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Scorpio

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Oil plunges to its worst loss in 2 weeks



Alex Nussbaum and Alex Longley

33 mins ago


Oil slid to its worst loss in two weeks as mounting fears about the global economy undercut the latest plan from OPEC and its allies to stabilize markets.




Futures dropped by as much as 4.3% in New York, the steepest intraday decline since June 12. Bank of England Governor Mark Carney warned of the dangers of rising protectionism around the globe, citing a “widespread slowdown” that may require a major policy response. That added to worries following weak manufacturing reports from the U.S., China and Europe.

The anxieties blotted out optimism despite Tuesday’s agreement by major oil exporters to extend production cuts for nine more months. Divisions remained over Saudi Arabia’s push to target even deeper reductions, with Russia expressing doubts at the end of a summit in Vienna.

In another sign of demand worries the backwardation for Brent, where the front month is valued more than future months, was halved between Monday and Tuesday for the near term prices.

“There are concerns that demand might slow to where it overpowers supply," Bart Melek, head of commodity strategy at Toronto’s TD Securities, said in an interview. The “gloomy" data, especially from China, “is very much part and parcel of what we’re seeing."

West Texas Intermediate crude for August delivery slipped $2.14 to $56.94 a barrel on the New York Mercantile Exchange as of 11:51 a.m., obliterating a Monday gain that followed announcement of the OPEC+ extension.

Brent for September settlement declined $2.12 to $62.94 a barrel on the ICE Futures Europe Exchange. The global benchmark crude was at a $5.92 premium to WTI for the same month.

At the Vienna meeting, Saudi Arabia said it would keep its output below 10 million barrels a day, even lower than required under the so-called OPEC+ deal. Saudi Energy Minister Khalid Al-Falih said he was “enthusiastic" about the outlook for oil demand.

Yet Russia, the other de facto leader of the group, questioned a Saudi push to use the average of 2010 to 2014 global oil inventories to set its upcoming production targets. That move, a change to current policy, would require deeper cuts but achieve the higher prices the Saudis need to balance their budget.

Russian Energy Minister Alexander Novak also said the group was ready to respond to any significant supply disruptions.

The OPEC pact leaves the door open for U.S. shale producers to grab more market share, as the group will have to cut deeper to achieve inventory targets, according to Goldman Sachs Group Inc. The decision creates a clearer downside risk to the bank’s forecast for Brent to average $60 a barrel next year, even though it could result in some shorter-term price spikes.

The structure of the Brent crude market suggests futures investors may be losing faith that the OPEC+ extension will be enough to stave off an oversupply. The premium of front-month futures over the next month reached as little as 20 cents on Tuesday, compared with 43 cents early on Monday. A shrinking premium, or backwardation, indicates a weakening near-term market.

A gauge of U.S. factory activity fell for a third month in June. The Institute for Supply Management index dropped to 51.7, the weakest level since October 2016. That came after the Caixin China PMI Manufacturing measure dipped below 50 for the first time in four months.


https://www.msn.com/en-us/money/mar...s-worst-loss-in-2-weeks/ar-AADId8c?li=BBnbfcN
 

Scorpio

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was wondering about something the other day,
if the dollar highs over longer periods have been lower and lower,
with it being a index and weighted against others, along with the continued break down of the currencies in the basket,
one would think it would in fact show off lower highs
I went and looked it up, and sure as heck, there it is,

lower highs,
which would be somewhat interesting if we are at or very near this cycle high for the dollar,
and if there is still some market reflection of USD vs gold and silver

then it is fair to ask, if we are near the highs in the dollar, can the metals continue to move up from here all else equal?

the longer chart currently shows the dollar testing recent highs. Whereas if it fails and goes down, you can see there has been no double top prior in the market marking the end of a upswing. That would become like a cement cap over it.

currently it is very close to the activity of 97 or so when it continued on to make new highs,

just something to watch for as if that double top holds, then metals may get quite a little run going



usd.jpg
 

JayDubya

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Deutsche Bank to cut 18,000 jobs in 7.4 billion euro overhaul

https://www.reuters.com/article/us-deutsche-bank-strategy-idUSKCN1U20J2

FRANKFURT (Reuters) - Deutsche Bank (DBKGn.DE) plans to cut 18,000 jobs in a sweeping, 7.4 billion euro overhaul designed to turn around Germany’s struggling flagship lender.

The plan represents a major retreat from trading by Deutsche Bank, which for years had tried to compete as a major force on Wall Street.

The bank will scrap its global equities business and scale back its investment bank. It expects a 2.8 billion euro ($3.1 billion) net loss in the second quarter as a result of restructuring charges.

Beyond the expected cutbacks to equities, Deutsche said it would also axe some of its fixed income operations, an area traditionally regarded as one of the bank’s strengths.

It will create a new unit to wind-down unwanted assets, with a value of 74 billion euros of risk-weighted assets.

Chief Executive Officer Christian Sewing flagged an extensive restructuring in May when he promised shareholders “tough cutbacks” to the investment bank. The pledge came after Deutsche failed to agree a merger with rival Commerzbank (CBKG.DE).

The overhaul, one of several over the past few years, signals that Deutsche is coming to terms with its failure to keep pace with Wall Street’s big hitters such as JP Morgan Chase & Co (JPM.N) and Goldman Sachs (GS.N).

Last week, the head of Deutsche’s investment bank Garth Ritchie agreed to step down, marking a sign of the division’s waning influence.

Sewing called the package the “most fundamental transformation” of the bank in decades. “This is a restart,” he said.

Media reports had suggested that Deutsche Bank could cut as many as 20,000 jobs — more than one in five of its 91,500 employees.

In the event, the bank said it would reduce headcount to 74,000 employees by 2022.

The bank did not disclose a geographic breakdown of the job cuts. The equities business is focused largely in New York and London.

A person with direct knowledge of the matter said job cuts would be distributed around the world, including in Germany.

The bank’s supervisory board met on Sunday to agree the proposed changes, one of the biggest announcements of job cuts at a major investment bank since 2011 when HSBC said it would axe 30,000 jobs.

Stephan Szukalski, head of the DBV union, told Reuters that the measures were in the right direction.

“This could be a real new beginning for Deutsche Bank,” said Szukalski, who also sits on the bank’s supervisory board.
 

Scorpio

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Potus mad at fed, says they should cut,

when asked why, he states they have a lot of debt to pay back, and to keep the economy going
then he says others are manipulating their currency against us.

My response would be, then stop spending far over revenue and cut the .gov like you said you would,
as for manipulation, there is always manipulation, and always will be, including by our own ptb.

With the current economy, there is zero reason to raise rates IMO.
 

Scorpio

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with gold chart, you can see the double tap on about 1440,

and now support is at 1385, and if that breaks, there is some room to run to the down,

someone was stating mid 1300's and they were right, in that there is a lot of congestion there that may lend support

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BarnacleBob

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the_shootist

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BTW, a main teaching hospital in Philadelphia is claiming bankruptcy.
Phaggadelphia? Good! Another business goes belly up in the cesspool city!
 

the_shootist

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JayDubya

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Congress courageously sticks US taxpayers with a $6 trillion liability

July 15, 2019
Santiago, Chile

There seems to be an unwritten rule with lawmakers that, every time they create a terrible piece of legislation, they give it the most noble-sounding name.

The USA PATRIOT Act from 2001 was a great example. It sounds great. Who wouldn’t love a law named for Patriots?

And yet that was easily among the most freedom-killing laws ever passed in US history, giving the federal government nearly unlimited authority to wage war and spy on its own people.

There are so many other examples-- the USA FREEDOM Act from 2015 (which renewed many of the worst provisions of the PATRIOT Act).

Or the HIRE Act from 2010, which created some of the most heinous tax rules of the last fifty years.

The names of these laws all sounded wonderful. But their effects were absolutely terrible.

The new SECURE Act will likely be no different.

If you haven’t heard of SECURE, it’s a new piece of legislation aimed at ‘fixing’ the US retirement system.

SECURE stands for “Setting Every Community Up for Retirement Enhancement”, which is pretty clever when you think about it.

People want to associate their retirement with a word like ‘secure’. So even without knowing anything about the law, most people will probably have good feelings about it based solely on the name.

But if you actually read the legislation, SECURE contains a number of predictably terrible consequences.

For starters, SECURE is basically a gigantic tax increase. And it’s a tax increase that will particularly affect your children when you pass away.

Under current law, you could leave your IRA to your children in a fairly tax efficient way. That’s actually one of the nice things about an IRA.

If your kids inherit your IRA, they’re required to pay out a small portion of the funds each year… and those distributions would be taxable income.

But the current rules only require tiny distributions; your kids are allowed to stretch out the annual payouts over the course of their lives, resulting in very minor taxation.

The new rules completely eliminate this benefit.

Under the SECURE Act, your kids would have ten years to pay out (and be taxed on) the entire value of your retirement account.

This means that the annual payouts would be MUCH larger… thus bumping your children up to a higher tax bracket… meaning that they’ll end up paying much higher taxes on your retirement savings.

This is tantamount to a huge estate tax increase. And it’s one that primarily affects the middle class.

For wealthy people, retirement accounts typically only comprise a small percentage of their assets. So this rule change won’t have much of an impact.

But for the middle class, retirement accounts are often one of the largest sources of their estates. And this legislation will be a significant hit for them.

The US House of Representatives already passed the SECURE Act. And just in case you’re about to start hating on your least favorite political party, you should know that it was passed with almost unanimous support from both parties.

(Though I have my doubts whether most members of Congress even read the legislation...)

It’s currently in the Senate and seems likely to pass, so this is a reality to prepare for.

In related news, Congress also made some movement on the Rehabilitation for Multiemployer Pensions Act.

Sadly this one doesn’t have a catchy acronym. But in essence the legislation is their comical attempt to address the multi-trillion dollar problem of unfunded pension plans in the Land of the Free.

We’ve talked about this before a number of times-- the vast majority of state, local, and even corporate pension plans in the United States (and worldwide for that matter) simply don’t have enough money to keep their promises.

Moody’s Investor Service estimated last year that the total pension funding gap in the US is $4.4 trillion. A few months ago the American Legislative Exchange Council estimated it at nearly $6 trillion.

Bottom line, it’s a big number.

Pension plans in the United States are currently guaranteed by a quasi-government agency called the Pension Benefit Guarantee Corporation.

The PBGC is sort of like an FDIC for pension funds… so that if a pension plan goes bust, the PBGC will step in with a bailout.

Problem is, the PBGC itself is nearly insolvent and will run out of money in 2025. And its balance sheet is trivial compared to the multi-trillion dollar pension problem.

So Congress came up with a solution: go into DEBT!

According to the new legislation, whenever a pension plan runs out of funds, Congress wants them to borrow money in order to keep making payments to beneficiaries.

This raises an obvious question: who would be insane enough to loan money to an insolvent pension fund?

Well, you’ll be pleased to know that your esteemed members of Congress have courageously signed you up for the task, putting the American taxpayer on the hook for this potential $6 trillion liability.

Clearly this plan is the work of genius.

If nothing else, these two laws point to an obvious conclusion: it’s more important than ever to get your house in order when it comes to retirement planning.

Pension funds aren’t going to be able to keep their promises. Even Social Security, according to its own annual report, will run out of money in 15 years.

And even when you responsibly set aside your own money for retirement, lawmakers will suddenly change the rules and impose a major tax increase on the middle class.

Just imagine the things they’ll do if the Bolsheviks come to power next year…

To your freedom,



Simon Black,