Good evening Ladies and Gentlemen:
Here are the following closes for gold and silver today:
Gold: $1193.60 down $9.50 (comex closing time)
Silver: $16.16 down 28 cents (comex closing time)
In the access market 5:15 pm
Gold $1194.70
Silver: $16.18
Gold/silver trading: see kitco charts on the right side of the commentary.
Despite the fact that gold and silver were down today, the gold/silver equity shares were higher. Thus expect gold and silver to rise tomorrow.
Following is a brief outline on gold and silver comex figures for today:
At the gold comex today, we surprisingly had a poor delivery day, registering 10 notices served for 1000 oz. Silver comex surprised again with 114 notices for 570,000 oz .
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 244.16 tonnes for a loss of 59 tonnes over that period. Lately the removals have been rising!
end
In silver, the open interest surprisingly rose by a huge 2015 contracts despite the fact that Wednesday’s silver price was down by 37 cents. The total silver OI continues to remain extremely high with today’s reading at 171,715 contracts. The front April month has an OI of 185 contracts for a loss of 200 contracts. We are still close to multi year high in the total OI complex despite a record low price. This dichotomy has been happening now for quite a while and defies logic. There is no doubt that the silver situation is scaring our bankers to no end.
We had 114 notices served upon for 570,000 oz.
In gold the collapse of OI stops. The total comex gold OI rests tonight at 391,054 for a gain of 483 contracts despite the fact that gold was down $7.50 on Wednesday. We had 10 notices served upon for 1000 oz.
Today, we had a huge addition of 2.98 tonnes of gold inventory at the GLD/ Gold Inventory rests at 736.04 tonnes
In silver, / the SLV/Inventory /we have no changes and thus the inventory tonight is 321.839 million oz
We have a few important stories to bring to your attention today…
1. Today we had the open interest in silver rise by a considerable 2015 contracts with the 38 cent fall in price on Wednesday. The OI for gold rose by 483 contracts as the price of gold fell on Wednesday to the tune of $7.50.
(report Harvey/)
2.Greece pays the iMF today. They are now given 6 days to complete their reforms and present them to the Troika et al
(zero hedge)
3. Bank deposits no longer guaranteed by the Austrian state. This spells trouble when the bail in is orchestrated to save the Austrian banks
(Mark O’Byrne)
4.Yemen rebels seize a very important town in the southwestern section of Yemen. This is the region that is very oil rich. Also in Aden, the Yemeni rebels arrive at the central bank of Yemen with welding equipment. They are intent on stealing the funds and possibly any gold still lying around there
(zero hedge)
5. Despite the lower Euro, German industrial production falters
(zero hedge)
6. Seems that Iran and the uSA do not agree on the terms of their agreement. Iran wants all sanctions lifted by signing..the Americans state that the sanctions will be lifted over time.
(zero hedge)
7. Wholesale sales in the USA faltering. Along with the fall in factory orders this is generally a harbinger of a recession. Also inventories are rising despite falling demand.
(courtesy zero hedge)
8. Great commentaries tonight from Bill Holter
(Bill Holter )
we have these and other stories for you tonight
Let us now head over to the comex and assess trading over there today.
Here are today’s comex results:
The total gold comex open interest rose by 483 contracts from 390,571 up to 391,054 despite the fact that gold was down by $7.50 on Wednesday (at the comex close). We are now in the active delivery month of April and here the OI fell by 76 contracts down to 2,731. We had 0 contracts filed upon on Wednesday so we lost another 76 contracts or 7600 oz will not stand for delivery in April. The next non active delivery month is May and here the OI fell by 40 contracts down to 421. The next big active delivery contract month is June and here the OI fell by 651 contracts down to 263,938. June is the second biggest delivery month on the comex gold calendar. The estimated volume today (which is just comex sales during regular business hours of 8:20 until 1:30 pm est) was poor at 62,289 (Where on earth are the high frequency boys?). The confirmed volume on Wednesday ( which includes the volume during regular business hours + access market sales the previous day) was poor at 123,053 contracts. Today we had 10 notices filed for 1000 oz.
And now for the wild silver comex results. Silver OI rose by 2015 contracts from 169,700 up to171,715 despite the fact that silver was down by 38 cents, with respect to Wednesday’s trading . We are now in the non active delivery month of April and here the OI fell to 185 for a loss of 200 contracts. We had 200 notices filed yesterday so we neither gained nor lost any silver ounces in this delivery month of April. The next big active delivery month is May and here the OI fell by 3,173 contracts down to 88,673 . The estimated volume today was poor at 26,916 contracts (just comex sales during regular business hours. The confirmed volume yesterday (regular plus access market) came in at 64,025 contracts which is excellent in volume. We had 114 notices filed for 570,000 oz today.
April initial standings
April 9.2015
Gold
Ounces
Withdrawals from Dealers Inventory in oz
nil
Withdrawals from Customer Inventory in oz
96.45 oz (3 kilobars), Manfra
Deposits to the Dealer Inventory in oz
nil
Deposits to the Customer Inventory, in oz
128.605 oz (JPMorgan)
No of oz served (contracts) today
10 contracts (1000 oz)
No of oz to be served (notices)
2807 contracts(280,700) oz
Total monthly oz gold served (contracts) so far this month
686 contracts(68,600 oz)
Total accumulative withdrawals of gold from the Dealers inventory this month
oz
Total accumulative withdrawal of gold from the Customer inventory this month
163,772.1 oz
Today, we had 0 dealer transaction
total Dealer withdrawals: nil oz
we had 0 dealer deposits
total dealer deposit: nil oz
we had 1 customer withdrawal
i) Out of Manfra: 96.45 oz (3 kilobars)
total customer withdrawal: 96.45 oz (3 kilobars)
we had 1 customer deposit:
i) Into JPMorgan: 128.605 oz
total customer deposit: 128.605 oz
We had 0 adjustments
Today, 0 notices was issued from JPMorgan dealer account and 10 notices were issued from their client or customer account. The total of all issuance by all participants equates to 10 contracts of which 5 notices were stopped (received) by JPMorgan dealer and 0 notices were stopped (received) by JPMorgan customer account
To calculate the total number of gold ounces standing for the March contract month, we take the total number of notices filed so far for the month (686) x 100 oz or 68,600 oz , to which we add the difference between the open interest for the front month of April (2731) and the number of notices served upon today (10) x 100 oz equals the number of ounces standing.
Thus the initial standings for gold for the April contract month:
No of notices served so far (686) x 100 oz or ounces + {OI for the front month (2731) – the number of notices served upon today (10) x 100 oz which equals 340,700 oz or 10.59 tonnes of gold.
we lost 76 contracts or 7,600 oz of gold that will not stand for delivery in April
Total dealer inventory: 631,988.064 or 19.65 tonnes
Total gold inventory (dealer and customer) = 7,849,645.349 oz. (244.15) tonnes)
Several weeks ago we had total gold inventory of 303 tonnes, so during this short time period 59.0 tonnes have been net transferred out. However I believe that the gold that enters the gold comex is not real. I cannot see continual additions of strictly kilobars.
end
And now for silver
April silver initial standings
April 9 2015:
Silver
Ounces
Withdrawals from Dealers Inventory
61,928.17 oz (Brinks)
Withdrawals from Customer Inventory
1,686,101.851 oz(Delaware, CNT,HSBC,Scotia)
Deposits to the Dealer Inventory
432,769.940 oz (CNT)
Deposits to the Customer Inventory
1,450,284.63 (JPM,CNT)
No of oz served (contracts)
114 contracts (570,000 oz)
No of oz to be served (notices)
171 contracts(855,000 oz)
Total monthly oz silver served (contracts)
315 contracts (1,575,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month
548,169.5 oz
Total accumulative withdrawal of silver from the Customer inventory this month
4,531,912.7 oz
Today, we had 0 deposits
Today, we had 1 deposit into the dealer account:
i) Into CNT: 432,769.940 oz
total dealer deposit: 432,769.940 oz
we had 1 dealer withdrawal:
i) Out of the Brinks vault: 61,928.17 oz
total dealer withdrawal: 61,928.17 oz
We had 2 customer deposits:
i) Into CNT: 167,095.99 oz
ii) Into JPMorgan: 1,283,188.64 oz
total customer deposits: 1,450,284.63 oz
*this is the second day in a row that we had greater than 1 million oz of silver arrive at JPMorgan customer side.
We had 4 customer withdrawals:
i) Out of Delaware: 179,204.711 oz
ii) Out of HSBC: 5,069.25 oz
iii) Out of CNT: 1,310,969.35 oz
iv) Out of Scotia: 90,858.54
total withdrawals; 1,686,101.851 oz
we had 1 adjustment:
i) Out of the CNT vault:
158,441.64 oz was adjusted out of the customer and this landed into the dealer account at CNT
Total dealer inventory: 63.235 million oz
Total of all silver inventory (dealer and customer) 176.373 million oz
.
The total number of notices filed today is represented by 134 contracts for 570,000 oz. To calculate the number of silver ounces that will stand for delivery in April, we take the total number of notices filed for the month so far at (315) x 5,000 oz = 1,575,000 oz to which we add the difference between the open interest for the front month of April (385) and the number of notices served upon today (114) x 5000 oz equals the number of ounces standing.
Thus the initial standings for silver for the April contract month:
315 (notices served so far) + { OI for front month of April(185) -number of notices served upon today (114} x 5000 oz = 1,930,000 oz standing for the April contract month.
we neither gained nor lost any silver ounces standing for this delivery month of April .
for those wishing to see the rest of data today see:
http://www.harveyorgan.wordpress.com orhttp://www.harveyorganblog.com
end
The two ETF’s that I follow are the GLD and SLV. You must be very careful in trading these vehicles as these funds do not have any beneficial gold or silver behind them. They probably have only paper claims and when the dust settles, on a collapse, there will be countless class action lawsuits trying to recover your lost investment.
There is now evidence that the GLD and SLV are paper settling on the comex.
***I do not think that the GLD will head to zero as we still have some GLD shareholders who think that gold is the right vehicle to be in even though they do not understand the difference between paper gold and physical gold. I can visualize demand coming to the buyers side:
i) demand from paper gold shareholders
ii) demand from the bankers who then redeem for gold to send this gold onto China
vs no sellers of GLD paper.
And now the Gold inventory at the GLD:
April 9.2015 we have a huge addition of 2.98 tonnes of gold inventory/GLD inventory tonight stands at 736.04 tonnes
April 8.2015:no changes in the GLD/Inventory 733.06 tonnes
April 7. we had another withdrawal of 4.18 tonnes of gold at the GLD/Inventory rests at 733.06 tonnes
April 6. no changes in gold inventory at the GLD/Inventory at 737.24 tonnes
April 2/no changes in gold inventory at the GLD/Inventory at 737.24 tonnes
April 1/2015/ no changes in gold inventory at the GLD/Inventory at 737.24 tonnes
march 31.2015/ no changes in gold inventory at the GLD/Inventory at 737.24 tonnes
March 30/no changes in gold inventory at the GLD/Inventory at 737.24 tonnes.
March 27/no changes in gold inventory at the GLD/Inventory at 737.24 tonnes
March 26 we had another huge withdrawal of 5.97 tonnes of gold. This gold is heading straight to the vaults of Shanghai, China/GLD inventory 737.24 tonnes
April 8/2015 / we had a huge addition of 2.98 tonnes of gold at GLD/ inventory at the GLD/Inventory stands at 736.04 tonnes
The registered vaults at the GLD will eventually become a crime scene as real physical gold departs for eastern shores leaving behind paper obligations to the remaining shareholders. There is no doubt in my mind that GLD has nowhere near the gold that say they have and this will eventually lead to the default at the LBMA and then onto the comex in a heartbeat (same banks).
GLD : 736.04 tonnes.
end
And now for silver (SLV):
April 9/2015 no changes in inventory at the SLV/Inventory rests at 321.839 million oz/
April 8.2015: no changes in inventory at the SLV/Inventory rests tonight at 321.839 million oz
April 7.2015: no changes in inventory at the SLV/Inventory rests tonight at 321.839 million oz
April 6. we had a small withdrawal of 136,000 oz/inventory tonight rests at 321.839 million oz
April 2/2015: no changes in inventory/SLV inventory rests this weekend at 321.975 million oz
April 1.2015: we had a huge withdrawal of 1.913 million oz of silver from the SLV vaults/Inventory 321.975 million oz
March 31.2015: no changes in inventory at the SLV/Inventory at 323.88 million oz
March 30.2015: no changes in inventory at the SLV/inventory at 323.888 million oz.
March 27. we had a huge withdrawal of 1.439 million oz leave the SLV/Inventory rests this weekend at 323.888 million oz
March 26.2015; no change in silver inventory/SLV inventory 325.323 million oz
March 25.2015:no change in silver inventory/SLV inventory 325.323 million oz
April 9/2015 we had no changes in inventory at the SLV/ inventory rests at 321.839 million oz
end
And now for our premiums to NAV for the funds I follow:
Note: Sprott silver fund now for the first time into the negative to NAV
Sprott and Central Fund of Canada.
(both of these funds have 100% physical metal behind them and unencumbered and I can vouch for that)
1. Central Fund of Canada: traded at Negative 8.1% percent to NAV in usa funds and Negative 8.0% to NAV for Cdn funds!!!!!!!
Percentage of fund in gold 61.5%
Percentage of fund in silver:38.1%
cash .4%
( April 9/2015)
Sprott gold fund finally rising in NAV
2. Sprott silver fund (PSLV): Premium to NAV rises to + 1.44%!!!!! NAV (April 9/2015)
3. Sprott gold fund (PHYS): premium to NAV falls -.30% to NAV(April 9/2015
Note: Sprott silver trust back into positive territory at +1.44%.
Sprott physical gold trust is back into negative territory at -.30%
Central fund of Canada’s is still in jail.
end
And now for your more important physical gold/silver stories:
Gold and silver trading early this morning
(courtesy Goldcore/Mark O’Byrne)
The banking system inside Austria is burning as derivatives blow up.
Bank Deposits No Longer Guaranteed By Austrian Government
By Mark O’ByrneApril 9, 20150 Comments
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– Austria will remove state guarantee of bank deposits
– Austrian deposit plan given go ahead by the EU
– Banks to pay into a deposit insurance fund over 10 years
– Fund will then be valued at a grossly inadequate €1.5 billion
– New bail-in legislation agreed by EU two years ago
– Depositors need to realise increasing risks and act accordingly
– “Bail-ins are now the rule” and ‘Bail-in regime’ coming
Bank deposits in Austria will no longer enjoy state protection and a state guarantee in the event of bank runs and a bank collapse when legislation is enacted in July. The plan to ensure that the state is no longer responsible for insuring deposits has been readied by the Austrian government in conjunction with the EU two years ago according to Die Presse.
Currently, Austrians have their bank deposits guaranteed to a value of €100,000 – the first half to be provided by the failing bank and the other by the state. From July, however, the state will be removed from the process and a special bank deposit insurance fund is to be set up and paid into by banks to meet potential shortfalls.
The fund will be filled gradually over the next ten years to a value of €1.5 billion. In the the event of a failure of a major bank in the intervening period the legislation will allow the fund to borrow internationally although who will provide such funding and on what terms is not clear, according to Austria’s Die Presse.
However, even when the scheme is fully funded it is clear that €1.5 billion will be woefully inadequate to deal with a bank failure.
€1.5 billion amounts to a mere 0.8% of total deposits in Austria. It is highly unlikely that deposits of any major bank would be adequately covered and in the event of multiple concurrent bank failures it is likely that most savers would be wiped out.
Die Presse gives the example of Bank Corp in Bulgaria. When that bank failed it had €1.8 billion in deposits but there was only €1 billion in the deposit insurance fund.
On a positive note “inheritances, real estate transactions, a dowry or a divorce [will be] be protected for three months, even up to an amount of 500,000 euros,” according to Die Presse (via google translate).
It is telling that, as Die Presse reports, the framework for the legislation was agreed in Europe two years ago and the legislative change has to take place by this summer. It was on June 27th, 2013 that Irish Finance Minister Michael Noonan made his infamous declaration that “bail-in is now the rule.”
The Die Presse story suggests that the Austrians may have gotten a derogation or an exemption from the new bail-in legislation which was enacted in 2013. “Bail-in is now the rule” as Irish finance Minister Michael Noonan warned in June 2013. Noonan admitted then that the move to not maintain deposits as sacrosanct was a “revolutionary move.” That it was and yet investors and depositors remain very unaware of the risks of bail-ins both to their own deposits but also to the wider financial system and economy.
At that time average depositors with deposits of less than €100,000 were given no indication that their savings may be at risk even as EU institutions were working on removing state liability for such deposits.
Romania’s Bursa newspaper points out that this is not some monetary experiment being foisted upon some peripheral Eurozone country. Austria is regarded as being part of the EU’s “hard core”.
What unfolds in Austria will likely follow across the EU. It may be that Austria was prompted to enact this legislation first among its European partners precisely because it anticipates major banks failures in the wake of the failure of its “bad bank”, Heta.
Also many Austrian banks have large exposures to Eastern European countries and property markets. Austrian banks are the most exposed to potential losses from tougher sanctions on Russia according to Fitch and the IMF. Swedish, French and Italian lenders are also vulnerable, the International Monetary Fund also warned.
Deposits in the insolvent banking system are no longer safe. So where is one to place one’s savings?
As Germany’s Deutsche Wirtschafts Nachrichten opines “depositors will have to thoroughly research the situation of the bank they place their savings in”. It adds, “this task is extremely difficult, because of the muddy financial statements and of the complexity of the interdependencies in the banking system”.
While Austria may be the first in enacting this legislation there is no guarantee that savers, particularly in the peripheral nations, will receive any indication that their deposits may be at risk.
Emergency legislation can be drawn up over-night – as was the case when Ireland was “bailed-out” or rather Ireland’s banks were bailed out and Ireland’s tax payers were bailed in. The developing bail-in regimes, means that soon individual and corporate depositors could see their savings and capital ‘bailed in’.
These are important developments. Average savers can no longer rely on the state to protect their deposits. They provide a good reason for depositors to allocate some of their funds to physical gold stored outside of the banking system, in the safest jurisdictions in the world.
Must Read Guides: Protecting Your Savings In The Coming Bail-In Era (11 pages)
Must Read Guides: From Bail-Outs To Bail-Ins: Risks and Ramifications – Includes 60 Safest Banks In World
(51 pages)
MARKET UPDATE
Today’s AM LBMA Gold Price was USD 1,196.00, EUR 1,113.33 and GBP 808.49 per ounce.
Yesterday’s AM LBMA Gold Price was USD 1,211.10, EUR 1,113.66 and GBP 811.40 per ounce.
Gold fell 0.59 percent or $7.10 and closed at $1,203.20 an ounce yesterday, while silver slid 2.13 percent or $0.36 closing at $16.52 an ounce. Gold has remained robust in most currencies except the dollar and remains above EUR 1,100 and GBP 800 per ounce.
Gold fell in dollar terms for its third session after some traders interpreted comments from the U.S. Fed minutes released yesterday as hawkish. Market participants still think a June interest rate hike remains a possibility despite the appalling jobs number last Friday.
The yellow metal dipped below its psychological $1,200 per ounce level yesterday as the U.S. dollar surged higher. The greenback hit a one week high against the euro at 1.0730. Silver sunk to a three week low.
Gold prices in Singapore was off 0.5 percent at $1,196.30 an ounce near the end of day trading prior to ticking slightly higher in London.
Holdings of SPDR Gold Trust, the world’s largest gold ETF, edged down to 733.06 tons on Wednesday, from its previous close of 735.45 tons on Tuesday.
Technical analysis suggest gold could drop to $1,181 as it has cleared a support at $1,205, based on a Fibonacci retracement analysis. The next support may be at $1,181, the 23.6 percent level.
Physical gold buying in China has briefly waned but powerhouse India is still seeing robust physical demand.
Fed governors, Dudley and Powell yesterday alluded to scenarios in which the central bank could make an initial move earlier than many now expect and then proceed in a slow and gradual manner on further rate increases.
As ever, many members of the Fed talk a good hawkish talk but never walk the hawkish walk. Meaning that despite continual talk of interest rate rises for years now – none never come. They will some day but it may not be this year.
In Europe, gold for immediate delivery in the late morning was trading at $1,196.30 or down 0.41 percent. Silver was $16.29 or off 1.16 percent and platinum was $1,159.55 or down 0.32 percent.
end
(courtesy Pam and Russ Martens/GATA)
Pam and Russ Martens: Americans don’t trust the Fed because it’s too secretive
Submitted by cpowell on Thu, 2015-04-09 03:38. Section: Daily Dispatches
By Pam and Russ Martens
Wall Street on Parade, New York
Wednesday, April 8, 2015
Having defeated the Crown in a bloody revolution some two centuries ago, Americans don’t like living under a patriarchy, oligarchy or kleptocracy. Unfortunately, the U.S. central bank, the Federal Reserve, is a little of all three.
On Monday this week the president of the Federal Reserve Bank of New York stated in a speech that “the Federal Reserve already is very transparent and accountable to Congress and to the public.” Two days later Wall Street On Parade attempted to get one piece of very basic information from the Fed and got the royal runaround.
We wanted to know if JPMorgan Chase, a bank operating under a deferred prosecution agreement for two felony counts and under a criminal investigation for currency rigging, was still the custodian of $1.7 trillion of mortgage-backed securities owned by the Federal Reserve, as we had reported on November 3, 2014.
Other basic information from the Fed is also off-limits to the press.
Each day the president of the United States posts his daily schedule on the Internet. Trying to find out whom the chairman of the Federal Reserve has met with is far more secretive. …
… For the remainder of the commentary:
http://wallstreetonparade.com/2015/04/why-americans-dont-trust-the-fed-i…
end
The 11 rules for gold/silver manipulation:
(courtesy James McShirley/GATA)
James McShirley: 11 rules for gold price suppression
Submitted by cpowell on Thu, 2015-04-09 03:21. Section: Daily Dispatches
By James McShirley
www.LeMetropoleCafe.com
Wednesday, April 8, 2015
1. Daily gold gains are capped at 1 percent (limit up) or 2 percent (expanded limit up).
2. Gold isn’t allowed to have any follow-through rallies.
3. Gold is attacked at specific times — 3 a.m. ET, pre-Comex and Comex open, NYSE open, London close, Comex close, 6 p.m. access trade open, and any opportune, thinly traded access markets.
4. Gold is attacked on all significant government data releases, especially the monthly nonfarm payrolls Friday report.
5. Gold is attacked on any ordinarily bullish news — war, turmoil, economic crises, and Wall Street jitters.
6. Gold is attacked on all significant Comex option expiration and first-notice days, assuring that the maximum number of calls expire worthless, mitigating deliveries.
7. An attack on gold is frequently signaled by attacking either silver, HUI stocks, or both.
8. Flash crashes with no corresponding explanation always keep speculative longs stopped out or in losing positions.
9. New York and London are the centers of gold price suppression, so the London PM fix will be lower or no higher than $5 from the AM fix.
10. Comex margin changes, both higher and lower, are always to the detriment of gold longs.
11. Gold is never allowed to anticipate any bullish developments, nor is it allowed to be a barometer for currency largesse.
—–
James McShirley writes for GATA Chairman Bill Murphy’s LeMetropoleCafe.com.
end
(courtesy Bullionstar.com/GATA)
Torgny Persson: Pro-gold governments and central banks
Submitted by cpowell on Thu, 2015-04-09 11:17. Section: Daily Dispatches
7:15a ET Friday, April 9, 2015
Dear Friend of GATA and Gold:
Bullion Star proprietor Torgny Persson writes this week that not all central banks are anti-gold. There are more or less pro-gold governments too, Persson writes, including those of China, Russia, Singapore, and even the super-government of Europe, the European Central Bank. Persson’s commentary is headlined “Pro-Gold Governments and Central Banks” and it’s posted at Bullion Star here:
https://www.bullionstar.com/blogs/bullionstar/pro-gold-governments-and-c…
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
end
A really good one tonight from Bill Holter
(courtesy Bill Holter/Miles Franklin)
Ignorant depositors
The plan for today was to pen an article regarding silver. I believe silver to be the cheapest, most undervalued asset on the planet. From these current levels I believe any capital in silver is a no brainer. Let’s hold off on this thought until next week however, a more pressing thought has come up.
Let’s start with a question. Would you ever lend money to someone you knew for a fact was bankrupt? Or, would you lend money to someone who told you to your face they were cooking their own book? Isn’t this exactly what you are doing any time you deposit money into most any bank? Without getting long winded on this aspect, you do remember back in 2010 or thereabouts our banks in the U.S. were allowed to outright cook their books? The banks were no longer required to price their portfolios at “marked to market” prices. Since then, they can simply “make up” whatever prices they choose and report those.
It is the same situation in Europe but they have had a little “help” in their fraud. For example let’s look at Greek bonds that are held in banks all over Europe. Greece without a doubt cannot mathematically pay back their debt. They do not have enough cash to even make next month’s “credit card payment” without an infusion from somewhere. I use this term credit card payment because that is exactly what these are, this week for example is a miniscule 500 million euros, not even half a ham sandwich in the global scheme of things. If they cannot make a payment or they go through a restructuring, or in all probability they cut a deal with the Russians and Chinese followed by “we quit and we aren’t paying you” …what are these bonds really worth? Ten cents? Five? Zero?
My point is this, these bonds are carried on balance sheets at 100 cents on the euro! Banks, including the European Central Bank itself values these bonds at par as if they were pristine a credit. The BIS has allowed sovereign credits within Europe to be carried at par on bank balance sheets. This is clearly bogus. It was my intention to also speak about Spain’s short term interest rates going negative. They were my original thought to “would you lend money to a bankrupt entity?”. While writing this, two pieces of news have come out and spotlights my point. Greece has in fact made the April payment, now we wait for the next due date which finance minister Varoufakis says “will be different”, what does he mean by “different”? Mr. Tsipras concluded his meeting in Moscow, what exactly was discussed? Greece has also surprised us yesterday by contemplating calling all new debt taken on since 2012 as “odious” http://www.zerohedge.com/news/2015-04-08/odious-debt-has-finally-arrived-greece-write-illegal-debt . I believe the new amount of debt taken on is over 100 billion euros, does this mean they will just walk away from this post 2012 debt and only service the earlier debt? Was this a part of the discussions in Moscow? Greece will continue to pay on pre 2012 debt but not post debt? Is this debt “justified” being priced at 100% or par or should a minor adjustment be in order?
As you know from previous writings, the Austrian banking system is wobbling because of the rise in the Swiss franc versus the euro. This was caused by Hypo Alpe Adria bank not being able to make a 600 million euro payment. This has affected their counterparties and has since spread. Could this paltry amount take down the Austrian banks?
Do you see what today’s exercise is all about? It looks like amounts as small as “millions” which only amount to credit card monthly payments may be enough to torpedo individual banks …and even a country! The fact that the world is so levered and interconnected means very small “non payments” have the ability to spread and take everything down with it… and it looks like this is exactly what is happening!
I have said all along that our entire financial system was about “collateral” and it would be the realization the collateral was “bad” as the reason for collapse. This is where we are today, extremely small interest payments which cannot be made are about to expose the true value of the underlying “collateral”. Just because the regulators have allowed banks to mark their assets to fantasy levels does not mean the bad collateral will not fail. It will. IT ALL WILL! This is the reason “bail in” legislation has been written and put into place all over the world. Because they KNEW when they wrote the legislation they would be forced to use it.
The white knight of “bail outs” will not and can no longer ride in to save ignorant depositors. I use the word “ignorant” because who in their right mind would lend their money at a negative interest rate …in a debasing currency …to a bank that lies about their asset quality …in a system where if one fails they all fail? And on top of this, the regulators, central banks and governments themselves have already written legislation saying “when it comes down, we will take your money to make ourselves whole”. Who would do this? I’m pretty sure holding gold is a safer bet but that’s just me and everyone knows I wear a tin foil cowboy hat. Regards, Bill Holter
end
Here is a link to Bill Holter’s latest interview with Sean Corrigan.
http://sgtreport.com/2015/04/proof-the-world-is-actively-preparing-to-ditch-the-dollar-bill-holter/
end
Early Thursday morning trading from Europe/Asia
1. Stocks mainly higher on major Chinese bourses /Japan higher /yen rises to 119.97
1b Chinese yuan vs USA dollar/yuan weakens to 6.2063
2 Nikkei up by 147.61 or 0.75%
3. Europe stocks all in the green/USA dollar index up to 98.16/Euro falls to 1.0770
3b Japan 10 year bond yield .35% (Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 119.97/
3c Nikkei still above 19,000
3d USA/Yen rate now just below the 120 barrier this morning
3e WTI 51.62 Brent 57.16
3f Gold down/Yen up
3gJapan is to buy the equivalent of 108 billion uSA dollars worth of bond per month or $1.3 trillion. Japan’s GDP equals 5 trillion usa.
Japan to buy 100% of all new Japanese debt and by 2018 they will have 25% of all Japanese debt. Fifty percent of Japanese budget financed with debt.
3h Oil up for WTI and up for Brent this morning
3i European bond buying continues to push yields lower on all fronts in the EMU
Except Greece which sees its 2 year rate slightly falls to 20.73%/Greek stocks up by .53% today/ still expect continual bank runs on Greek banks.
3j Greek 10 year bond yield: 11.25% (down by 40 basis point in yield)
3k Gold at 1199.80 dollars/silver $16.32
3l USA vs Russian rouble; (Russian rouble up 1 1/4 rouble/dollar in value) 51.92 , with the higher brent oil price/the rouble is the best acting currency this year!!
3m oil into the 51 dollar handle for WTI and 57 handle for Brent/Saudi Arabia increases production to drive out competition.
3n Higher foreign deposits out of China sees hugh risk of outflows and a currency depreciation. This scan spell financial disaster for the rest of the world/China may be forced to do QE!!
30 SNB (Swiss National Bank) still intervening again in the markets driving down the SF
3p Britain’s serious fraud squad investigating the Bank of England/ the British pound is suffering
3r the 7 year German bund still is in negative territory/no doubt the ECB will have trouble meeting its quota of purchases and thus European QE will be a total failure.
3s Eurogroup reject Greece’s bid for more euros of bailout funds as proposal is to vague. The ECB increases ELA by .7 billion euros up to 72.0 billion euros. This money is used to replace fleeing depositors.
Greece repaid the IMF today. There will be nothing left after that.
(see article below/zero hedge)
3t
4. USA 10 year treasury bond at 1.88% early this morning. Thirty year rate well below 3% at 2.52%/yield curve flatten/foreshadowing recession.
5. Details Ransquawk, Bloomberg, Deutsche bank/Jim Reid.
(courtesy zero hedge/Jim Reid Deutsche bank)
US Dollar Surge Returns, Pushes Equity Futures Lower
As noted several hours ago, the main story overnight is not that Greece once again narrowly averted a Grexit when it was reported it would make its scheduled payment to the IMF today (adding that next month is a “different story”) a development that was met with yet another ultimatum by its “partner“, the Eurozone, but the dot com bubble deja vu-esque move in Hong Kong stocks, where the Chinese, seemingly tired of pushing up their local market into the stratosphere have turned their attention southward and are desperate to buy up every single Hong Kong stock.
As a result, the Hang Seng (+2.7%) jumped to its highest level since 2007, gaining as much as 6.4%, with volume turnover on the Index ~400% above the 30-day average. Gains were led by Chinese regulators allowing mainland Chinese funds to buy shares in HK and as analysts see HK stocks as undervalued relative to their Chinese peers, due to the out performance of the Shanghai Comp. vs. HSI. Despite opening above 4,000 for the first time since 2008, the Shanghai Comp (-0.9%) moved lower given the flows away from Chinese equities into Hong Kong stocks. Nikkei 225 (+0.75%) extended on its 15-year highs and is now in close proximity to the key 20,000 level, further underpinned by JPY weakness. JGBs rose with the curve notably flatter after today’s 30yr auction which despite a lower than prev. b/c, saw the yield in price narrow significantly to 0.19% vs. prev. 0.34%.
European equities started the session on the front foot, taking the lead from the positive Wall Street close and Asia-Pacific session overnight. Furthermore, sentiment has also been bolstered by confirmation that Greece are to make their scheduled repayment to the IMF Later today, which has subsequently seen the GR/GE spread tighter by 21bps. On a sector specific basis, auto-names outperform and have helped support the DAX after bouncing back from yesterday’s declines and also being assisted by lower aluminium prices in the wake of Alcoa’s after-market report yesterday. Elsewhere, fixed income markets trade in a relatively directionless manner with things otherwise quiet from a European perspective. However, heading into the North American crossover, Gilts have moved higher after breaking above yesterday’s highs with volumes otherwise light.
In FX markets, the USD-index trades higher with no stand out news supporting the move higher, with price action instead led by a technical break below 1.4850 in GBP/USD which triggered stops along the way, with EUR/USD extending further losses and the next level of support said to be at 1.0714 – its March 31st low. With regards to GBP, GBP/USD has pared the entire gains from yesterday which were attributed to the large M&A deal between Royal Dutch Shell and BG Group. Elsewhere, Antipodeans remain supported as carry trades continue to come back in favour amongst investors stirred by yield demand, with NZ and AU yields notably higher across the curve, while NZD faded earlier losses, after PM Key said he expects the currency to fall further against USD.
And while the USD has indeed been higher all night without any material catalyst, the snapback is starting as can be seen below, in what has now become a standard market fixture before the US open, i.e., the infamous stop hunt. Case in point: a 30 pip move in the biggest FX pair in seconds and on no news.
In the commodity complex, both WTI and Brent crude futures trade higher in a pullback of yesterday’s heavy losses which were triggered by the latest API and DoE inventory data which revealed a substantial build for the headline figures and an increase in US oil production. The result was the biggest drop in WTI in 2 months.
Elsewhere, precious metals continue to weaken as gold retreats for a third consecutive session as the USD trades higher, subsequently seeing the yellow metal remain below the USD 1,200 level. Furthermore, Aluminium underperforms industrial metals amid revised forecasts from Alcoa that now sees a surplus of aluminium compared to a previous deficit, which consequently weighed on aluminium prices.
In summary: European shares rise a third day with the media and construction sectors outperforming and basic resources, telcos underperforming. The Swiss and French markets are the best-performing larger bourses, Spanish the worst. The euro is weaker against the dollar. German 10yr bond yields fall; Greek yields decline. Commodities gain, with Brent crude outperforming and silver, gold underperforming. * U.S. jobless claims, continuing claims, Bloomberg consumer comfort, wholesale inventories, due later.
Market Wrap
S&P 500 futures down 0.3% to 2070.5
Stoxx 600 up 0.6% to 407
US 10Yr yield down 1bps to 1.89%
German 10Yr yield little changed 0.16%
MSCI Asia Pacific up 0.6% to 152
Gold spot down 0.5% to $1196.8/oz
Eurostoxx 50 +0.5%, FTSE 100 +0.7%, CAC 40 +0.8%, DAX +0.4%, IBEX +0.2%, FTSEMIB +0.5%, SMI +1.2%
MSCI Asia Pacific up 0.6% to 152; Nikkei 225 up 0.7%, Hang Seng up 2.7%, Kospi little changed, Shanghai Composite down 0.9%, ASX down 0.5%, Sensex up 0.6%
Shell’s $70 Billion BG Deal Meets Shareholder Skepticism
Teva Mulls Next Move as Mylan’s Perrigo Bid Jolts Drugmakers
Burberry Outperforms; Daily Mail Cites Takeover Speculation
Chemicals M&A May Accelerate, Baader-Helvea Says; Lists Targets
Wincor Nixdorf M&A Not Without Risks, Analysts Say
Euro down 0.45% to $1.0733
Dollar Index up 0.52% to 98.45
Italian 10Yr yield up 2bps to 1.26%
Spanish 10Yr yield up 1bps to 1.21%
French 10Yr yield down 1bps to 0.44%
S&P GSCI Index up 1.5% to 410.1
Brent Futures up 2.8% to $57.1/bbl, WTI Futures up 2.6% to $51.7/bbl
LME 3m Copper up 0.5% to $6043/MT
LME 3m Nickel down 0% to $12575/MT
Wheat futures down 0.4% to 524.3 USd/bu
Bulletin Headline Summary
European equities take the lead from the US and Asia, with things otherwise quiet from a European perspective
The USD-index is providing a bulk of the price action in FX markets, subsequently weighing on EUR and GBP, with GBP paring yesterday’s M&A related advances
Looking ahead, today sees the BoE rate decision, US weekly jobs data, wholesale inventories and US 30yr auction.
Treasuries gain before week’s auctions conclude with $13b 30Y bonds; WI yield 2.525% vs. 2.681% in March. 10Y notes sold yesterday awarded at lowest yield since May 2013.
Greece has met its payment obligation to IMF that was due today, Greek Finance Ministry official says on condition of anonymity
German industrial production rose 0.2% in February, better than expected, vs a revised 0.4% drop in January
State action can help solve bad loan issue, Bank of Italy Governor Ignazio Visco said in an interview; public intervention can help free up resources for credit, even through “a direct participation in the management and the recovery of impaired loans”
Italy banks’ gross non-performing loans rose 15.3% in Feb. from yr earlier, Bank of Italy says in e-mailed statement today.
Kaisa Group Holdings said that a unit of shareholder Sino Life Insurance Co. agreed to lend it 1.38b yuan ($222m) as “financial assistance”
While Obama probably hoped an interview he gave to pu