Posted at 10:17 AM (CST) by & filed under In The News.

Bill Holter’s Commentary

Very interesting!

Federal Regulator: Wall Street Stock Trading Plunged 88.6 Percent in Q4
March 24, 2019

Pam Martens

The Office of the Comptroller of the Currency (OCC), the Federal regulator of national banks, which includes the largest banks on Wall Street, quietly issued its quarterly report on trading in cash instruments and derivatives on Friday. The report contained a shocker: stock (equity) trading had plunged 88.6 percent in the fourth quarter of 2018 versus the fourth quarter of 2017 on a consolidated basis at the bank holding companies, which includes the results of their commercial and investment banks. Equally stunning, stock trading was down an even more staggering 91.7 percent from the third quarter of 2018. (See chart above from the report.)

This bombshell statistic is something that we have not heard a peep about from either the Wall Street banks on their earnings calls or the business media.

In fact, Wall Street banks have been telling business media that their trading pain in the fourth quarter came from fixed income (bond) trading. The media reports now read like something from Alice in Wonderland when compared to the OCC report.

Reuters reported on February 25, 2019 that while Wall Street banks overall did better than their European counterparts “The biggest losers, however, were the divisions that trade fixed income, currencies and commodities…However, equity trading picked up, particularly for Wall Street banks, where revenue rose 10 percent.” That statement contrasts with this statement in the OCC report: “The quarter-over-quarter decrease in trading revenue was across all instrument categories with the largest decrease due to equity trading.”

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Bill Holter’s Commentary

J.Johnson’s Latest.

It’s cheaper to borrow next year than right now!
March 25, 2019

Great and Wonderful Monday Morning Folks,   

      Gold gives us an early morning pre-sunrise smile with the trade up $5.10 at $1,317.40 and close to the high of $1,318.90 with a low at $1,310.60. Silver is equally as strong with its price now at $15.53 up 12.3 cents and right beside its high of $15.54 with the low at $15.385. This week’s currency activity is still all about British and American politics with the US Dollar now at 96.12, down 3.1 points after reaching a height of 96.19 before heading lower with the low to beat at 95.99. Of course all of this was done way before 5 am pst and before the Comex Openings tranquilizing dart hits our collective asses once again. Venezuela’s current Gold price is now at 13,157.53 Bolivar gaining 54.93 over the weekend with Silver’s price now at 155.106 gaining .749 Bolivar.    

      March Silver Deliveries seemed to have frozen on Friday with today’s early morning count being the same as Friday’s, 45 contracts waiting for receipts, with zero Volume up on the board. Silver’s Overall Open Interest is showing a very slight drop in OI with the count losing only 140 overnighters so far bringing the total to 190,915 obligations.   

      Another emerging market currency took a stab at going lower with the nation of Turkey now blaming JP Morgan for the Lira’s Worst Slide Since the 2018 Crash sending Gold back up to its earlier heights under the Lira, proving the emerging markets failing currencies are gaining momentum as nation after nation turns itself upside down in uncontrollable debt against its natural resources and those with the digital print controls. What else is new?   

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Bill Holter’s Commentary

Can a snake eat its own tail?

Over $10 Trillion In Debt Now Has A Negative Yield
March 25, 2019

NIRP is back.

On Friday, when Germany reported disastrous mfg and service PMI prints, the 10Y German Bund finally threw in the towel, with the yield sliding back under zero for the first time in three years. When that happened, and when the 3M-10Y yield curve inverted in the US right around that time, just over $400 billion in global debt changed the sign on its yield from positive to negative.

As a result, the total notional of global negative yielding debt soared on Friday, rising above $10 trillion for the first time Since September 2017, and which according to Bloomberg has intensified “the conundrum for investors hungry for returns while fretting the brewing economic slowdown.”

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Posted at 8:09 AM (CST) by & filed under In The News.

Bill Holter’s Commentary

The bank index has crashed 10% in the 2 1/2 days of trading after the Fed meeting…wasn’t the Fed about as dovish as possible?  Washington, we have a major problem!

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Runs Largest Monthly Budget Deficit On Record In February
March 22, 2019

The numbers: The federal government ran a budget deficit of $234 billion in February, the Treasury Department reported on Friday, the biggest monthly shortfall on record.

It was wider than the $215 billion recorded in February 2018, as spending rose 8% while receipts climbed 7%. Previously, the largest monthly deficit was $231.7 billion in February 2012.

The release of the February figures was later than normal due to the 35-day shutdown that ended Jan. 25.

What happened: Total spending was $401 billion in February while the government took in $167 billion.

Drivers of spending in February included agriculture and transportation programs. The Treasury said individual withheld and payroll taxes climbed 5% in the month. Refunds dropped 10% in February, a month in which the Congressional Budget Office notes the share of total refunds paid varies from year to year.

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Jim Sinclair’s Commentary

QE TO INFINITY.

The Fed Has Given Up: Get Ready for More QE
March 21, 2019

The Federal Reserve’s Federal Open Market Committee on Wednesday voted unanimously to keep the federal funds rate unchanged. Overall, the FOMC signaled it has made a dovish turn away from the promised normalization of monetary policy which the Fed has promised will be implemented “some day” for a decade. Although the Fed began to slowly raise rates in late 2016 — after nearly a decade of near-zero rates — the target rate never returned to even three percent, and thus remains well below what would have been a more normal rate of the sort seen prior to the 2008 financial crisis.

 

 

 

 

 

 

 

 

 

 

 

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Posted at 7:59 AM (CST) by & filed under Jim's Mailbox.

Jim,

As I have said in the past hope is not a strategy.

Dave

Pompeo: God May Have Sent Trump To Save Israel From Iran
March 22, 2019

Is an apocalyptic war on Iran by the US and Israel coming, driven by American Evangelical “rapture” theology of end times prophecy? Pompeo’s latest suggestion that God “raised Trump for such a time as this” doesn’t bode well for the region, or at least for those who hope to avoid a WWIII scenario. Apparently, Pompeo truly believes that Trump was sent by God to save Israel, and that the Golan is to be the first US bestowed “gift” bringing the world closer to “end times” fulfillment.

While on his multi-country tour of the Middle East on Thursday, the US secretary of state responded to a question from the Christian Broadcast Network’s Chris Mitchell during a press conference in Jerusalem, who asked, “could it be that President Trump right now has been sort of raised for such a time as this, just like Queen Esther, to help save the Jewish people from the Iranian menace?”

Pompeo responded, “As a Christian, I certainly believe that’s possible” in agreement with the bizarre question. Crucially, this came the same day Trump tweeted his intention for the US to formally recognize full Israeli sovereignty over the Golan Heights. This after Syria previously warned Israel its continued unlawful occupation of the long disputed territory would lead to war.

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Posted at 8:35 AM (CST) by & filed under In The News.

Posted without commentary…
Bill

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bill Holter’s Commentary

Ready to find out what “Hot” means when combined with “Inflation”

Good and Wonderful Friday Morning Folks!

     Gold continues to go against the short traders as the push for price carries forward its momentum with Gold now at $1,311.90, up $4.60 with the high hitting $1,313.60 and the low at $1,306.50. Silver is hardly up at all with its trade at $15.455, up 1.8 cents with a high at $15.55 and the low right close to the now at $15.435. It seems that since Harvey Organ’s EFP watch of our precious metals futures transfers going to London took away all the trading activity from Comex as we expect another day of sleep once Comex Opens but for now the US Dollar is trading higher at 96.205, up 21.8 points with the high at 96.29 and the low way down at 95.695. That low occurred around 1 am pst, of course the rest of the activity has already occurred way before 5 am pst and the Comex’s (no need to be awake) Open. In Venezuela, Gold’s price is currently set at 13,102.60 Bolivar, losing 32.96 over night with Silver at 154.357, losing .999 Bolivar in value, ironically the exact measure of pure metal inside 1 ounce of real.

     March Silver’s Physical Deliver demands got met with a bunch of receipts either here or in London with the total sum dropping 56 obligations, setting today’s starting count at 45 with Zero Volume up on the board so far. The shorts are in the fight of their lives with Silver’s Over All Open Interest gaining more during yesterday’s attempted price push lower, adding an additional 431 more shorts to stay the price, while someone takes away the physicals with today’s Overall total equaling 191,055 overnighters during this weekends “Britain is sick of the MayDay Delay” as the EU supposedly accepts 2 more weeks. We know this term and the game, called Extend and Pretend, and only politicians can do it because of the closed doors they speak behind that the rest of the world is not allowed to hear.

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Jim Sinclair’s Commentary

The latest from John Williams’ www.shadowstats.com

– March 20th Federal Open Market Committee Held Interest Rates in Check, Indicating No Rate Hikes in 2019, in Line with Market Expectations
– The Fed Slowed its Pace of Projected Balance Sheet Liquidation
– The FOMC Lowered Its U.S. Economic Projections for 2019 and 2020, Albeit Still With Purportedly Healthy Growth
– The Fed Likely Has an Internal Recession Forecast, But Not One to Be Published, Other Than for an Obvious Coincident or Lagging Circumstance
– Nonetheless the U.S. Economy Is Weakening More Sharply and Quickly Than Acknowledged, Signaling a Formal Recession That was Triggered Directly by Overly Aggressive FOMC Tightening and Rate Hikes of the Last Year or Two
– Latest Indication of an Accelerating Downturn Was In Freight Activity
– Where FOMC Meeting Results Broadly Matched Expectations, Stocks Rallied, Initially, Selling Off by the End of the Day; Gold and Silver Prices Spiked Amidst Heavy U.S. Dollar Selling, Which Also Boosted Oil Prices
– Those Late-Day Market Movements Likely Will Become the Trending Norm, As Evidence of the Deepening, Severe Economic Downturn Mounts Rapidly

“Bullet Edition No. 4”

www.shadowstats.com

Bill Holter’s Commentary

I’m not sure I would like to pay for my child’s tuition if they are teaching that Booker T. Washington was America’s first president?

‘American Political Thought’ Course At CU Denver Removes All White Men From Curriculum
March 22, 2019

DENVER — I can clearly recall the first day of class a few semesters ago when I eagerly began a course called “American Political Thought” at the University of Colorado, Denver.

My excitement quickly soured, however, after Professor Chad Shomura explained to the students in the room that most traditional “American Political Thought” courses are too focused on the achievements of white men.

As a consequence, he told us he had removed every single white male and their theoretical perspectives from the entire course curriculum.

This is echoed in the syllabus:

“This course aims to develop an understanding of American political life from the margins. Rather than surveying traditional figures of American political thought, it attends to historically marginalized voices at the crossings of race, gender, sexuality, and nation. It explores issues such as intersectionality, antiblack racism and the American Dream, ordinary life, borderlands and migration, public feelings, mental health, and settler colonialism. The materials we examine also exceed the usual genres of American Political Thought. They include, among other things, poems, an ethnography, academic articles, a novel, and a hacked tarot card set.”

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Posted at 8:32 AM (CST) by & filed under Jim's Mailbox.

Courtesy of JB.

Bill

 

A warning about the world economy.

JB

A Growing List Of Companies From Fedex To BMW Are Warning About The World Economy
March 20, 2019

Corporate giants doing business abroad are painting a dreary picture of the world’s economy.

With an ongoing trade war between the U.S. and China, Brexit uncertainty weighing on Europe and the U.K., and new weakness out of Japan, some business leaders say it’s harder than ever to rake in profits.

This week, top executives at FedEx, BMW, UBS and others described bleak global business conditions while discussing quarterly results. Fitch Ratings also “aggressively” cut its forecast for the year.

The head of UBS was among the latest to blame the world’s backdrop for weaker-than-expected results. CEO Ermotti told a conference in London on Wednesday that it “one of the worst first-quarter environments in recent history,” Reuters reported. The Swiss bank slashed another $300 million from 2019 costs after revenue at its investment bank plunged. Investment banking conditions are among the toughest seen in years, especially outside the U.S., he said.

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The turn churn has turned.

JB

Yield Curve Inverts For The First Time Since 2007: Recession Countdown Begins
March 22, 2019

Update: The most prescient recession indicator the market just inverted for the first time since 2007.

 

 

 

 

 

 

 

 

 

Don’t believe us? Here is Larry Kudlow last summer explaining that everyone freaking out about the 2s10s spread is silly, they focus on the 3-month to 10-year spread that has preceded every recession in the last 50 years (with few if any false positives)… (fwd to 4:20)

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Jim/Bill,

The real reason Powell succumbed to easing, leading to an inverted yield curve?

“Another month, another frightening jump in the US budget deficit. And this time it was a record.”

Gotta keep those rates low, else they kill us!

CIGA Wolfgang Rech

US Budget Deficit Hits A Record $234 Billion As Interest On Debt Soars
March 22, 2019

Another month, another frightening jump in the US budget deficit. And this time it was a record.

According to the latest Treasury data, the US budget surplus in February – traditionally the worst month of the year due to tax refunds – was a whopping $234 billion, missing the $227 billion deficit expected, and well worse than the $214 billion deficit recorded last February. And even though there may have been one-time tax refund and government shutdown factors at play, the February deficit was also the biggest budget deficit on record.

 

 

 

 

 

 

 

 

 

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Posted at 10:30 AM (CST) by & filed under In The News.

Our Dollar Is Going To Fall
March 21, 2019

Great and Wonderful Thursday Morning Folks,  

         Gold is higher in the early morning trade report with the price now at $1,315.20, up $13.50 from the Comex close which happened before yesterday’s FOMC report with the high so far at $1,320.20 and the low at $1,312.50. Silver is up as well (not sure who is leading here Ag or Au) with the trade at $15.555, up 23.7 cents with the high at $15.65 and the low at $15.48. The US Dollar took a hit after the data release but has recovered (against Trumps weaker dollar demand) with the trade at 95.675, up 47.4 points inside a trading range between 95.705 and 95.295. Of course, all of this was done while we’re not trading and before the Comex sleepy time open. As expected, when Gold rises in the US Dollar, it rises even more in the secondary’s (emerging markets) with the Venezuelan Bolivar price at 13,135.56, gaining 99.87 Bolivar in a 24 hour period. Silver’s price gained 2.248 cents (HUGE!!!) with its price at 155.356 Bolivar. In Argentina, another country going into massive convulsions because of the exchange rate, Gold’s price before the FOMC was 53,322.03, now it’s priced at 53,730.56 gaining 408.53 Argentinian Pesos over night with Silver gaining 9.192 Argentinian Pesos at 635.484. These are very big gains brought on because of the swings caused by a major currency and not their own, wait till this hits under the US Dollar. No one’s seen anything yet!  

     The March Silver deliveries had a major jump in demand BEFORE yesterday’s FOMC data release with the count now at 101 Demands for Physical as buyers came in with needs proving a gain of only 17 contracts. However, yesterday’s Volume in March Silver totaled 94 swaps with the last purchase made at 8:57 am pst. Did someone jump in and get their requirements ahead of those already in cue? Watch Harvey’s count here because there may be some EFPS being passed over to the city in chaos or the purchases got stopped here draining more from COMEX, as less is getting pulled out of the ground globally. The Overall Open Interest in Silver is still gaining with the count now at 190,624 Overnighters proving 1,314 more shorts had to be placed in trade to stay the price from the buyers but not stopping the demands for physical at all.    

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Bill Holter’s Commentary

This is 100% true!

Posted at 10:22 AM (CST) by & filed under Jim's Mailbox.

Jim/Bill,

I always made a decent amount of small pocket change trading put and call options on market inflection points.

Then suddenly, everything went to hell in a handbasket.

All my academic and professional trading knowledge could be tossed out the window.

There is no possible way anyone could utilize fundamental, technical, and macro events to trade.

Not with the advent of algorithms for machine trading (equities are the best example).

Not when the Fed steps in to foil economic laws (precious metals are the best example).

But as the article states, it will come home to roost some day.

One thing is certain, markets have a way of remaining in dreaded doldrums for decades. I’ve seen this in the 60’s.

I’ve seen grown men sitting on the curbside, crying. They saved money for years and invested. Then out of the blue lost everything they had worked for. “Never Again” was the mantra I kept hearing.

Indeed, it a decade or more before interest in stocks resumed.

But of course, by a new crowd. The old timers never returned.

It will take a very loooong time, a generation or more perhaps, until the markets regain popularity again.

People had better brace themselves for a major correction, a reversion to mean if you will, that will exceed the massive and unprecedented Fed stimulated rally of the past decade. Pain never shows its face until it’s too late.

The 2000 and 2008 collapse was just a teaser.

Patience is not a trait the new generation possesses.

Their eagerness will get many into financial trouble and decimate their lives. The illusion of “paper prosperity” will disappear in the blink of an eye.

 

 

 

 

 

 

Be ever vigilant and not fall asleep as the wheel, thinking the Fed will ALWAYS have your back. Even they have their limitations.

Rest assured, although markets can be manipulated, they eventually succumb to the laws of physics. I say physics in lieu of economics, as the former has become nothing more than alchemy in modern times; a charlatan’s game.

Be on your toes!

CIGA Wolfgang Rech

Why The Fed Keeps Propping Up The Market
March 21, 2019

Authored by Jesse Colombo via RealInvestmentAdvice.com,

The bull market of the past decade since the Great Recession has been an unusual one: despite all of the economic damage that occurred during the global financial crisis and rising risks (including global debt rising by $75 trillion), it has been the longest bull market in history. The explanation for this paradox is simple: it’s not an organic bull marketbecause the Fed and other central banks keep stepping in to prop up the market every time it stumbles. Though the Fed has two official mandates (maintaining stable consumer prices and maximizing employment), it has taken on the unofficial third mandate of supporting and boosting the stock market since the Great Recession.

The chart below, which was inspired by market strategist Sven Henrich, shows how the Fed or other central banks have stepped in with more monetary stimulus (quantitative easing, promises to keep interest rates low, etc.) every time the S&P 500 has stumbled over the past decade:

 

 

 

 

 

 

 

 

 

 

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Jim,

We told listeners weeks ago, countries would do what was in their own best interests.

Dave

Italy Joining China’s Silk Road Shows EU Maximizes Its Own Interests Over US Wishes – Former FM
March 21, 2019

Italy’s desire to build trade ties with China isn’t a move against the US, but an effort to “maximise” its own interests, Italy’s former Foreign Minister Franco Frattini told RT, ahead of Chinese President Xi Jinping’s Rome visit.

Italy is expected to sign a non-binding memorandum in support of China’s Belt and Road global trade and infrastructure network, dubbed the New Silk Road, during Xi’s visit, and has signalled its intention to play a major role in the grand plan, despite warnings about the project from Washington.

The move will make Italy the first G7 country to back the initiative, which aims to link China by sea and land with the Middle East, Europe and Africa. Rome is hoping that its involvement can help revive the Italian economy by providing greater access to the Chinese market.

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Jim,

The debt will never be re-paid.

Dave

Japan’s Debt Passes 250% Of GDP
March 17, 2019

anta Claus territory.” That is how Charles Gave of Gavekal Research views renewed debate about how a concept known as “Modern Monetary Theory” can save capitalism.

There’s nothing modern, of course, about the idea that a government can borrow with abandon in its own currency, unconstrained by deficits. It’s not just that its origins can be traced back 100 years – some argue 1,000. It’s that Japan has been toying with MMT for two decades now.

In 1999, the Bank of Japan became the first major authority in modern history to drive interest rates down to zero. A couple of years later, it pioneered the quantitative-easing that peers from Washington to Frankfurt would eventually adopt.

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Jim,

This article is from 2012 regarding Basel III over 6 years ago.

Dave

Basel III Brings Gold Back
December 5, 2012

. . .

Why the turnaround, and at prices much higher than those at which the central banks sold? Because the rules have changed: The Basel Committee on Banking, the body that sets the standards followed by the industrialized world’s central banks (and the commercial banks they oversee), has reclassified gold bullion as a “tier one asset.” According to the Basel Committee’s new rule, known as “Basel III,” as of the New Year, gold will be counted at 100 percent of its market value when a bank’s assets are audited. Moreover, under Basel III, a bank’s tier one assets must rise from 4 percent to 6 percent of its total assets. This means that many banks are likely to replace substantial portions of their mortgage-backed securities and bond portfolios with gold.

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Posted at 1:42 PM (CST) by & filed under Jim's Mailbox.

Jim,

As I have said previously, is the wall to keep US citizens in or immigrants out!?

Dave

Worldwide Effort To Restrict Everyone’s Right To Travel Is Close To A Reality
February 14, 2019

According to a recently published white paper there is a worldwide effort to restrict the right to travel of everyone. And you will not believe how the U.N. is involved.

A recent article at PapersPlease.org warns that the Organization for Security and Co-operation in Europe (OSCE) wants to check every airline passenger’s background and send airlines an “Authority to Carry” before a passenger is allowed to board a plane.

 

 

 

 

 

 

 

 

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Jim,

This is written by a man who has been there.

Dave

Empire of Absurdity: Recycled Neocons, Recycled Enemies
March 19, 2019

There are times when I wish that the United States would just drop the charade and declare itself a global empire. As a veteran of two imperial wars, a witness to the dark underside of America’s empire-denial, I’ve grown tired of the equivocation and denials from senior policymakers. The U.S. can’t be an empire, we’re told, because – unlike the Brits and Romans – America doesn’t annex territories outright, and our school children don’t color its colonies in red-white-and-blue on cute educational maps.

But this distinction, at root, is rather superficial. Conquest, colonization, and annexation are so 19th century – Washington has moved beyond the overt and engages in the (not-so) subtle modern form of imperialism. America’s empire over the last two decades – under Democrats and Republicans – has used a range of tools: economic, military, political, to topple regimes, instigate coups, and starve “enemy” civilians. Heck, it didn’t even start with 9/11 – bullying foreigners and overturning uncooperative regimes is as American as apple pie.

Still, observing post-9/11, post-Iraq/Afghanistan defeat, Washington play imperialism these days is tragicomically absurd. The emperor has no clothes, folks. Sure, America (for a few more fleeting years) boasts the world’s dominant economy, sure its dotted the globe with a few hundred military bases, and sure it’s military still outspends the next seven competitors combined. Nonetheless, what’s remarkable, what constitutes the real story of 2019, is this: the US empire can’t seem to accomplish anything anymore, can’t seem to bend anybody to its will. It’s almost sad to watch. America, the big-hulking has-been on the block, still struts its stuff, but most of the world simply ignores it.

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Jim,

Our veterans are speaking out.

Dave

Veterans Call on U.S. Troops to Resist Illegal Orders to Invade Venezuela
March 19, 2019

By Veterans For Peace (VFP)

“Information Clearing House” – Veterans For Peace (VFP) calls on all members of the U.S. military to refuse illegal orders to intervene in Venezuela. Furthermore, VFP urges all U.S. military leaders to inform the president that they will order their units to stand down from preparations to invade Venezuela. 

President Donald Trump has called on Venezuelan soldiers to disobey orders and join coup perpetrators headed by U.S.-backed opposition leader, Juan Guaidó.  If they do not do this, President Trump threatened: “You will find no safe harbor, no easy exit and no way out.  You will lose everything.”

Veterans For Peace President, Gerry Condon states, “While President Trump speaks of supporting democracy in Venezuela and Latin America, the real purpose of the U.S. assault on the Venezuelan government is to fully open the vast Venezuelan oil reserves to U.S. and other Western oil corporations as well as to destroy progressive governments in Latin America that put their own peoples’ needs above the profits of foreign corporations.”

Illegal, immoral and irresponsible U.S. actions, including “sanctions” (economic war) have already taken a great toll on the people Venezuela.  Nonetheless, the vast majority of Venezuelan people and military are standing firm against foreign intervention.

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Jim/Bill,

Inversion happening before your eyes!

After our manufacturing sector got sucker punched, it’s now the banks’ turn.

With spending out of control, debt at unimaginable levels, and a tanking economy, is there any hope to resuscitate the victim?

 

 

 

 

 

CIGA Wolfgang Rech

Curve Crushed: 2Y, 3Y And 5Y Treasury Yields Plummet Below The Fed Funds Rate
March 20, 2019

Some were convinced there was no way Powell could surprise markets dovishly. They were wrong.

And to get a sense of just how dovish the Fed’s statement was, look no further than the yield curve where everything to the left of the 7Y Treasury (and even that is in danger), is now inverted to the effective Fed Funds rate (2.40%), with 2Y and 3Y yields tumbling to 2.326%, and 5Y 2.3858%.

 

 

 

 

 

 

 

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