• "Spreading the ideas of freedom loving people on matters regarding high finance, politics, constructionist Constitution, and mental masturbation of all types"

Business News & Views - Metals, Markets, Shipping, Energy, More

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Playing ‘Kleptopoly’? Goldman Sachs faces criminal charge over fraud
RT


Published on Dec 18, 2018
READ MORE: https://on.rt.com/9kqt

Malaysia filed criminal charges against Goldman Sachs and two ex-bankers over the multi-billion dollar looting of state fund, 1MDB. The US bank denies the accusation, claiming it was deceived by the previous Malaysian government.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Corporate Debt: A Liquidity Crisis in the Making?
Silver Fortune


Published on Dec 18, 2018
The corporate debt market is flashing red; pay attention to what spreads do in the future, and whether this market can handle a massive shift in debt.

Support Silver Fortune, shop at SD Bullion! Free shipping over $99, and a 1 oz. round for new customers! sdbullion.com/sf
(I am compensated by SD Bullion when the at spot round is claimed by new customers)

Support Silver Fortune through Patreon: https://www.patreon.com/silverfortune

International Silver Syndicate poured silver, featuring various popular YouTube silver and gold channels, including your's truly: https://mkbarzandbullion.com/pages/in...
(MK Barz does offer a small share of profits to channels featured on the ISS bars)

Any content within this video or any other video by the Silver Fortune channel is merely one man's opinion, commentary, and analysis, or actual information obtained from elsewhere, and should not be constituted as legal, investment, or financial advice. Make your own financial decisions, or consult a professional if you'd prefer to go that route. The Silver Fortune channel disclaims any liability for legal, financial, or investment decisions made.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Blacklisted for 50 Yrs: Cannabis Emerges | ALEXANDER COLEMAN
Reluctant Preppers


Published on Dec 18, 2018
With the new Farm Bill and numerous state legal changes, what promising benefits of CBD, hemp and cannabis are now coming available for widespread use? And what strategies are a future leader in this young and rapidly growing industry using to take a key role in this global phenomenon?

Join Reluctant Preppers’ new guest Alexander Coleman, CEO and co-chairman of TILT holdings, as he explains the exciting prospects of his young company as it goes public!

https://www.tiltholdings.com/

ABOUT

TILT Holdings Inc. is a vertically-integrated infrastructure and technology cannabis company and is publicly traded on the CSE under the ticker symbol "TILT". The company's vision is to provide value to all cannabis retailers through software, infrastructure, access to capital, and more.

This interview Sponsored by TILT Holdings.

==================================
Get Silver at SPOT PRICE and Support ReluctantPreppers!
https://www.SDBullion.com/RP

Donate to Support ReluctantPreppers!
https://www.Patreon.com/ReluctantPrep...
or
https://www.paypal.me/ReluctantPreppers
==================

Subscribe (it's FREE!) to Reluctant Preppers for more ► http://bit.ly/Subscribe-Free

Channel graphics by http://JosiahJohnsonStudios.com
Promotion by http://FinanceAndLiberty.com
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
On Contact: The history of debt forgiveness
RT America


Published on Dec 15, 2018
Economist and author, Michael Hudson, in his new book “…And Forgive Them Their Debts: Lending, Foreclosure and Redemption From Bronze Age Finance to the Jubilee Year,” shares with journalist Chris Hedges how Ancient cultures forgave debt cyclically to prevent debt peonage and the rise of an oligarch elite.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Ira Epstein's End of the Day Financial Video 12 18 2018
Ira Epstein


Published on Dec 18, 2018
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Ira Epstein's End of the Day Agriculture Video 12 18 2018
Ira Epstein


Published on Dec 18, 2018
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Ron Paul: Next Crash Could Be Worse Than 1929 Gold Edges UP!
SalivateMetal


Published on Dec 18, 2018
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Sea Machines Raises $10 Million to Further Advance Autonomous Tech in Shipping
December 17, 2018 by gCaptain



Image credit: Sea Machines

Boston-based Sea Machines Robotics has closed a $10 million Series A investment which will help the company further develop autonomous technology for use aboard ships..

The investment marks one of the largest venture rounds for a marine- and maritime-focused technology company and brings the total capital Sea Machines has raised to $12.5M.

Sea Machines will use the funds to expand the sales and global reach of its recently released line of products, grow the R&D and engineering teams, roll out new product feature sets, and further the company’s lead in developing advanced situational awareness systems for vessels.

Funding round was led by Accomplice and Eniac Ventures, with participation from Toyota AI Ventures; Brunswick Corp., through investment partner TechNexus Venture Collaborative; NextGen VP, Geekdom Fund; LaunchCapital; LDV Capital and others.

Sea Machines believes the industrial marine sector, which encompasses maritime transportation, offshore energy, and commercial fishing and aquaculture, could benefit greatly from today’s autonomous technology.

“We are creating the technology that propels the future of the marine industries. This investment enables us to double down on our commitment to building advanced command and control products that make the industry more capable, productive and profitable,” said Michael Gordon Johnson, founder and CEO, Sea Machines. “This backing is another signal that Sea Machines is the unquestioned leader in the space and is playing an integral role in the revolution of marine and maritime operations driven by technology.”

Sea Machines is currently developing advanced perception and navigation assistance technology for a range of vessel types, including container ships. In the first quarter of 2019, the company will initiate testing of its perception and situational awareness technology aboard one of A.P. Moller-Maersk’s new-build ice-class container ships.

In October, Sea Machines released its introductory line of autonomous command and remote control systems, developed for the demanding challenges of vessels serving the offshore commercial, scientific and government applications. The SM product series is available now and can be installed aboard existing or new-build commercial vessels with return on investment typically seen within a year.

“At Toyota AI Ventures, we believe that autonomous mobility can help improve people’s lives and create new capabilities – whether on land, in the air or at sea,” said Jim Adler, founding managing director, Toyota AI Ventures. “Sea Machines’ autonomous technology and advanced perception systems can reduce costs, improve efficiency and enhance safety in the multi-billion dollar commercial shipping industry. This marks our first investment in the maritime industry, and we’re excited to embark on this journey with Sea Machines.”

https://gcaptain.com/sea-machines-raises-10-million-to-further-advance-autonomous-tech-in-shipping/
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
One Book Explains the Rise of Globalization: Peter R. Orszag
December 18, 2018 by Bloomberg



Photo: Avigator Thailand / Shutterstock

By Peter R. Orszag (Bloomberg Opinion) — At the top of my most interesting reads this year was Marc Levinson’s “The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger,” the second edition of which was published in 2016. The book tells the story of container shipping, which revolutionized international trade over the past 60 years.

How container shipping came to dominate global trade may not sound like a gripping read, but Levinson intersperses the story with colorful business characters like Malcom McLean and exacting operations researchers such as Foster Weldon. And the story itself is both historically important and also central to many of the ongoing debates still raging about globalization.

Before containers were standard, shipping was more expensive and time of arrival more uncertain. Moving cargo from ship to truck or train and vice versa was a surprisingly large component of the problem. Some estimates suggest that about half the overall cost of transporting goods by sea involved laborious loading and unloading at the originating and recipient ports. Moreover, ships were often tied up in ports for a week or more in the helter-skelter process of moving cargo on and off.



Related Book: Related Book: The Box, Book by Marc Levinson


Into this chaos entered several attempts at standardization. One early idea of McLean’s was to drive truck trailers onto ships and transport the whole trailer to the next port, where it could be attached to a new truck and driven away. The wheels on the trailers, however, would have consumed valuable space, and the trailers couldn’t be stacked on top of one another. Thus came the idea of putting only the trucking container on board; the containers could be stacked on the ship to carry even more cargo.

Although scattered efforts at container shipping existed in the U.S. and elsewhere earlier, Levinson points to the May 1956 arrival in Houston of McLean’s Ideal-X as the start of the modern container era. The Ideal-X carried 58 33-foot aluminum containers. Massive innovation and experimentation, on everything ranging from terminal cranes to the sizes and latching systems of the containers, followed its maiden journey.

Containers were more efficient than the alternatives, but growth was slow and unsteady both because it was a new technology and because different shippers used different types and sizes of containers. That lack of standardization was solved by the war in Vietnam. The military, facing the need to supply troops in Asia and logistical breakdowns at Vietnamese ports, developed a massive container port at Cam Ranh Bay and in 1967 awarded a large contract to McLean’s Sea-Land Service Inc. The 20-foot container preferred by the military became the norm, and container shipping exploded. (The 20-foot container was eventually supplemented by 40-foot ones.)

The military boom created a civilian one also, as the infrastructure needed for military shipping was repurposed for commercial trade. The results are dramatic. In 1965, container shipping was still mostly in its infancy. By 1968, U.S. ports were handling an average of 3,400 20-foot containers each week. Civilian container shipments passing through Oakland’s port rose to 3 million tons in 1969 from 365,000 tons in 1965.

The military shipments to Vietnam also spurred growth in trade with Asia, because the Defense Department paid for the round trip — and so any goods carried back from Asia to the U.S. were effectively pure profit for the shipping companies. The result was rapid growth in exports to the U.S., first from Japan and then ultimately other parts of Asia.

In the midst of this shipping boom, New York’s ports were bypassed. New York spent the equivalent of billions in today’s dollars rebuilding piers in the late 1950s and early 1960s, but they were not designed to handle the rapid growth in container shipping that was about to occur and in any case they still faced two structural problems that made New York unattractive as a recipient port: inadequate rail capacity and crowded lanes for trucks. Across the Hudson, by contrast, Port Elizabeth was imagined from the beginning as a container port.

The result? In 1960, over 75 percent of all cargo entering the New York area was offloaded in Manhattan or Brooklyn. By 1970, almost two-thirds was instead entering through New Jersey’s ports. The four-pier west-side terminal near 14th Street — reconstructed at significant cost in 1963 — was effectively unusable by the mid-1970s because it didn’t make sense to use New York as a commercial port for containers. Today it is the Chelsea Piers Sports & Entertainment Complex.

Trade has become controversial in this political moment, so much so that we see cognitive dissonance like support for deepening ports paired with opposition to new trade deals. But politics only does so much: The story told in “The Box” shows that the rise of container shipping and the decline in transportation costs may well have done more to promote globalization and international trade than all the trade agreements signed since the 1960s combined.

Peter R. Orszag is a Bloomberg Opinion columnist. He is a vice chairman of investment banking at Lazard. He was director of the Office of Management and Budget from 2009 to 2010, and director of the Congressional Budget Office from 2007 to 2008.

© 2018 Bloomberg L.P

https://gcaptain.com/one-book-explains-the-rise-of-globalization-peter-r-orszag/
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Bill Black: Countering Chinese Accounting Control Fraud and Predation Against U.S. Investors

Posted on December 18, 2018 by Jerri-Lynn Scofield

By Bill Black, the author of The Best Way to Rob a Bank is to Own One, an associate professor of economics and law at the University of Missouri-Kansas City, and co-founder of Bank Whistleblowers United. Jointly published with New Economic Perspectives

On December 13, 2018, the Wall Street Journal published an interesting op ed by Jesse M. Fried, a famous law professor in multiple areas of corporate law, and Matthew Schoenfeld, who works at a hedge fund that is the leading funder of civil lawsuits, primarily fraud and tort suits.

The title is “Will China Cheat American Investors? The answer, of course, is yes – it will continue to cheat American (and non-American) investors. Fried also has a strong background in economics, which is relevant to his op ed and my blog article.

The op ed is interesting in part because it was published just after a documentary on Chinese stock fraud (“The China Hustle”) had its general video release. The China Hustle explores the pervasive defrauding of primarily U.S. investors by those that control Chinese corporations.

Though the documentary does not make the point, it is describing “accounting control fraud.” A ‘control fraud’ is a seemingly legitimate entity used by the person that controls it as a “weapon” to defraud or predate. For the sake of brevity, I use “CEO” rather than “the person that controls the corporation.”

Accounting control frauds target creditors and shareholders as their primary intended victims. Their primary weapon of fraud and predation is accounting. The art is to inflate assets and understate liabilities, which overstates capital and income. White-collar criminologists, economists, accounting academics, and regulators have explained the ease with which the CEOs running control frauds are able to suborn supposed “controls” (auditors, appraisers, attorneys, and credit rating agencies). The art is to suborn, not destroy, supposed ‘controls’ so that they will “bless” the CEO’s frauds, lending their reputation as supposedly independent professionals to aid the CEO in defrauding creditors and defrauding and predating on shareholders. The CEOs leading the fraud and predation can even use their ability to hire and fire the key officers at these supposed independent professional controls to generate a “Gresham’s” dynamic within their profession. George Akerlof, in his famous 1970 “lemons” article that led to award to him of the Nobel Prize in Economics in 2001, first named that perverse dynamic. Akerlof explained how it worked.

[D]ishonest dealings tend to drive honest dealings out of the market. The cost of dishonesty, therefore, lies not only in the amount by which the purchaser is cheated; the cost also must include the loss incurred from driving legitimate business out of existence.​
What all of these factors mean, plus a host of other factors that make controlling a seemingly legitimate firm uniquely valuable to CEOs running sophisticated, massive fraud and predation schemes, is that control frauds and predation cause vast harm and can become epidemic. When I say that the control frauds are “seemingly legitimate” and that the supposed ‘controls’ are seemingly legitimate I mean that they both actually function frequently as ‘criminal enterprises.’

The “China Hustle” documentary is deeply flawed in its apparent belief that endemic fraud can only occur in places like China that have no effective rule of law. The GFC, the three most destructive financial fraud epidemics in history that drove the GFC, the astonishing level of elite financial predation in the United Kingdom, the U.S., and Australia, and the complete failure to prosecute the financial elites that led those fraud epidemics combined to prove that the United States does not have an effective rule of law.

I now routinely use the phrase “control fraud and predation” because Bastiat’s warning has proven true. Frederic Bastiat is the patron saint of economists that worship laissez faire, so it is ironic that his famous warning has revealed why laissez faire ideology creates an intensely criminogenic and predatory environment. Laissez faire ideology ignores the ability of elite frauds and predators to use their exceptional power to corrupt the rule of law. Vigorous regulation, supervision, and prosecution of elite crimes and predation is essential to the effective rule of law. Laissez faire proponents wage a continuous, unholy war in favor of the three “de’s” – deregulation, desupervision, and de facto decriminalization and “glorify[y]” elite white-collar criminals as their heroes.

When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that glorifies it.​
Predatory acts (“plunder[ing]”) are not criminal. Predatory acts, however, are so deeply unethical that if the poor committed those acts the wealthy, with dominant political power, would make those acts crimes. This point is similar to one that the media has been describing considerably in recent weeks – the fact that campaign finance crimes require the prosecution to prove that the defendant “knowingly and willfully” committed the crime. This means that ignorance of the law can be a defense for people like President Trump unless the prosecution can prove he knew he was violating the law. Laws that criminalize behavior undertaken primarily by elites are far more likely to require the prosecution to demonstrate that the defendant willfully violated the law. The President and members of the Congress share a common interest in protecting their political contributors from prosecution, so they drafted the statutes governing contributions (and bribery) to make it exceptionally difficult to prosecute the elites that enrich them and help them win elections. Our greatest ability to predict judicial decisions by conservative jurists is when the case involves business interests. Conservative jurists are most likely to vote to advance business interests (as opposed to factors such as national security or views on federalism). Conservative jurists, over the last 30 years, have recurrently made it more difficult to prosecute elite white-collar crimes and corruption and to gut regulatory actions essential to prevent a criminogenic and predatory environment.

I emphasize predation for two other reasons. First, two Nobel Laureates in economics, George Akerlof and Bob Shiller have written a book to try to get economists to take predation seriously. The standard neoclassical assumption channels the false laissez faire claim that predation cannot occur, or, in the alternative, cannot be serious. Second, the WSJ op ed that prompted this article focuses on a classic example of predation frequently observed – and then ignored – by bad economists. The predation is by controlling shareholders that loot minority shareholders. This is a common pattern for hundreds of years all over the world.

There are two semi-remarkable facts about this form of predation in China that the op ed discusses. The first is remarkable only to bad economists. The op ed explains:

Americans now collectively own most of the public equity of China’s biggest tech companies, including Alibaba, Baidu and Weibo. This relationship is strange (imagine if the Chinese owned most of Amazon, Facebook and Google). It’s also extremely risky, at least for American investors.​

China’s tech darlings began tapping U.S. investors in the early 2000s, when mainland capital markets were unsophisticated and strict profitability requirements shut out most fast-growing tech firms. Dozens of Chinese unicorns and near-unicorns went to New York to raise capital from Americans eager for exposure to China’s explosive growth.​

American investors became dispensable, and thus vulnerable to expropriation.​

It started around 2014 with a wave of confiscatory “take private” transactions led by Chinese controlling shareholders. The objective was to delist U.S. shares at low buyout prices and later relist them in China at a much higher valuation.​

Consider the July 2016 take-private of Qihoo 360, an internet security firm. The founders squeezed out U.S. shareholders at $77 a share, reflecting a value of $9.3 billion. In February 2018, they relisted Qihoo on the Shanghai Stock Exchange at a valuation north of $60 billion. That’s a 550% return. Qihoo’s chairman personally made $12 billion upon relisting, more than he claimed the entire company was worth 18 months earlier.​

Public investors in a firm with a controlling shareholder always face the risk of an unfair take-private. But investors in U.S.-listed Chinese companies are particularly vulnerable. Most incorporate in the Cayman Islands. This jurisdiction affords investors much less protection than Delaware, home to most U.S. companies. Neither U.S. nor Cayman court judgments can be enforced in China, where insiders and assets are based. Chinese controllers can thus squeeze out the minority on terms that would make American controllers blush. More than 60 U.S.-listed Chinese companies have been taken private since 2013.​

Despite the warning signs, American investors continue lining up for Chinese initial public offerings. In fact, Chinese companies have raised more than $8.5 billion in U.S. markets this year, the most since 2014. This week, Tencent Music Entertainment went public in the U.S., raising about $1 billion at a valuation exceeding $20 billion.​

This form of predation allows the controlling shareholders to transfer to themselves the great bulk of the market value of the minority owners’ shares. The China Hustle fraud works by massively overvaluing the firms’ assets, capital, and profits. The predation scheme does the opposite. (Though the explanation it is beyond the scope of this article, shareholders need to know that the controlling person can use both the fraud and predation schemes at the same company at different times.)

“Unicorn” is investor jargon for an initial public offering (IPO) with $1 billion or more in capitalization. The op ed indicates the extraordinary scale and success of the predation. Bad economists’ dogma is that material predation is a fiction. The op ed shows that after literally tens of thousands of cases of predation by controlling shareholders against minority shareholders conducted over hundreds of years in hundreds of countries – it proved to be child’s play for none-to-sophisticated Chinese predators to fleece American shareholders out of billions of dollars. (As I often explain, the key to successful fraud is audacity, not genius.) Worse, the American investors were often purportedly sophisticated institutional investors. Still worse, the Chinese controlling shareholders’ predation scheme has been in successful action for over 15 years. To top it all off, the Chinese are still attracting record amounts of new money successfully from American investors despite having repeated the predation scheme 60 times in the last five years. Only laissez faire ideologues would believe this was impossible because predation was impossible.

The second remarkable fact is probably remarkable only to people like me, who spent a decade working with thousands of effective regulators. What the China Hustle accounting control fraud schemes and the predation schemes described have in common is that neither would be possible if the SEC and either the Bush, Obama, or Trump administration were not so utterly spineless for at least 15 years as to allow the fraud and predation schemes to persist. The Chinese context should have been the easiest context for the U.S. to deny the ability of Chinese corporations to list on the U.S. markets unless the SEC had the power to prevent fraud and contract provisions in the U.S. that China agreed in a binding fashion were enforceable in China. The SEC has not required such a grant of power as a condition of approving Chinese stock listings in the U.S. and has not insisted on enforceable contract terms to prevent predation. The SEC is not even asking for such powers, warning Americans not to invest in Chinese stocks, or seeking to ban such listings.

The Trump administration is making a great deal of noise about China being the great threat to the U.S., but it is refusing to act to prevent endemic fraud and predation against U.S. citizens by Chinese elites. The Chinese government is deeply complicit in these fraud and predation schemes. In January, the new House of Representatives should introduce a bipartisan bill to stop the Chinese fraud and predation schemes and hold oversight hearings on the SEC’s bipartisan failure to protect American investors.

The op ed, presumably due to space limitations, calls for no action. It ends with a wish that the authors know to be false. “Let’s hope investors price in the risk.” That ‘hope’ makes sense only if you believe in laissez fairey tales.


This entry was posted in China, Corporate governance, Regulations and regulators, Ridiculously obvious scams on December 18, 2018 by Jerri-Lynn Scofield.

https://www.nakedcapitalism.com/201...ng-control-fraud-predation-u-s-investors.html
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
The Case for Gold and Cryptocurrencies in the 21st Century.
maneco64


Published on Dec 19, 2018
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Share Talk Bulletin Board Heroes, Wednesday 19th December 2018
Share Talk


Published on Dec 19, 2018
A charting look at some of the most followed stocks on the London market, Zak Mir covers.

Bushveld Minerals (BMN)
Hummingbird (HUM)
Itaconix Plc (ITX)
Infrastrata (INFA)
Opg Power (OPG)
Regal Petroleum (RPT)

@ZaksTradersCafe deductive reasoning as to what should happen next in terms of the newsflow regarding the companies listed in this video.

Zakmir.com is a purely journalistic website – Zak Mir is a member of the National Union of Journalists. There is no intention here of providing financial advice. It is recommended you seek an independent professional opinion before deciding whether or not to take any action with regard to anything written here.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Futures Rise Ahead Of Fed; Europe Jumps On Italy Budget Deal


by Tyler Durden
Wed, 12/19/2018 - 07:16


S&P futures rose after yesterday's volatile session ahead of today's Fed decision, and European stocks jumped after Italy struck a crucial budget deal with the EU following a downbeat Asian session as oil tried to rebound after a furious three-day selloff that rattled global markets and sent investors scrambling into the safety of government bonds (in record numbers according to BofA).



The Stoxx Europe 600 Index gained 0.5% rising to session highs after four days of declines, with banking and healthcare stocks contributing the most to the gains, after the European Commission decided against launching a disciplinary procedure against Italy over its budget, while carmakers climbing on hopes of a breakthrough on trade.



Rome and Brussels ended their long-running feud over Italy’s 2019 budget, striking a deal on spending plans that had shocked investors and stoked tensions between the country’s populist government and the rest of the EU. Valdis Dombrovskis, the EU commission vice-president responsible for the euro, said the agreement that had been reached would lead to a budget deficit next year of precisely 2.04% of GDP and not a penny less or more compared with 2.4 per cent in Rome’s original plans.

Europe's rebound followed a weak Asian session which saw equities mostly lower after a disappointing market debut for SoftBank Group’s Japanese telecom business and amid cautious trade ahead of the FOMC rate decision, and after the attempted rebound on Wall St. where the S&P closed little above its 2018 low. Australia's ASX 200 (-0.2%) was pressured by oil names following the mass decline in the complex, while Nikkei 225 (-0.7%) initially traded with no firm direction amid a choppy JPY before digging deeper into losses and giving up the 21,000 handle.

Sentiment across the region was also reflected by the 10% plunge in Softbank’s mobile business in its USD 24bln market debut. Elsewhere, Hang Seng (+0.2%) and Shanghai Comp. (-0.5%) were mixed as the former was supported by financial names with the four large banks in positive territory. Meanwhile, mainland gains in real estates and utilities were offset by the decline in the energy and healthcare sectors. Finally, JGB futures posted the biggest intraday gain since 2016 on growing concerns over the global economy health, at one point triggering an emergency margin call for JGB futures after the 10Y note future spiked as it triggered stop losses.

Futures on the S&P 500 Index erased losses made in late trading on Tuesday after earnings from FedEx cast doubt on the strength of global trade, and were trading 25 points higher from session - and 2018 - lows of 2,530.95. FedEx, considered a bellwether for the world economy, slashed its 2019 forecasts, noting “ongoing deceleration” in global growth and sending S&P futures sharply lower early in the session only for market to quickly BTFD.



Even with today's rebound, US stocks are set for their worst December since 1931, the depths of the Great Depression.

“It’s a confluence of several important factors: the market is adjusting its outlook on growth and there is a consensus we will see a slowdown. More importantly, the market is adjusting to the idea this will translate into lower earnings growth,” said Norman Villamin, chief investment officer for private banking at Union Bancaire Privee in Zurich.

“It’s being complicated by the tightening liquidity situation with the Fed expected to move today and the ECB having signaled the end of its (stimulus)”.

Crude was mixed, trading unchanged after the biggest three-day slump since 2016 on slowing demand. Oil’s spectacular fall - down almost 10% since last Thursday - and world stocks’ plunge to 19-month lows spurred speculation the U.S. Federal Reserve might be done with tightening after its policy meeting later in the day. While WTI was unchanged at just above $46 after plunging 6 percent overnight, its 35% fall since October is sending a deflationary pulse through the world just as trade and economic activity are cooling.

Looking at today's Fed decision, Fed Fund Futures are sticking with a two-in-three chance of a rate rise on Wednesday and Villamin expects the Fed to move twice in 2019. That’s a more hawkish call than the broader market which is pricing less than one rise in 2019, down from three not long back.

“One thing I would like to see is what people are calling a dovish hike,” Ronald Temple, head of U.S. equity and co-head of multi asset at Lazard Asset Management LLC, told Bloomberg TV. “The hiatus on trade helps as well, but I’m a bit more skeptical about how long-lasting that is.”

Beyond the Fed, trade and politics remain the dominant themes. Unless Trump and Congress reach a deal, spending authority expires for a majority of the U.S. government on Friday night. Meanwhile, Treasury Secretary Steven Mnuchin said America and China are planning to hold meetings in January to negotiate a broader trade truce.

The expectations of a Fed pause and the equity selloff sent 10-year Treasury yields to the lowest since August at 2.799 percent down 20 bps in December - while two-year yields touched a three-month trough of 2.629 percent, sliding from November’s 2.977 percent peak. Meanwhile, as noted earlier, Italian debt surged after the European Commission was said to have decided against launching a disciplinary procedure against the country over its budget.



The yield on benchmark Japanese notes slipped to within striking distance of 0% before a rapid turnaround as the surge in demand triggered a margin call.

The Bloomberg Dollar Spot Index fell a third day as traders speculated the Fed may signal Wednesday that it’s approaching a pause in its rate-hike cycle; the greenback retreated versus most of its Group-of-10 peers. The euro advanced and Italian bonds surged to take yields to the lowest in nearly three months after the nation was said to have reached a technical agreement with EU officials over its budget. The pound was steady after U.K. inflation rate slowed to a 20-month low of 2.3% y/y, in line with estimates. The Norwegian krone led gains in G-10, rebounding from a one-year low against the euro, as oil prices stabilized

In commodities, Brent (+0.1%) and WTI (+0.1%) remain in close proximity to recent lows following from yesterdays significant losses where WTI dropped by 7.3%. Prices were mostly unreactive to the surprise 3.5mln barrel build in API crude inventories, where consensus has been for a draw of over 2mln barrels. Markets will be looking to see if EIA data later in the session confirms this build or if the crude stocks consensus of -2.475mln barrels is correct; if the build is confirmed it will be the first in 3 weeks and may generate new downward price pressure.

Gold is trading relatively flat after reaching a 5-month high of USD 1251.43/oz earlier in the session, with the yellow metal continuing to benefit from a softer dollar ahead of the FOMC decision. Elsewhere, profit margins at Chinese steel mills has significantly narrowed in November as the Chinese government has removed overall winter production restriction, now allowing cities and provinces to decide output curbs based on their emissions levels.

Market Snapshot
  • S&P 500 futures up 0.8% to 2,559.25
  • MXAP up 0.3% to 148.27
  • MXAPJ up 0.6% to 479.88
  • Nikkei down 0.6% to 20,987.92
  • Topix down 0.4% to 1,556.15
  • Hang Seng Index up 0.2% to 25,865.39
  • Shanghai Composite down 1.1% to 2,549.56
  • Sensex up 0.4% to 36,506.13
  • Australia S&P/ASX 200 down 0.2% to 5,580.60
  • Kospi up 0.8% to 2,078.84
  • STOXX Europe 600 up 0.1% to 340.95
  • German 10Y yield rose 0.8 bps to 0.252%
  • Euro up 0.4% to $1.1403
  • Italian 10Y yield fell 2.1 bps to 2.576%
  • Spanish 10Y yield fell 2.7 bps to 1.351%
  • Brent Futures up 1% to $56.83/bbl
  • Gold spot down 0.1% to $1,248.30
  • U.S. Dollar Index down 0.2% to 96.87
Top Overnight News from Bloomberg
  • The U.S. and China are planning to hold meetings in January to negotiate a broader truce in their trade war but are unlikely to have any face-to-face contact before then, according to Treasury Secretary Steven Mnuchin. READ: Xi’s defiant end to 2018 signals more U.S.-China tension ahead
  • Italy’s populist government is betting the European Commission will ratify an informal budget deal on Wednesday to avoid sanctions over its spending plans
  • U.K. Cabinet ministers agreed to implement “in full” plans for a no- deal break from the European Union, including 3,500 troops put on standby and 2b pounds ($2.5b) of funds made available for contingencies
  • Economic jitters and surging supplies from the U.S. to Russia hammered oil again, with crude suffering its biggest decline in more than three weeks
  • Japan’s exports rose 0.1% in November from a year earlier, broadly in line with estimates and reflecting a weakening pace
  • Thailand’s central bank raised its benchmark interest rate for the first time since 2011, joining peers in the region in tightening monetary policy this year
  • India’s rupee rallied with sovereign bonds as sliding oil prices improved the outlook for the nation’s finances and the central bank extended support via open-market debt purchases
  • Citigroup Inc. faces losses of as much as $180 million on loans made to an Asian hedge fund whose foreign-exchange wagers went awry, prompting board-level discussions and a business shakeup, according to a person briefed on the matter
Asian equities were mostly lower amid cautious trade ahead of the FOMC rate decision, and after the attempted rebound on Wall St. where the S&P closed little above its 2018 low, while the Dow Jones was supported by gains in Goldman Sachs. ASX 200 (-0.2%) was pressured by oil names following the mass decline in the complex, while Nikkei 225 (-0.7%) initially traded with no firm direction amid a choppy JPY before digging deeper into losses and giving up the 21,000 handle. Sentiment across the region was also reflected by the 10% plunge in Softbank’s mobile business in its USD 24bln market debut. Elsewhere, Hang Seng (+0.2%) and Shanghai Comp. (-0.5%) were mixed as the former was supported by financial names with the four large banks in positive territory. Meanwhile, Mainland gains in real estates and utilities were offset by the decline in the energy and healthcare sectors. Finally, JGB futures posted the biggest intraday gain since 2016 on growing concerns over the global economy health, while futures purchases were also exacerbated after BoJ kept 5-10yr purchases steady at JPY 430bln.

Top Asian News
  • China Watchers Split on Yuan Outlook; It Comes Down to Trade
  • Samsung’s 5G Network Grab Gets Boost With Huawei, ZTE Under Fire
  • Third Canadian Citizen Detained in China, National Post Says
  • Stocks Edge Up Before Fed Decision; Bonds Steady: Markets Wrap
Major European indices are in the green (Euro Stoxx 50 +0.5%(, with some outperformance seen in the FTSE MIB (+1.6%) with banking names such as UBI Banca (+4.0%) and Intesa Sanpaolo (+3.7%) benefitting from reports that the EU commission has accepted Italy’s 2019 budget deficit at 2.04%. Sectors are mixed with some outperformance seen in the telecom and consumer discretionary sector. Other notable movers include GlaxoSmithKline (+6.6%) in the green as they are to create a new healthcare joint venture with Pfizer estimated combined sales of GBP 9.bln. With Fresenius SE (+3.0%) following an upgraded to buy at Goldman Sachs. Whilst Natixis (-6.5%) are at the bottom of the Stoxx 600 after reporting Q4 revenue will be 10% lower than the previous year. Whilst postal names such as Royal Mail (-2.6%) and Deutsche Post (-4.5%) are down after FedEx cut their guidance.

Top European News
  • Europe Loses Taste for Punishing Russia as U.S. Toughens Stance
  • Italian Markets Rally as Budget Agreement Seen Reached With EU
  • U.K. Unveils Post-Brexit Migrant Plan for Skilled Workers
  • Electronics Retailer Ceconomy Latest Victim of Retail Crisis
In FX, the Dollar remains depressed in the run-up to the FOMC in anticipation of a dovish hike if not quite one more and done as a growing number of pundits look for the accompanying statement and guidance to be tweaked via the dot plots and/or removal of further gradual tightening. The index has duly retreated from another 97.000+ test and is holding just above recent lows ahead of 96.500, with the December base so far around 96.360 and ytd peak circa 97.710-715 the obvious bearish and bullish targets depending on the tone of the Fed.
  • EUR/AUD/NZD - All vying for top G10 spot and biggest gainer vs the flagging Greenback, but with the single getting an extra lift or rather relief bid on the back of Italy and EU agreement on the 2019 budget that is likely to be officially announced by Italian PM
  • Conte shortly. Eur/Usd has subsequently revisited 1.1400+ terrain, albeit just, while Aud/Usd has had another go at 0.7200 and the Kiwi is pivoting 0.6850 even though NZ current account data for Q3 was somewhat disappointing overnight. Note, decent option expiry interest may act as a drag on Eur/Usd with 1 bn at 1.1375 and the same amount between 1.1355-60 rolling off, while there is strong chart resistance ahead of 1.1450 at 1.1442 (earlier December peak) and 1.1445 (Fib).
  • JPY/GBP - Also firmer vs the Usd, with the former just off a marginal new mtd high, but perhaps restricted to an extent by option related flow as 1.2 bn resides between 112.00-05 and 1.5 bn sits from 112.40-50, while for the Yen there is also the BoJ’s final policy meeting of 2018 to consider just after tonight’s FOMC. Meanwhile, Brexit continues to put a brake on the Pound, or at least temper Sterling gains as Cable crests 1.2650 and Eur/Gbp hovers around 0.9000 with little reaction to broadly in line UK inflation data or a modest beat on CBI trends that seems to have been released early.
  • CAD/CHF - The marginal underperformers, with the Loonie still blighted by crude’s slump and diplomatic strains with China, but just off new ytd lows a fraction above 1.3500 ahead of Canadian CPI data, while the Franc meanders between 0.9910-35 and around 1.1300 vs the Eur.
In commodities, Brent (+0.1%) and WTI (+0.1%) remain in close proximity to recent lows, as global equity markets have begun stabilising, following on from yesterdays significant losses where WTI dropped by 7.3%. Prices were mostly unreactive to the surprise 3.5mln barrel build in API crude inventories, where consensus has been for a draw of over 2mln barrels. Markets will be looking to see if EIA data later in the session confirms this build or if the crude stocks consensus of -2.475mln barrels is correct; if the build is confirmed it will be the first in 3 weeks and may generate new downward price pressure.

Gold is trading relatively flat after reaching a 5-month high of USD 1251.43/oz earlier in the session, with the yellow metal continuing to benefit from a softer dollar ahead of the FOMC decision. Elsewhere, profit margins at Chinese steel mills has significantly narrowed in November as the Chinese government has removed overall winter production restriction, now allowing cities and provinces to decide output curbs based on their emissions levels. Saudi Finance Minister says the 2019 budget allocation to the energy industry, mining and logistics is over 3 times higher than in the previous budget.

US Event Calendar
  • 7am: MBA Mortgage Applications, prior 1.6%
  • 8:30am: Current Account Balance, est. $125b deficit, prior $101.5b deficit
  • 10am: Existing Home Sales, est. 5.2m, prior 5.22m; Existing Home Sales MoM, est. -0.38%, prior 1.4%
  • 2pm: FOMC Rate Decision; Interest Rate on Excess Reserves, est. 2.4%, prior 2.2%
DB's Jim Reid concludes the overnight wrap
Ahead of the Fed meeting conclusion today, yesterday had looked like we’d finally get a dull pre-Xmas session. However a sharp decline in oil prices late in the European session put pay to this. Indeed WTI and Brent tumbled -5.54% and -7.36%, respectively, sending WTI to $46.21/bbl and the lowest since August 2017. The price is also down almost 40% from the October highs just seven weeks ago. Despite the energy sector struggling (-2.35%), the S&P 500 ultimately closed flat, albeit that was after volatile intraday moves of +1.10% and -0.68%. Yesterday’s flat session at least snaps a losing streak of -3.95% over the previous two sessions, but leaving the S&P 500 still on track for its worst December since 1931. Europe struggled but in fairness was still playing catch up (or down) to the US with the STOXX 600 closing -0.82%. US HY underperformed yesterday with spreads +12bps wider. That means they are now +146bps wide of the October tights, and +88bps wider YTD. As recently as November 9th, spreads were still tighter than where they started this year.

The immediate catalyst for the oil move was the publication of Saudi Arabia’s budget plan, which included ambitious oil revenue targets of $177 billion for next year. To reach that number, the Kingdom is either assuming very unrealistic oil prices of around $80 per barrel, or they plan to pump more than the 10.2 million barrels per day target agreed earlier this month.Since the $80 per barrel figure is around 30% more than consensus estimates, the latter scenario looks more probable, which would equate to a significant increase in global supply and would end up being more bearish for prices.

Now to the Fed which starts a run of three central bank meeting outcomes over the next couple of days. Our US economists expect the Fed to raise rates for the fourth time this year (and a 20bp increase to the IOER) – which is in line with the consensus and market pricing. The more important question for our economists is what signal will the Committee send about its policy path in the coming years. They expect the message to be that the Fed remains upbeat on the outlook and expects to raise rates further in coming quarters, but that the pace of normalization is likely to slow next year from its recent quarterly rate as the Fed becomes more data dependent. Reflecting this, our colleagues expect the statement to modify the forward guidance language by noting that gradual increases remain appropriate in the “near term”.

Also worth keeping an eye on is the 2019 median dot which our team expect to fall from three hikes to two. This wouldn’t impact our house view for three hikes for next year and, in fact, if the Fed signals some flexibility around the pace of hikes, while maintaining the overall trajectory for the terminal rate, it could help to ease financial conditions which in turn makes three hikes more likely next year. We’ll know more tonight with the meeting outcome due at 7pm GMT and Powell’s press conference shortly after.

Interestingly, in our yield curve note from last week (link here ) we showed how 2s10s has inverted ahead of each of the last 9 recession. However there was one false positive ahead of the 1970 recession where this measure inverted 48 months before the recession. In our view the main reason for a false positive was due to the Fed easing policy via cutting rates in late 1966/early 1967. This was despite the fact that core inflation was on the rise and accelerated more as the fed funds rate declined, and ultimately therefore can be viewed as a policy mistake given that this uptick in inflation continued into the early 1970s. Curves subsequently steepened again in 1967 once the Fed cut rates, however they inverted once more in 1968 as tightening resumed and the Fed corrected its earlier error. The recession then eventually materialised in 1970 after the second inverted YC signal worked with a more normal time lag. We mention this as there could be parallels to today if the Fed responds dovishly to the recent wobbles in markets and recent softness in inflation. This could delay a slowdown (and curve inversion) but at the expense of exacerbating pressures in the labour market and generating higher inflation further down the line. So food for thought as we hit more challenging times for the Fed.

Ahead of today’s meeting, President Trump reiterated his view that the Fed shouldn’t hike, tweeting yesterday that “I hope the people over at the Fed will read today’s Wall Street Journal Editorial before they make yet another mistake. Also don’t let the market become any more illiquid than it already is. Stop with the 50 B’s”. The “50 B’s” reference apparently referred to the balance sheet roll off caps. That tweet did little to move Treasuries with yields lower across the curve – more reflecting the oil move. 10y yields ended -3.4bps lower and the 2s10s curve finished slightly steeper at 16.8bps. It had been a similar story for Europe too where bond yields were broadly 1bp to 2bps lower. Gilts were the exception with yields up 1.6bps however there didn’t appear to be any material new Brexit newsflow from yesterday’s Cabinet meeting.

Also on the cards today is the European Commission meeting to discuss Italy’s budget. Press reports (Bloomberg) suggested that the two sides have reached an informal agreement to avoid a launch of the excessive deficit procedure. Apparently, the deal will include delays to some of the newly planned social spending and a reduction in the size of other programs. Overall the new deficit is reported to be around 2.04% and includes EUR 4bn in cuts versus the original proposal. In an effort to prove their seriousness, the government will also cut their 2019 growth forecasts to 0.9-1.0% from 1.5%. This follows news (Corriere della Sera) that the Commission was still not satisfied by the latest plan presented by the government with the sticking point being that the Commission does not see a sufficient enough reduction in the structural deficit – the important condition to avoiding an EDP. We will find out more today as to whether both sides have indeed reached an agreement.

This morning in Asia markets are continuing to trade mixed with the Nikkei (-0.57%) and Shanghai Comp (-0.25%) trading lower while the Hang Seng (+0.16%) and Kospi (+0.69%) are trading up. In overnight news, the US Treasury Secretary Steven Mnuchin said that the US and China are planning to hold meetings in January to negotiate a broader truce in their trade wars but are unlikely to have any face-to-face contact before then. It’s also worth noting that the three-day annual economic policy-setting meeting of Chinese leaders kicks off today. This could have important policy implications for 2019 and beyond so watch for any headlines. Elsewhere, futures on the S&P 500 are up +0.57% despite FedEx’s stock price being down -5.55% in aftermarket trade as the company slashed its profit forecast for the current fiscal year and decided to pare its international air-freight capacity on account of a darkening view of demand for shipping services outside the US. Interestingly, FedEx has made a U-turn on its guidance just three months after raising it, reflecting an abrupt change in FedEx’s view of the global economy and indicating that the global macroeconomic headwinds are rising.

Meanwhile, yesterday’s data didn’t add a whole lot to the growth debate. The volatile housing starts and building permits series surprised to the upside in November with the former rising +3.2% mom (vs. 0.0% expected) and the latter +5.0% mom (vs. -0.4% expected). However, the rise was concentrated in the south of the US and represented some pay-back from weakness over the last few months, as hurricanes depressed regional activity. In Germany, there was some slight disappointment in the December IFO survey with the business climate reading down 1pt to 101.0 (vs. 101.7 expected) largely due to a drop in the expectations component of 1.4pts to 97.3 (vs. 98.4 expected). That is actually the lowest expectations reading since November 2014 and it appears that the IFO survey is now finally catching up with the slide in the Germany PMIs in recent months.

Looking at the day ahead, the highlight will no doubt be the Fed this evening however prior to that this morning we get November PPI in Germany and the November inflation data docket in the UK. The December CBI trends orders and selling prices survey for the UK is also out just before lunch while in the US we get the Q3 current account balance reading and November existing home sales data. The ECB’s Hansson is also slated to speak today while the other potentially important event to note is the aforementioned European Commission meeting to discuss Italy’s budget and the potential for enforcing the excessive deficit procedure.

https://www.zerohedge.com/news/2018-12-19/futures-rise-ahead-fed-europe-jumps-italy-budget-deal
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Naked Capitalism Links 12/19
https://www.nakedcapitalism.com/2018/12/links-12-19-18.html

SA - Market News Live Feed 12/19
https://seekingalpha.com/market-news

TBP - 10 Wednesday AM Reads 12/19
https://ritholtz.com/2018/12/10-wednesday-am-reads-125/

CWS - Morning News: December 19, 2018
http://www.crossingwallstreet.com/archives/2018/12/morning-news-december-19-2018.html

MtM - The Fed's Paws may Still Unsettle Investors 12/19
http://www.marctomarket.com/#!/2018/12/the-feds-paws-may-still-unsettle.html

SA - Wall Street Breakfast: One Rate Hike Over The Line? 12/19
https://seekingalpha.com/article/4229148-wall-street-breakfast-one-rate-hike-line

TCS - Short-Term Maturities Top US Bond Performances In 2018 12/19
http://www.capitalspectator.com/short-term-maturities-top-us-bond-performances-in-2018/

FC - CAD: Look For CAD To Underperform Vs EUR and GBP In 2019 – CIBC 12/19
https://www.forexcrunch.com/cad-loo...utm_campaign=Feed:+ForexCrunch+(Forex+Crunch)
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
BREAKING NEWS: FED DEFIES Trump and hikes interest rates despite the president's unceasing attacks on chair Jerome Powell and his plea to 'feel the market' and freeze increases

  • The Federal Reserve announced its decision on rates after extraordinary public pressure from the president
  • Hike of 2.5 per cent
  • Said more rate increases were appropriate
  • News wiped away morning 350 point gain in the Dow
  • Trump on Tuesday argued against a hike and urged the Fed to 'feel the market'
  • He has also attacked Fed Chair Jerome Powell in interviews and on Twitter
  • Decision comes amid a strong job market but some signs of economic cooling
  • A volatile market has wiped out 2018's stock market gains
  • The move impacts borrowing across the board
https://www.dailymail.co.uk/news/ar...tes-despite-presidents-unceasing-attacks.html
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Market Blood Continues After Federal Reserve Meeting!
StackingThreePercenter


Published on Dec 19, 2018
Thanks for tuning in today guys - very brief update here this afternoon on the market's reaction to today's FOMC meeting, along with the reactions of #gold and #silver.

Be sure to consider hitting SUBSCRIBE for all of my content!
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Scrappy Holidays or At Least We Thought... - 12/19/18
iScrap App


Published on Dec 19, 2018
Check Scrap Prices Today: https://iScrapApp.com/ - As you may have seen through our Facebook group or by going to your local yard to cash in before Christmas, it has been a rough month of December. With copper getting hit 10 cents yesterday alone, that has made copper sink to lows of 2018 and we are at the mercy of the markets right now. Gas prices have hit 15-month lows, and steel has not helped. Read more: https://iscrapapp.com/?p=1201309

Download the iScrap App:
Free iPhone App: https://iscrapapp.com/iOS
Free Android App: https://iscrapapp.com/Android

- Visit our blog for prices & news: https://iscrapapp.com/blog/
- US State Scrap Metal Laws: https://iscrapapp.com/scrap-laws/
- Get news delivered to your inbox: http://eepurl.com/DNJJH
- Buy an iScrap App T-Shirt: https://iscrapapp.com/shop

Facebook: https://www.facebook.com/iScrapApp
Twitter: https://twitter.com/iScrapApp
Instagram: http://instagram.com/iscrapapp/
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Ira Epstein's End of the Day Agriculture Video 12 19 2018
Ira Epstein


Published on Dec 19, 2018
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Ira Epstein's End of the Day Financial Video 12 19 2018
Ira Epstein


Published on Dec 19, 2018
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Fed Rate Hike & Statement Spooks Market: Precious Metals React
SalivateMetal


Published on Dec 19, 2018
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
The Fed Is an Instrument of Legal Plunder.
maneco64


Published on Dec 20, 2018
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Nutrien Ag Solutions Ag Forecast - Dec 20 2018
Agrible, Inc.


Published on Dec 20, 2018
Brought to you by Nutrien Ag Solutions.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
FED Raises Rates and Reveals Future Strategy - Markets fall in response
Illuminati Silver


Published on Dec 20, 2018
https://www.illuminatisilver.com

Today is Thursday 20th December 2018 and we are addressing and revealing to you our interpretation on the FED’s interest rate decision and future strategy.

At last the FED has now clearly communicated its future interest rate policy its goals and the markets do not like it.

Yesterday the FED raised interest rates in the US by 0.25% so the Fed's benchmark rate now ranges between 2.25% and 2.5%. It is the fourth rate hike this year and the ninth rise since Peter Schiff publicly declared that the FED can never raise rates some 3 years ago.

The immediate stock-market reaction was brutal with The Dow and S&P 500 closing down around 1.5 percent, while the tech-heavy Nasdaq lost more than 2 percent. Now many may ask why is this? The Fed Chair Jerome Powell intimated at the Press Conference that interest rates were only likely to rise twice next year as opposed to the envisaged 3 times.

Well we can tell you why. The Financial talking heads had persuaded themselves that the FED would take into account the protestations of President Trump, the slowing down of world economic growth and the strong but weakening US growth data. Its now forecast that growth for the US for 2018 would be 3% as opposed to 3.1% for the year. Instead the FED made its policy instantly clear – it was going to be a policy of symmetrical inflation around 2%.

When asked about political interference Jerome Powell’s response at a Press Conference after the rate rise announcement said:

"Political considerations play no role whatsoever in our discussions or decisions on monetary policy…. Nothing will deter us from doing what we think is the right thing to do."

The result of this rise and following current interest rates policy the FED admits that it expects lower growth next year. It projects the U.S. economy will expand 3% this year, and 2.3% in 2019, lower than the 2.5% it predicted in September – and this is the important part to note, it is comfortable with this.

Fed policymakers’ median forecast puts the federal funds rate at 3.1 percent at the end of 2020 and 2021.Gross domestic product is forecast to grow 2.3 percent next year and 2.0 percent in 2020. The unemployment rate, currently at a 49-year low of 3.7%, is expected to fall to 3.5% next year and rise slightly in 2020 and 2021.

Now that it is clear what the FED’s intentions are policy makers, businesses and institutions can plan accordingly. So we have a slightly dovish tone but with firm resolution to do whatever is necessary to keep inflation at that 2% level. What does this mean for gold and silver? Well; frankly moderately positive but do not expect to see any significant rises or falls any time soon.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Futures Whipsaw Violently In Aftermath Of Fed Hike Turmoil


by Tyler Durden
Thu, 12/20/2018 - 07:10


Markets whipsawed violently in the aftermath of the Fed's "less dovish than expected" rate hike, with European stocks sliding to 2 year lows, and Japanese stock entering a bear market as crude oil tumbled after another mini flash crash after the European open as the dollar slumped.



US equity futures initially rose, then tumbled sliding to a new 2018 low around midnight dragged lower by Asian market fears, then once again rebounded around the time EUrope opened, and were trading mostly flat as US traders walked in.



Investors “think the Fed has completely misjudged the situation and now it’s just a matter of just trying to find an exit while you can,” said Kyle Rodda, a market analyst at IG Group in Melbourne. “We’re probably entering a stage now where markets have got it their head that we’re preparing for quite sustained downside going into 2019.”

The sell-off that began Wednesday after Powell disappointed markets with a rate hike and a promise to keep reversing quantitative easing after downplaying the implications of market volatility, gathered pace in Asia and Europe. Markets were mostly spooked by Powell's comment that the process of unwinding QE is on "autopilot."



The Fed’s been a huge friend of the stock market and they are now a little bit of an enemy” and will probably become a worse enemy before this is all over, Bob Doll, Nuveen chief equity strategist and senior portfolio manager, said on Bloomberg Television.

The enemy was revealed in European trading, where more than three-quarters of Stoxx Europe 600 members declined, with the index sliding to the lowest level since December 2016. Major European Indices are in the red, continuing from the declines seen in Asia which were spurred by US equity markets hitting YTD lows in reaction to the FOMC rate target hike; with EUR strength weighing on European equity markets as the dollar declines. FTSE 100 (-0.4%) is the outperforming index despite being weighed on by poor performance in the mining and materials sectors. Shell (-1.8%) is weighing on both the FTSE 100 and the AEX (-1.5%) which is the underperforming index, also impacted by semiconductor ASML (-3.3%) in the red after Apple’s poor performance yesterday. Sectors are firmly in the red, with the aforementioned materials sector lagging.

Earlier in the Asian session, Japanese stocks entered a bear market as the last policy statement of the year from the BOJ added to mounting investor concerns, sending the yen to its strongest since mid-September. The Topix index fell 2.5%, extending its decline after the BOJ kept its policy unchanged. Electronics makers and telecommunications stocks were the biggest drags on the benchmark gauge, which closed almost 21 percent below its January high.



Some investors thought the drop in Japanese stocks went too far. “This is an adjustment on the market from a strongly crowded position, especially on U.S. equities, to a more normal level,” said Frank Benzimra, head of Asia equity strategy at Societe Generale. “I’m surprised at the reaction of the Japanese market, which I find a bit excessive.”

USD/JPY fell below 112 for the first time since Oct.; the yen was supported amid concerns about slowing global growth after the Fed said it still intends to raise interest rates two more times next year; yields on super-long JGBs dropped to five-month lows after the Bank of Japan kept policy unchanged.

Elsewhere in currencies, the dollar fell broadly, with the BBDXY sliding back under 1,200 while treasuries held most of their steep gain from Wednesday.



Sweden’s krona rose against all Group-of-10 peers after a surprise interest rate hike by the Riksbank which raised its policy rate by 25 bps, as expected by 10 of 24 economists in a Bloomberg survey; the krona rose as much as 1% against the euro to a three-day high, before paring gains as traders digested a lowered rate projection.

In other central bank news overnight, the BoJ left monetary policy steady with short-term rate target at -0.1% and JGB yield target at around 0.0%; unchanged as expected. The Central Bank maintained pledge to buy JGBs in a flexible manner with holdings to increase at a pace of JPY 80tln per annum. Forward guidance was unchanged with BoJ stating it "will keep current extremely low rates for an extended period of time". Board members Kataoka and Harada dissented on YCC as expected.

Also in Asia, the Hong Kong Monetary Authority raised rates by 25bps to 2.75% in lockstep with the Fed, as expected. HKMA stated that rising interest rates reflect normalization from a low-rate environment and more data in needed to determine if the local property market is in a downturn. Meanwhile, somewhat surprisingly the PBoC left interest and reverse repo rates unchanged, once again refusing to hike rates in lockstep with the Fed.

In another surprise move, the Swedish Riksbank raised rates for the first time in 7 years, to -0.25% vs. Exp. -0.5%. The bank's forecast for the Repo rate indicates the next hike will likely occur in the second half of 2019. Deputy Governor Jansson dissented the rate hike, and did not support the repo-rate path in the monetary policy report. The Riksbank also sees the repo rate averaging 0.48% in Q4 2020, vs. Prev. 0.66% forecast and, 0.98% in Q4 2021, vs. Prev. 1.23% forecast. The bank noted that even though inflation has been lower than expected, conditions remain good for inflation to stay close to the inflation target going forward. The hike sent the SEK sharply higher against all of its peers.

After posting a modest rebound on Wednesday, oil once again tumbled, sliding more than 3 percent in New York. Brent (-3.4%) and WTI (-3.5%) have continued to decline as concerns over slowing global growth and supply concerns continue to weigh on price; taking out USD 56 and USD 47 a barrel respectively. IEA’s Birol exerting additional pressure by stating that he does not expect a sharp oil price increase in the short term, and he expects serious US oil production growth to continue until 2025. In addition the El Sharara oil field is to reopen following the Libyan PM’s visit, although production has not yet restarted as workers are awaiting orders from state oil Co NOC.

Gold is firmly in the green benefitting from safe haven flows following the weaker dollar post-FOMC. Aluminium prices in London dropped to a 16-month low after aluminium producer Rusal confirmed that the US intends to lift sanctions on the Co which were imposed in April. Separately, China’s aluminium firms are to meet to discuss falling prices and lower demand for the metal.

Expected data include jobless claims and November’s Leading Index. Accenture, Blackberry, Carnival, Walgreens Boots, and Nike are among companies reporting earnings

Market Snapshot
  • S&P 500 futures little changed at 2,505.25
  • STOXX Europe 600 down 1.2% to 337.29
  • MXAP down 1.3% to 146.16
  • MXAPJ down 0.9% to 474.60
  • Nikkei down 2.8% to 20,392.58
  • Topix down 2.5% to 1,517.16
  • Hang Seng Index down 0.9% to 25,623.53
  • Shanghai Composite down 0.5% to 2,536.27
  • Sensex down 0.3% to 36,368.40
  • Australia S&P/ASX 200 down 1.3% to 5,505.82
  • Kospi down 0.9% to 2,060.12
  • German 10Y yield fell 1.7 bps to 0.222%
  • Euro up 0.8% to $1.1467
  • Italian 10Y yield fell 16.3 bps to 2.413%
  • Spanish 10Y yield rose 0.2 bps to 1.38%
  • Brent futures down 2.8% to $55.64/bbl
  • Gold spot up 1% to $1,255.60
  • U.S. Dollar Index down 0.7% to 96.37
Top Overnight News from Bloomberg
  • Fed Chairman Jerome Powell suggested he will be more cautious about raising rates next year after boosting them for the fourth time in 2018. “There’s significant uncertainty about both the path and the ultimate destination of any further rate increases,’’ he told a press conference
  • The Bank of Japan left its stimulus settings unchanged at its final policy meeting of the year, with Governor Haruhiko Kuroda acknowledging that risks are tilted to the downside; Japanese stocks entered a bear market
  • People’s Bank of China said it would supply lower-cost liquidity for as long as three years to banks willing to lend more to smaller companies, as policy makers roll out targeted measures aimed at shoring up the flagging economy
  • New Zealand’s economy grew at half the pace economists predicted in the third quarter, suggesting inflation will remain subdued and raising the possibility the central bank may cut interest rates.
  • Australia’s labor market softened a little in November in a setback for the Reserve Bank’s drive for higher wages and faster inflation
  • Special Counsel Robert Mueller will be cautious about implicating President Donald Trump -- or even a thinly disguised “Individual-1” -- directly in criminal activity in legal filings he’s expected to issue in the next few months, according to people familiar with his investigation
  • Soros Fund Management has reduced most of its macro wagers, moving away from the strategy that made George Soros a billionaire, according to people familiar with the changes
Asian equities drowned in a sea of red following the decline seen on Wall Street post-FOMC where the Dow, S&P 500 and Nasdaq all dived to fresh YTD lows and tech-giant Apple sunk over 3%. ASX 200 (-1.3%) was mostly pressured by the material sector as metals fell with the Fed-induced USD strength, similarly Nikkei 225 (-2.8%) retreated further below the 21,000 handle to levels last seen in September 2017 as its heavy mining sector slumped, while a firmer JPY further distressed the benchmark. Elsewhere, Shanghai Comp. (-0.5%) was weighed on by financial names (China Banks sector -2.3%) after the PBoC refrained from raising reverse repo rates following the FOMC and HKMA 25bps hikes. Meanwhile, Hang Seng (-1.0%) was pressured by the regional risk sentiment alongside weakness in the property and financial sectors, on the flip side, shares in Rusal provided the industrial sector with modest support after spiking higher in excess of 20% after the reports that US will terminated sanctions against the company.

Top Asian News
  • China, Canada Said to Discuss Third Detainee’s Return, Post Says
  • Asia Stock Carnage Deepens as Hopes Fizzle With Policy Updates
  • Developer Jiayuan International Jumps By Record 25% in Hong Kong
  • Bank Indonesia Pauses Rate Hikes as Fed Turns Cautious
  • Emerging Markets Seen Coming Back From Dour 2018 Led by Brazil
Major European Indices are in the red [Euro Stoxx 50 -1.5%] continuing from the declines seen in Asia which were spurred by US equity markets hitting YTD lows in reaction to the FOMC rate target hike; with EUR strength weighing on European equity markets as the dollar declines. FTSE 100 (-0.4%) is the outperforming index despite being weighed on by poor performance in the mining and materials sectors with index heavyweights Anglo American (-3.1%), Rangold Resources (-2.6%) and Rio Tinto (-2.6%) in the red. Shell (-1.8%) is weighing on both the FTSE 100 and the AEX (-1.5%) which is the underperforming index, also impacted by semiconductor ASML (-3.3%) in the red after Apple’s poor performance yesterday. Sectors are firmly in the red, with the aforementioned materials sector lagging. Other notable movers include Wirecard (-3.7%) who are at the bottom of the DAX (-0.9%) following a article stating the Co only has a 5-10% share in German online transactions

Top European News
  • U.K. Retailers Get Black Friday Boost as Sales Surge
  • Bang & Olufsen Loses Quarter of Its Value on Lower Forecast
  • Societe Generale to Take $123 Million Charge on Serbia Sale
  • London Gatwick Airport Shut by Drone Scare Amid Holiday Rush
  • After Brexit and Italy, Poland Shows Cost of Clashing With EU
In FX, the Dollar has recoiled sharply from initial recovery highs seen after the Fed delivered its latest 25 bp hike, but not quite the dovish future guidance that most seemed to be anticipating. However, 2019 dot plots were trimmed to 2 from 3, the neutral rate was shaved to 2.8% from 3% and the accompanying statement was tweaked to a degree in terms of the amount of further policy normalisation in the current cycle. Hence, on reflection the FOMC has shifted towards a more cautious stance, and this was highlighted by Chair Powell in the post-meeting press conference, particularly with regard to subdued if not expressly declining inflation pressure. The upshot, an unwind and part-reversal in the Usd and index through pre-FOMC lows around 96.200.
  • SEK - In stark contrast to the Greenback’s relatively abrupt U turn, the Swedish Crown received a semi-surprise boost from the Riksbank that raised the repo rate by ¼ point against majority, albeit not unanimous by any means market expectations. Indeed, Eur/Sek has tested 10.2500 vs almost 10.3700 at one stage ahead of the contentious final policy meeting of the year, even though the decision to hike was contested by one Board member and came with a shallower projected tightening path out to 2021.
  • EUR - The single currency is heading gains vs the back-pedalling Usd and finally cleared recent highs just ahead of 1.1450 on its way to circa 1.1485 and mega option expiries/barriers at 1.1500 (5.6 bn) that also coincide with early November peaks
  • CHF/GBP/JPY - All benefiting from the aforementioned Dollar demise, with the Franc breaching 0.9900 resistance and perhaps also aided by a widening Swiss trade surplus. Similarly, Cable has overcome a sticky level around 1.2650 to briefly peer above 1.2700 despite ongoing Brexit uncertainty and helped in part by a strong pre-Xmas UK retail sales update, but highly unlikely to derive any further purchase from the BoE that is unanimously seen standing pat. Meanwhile, broad risk-off sentiment/positioning and even flatter yield curves have sparked strong demand for the Jpy that has now rallied through 112.00 to just over 111.70, even though Japanese monetary authorities are monitoring the situation and BoJ Governor Kuroda maintains the option of further easing if needed following an unchanged final policy meeting of the year.
  • AUD/NZD/CAD - The Aud is markedly outperforming vs its fellow non-US Dollars, albeit within a significantly lower range vs its US counterpart around 0.7100, as the Kiwi is undermined by much weaker than forecast Q3 GDP overnight and ANZ’s dovish call for a 25 bp RBNZ rate cut. Nzd/Usd is languishing below 0.6800 and the Aud/Nzd cross is back over 1.0500 accordingly. Elsewhere, sliding crude prices and the Canadian-Chinese diplomatic situation continues to weigh heavily on the Loonie, but the Cad has rebounded from 1.3500+ lows to circa 1.3450.
  • EM - Regional currencies now all in the ascendency vs the Usd and regaining lost ground after the initial Fed fall-out and rout in risk assets.
In commodities, Brent (-3.4%) and WTI (-3.5%) have continued to decline as concerns over slowing global growth and supply concerns continue to weigh on price; taking out USD 56 and USD 47 a barrel respectively. IEA’s Birol exerting additional pressure by stating that he does not expect a sharp oil price increase in the short term, and he expects serious US oil production growth to continue until 2025. In addition the El Sharara oil field is to reopen following the Libyan PM’s visit, although production has not yet restarted as workers are awaiting orders from state oil Co NOC. Gold is firmly in the green benefitting from safe haven flows following the weaker dollar post-FOMC. Aluminium prices in London dropped to a 16-month low after aluminium producer Rusal confirmed that the US intends to lift sanctions on the Co which were imposed in April. Separately, China’s aluminium firms are to meet to discuss falling prices and lower demand for the metal.

US Event Calendar
  • 8:30am: Philadelphia Fed Business Outlook, est. 15, prior 12.9
  • 8:30am: Initial Jobless Claims, est. 215,000, prior 206,000; Continuing Claims, est. 1.66m, prior 1.66m
  • 9:45am: Bloomberg Consumer Comfort, prior 59.4; Bloomberg Economic Expectations, prior 56
  • 10am: Leading Index, est. 0.0%, prior 0.1%
https://www.zerohedge.com/news/2018-12-20/futures-whipsaw-violently-aftermath-fed-hike-turmoil
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Naked Capitalism Links 12/20
https://www.nakedcapitalism.com/2018/12/links-12-20-18.html

SA - Market News Live Feed 12/20
https://seekingalpha.com/market-news

TBP - 10 Thursday AM Reads 12/20
https://ritholtz.com/2018/12/10-thursday-am-reads-221/

CWS - Morning News: December 20, 2018
http://www.crossingwallstreet.com/archives/2018/12/morning-news-december-20-2018.html

MtM - Forex Forensics: The Case of the Yen 12/20
http://www.marctomarket.com/#!/2018/12/forex-forensics-case-of-yen.html

SA - Wall Street Breakfast: Did Powell Poke The Bear? 12/20
https://seekingalpha.com/article/4229350-wall-street-breakfast-powell-poke-bear

TCS - Treasury Inflation Forecasts Continue Falling After Fed Rate Hike 12/20
http://www.capitalspectator.com/treasury-inflation-forecasts-continue-falling-after-fed-rate-hike/

FC - Was it a dovish or a hawkish hike? Wall Street will determine soon 12/20
https://www.forexcrunch.com/was-it-...utm_campaign=Feed:+ForexCrunch+(Forex+Crunch)

MtM - Stocks Slump and the Dollar Slides as Market Concludes Fed is Mistaken 12/20
http://www.marctomarket.com/#!/2018/12/stocks-slump-and-dollar-slides-as.html
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
TVR [# ] 12-19-2018 LIVE CHAT FOMC
ALGO CAPITALIST


Published on Dec 20, 2018
Please remember to RATE, SHARE, FAVORITE, COMMENT AND SUBSCRIBE.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
What Fed Carnage Means for Silver, Gold, and the Economy
Silver Fortune


Published on Dec 20, 2018
Stocks were sent reeling after the Fed decision yesterday, but somehow, I don't think this is over.

Support Silver Fortune, shop at SD Bullion! Free shipping over $99, and a 1 oz. round for new customers! sdbullion.com/sf
(I am compensated by SD Bullion when the at spot round is claimed by new customers)

Support Silver Fortune through Patreon: https://www.patreon.com/silverfortune

International Silver Syndicate poured silver, featuring various popular YouTube silver and gold channels, including your's truly: https://mkbarzandbullion.com/pages/in...
(MK Barz does offer a small share of profits to channels featured on the ISS bars)

Any content within this video or any other video by the Silver Fortune channel is merely one man's opinion, commentary, and analysis, or actual information obtained from elsewhere, and should not be constituted as legal, investment, or financial advice. Make your own financial decisions, or consult a professional if you'd prefer to go that route. The Silver Fortune channel disclaims any liability for legal, financial, or investment decisions made.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Ira Epstein's End of the Day Agriculture Video 12 20 2018
Ira Epstein


Published on Dec 20, 2018
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Ira Epstein's End of the Day Financial Video 12 20 2018
Ira Epstein


Published on Dec 20, 2018
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Asian Metals Market Update: Dec 21 2018
By: Chintan Karnani, Insignia Consultants
Gold needs a close over $1260 and silver needs a close over $1490 today to zoom next week. Volumes will be there from Asia. Trading volumes will be down next week but not zero. Holiday goers will enjoy as petrol/diesel prices are low. The current market situation is that one should not leave any open positions while on holiday. Anything can happen. Apart from economics everything can affect gold, silver, energies and precious metals.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
The Yen Carry Trade and the Health of the Financial Markets.
maneco64


Published on Dec 21, 2018
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Global Markets Ends Miserable Week In Sea Of Red


by Tyler Durden
Fri, 12/21/2018 - 07:08


Call it the "Satan rally."

Global markets are set to end a miserable week, one where stocks were expected to levitate into the holidays on the back of a belated Christmas rally, in a sea of red with S&P futures sliding and Asia and Europe sharply lower.



Sentiment is so dismal that not even an explicit promise of fiscal and monetary stimulus from China evinced more than a shrug from traders who barely responded to the overnight news of "significant" tax cuts and more monetary stimulus from Beijing which was released after the annual Economic Work Conference concluded in Beijing on Friday.



Perhaps this is the result of fears that the trade issue won't be resolved any time soon given the latest U.S. accusations over spying. whatever the reason for the muted reaction, markets no longer see mere promises out of China for "more" as anything more than just failed attempts at jawboning, especially after last night's terse official statement by China's foreign ministry that the Chinese government has never participated or supported any stealing of trade secrets, and urged the U.S. to correct its own cyber espionage wrongdoings and withdraw indictment of Chinese nationals.

Meanwhile, traders were far more focused on the rising threat of an extended U.S. government shutdown which together with further hikes in U.S. borrowing costs compounded investor anxieties over the trajectory of global economic growth.

“China is cooling and the euro zone is slowing down, and some of the economic indicators from the U.S. have been a bit soft recently, but yet the Fed hiked rates and suggested that two more interest rate hikes were lined up for 2019,” said Michael Hewson, chief markets analyst at CMC Markets in London who added that speculation the U.S. economy could be headed for a recession has picked up, dampening global sentiment. “Fear about a U.S. government shutdown is playing into the mix too.”

European shares opened in negative territory, following in the footsteps of Thursday's U.S. rout and sharp drop in Asian markets. The European STOXX 600 index fell over half a percent, continuing its slide towards lows not seen since the end of 2016, and is less than 2% away from a bear market.

Most European bourses and industry indexes were in the red after the S&P 500 fell overnight, heading for its worst quarter since the days of the financial crisis in late 2008, with a loss of 15% so far. The Nasdaq, which briefly entered a bear market on Thursday, has shed 19.5% from its August peak.

Earlier in the session, the MSCI All-Country World index was down 0.2%. It was set for its worst week since March. In Asia, Japan’s Nikkei lost 1.1% to close at its lowest since mid-September last year, after giving up 5.6% this week. Australian stocks slipped 0.7% , hovering just above a two-year trough hit earlier in the session. Meanwhile in China, China's Shanghai Composite lost 0.8% after the United States accused Beijing of orchestrating the hacking of government agencies and companies around the world.

After the Fed sparked the biggest Fed-announcement day selloff in over a decade with a not-dovish-enough-hike, markets were further spooked when President Trump refused to sign legislation to fund the U.S. government unless he received money for a border wall, thus risking a partial federal shutdown on Saturday.

“Political brinkmanship in Washington is further heightening market uncertainty,” said Westpac economist Elliot Clarke. “Friday will be a tense day in Washington, and for financial markets, as a last-minute compromise is sought.”

Making things worse, political pundits now say that the government shutdown may last far longer than some suspect, potentially impacting risk assets as well.

Adding to the sense of crisis was news U.S. Defense Secretary Jim Mattis had resigned after Trump announced a withdrawal of all U.S. forces from Syria and sources said a military pullback from Afghanistan was on the cards.

The brittle mood culminated in another bloodbath on Wall Street where the Dow ended Thursday with a loss of 1.99%, the S&P 500 dived 1.58% and the Nasdaq closed 1.63% lower.

The mood change has triggered a rush out of crowded trades, including massive long positions in U.S. equities and the dollar and short positions in Treasuries. Lipper data showed investors pulled nearly $34.6 billion out of stock funds in the latest week and were heading for the biggest month of net withdrawals on record.

In rates, yields on the 10-year U.S. Treasury were back up to 2.795% after hitting their lowest since early April at 2.748% on Thursday’s bid to safety. As recently as October, they had been at a seven-year top of 3.261 percent. The gap between two- and 10-year yields was back up to just 12 bps, after flattening to single digits overnight.

In currency markets there was also a sense of capitulation as the dollar dived 1.1% on the yen on Thursday to hit a three-month trough at 110.80. However, the dollar rebounded on Friday, rallying to a session high in early London hours, snapping four days of losses against the euro. Still, the dollar was headed for its worst week in nine months, before a plethora of U.S. data releases and hefty expiries in the majors currencies.

The euro dipped 0.1 percent to $1.1430, having jumped to its highest in over six weeks at $1.1485. The pound was steady, even as data showed the U.K. current-account deficit stood at its highest in two years in the third quarter. The yen also held its ground; the Japanese currency headed for its best week versus the dollar since February. New Zealand and Australian dollars were the worst performers; the Aussie headed for a third straight weekly loss, the longest run since July.

Oil prices, which slid just over 4 percent on Thursday, continued their slide: Brent (-2.0%) and WTI (-1.0%) have seen a further decline in prices amidst ongoing concerns over global growth and excess supply. Recent news flow has seen comments from Russian Energy Minister Novak that they are sticking to plan to cut oil production by 228,000 BPD with Russian oil producers confirming their readiness to cut output.

Gold prices which remained steady for much of the session dropped into the red as the dollar strengthened, although the yellow metal is still within a narrow USD 5/oz range on the day. Elsewhere, Chinese aluminium producers are estimated to cut more than 800,000 tonnes of capacity each year according to Antaike although no specific time period is given; for reference Chinese smelters have closed over 3.2mln tonnes of capacity in 2018.

In terms of data, all eyes will be on U.S. inflation numbers due later on Friday, day, which include the Federal Reserve’s preferred measure of core inflation. Expected data include GDP, durable goods orders, and personal income and spending. CarMax is reporting earnings

Market Snapshot
  • S&P 500 futures down 0.7% to 2,468.75
  • STOXX Europe 600 down 0.7% to 334.12
  • MXAP down 0.7% to 145.05
  • MXAPJ down 0.3% to 472.46
  • Nikkei down 1.1% to 20,166.19
  • Topix down 1.9% to 1,488.19
  • Hang Seng Index up 0.5% to 25,753.42
  • Shanghai Composite down 0.8% to 2,516.25
  • Sensex down 1.8% to 35,765.37
  • Australia S&P/ASX 200 down 0.7% to 5,467.64
  • Kospi up 0.07% to 2,061.49
  • German 10Y yield rose 1.4 bps to 0.242%
  • Euro down 0.2% to $1.1420
  • Italian 10Y yield fell 3.4 bps to 2.379%
  • Spanish 10Y yield rose 0.6 bps to 1.38%
  • Brent futures down 1.1% to $53.73/bbl
  • Gold spot down 0.1% to $1,258.24
  • U.S. Dollar Index up 0.3% to 96.60
Top Overnight News
  • China’s top policy makers said ‘significant’ cuts to taxes and fees will be enacted in 2019, and signaled an easier monetary policy stance, as the government tries to put a floor under the economic slowdown
  • The U.S. government is just hours away from a partial shutdown with Congress at an impasse over funding President Donald Trump’s border wall
  • Italy’s government is expected to seek a key vote on its 2019 budget bill in Rome late on Friday, according to a Senate official
  • U.K. Prime Minister Theresa May’s senior team are wrestling with the question of what to do if her Brexit divorce deal is thrown out by lawmakers. In private, the options on the table include postponing the divorce, calling another referendum or even announcing fresh elections
Asia-Pac stocks were lower across the board as the global stock rout continued into the region following the losses in US amid fears of a government shutdown. The DJIA posted a fifth consecutive session in the red as the index fell to a 14-month low, while the Nasdaq briefly dipped into bear market territory amid weakness in Amazon and Apple, meanwhile the S&P printed its sixth day of back-to-back losses. ASX 200 (-0.7%) hovered at a two-year low as the index felt pressured by financial names as the “Big Four” banks sat firmly in the red, alongside insurance names (ASX 200 Insurance Index -0.8%) amid a large number of claims after severe thunderstorms in Sydney. Nikkei 225 (-1.3%) fell deeper into bear market as regional shares were poised for the worst week since October, with downside exacerbated by the firmer JPY.

Elsewhere, Shanghai Comp. (-1.1%) opened with firm losses and extended the decline as the Mainland suffered from losses in financials and real estate names. Hang Seng (+0.5%) rebounded off intraday lows after heavyweight Tencent spiked higher by over 4% after the Chinese government hinted at lifting a nine-month long block on the release of new online games.

Top Asian News
  • Tencent, Peers Rally on Reports China Resumes Game Approvals
  • It’s Only Getting Worse for Asian Shares Set for 21-Month Low
Main European Indices are in the red [Euro Stoxx 50 -0.7%] with equity markets following the losses seen in Asia. Outperformance is seen in the FTSE 100 (-0.2%) after Anglo American (+1.6%) are up after resuming operations in their Minas-Rio iron ore plant; with other mining names such as Antofagasta (+2.3%), Glencore (+1.2%) and Rio Tinto (+1.0%) also in the green. Sectors are similarly in the red, with some outperformance seen in the materials sector. Other notable movers include Just Eat (+3.9%) who are up in sympathy after Delivery Hero (+9.0%) sold their German assets to takeaway.com. Danske Bank (-1.8%) firmly in the red after issuing their second profit warning for 2019.

Top European News
  • Macron’s Little Helper CEOs Spread Holiday Cheer With Bonuses
  • London Gatwick Open With Mammoth Backlog as Drones Disappear
  • Credit Suisse Pushes On in Wealth Market That UBS Abandoned
In FX trading, the Greenback has rebounded from overnight lows and the index appears to be forming a firmer base above 96.000, albeit thanks in part to counterpart currency weakness as broad risk sentiment remains bleak ahead of the festive break. Indeed, the DXY has ventured back over 96.600 vs 96.241 at one stage and a post-FOMC low of 96.163 ahead of a packed release schedule on the final full trading session of the year.
  • NZD/AUD - The Kiwi has extended losses vs its US peer in wake of Thursday’s much weaker than expected NZ GDP data, news that the RBNZ is mulling a 2-fold increase in bank reserve holdings of high grade assets and a call by one prominent regional bank for the OCR to be cut by 25 bp late next year. Nzd/Usd is hovering around 0.6725 and Aud/Nzd is holding above 1.0500 even though the Aussie Dollar has fallen in sympathy and under the weight of broader risk aversion, not to mention another US-China spat that could derail efforts to resolve trade issues. Aud/Usd is pivoting 0.7100 with a hefty 2.1 bn option expiry at the strike perhaps exerting a gravitational pull.
  • CHF/CAD/EUR - All succumbing to the latest Usd revival, as the Franc slips back below 0.9900 and Loonie hits fresh, albeit marginal new 2018 lows circa 1.3535 against the backdrop of still precarious crude prices, ahead of top tier and potentially pivotal Canadian data in the form of GDP and retail sales. Meanwhile, the single currency continues to mirror Dollar moves and perhaps respect more technical/flow-related levels with another fade ahead of 1.1500 and the 100 DMA at 1.1482 culminating in a drift back towards 1.1400 where 1.4 bn expiries reside.
  • JPY/GBP - Both holding up relatively well, if not quite bucking the overall trend, although the Jpy is displaying its characteristic greater allure in risk-off climes and trades near the top of a 111.05-45 range. Cable is also pretty restrained between 1.2700-1.2645, with a raft of UK data largely shrugged off in the Brexit hiatus and consolidation in vogue before Xmas and New Year.
In commodities, Brent (-2.0%) and WTI (-1.0%) have seen a further decline in prices amidst ongoing concerns over global growth and excess supply. Recent news flow has seen comments from Russian Energy Minister Novak that they are sticking to plan to cut oil production by 228,000 BPD with Russian oil producers confirming their readiness to cut output. Separately, IEA’s Birol has commented that US oil production will equal the combined production of Russia and Saudi Arabia by 2025.

Gold prices which remained steady for much of the session have dropped into the red as the dollar has strengthened, although the yellow metal is still within a narrow USD 5/oz range on the day. Elsewhere, Chinese aluminium producers are estimated to cut more than 800,000 tonnes of capacity each year according to Antaike although no specific time period is given; for reference Chinese smelters have closed over 3.2mln tonnes of capacity in 2018. As according to the International Copper Study Group global refined copper market had a 168,000 tonnes deficit in September compared to 43,000 tonnes in August.

Looking at the day ahead, in the US we’ve got a packed agenda. First up is the third and final Q3 GDP revisions where no change is expected from the +3.5% qoq saar print. Also due are preliminary November durable and capital goods orders data, while not long after that we get the November PCE report. The consensus is for a +0.2% mom reading which would be enough to push up the annual rate to +1.9% yoy. Finally, we’ll get the final December University of Michigan consumer sentiment survey readings and the December Kansas City Fed manufacturing survey. We should note that today is also a quadruple witching day for stock markets, so it wouldn’t be a great surprise to see a pick-up in volatility towards the end of the session.

US Event Calendar
  • 8:30am: GDP Annualized QoQ, est. 3.5%, prior 3.5%
  • 8:30am: Personal Consumption, est. 3.6%, prior 3.6%
  • 8:30am: Core PCE QoQ, est. 1.5%, prior 1.5%
  • 8:30am: Durable Goods Orders, est. 1.6%, prior -4.3%; Durables Ex Transportation, est. 0.3%, prior 0.2%
  • 8:30am: Cap Goods Orders Nondef Ex Air, est. 0.2%, prior 0.0%; Cap Goods Ship Nondef Ex Air, est. 0.2%, prior 0.3%
  • 10am: Personal Income, est. 0.3%, prior 0.5%; Personal Spending, est. 0.3%, prior 0.6%
  • 10am: PCE Deflator MoM, est. 0.0%, prior 0.2%; YoY, est. 1.8%, prior 2.0%
  • 10am: PCE Core MoM, est. 0.2%, prior 0.1%; PCE Core YoY, est. 1.9%, prior 1.8%
  • 10am: U. of Mich. Sentiment, est. 97.4, prior 97.5; Current Conditions, prior 115.2; Expectations, prior 86.1
  • 11am: Kansas City Fed Manf. Activity, est. 12.5, prior 15
DB's Jim Reid concludes the overnight wrap
Welcome to the last EMR of 2018 and shortest/longest day of the year depending on where you’re reading this. 2018 has been like a rebellious teenager suddenly aware of their own mind, independence, and the world around them after years of being guided and cajoled in everything they do. For us, peak QE moving to QT and the Fed raising rates four times this year has been enough to reverse a significant amount of the liquidity-inspired asset price returns of the pre-tightening era. A bit like Road Runner galloping off the cliff only to suddenly look down. In today’s pdf (towards end) we update our chart of the percentage of global assets down on a dollar adjusted basis each year since 1901. 2018 continues to the be the worst year on record on this measure with 93% of assets currently down.

This chart has been the most requested chart we’ve ever been involved in, which hopefully doesn’t say anything about the quality of our previous work. We think 2019 will again be difficult for the same reasons we thought 2018 would be, but believe that, in the short term, markets have overreacted and gone too far too quickly. So we think a Q1 rally could be on the cards, even if the year ends up being tough. We still think the risks of a 2020 downturn are elevated but think the short-term US economic risks are relative low.

Whether a downturn materialises or not after the end of next year, markets could price it in increasingly as 2019 develops, which would be a problem. However, nothing is preordained and perhaps the most likely way this cycle could be extended for longer is via a policy error from the Fed (not tightening into higher inflation) or if inflation genuinely rolls over here. If they end up not raising rates in 2019 for either reason then this could steepen curves, help risk, and prolong the cycle. So all to play for still. Nothing is set in stone.

As you read this I will be just about to start a 12-hour drive to the Alps which always takes us nearer 18 hours with stops - planned or in response to events! I bought all three of the children very cheap tablets to watch various stuff on with the aim to reduce the crying/travel time at the cost of potentially ruining their upbringing. Thank you for all the support, interaction and for reading this year. Happy Christmas and NY to all of you and your families from Craig, Quinn, and myself. As a passing note before we review markets one last time I thought I would do my usual list of favourite book, film, TV show and album of the year. Favourite book was “The Spy and the Traitor” - Ben MacIntyre. A remarkable true story of a double agent that reads like fiction. Favourite film was “The Guernsey Literary and Potato Peel Pie Society”. This is utterly sentimental but very sweet and I only watch 5 or 6 films a year nowadays and all at home so not much to choose from. I think the others were “The Darkest Hour”, “Molly’s Game”, “I Tonya”, “Game Night”, and “All the Money in the World”. I enjoyed them all. Best TV was probably “Bodyguard” for its gripping absurdity and the fact that almost everyone in the U.K. watched it. Closely behind were “Better Call Saul”, and “A Very British Scandal”. I fully expect the best TV of 2019 to be the final series of Game of Thrones which hopefully will be out just as I move into my new house with a big new TV in April. Best album is difficult as I only stream things these days but I’d say The 1975 - “A Brief Inquiry into online relationships” or Paul Weller - “True Meanings”. Feel free to send me your lists!!!

The last EMR of the year from us sees markets continuing the recurring nightmare seen of late with no circuit breaker in sight at the moment. Indeed, the S&P 500 tumbled -1.58% and has now dropped -5.10% this week alone and is now down -10.61% in December.The NASDAQ fell -1.63% and on a closing level has now dropped -19.73% from the intraday highs at the end of August, and therefore just shy of closing in bear market territory after trading there intra-day. The NYSE FANG index also tumbled -3.42% (down -28.03% from the YTD peak) while in Europe the STOXX 600 finished -1.45% to close at a fresh two-year low. The DAX, CAC, and IBEX fell -1.44%, -1.78%, and -1.97% respectively to reach new multi-year lows as well. Meanwhile US HY credit ended another +20bps wider yesterday in cash terms which means spreads are 60bps wider this week alone with one day left to play.That's within two basis points of the worst week of the last four years, which was +62bps in December 2015, which incidentally was the week before the Fed executed its first rate hike of the cycle, and also came shortly before the Fed ended up walking back its planned pace of rate hikes.

As for the yield curve watch, the US 2s10s touched an intraday low of 9.5bps and therefore eclipsed the intraday lows from December 4th. It nevertheless steepened +2.9bps on the day to 13.6bps however this morning in Asia is trading at 12.2bps. Interestingly, despite the risk off Treasury yields were broadly 2-5bps higher across the curve yesterday. In Europe bond markets were generally stronger yesterday led by BTPs (-3.6bps) while Gold (+1.35%), which has been the other strong performer since the October selloff, also rose.

Back to this morning in Asia where sentiment has failed to improve and markets are continuing to follow Wall Street’s lead with the Nikkei (-1.51%), Hang Seng (-0.25%), Shanghai Comp (-1.09%) and Kospi (-0.35%) all down. Elsewhere, futures on S&P 500 are down -0.30% and oil prices (WTI +0.78% and Brent +0.57%) are up following yesterday’s decline (more on this below). As for the overnight data, Japan’s headline November CPI printed in-line with consensus at +0.8% yoy however there were marginal misses for the core CPI (+0.9% yoy vs. +1.0% yoy expected) and core-core CPI (+0.3% yoy vs. +0.4% yoy expected) readings. Meanwhile, the UK’s December GfK consumer confidence reading was on the money at -14, the lowest reading since July 2013.

As for what’s been driving the latest leg lower in markets, the trade war between the US and China escalated further when the Justice Department indicted two Chinese nationals on hacking charges.According to US prosecutors, the two hackers stole data and intellectual property from 45 government agencies and private companies. The Washington Post reported that “more than a dozen international allies are expected to call out Beijing” over similar concerns in connection with the US move. This is another avenue of conflict between developed markets and China, and it has scope to continue to grow and complicate efforts to achieve a tariff détente.

Moving on. Political events in the US surprised again, as President Trump shifted course on the spending bill, reverting to his original position that he will only sign a bill that includes $5 billion of funding for a border wall. Senate Democrats have resisted this request, and have offered only a shortterm continuing resolution instead. The sides continue to negotiate ahead of this evening's deadline, at which point funding for around two thirds of the discretionary budget will lapse. If unresolved by Monday, a shutdown would furlough around 380,00 workers and would require 420,000 employees to continue working without pay.

Staying with politics, last night it emerged that Defense Secretary Jeff Mattis has resigned from his role citing differences with President Trump. This comes one day after Trump called for the withdrawal of American forces from Syria.

Meanwhile, in commodity markets and specifically the oil market, Bloomberg reported that OPEC+ will give greater clarity on “their strategy to stabilize oil markets” today by listing production cuts agreed by each country.WTI was down another -2.80% yesterday and therefore undid all (and more) of Wednesday’s bounceback. So the story didn’t seem to help at all.

Here in the UK, as expected the final BoE meeting of the year was a bit of a non-event. It was a unanimous decision amongst the MPC to leave policy unchanged with the main development in the statement being a downgrade around the language on global and domestic growth, and also global financial markets.The MPC also highlighted that “Brexit uncertainties have intensified considerably since the Committee’s last meeting” and that “the monetary policy response to Brexit, whatever form it takes, will not be automatic and could be in either direction”.

Having touched as high as $1.2707 intraday (+0.75%), Sterling gave up a decent chunk of that move to end at $1.266 and +0.36% on the day.
Speaking of central banks, it was a landmark day of sorts for the Riksbank following the first rate hike since 2011.The repo rate is still negative (-0.25%) however the move was a bit of a surprise with just 10 of the 24 economists surveyed on Bloomberg expecting a hike. The krona gained +0.73% versus the euro to 10.276.

Prior to the BoE we got a surprisingly strong November retail sales report in the UK.Headline sales were reported as rising +1.4% mom (vs. +0.3% expected) while the core ex fuel sales reading also beat to the upside at +1.2% mom (vs. +0.2% expected). That certainly seemed to contribute to the early rise for Sterling. Meanwhile, in the afternoon the latest Philly Fed print for December was disappointing at just +9.4 (vs. +15.0 expected). The reading was down -3.5pts from November and the lowest since August 2016. On the plus side though, both the new orders and employment components rose, while the prices paid component actually fell slightly, albeit from still elevated levels. In other news initial jobless claims printed slightly higher at 214k but the low levels appear to confirm that the move higher in previous weeks was only temporary.

As for the day ahead, this morning we’ll get consumer confidence data prints in Germany and France along with the final Q3 GDP revisions in the latter. Later this morning in the UK we’ll get the November public finances data and final Q3 GDP revisions. This afternoon in the US we’ve got a packed agenda. First up is the third and final Q3 GDP revisions where no change is expected from the +3.5% qoq saar print. Also due are preliminary November durable and capital goods orders data, while not long after that we get the November PCE report. The consensus is for a +0.2% mom reading which would be enough to push up the annual rate to +1.9% yoy. Finally, we’ll get the final December University of Michigan consumer sentiment survey readings and the December Kansas City Fed manufacturing survey. We should note that today is also a quadruple witching day for stock markets, so it wouldn’t be a great surprise to see a pick-up in volatility towards the end of the session.

See you in 2019... assuming markets can survive that long!!

https://www.zerohedge.com/news/2018-12-21/global-markets-ends-miserable-week-sea-red
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
How Appeals Work - Casual Friday - Lehto's Law Ep. F8
Steve Lehto


Published on Dec 21, 2018
Someone asked me to give a brief overview of how appeals work. So, here is it in plain English.

http://www.lehtoslaw.com
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Last edited:

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Jim Cramer Backs Gold as it Catches Safe Haven Bid
Silver Fortune


Published on Dec 21, 2018
With all the mayhem in the markets, Jim Cramer is saying that gold is a good buy right now, even going so far as to say it is in a bull market.

Support Silver Fortune, shop at SD Bullion! Free shipping over $99, and a 1 oz. round for new customers! sdbullion.com/sf
(I am compensated by SD Bullion when the at spot round is claimed by new customers)

Support Silver Fortune through Patreon: https://www.patreon.com/silverfortune

International Silver Syndicate poured silver, featuring various popular YouTube silver and gold channels, including your's truly: https://mkbarzandbullion.com/pages/in...
(MK Barz does offer a small share of profits to channels featured on the ISS bars)

Any content within this video or any other video by the Silver Fortune channel is merely one man's opinion, commentary, and analysis, or actual information obtained from elsewhere, and should not be constituted as legal, investment, or financial advice. Make your own financial decisions, or consult a professional if you'd prefer to go that route. The Silver Fortune channel disclaims any liability for legal, financial, or investment decisions made.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
180,490
Likes
43,595
Ira Epstein's End of the Day Financial Video 12 21 2018
Ira Epstein


Published on Dec 21, 2018