the “confessions of an economic hitman” suggests over levering foreign central banks and treasuries has been a plan all along? .56 on the USDX, par, or even 120 will be a moot point when all is said and done because anything times zero is still zero…

The US Dollar Beast
October 1, 2019

John Maynard Keynes (1883–1946) explains very well how to predict the winner of a beauty contest successfully. You must, he noted, think along the following lines: “(…) 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 (…). It is not a case of choosing those which, to the best of use of one’s judgment, are really the prettiest, nor even those which average opinion genuinely thinks the prettiest. We have to reach the third degree where we devote our intelligences to anticipating what average opinion expects the average opinion to be.”1

This is a perspective that those may wish to take into consideration who think the US dollar is about to collapse, would be the ugliest of all currencies. Latest data from the Bank of International Settlement (BIS) speaks a rather different language. In its 2019 Triennial Survey,2 the BIS informs us that daily trading in foreign exchange markets had reached 6.6 trillion US dollar per day in April 2019 – compared to 5.1 trillion US dollar three years earlier – and that the US dollar remained the single-most important currency in the FX markets, being on one side of 88% of all the trades. For comparison: the euro was on one side of 32% of all trades, the Japanese yen of 17%, and the Chinese renminbi of just 4.3%.

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