Baltic Dry Index. 930 -05 Down 59% YTD
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
“But
I don’t want to go among mad people," Putin remarked.
"Oh, you can’t help that," said Merkel: "we’re all mad here. I’m mad. You’re mad."
"How do you know I’m mad?" said Putin.
"You must be," said Merkel, "or you wouldn’t have come here.”
"Oh, you can’t help that," said Merkel: "we’re all mad here. I’m mad. You’re mad."
"How do you know I’m mad?" said Putin.
"You must be," said Merkel, "or you wouldn’t have come here.”
With
apologies to Alice and Lewis Carroll.
It is D-Day for stocks. Will Goldman’s little
helpers at the Fed, and most of the other central banks, send in the Plunge
Protection Team today, to end a bad two weeks for global stocks with a fig leaf
rally? If they don’t, next week could turn very ugly, as the HFT algo thieves
switch from “buy the dips” to “sell the rallies.” Will the Fed come through
today with PPT action and next week announce QE Forever is to roll on a little
longer? We shall see later today. Perhaps one hint is coming from crude oil. Prices
have stabilised and jumped from the lows by about three dollars. It might be
nothing more than short covering ahead of the weekend, but there again Uncle
Scam might be twisting Saudi arms for a floor of 90 dollars for WTI. For more
on oil scroll down to Crooks Corner.
While we await today’s global stock market casino outcome,
we open with a very testy President Putin arriving in Milan, like an American President. It could be a very
cold winter for some, he suggested. Meanwhile back in Russia Prime Minister
Medvedev questioned President Obama’s sanity. Seems to me in faraway safe London,
the ever growing second city of France, that another round of Russian
retaliation is heading continental Europe’s way.
Putin Threatens EU Gas Squeeze Raising Stakes for Ukraine
Oct 17, 2014 1:55 AM GMT
Russian President Vladimir Putin flew into Milan last night for peace talks
with European Union leaders after threatening to cut the supply of natural gas
through Ukraine if the government in Kiev diverts fuel for domestic use. After missing an earlier meeting time because he stayed on at a military parade in Serbia, Putin met German Chancellor Angela Merkel shortly before midnight as they prepared for formal talks on Ukraine scheduled for 8 a.m. today. Ukrainian President Petro Poroshenko also met Merkel as well as Italian Prime Minister Matteo Renzi and EU President Herman van Rompuy.
Merkel and the EU have blamed Putin for stoking the crisis by providing pro-Russian rebels with cash, weapons and fighters since Russia annexed the Ukrainian peninsula Crimea in March. Putin, who was accompanied by OAO Gazprom Chief Executive Officer Alexey Miller, said he’s worried Ukraine may steal Russian gas bound for European markets.
“There
are big transit risks,” Putin, who denies involvement in the Ukrainian
conflict, said yesterday in Belgrade, Serbia. If Russia sees its Ukrainian
partners “are starting to siphon off our gas from the export pipeline network,
we will respond by reducing flows by the amount stolen.”
more
Calling Russia ‘threat to humanity’ puts Obama’s sanity in doubt - Medvedev
Published time: October 15, 2014 10:58
The Russian PM has suggested that
Obama’s charges against Russia were caused by a “brain aberration” and added
that such rhetoric saddened him.
“I am very upset by the fact
that President Obama, while speaking from the United Nations’ podium and
listing the threats and challenges humanity is currently facing, put Ebola in
first place, the Russian Federation second and the Islamic State organization
was only in the third place. I don’t even want to comment on this, this is some
sort of aberration in the brain,” Dmitry Medvedev said in an interview with
CNBC television.
The top Russian official stressed
that his country was not isolating itself from the rest of the world, but
sought mutually beneficial cooperation with foreign nations. “We want to
communicate with all civilized peoples on friendly grounds. Of course, this
includes our partners from the United States of America, but for this the
situation must be leveled,” Medvedev said.
However, the Russian PM also
noted that the Western sanctions have inflicted considerable damage to Russia’s
cooperation with the US, and without cancellation of this policy there can be
no return to partnership.
More
New York Gets Frigid Winter Warning From Siberia Snowfall
Oct 15, 2014 4:09 PM GMT
The snow in Siberia is piling up, and if it
keeps coming, people in New York may have to bundle up this winter. There’s a theory that the amount of snow covering Eurasia in October is an indication of how much icy air will sweep down from the Arctic in December and January, pouring over parts of North America, Europe and East Asia.
Last year, the snow level across Eurasia was the fourth highest for the month in records going back to 1967. In January, frigid temperatures dubbed “the polar vortex” slid out of the Arctic to freeze large portions of the U.S.
It was a pattern that repeated itself during the Northern Hemisphere winter and helped make the first three months of this year the coldest in the 48 contiguous states since 1985, according to the National Climatic Data Center in Asheville, North Carolina.
With the snow now piling up across Eurasia, will this winter be a grim reminder of last year’s?
“It’s still early in the game,” said Judah Cohen, director of seasonal forecasting at Atmospheric and Environmental Research in Lexington, Massachusetts, a division of Verisk Climate.
----As of Oct. 13, Cohen calculated, 12.2 million square kilometers of Eurasia were covered by snow, compared with 10.8 million square kilometers on the same day last year.
More
Putting a Siberian Snow Connection to the Test
By Andrew C. Revkin
With President Obama seemingly preoccupied bombing
yet more countries in the Middle East, fighting Ebola in Dallas, fighting to
get something out of next month’s US mid-term elections, and of course fighting
President Putin for the right to slice and dice up Russia for its mineral
wealth, China’s President Xi thinks that this is the perfect moment to seize the
initiative over Taiwan. Forget the Diaoyu Islands for now, they can come later.
Taking Taiwan trumps the botched coup in Kiev.
Xi Jinping pushes his Taiwan policy
Lo
Yin-chung & Staff Reporter 2014-10-17
Chinese president Xi Jinping, who
is also the general secretary of the Communist Party of China's Central
Committee, said during his speech on Sept. 26 that "one country, two
systems" is his country's formula for Taiwan's future, triggering heated
debates in Taiwan.
In a speech delivered during a
meeting with a Taiwanese delegation composed of the island's pro-reunification
groups, Xi spelled out China's bottom line on the Taiwan issue before the
fourth plenary session of the 18th Communist Party of China (CPC) Central
Committee, slated to be held from Oct. 20 to 23.
Xi espoused the "one
country, two systems" proposal for unification, mainly based on his
judgments of CPC power, China's role in foreign relations, and the situation in
Taiwan.
The Chinese leader said the
"one country, two systems" principle would take the island's actual
condition into consideration, and that suggestions from both sides of the
strait would be taken to fully consider Taiwanese interests, Xi added.
Since the beginning of this year,
Xi has spoken about the goal of China's Taiwan policy several times while
meeting with political figures from Taiwan's pan-blue camp as well as
pro-reunification groups. This includes his idea of cross-strait cooperation to
realize the "Chinese dream" which he talked about at a meeting with
the honorary chairman of the Kuomintang, Lien Chan, in February.
----Xi chose late
September to start his diplomacy push for several reasons. First, he wanted to
set his tone on Taiwan policy before the fourth plenary session of the 18th
CPCCC. Also, this November, Beijing will host the Asia-Pacific Economic
Cooperation (APEC) Summit, where the president plans to meet many foreign
leaders to discuss regional development. Lastly, due to what he considers the
poor performance of the Taiwanese government in promoting cross-strait exchanges,
China has decided to up the ante in order to make the the island nation move
faster.
More
Up next, Bloomberg notices that the market is
getting very nervous of love rat, President Hollande’s France. In Mr Market’s
eyes, France is becoming the new Italy or Spain. Meanwhile back in Brussels, “the
capital of the EUSSR,” the e-taxis go for a Chinese.
“Would
you tell me, please, which way I ought to go from here?"
"That depends a good deal on where you want to get to."
"I don't much care where –"
"Then it doesn't matter which way you go.”
"That depends a good deal on where you want to get to."
"I don't much care where –"
"Then it doesn't matter which way you go.”
Hollande,
with apologies to Lewis Carroll.
France Gets Whacked by the Bond Market
By Mark
Gilbert
----Given
the scale of the rout in the world's financial markets, a jump of 11 basis
points in your 10-year yield to 1.24 percent is nothing for a sovereign
borrowing officer to worry about, right? Especially when investors drove that
level to a record low yesterday, yes?
Except … take a look at this
chart, showing the relative performance of French bonds versus their German
counterparts:
In short, fixed-income investors are prioritizing the perceived safety of German bunds over everything else in Europe. U.S. Treasuries, for example, have narrowed their yield gap to German securities. So while yield spreads for both Spain and Italy have also widened today, neither of those was previously classed as a core European country by the investment community.
Now, maybe Eric Oynoyan, a strategist at BNP Securities, was correct when he told Bloomberg's Max Julius that the move is "just a blip" reflecting how investors are managing their liquidity rather than expressing any view on French creditworthiness.
But the backdrop is ominous. France is tussling with the European Union because its budget plans mean it'll be two years late in meeting its deficit target. Earlier this week, Fitch said that may prompt it to cut France's AA+ rating. So if I was the head of bond sales for France, I'd be somewhat worried that investors seem to be downgrading my status to that of peripheral European borrower.
Brussels’ First Electric Taxis Are Made in China
Oct 16, 2014 6:00 PM GMT
European Union officials in Brussels can now shuttle between policy meetings
without burning fuel, thanks to a new fleet of electric-powered taxis made in China. Shenzhen-based BYD Co. (002594), owned in part by Warren Buffett’s Berkshire Hathaway Inc., was the big winner in the city’s first tender for emission-free taxis in the EU’s de facto capital, beating France’s Renault SA (RNO) and Japan’s Nissan Motor Co. (7201) Of the 50-car order for battery-powered taxis, local operators bought 34 of BYD’s e6 model, the Chinese manufacturer said yesterday in a statement.
“I’d rather have chosen a European brand than a Chinese one of course,” Luigi Marrocco, chief executive officer of Taxis Bleus, one of the two biggest taxi companies in Brussels. said by phone. “But when it comes to size, comfort and range, BYD was clearly above Nissan and Renault.”
The deal is a blow for Carlos Ghosn, the CEO of both Renault and Nissan, who has struggled to find buyers for the group’s Renault Zoe and Nissan Leaf electric vehicles. For BYD, it’s the biggest taxi order so far in Europe. The company has 20 taxis in London and a “small number” in Rotterdam, it said today.
BYD’s e6 has a range of 300 kilometers (190 miles), double the 150 kilometers that Renault’s Zoe can drive before needing to recharge.
While the 48,000-euro ($61,000) price tag for the BYD car is more expensive than conventional vehicles, the fuel savings offset the additional cost over the course of about four years, said Marc Debont, a spokesman for the Brussels regional government.
More
We end for the day with a weather update for rainy
UK that still includes dour Scotland. Next week looks like being rainier than
most. Well at least it’s not snow and we still have access to winter gas.
“Take
some more tea," Merkel said to Putin, very earnestly.
"I've had nothing yet," Putin replied in an offended tone, "so I can't take more."
"You mean you can't take less," said Cameron: "it's very easy to take more than nothing."
"Nobody asked your opinion," said Putin.”
"I've had nothing yet," Putin replied in an offended tone, "so I can't take more."
"You mean you can't take less," said Cameron: "it's very easy to take more than nothing."
"Nobody asked your opinion," said Putin.”
With
apologies to Lewis Carroll.
Britain on alert for flooding and high winds from Hurricane Gonzalo
A powerful hurricane set to strike Britain next week has gained strength and been upgraded to one of the top rankings
By Nicola Harley 6:40AM BST 17
Oct 2014
A powerful hurricane is bringing the threat of flash flooding to Britain as
experts predict it is due to hit the country in days. The National Hurricane Center (NHC), based in America, has plotted the route of Hurricane Gonzalo, which has now been upgraded to the second most dangerous level, and Britain is directly in its path.
Hurricane Gonzalo is presently in the Atlantic and experts predict it will leave devastation in its wake when it strikes Bermuda on Friday.
The aftermath of the storm is due to hit the UK shores next week and the NHC has mapped its route finishing in Britain.
However, the Met Office said there was still a chance that the UK could escape the worst of the weather.
Emergency planning procedures are
on standby in case they are needed and officials from the Met Office are
working closely with the Highways Agency and the Environment Agency.
If it strikes the country there
is a risk of flash flooding and strong winds.
Last October, the St Jude's Day
storm saw 80mph winds, flights cancelled and 20ft waves battering the
coastline.
This weekend forecasters have
already predicted a bizarre combination of unseasonally warm weather, strong
winds and rain from the fall out from Hurricane Fay which hit last weekend.
Despite winds forecast of up to
50mph in exposed areas, temperatures are set to increase from the average of
55F (13C) to 70F (21C).
The NHC predicts Hurricane
Gonzalo will hit Bermuda on Friday and make its way across the Atlantic to
reach Britain's coastline by next Tuesday in a milder form.
More
"Those entrapped by the herd instinct are drowned in the deluges of history. But there are always the few who observe, reason, and take precautions, and thus escape the flood. For these few gold has been the asset of last resort."
Antony C. Sutton
At the Comex silver depositories Thursday final figures were: Registered 66.51
Moz,
Eligible 114.92 Moz, Total 181.43 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today, the fracker’s come crashing back to earth
and everyone gets stuck in the tar pits.
Don’t Mess With Saudis in Oil Bear Market Global Shakeout
Oct 16, 2014 4:03 PM GMT
The bear
market in oil is showing the world there’s still only one country in a
position to choose winners and losers in the global market: Saudi Arabia. The world’s largest oil exporter is trying to protect its market share by keeping its production steady even as prices hit a four-year low. Energy producers in turmoil, such as Russia, Iran and Venezuela, stand to lose the most, U.S. shale drillers and other Saudi rivals will suffer and industrialized importing countries including Japan will get a boost from cheaper prices.
“Saudi Arabia is the only one in the position of putting more oil on the market when they want to and cutting production when they want to,” said Edward Chow, a senior fellow at the Center for Strategic & International Studies in Washington. “Consumers win, producers lose.”
Brent crude, the international benchmark, fell as much as 29 percent since June 19 to $82.60 a barrel, the lowest since November 2010. Prices have averaged above $105 a barrel since 2011, the four highest years on record. Brent will stay higher than $80 a barrel, analysts at Bank of America Corp. and BNP Paribas SA said yesterday.
While cheaper crude erodes Saudi Arabia’s income, too, the country has enough reserves and credit to withstand the slump, Chow said. The kingdom needs $83.60 a barrel to balance its budget, and the central bank has $734.7 billion in reserve assets, the International Monetary Fund said. The Saudis ran deficits from the mid-1980s until the late 1990s and may be prepared to do so again, according to Chow. Brent traded at $82.96 as of 12:58 p.m. in London.
----Kuwait, Qatar and the United Arab Emirates should be able to weather lower oil prices for the same reasons, Fahad Al-Turki, head of research at Jadwa Investment Co. in Riyadh, said by phone Oct. 15. Countries that haven’t been able to save, such as Iran and Iraq, will be more vulnerable, he said.
Saudi Arabia increased September output 0.5 percent to 9.65 million barrels a day, according to data compiled by Bloomberg. The Organization of Petroleum Exporting Countries pumped 30.9 million barrels a day, the most in a year. Saudi Arabia, Iraq and Iran are offering the biggest discounts to crude buyers in Asia since at least 2009.
----Lower prices could slow the U.S. boom because extracting oil from shale costs $50 to $100 a barrel, compared with $25 a barrel for conventional supplies from the Middle East and North Africa, according to the IEA.
The Saudis, OPEC’s biggest member, might actually want the price collapse because it hurts rivals Iran and Russia in addition to slowing U.S. drilling, said Bruce Jones, a senior fellow at the Brookings Institution in Washington.
More
Oil Slump Means Canceled Projects as Investment Declines
Oct 16,
2014 2:07 PM GMT
The global crash in crude prices is reverberating through the oil and gas
industry, pressuring producers to curtail investment to protect profits and
avoid cuts to dividend payments. Projects in the Canadian oil sands, offshore fields in Norway and drilling-intensive U.S. shale deposits are among the most vulnerable as oil prices come perilously close to production costs. The world’s largest oil companies have rarely spent so much for so little reward.
Even before this week’s sharp drop-off in prices, French research house IFP Energies Nouvelles expected investment in the industry to fall 8 percent this year. With oil approaching a four-year low, producers will be even more cautious about sanctioning investment, chairman Olivier Appert said yesterday.
“Oil companies will think twice before launching new projects,” he said.
Austerity will also be severely felt by oil services companies, which rely on drilling and construction contracts from producers. So far this month the Bloomberg World Oil & Gas Services Index has dropped about 13 percent versus a 8.4 percent decline in the same index for oil products.
Exxon Mobil Corp., Royal Dutch Shell Plc and Total SA are already paring back as new investment fails to yield positive returns. Total said last month that capital spending in 2017 will be 11 percent below 2013’s peak.
More
Another weekend, and are
stocks going to magically rise from the ashes today, or sink like the Titanic.
What a good idea it was to raise debt to buy back stocks. Have a great weekend
everyone.
"For more than two thousand years gold's natural qualities made it man's universal medium of exchange. In contrast to political money, gold is honest money that survived the ages and will live on long after the political fiats of today have gone the way of all paper."
Hans F. Sennholz
The monthly Coppock Indicators finished September.
DJIA: +141 Down. NASDAQ: +289 Down. SP500: +216 Down.
No comments:
Post a Comment