Baltic Dry Index. 1436 -28
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
The
mercantile community will have been unusually fortunate if during the period of
rising prices it has not made great mistakes. Such a period naturally excites
the sanguine and the ardent; they fancy that the prosperity they see will last
always, that it is only the beginning of a greater prosperity. They altogether
over-estimate the demand for the article they deal in, or the work they do.
They all in their degree—and the ablest and the cleverest the most—work much
more than they should, and trade far above their means. Every great crisis
reveals the excessive speculations of many houses which no one before
suspected, and which commonly indeed had not begun or had not carried very far
those speculations, till they were tempted by the daily rise of price and the
surrounding fever.
Walter Bagehot. Lombard Street. 1873
We open with the OECD fretting over the dying EUSSR. They pose a major
risk to “world growth” they think. Of course the only world growth is now
coming from central banksters printing money like there’s no tomorrow, because
on the Great Nixonian Error of fiat money, they know that there is no tomorrow
if they ever stop after the GNE blew up under the serial bubbles policies of
disgraced fallen former guru Greenspan and his disastrous successor Bernocchio.
With both having left town, the fall comes on the watch of the talking chair.
Below the OECD frets over the wrong problem. The risk of an American
generated World War Three is rising again.
Eurozone standstill poses 'major risk' to world growth, warns OECD
Organisation for Economic Co-operation and Development warns eurozone is "grinding to a standstill" and repeats call for bloc to launch quantitative easing
The eurozone is heading towards a
protracted period of stagnation that could derail the global recovery, the
Organisation for Economic Co-operation and Development (OECD) has warned.
Ahead of this month's meeting of
G20 finance ministers and central bank governors in Brisbane, Australia, the OECD
slashed its growth forecasts for the 18-nation bloc's biggest economies for the
second time in just six months.
It warned that continued
belt-tightening, stubbornly high unemployment and the threat of deflation meant
the eurozone was at risk of a "still more prolonged period of
stagnation".
The euro area is expected to grow
by just 1.1pc in 2015, unchanged from the OECD's September projection but down
from its May forecast for 1.7pc growth.
The Paris-based think-tank
believes Germany will grow by 1.1pc in 2015, down from a projection of 1.5pc in
September and 2.1pc in May, while growth in France is projected to be 0.9pc
next year, down from its forecast of 1.5pc in May.
Catherine Mann, the OECD's chief
economist, said the eurozone was at risk of "running zero inflation and
zero growth" while the global economy would continue to run in "low
gear".
"The euro area is grinding
to a standstill and poses a major risk to world growth as unemployment remains
high and inflation persistently far from target," she said. The International Monetary Fund
recently said there was around a 40pc chance that the eurozone could slip into
a triple-dip recession.
While the OECD expects world
output to strengthen over the next two years, with growth of 3.7pc in 2015 and
3.9pc in 2016, it warned that the scars left from the Great Recession meant
global growth might never return to the pace of expansion seen before the
financial crisis.
More
In better news for most, crude oil prices continue falling, though part
of the reason is falling demand due to slower world growth.
Oil tumbles after OPEC cuts demand forecasts
Published: Nov 6, 2014 3:43 p.m. ET
SAN FRANCISCO (MarketWatch) — Crude-oil futures fell further on Thursday
after the Organization of the Petroleum Exporting Countries cut demand
forecasts for its oil and investors worried about the health of the eurozone’s
economy. On the New York Mercantile Exchange, light, sweet crude futures for delivery in December CLZ4, -0.40% fell 77 cents, or 1%, to settle at $77.91 a barrel.
December Brent crude LCOZ4, -0.68% on London’s ICE Futures exchange fell 9 cents, or 0.1%, to $82.86 a barrel.
Both benchmarks are down for five out of the past six sessions and off nearly 30% from a June peak.
In its annual world outlook released earlier Thursday, OPEC predicted less demand for its oil through 2017.
OPEC said demand for its crude oil would fall to 28.2 million barrels a day by the end of 2017, as output from producers outside the cartel, such as the U.S. and Canada, Latin American countries, and Russia, continue to rise.
Demand for OPEC crude will pick up again in 2018, but a year later it will still be lower than demand for 2013, OPEC said.
More
Vladimir Putin: oil price decline has been engineered by political forces
As slumping oil prices dampen Russia's economic outlook, the country's President has said that "at some moments of crisis it starts to feel like it is the politics that prevails in the pricing of energy resources".
Recent tumbles in the value of
oil on global markets have been the creation of politicians, Vladimir Putin,
President of Russia, suggested on Thursday.
The Russian state has been
heavily exposed to slumping oil values, widely viewed to be the result of a
supply glut.
“The obvious reason for the
decline in global oil prices is the slowdown in the rate of [global] economic
growth which means consumption is being reduced in a whole range of countries”,
Mr Putin said.
In addition to this, “a political
component is always present in oil prices. Furthermore, at some moments of
crisis it starts to feel like it is the politics that prevails in the pricing
of energy resources”, he added.
Mr Putin also referred to a
"distinct direct link" between physical oil markets and "the
financial platforms where the trade is conducted", in explaining part of
oil price changes.
More
In war news, America’s War Party wasted no time in ordering a new
offensive in East Ukraine following Tuesday’s US elections. By now under the
Nuland neocon plan, all of the Ukraine was supposed to be safely in western
hands, on its way to joining NATO, with Belarus and Russia crumbling, ready to
be sliced and diced for resources, and
President Putin a failed piece of history. Instead World War Three looms into
our future. Stay long fully paid up physical precious metals stored outside of
the USA and Great Britain.
Ukraine Lurches Back Toward Open War on East Fighting
Nov 6, 2014 10:00 PM GMT
Ukraine’s east lurched back toward open war as the government in Kiev and
pro-Russian rebels accused each other of starting major offensives in the
region. The Ukrainian government said there were 26 outbreaks of fighting yesterday between its forces and separatists in the east, while the rebels said the Kiev government’s troops had gone on a large-scale military push there.
The standoff is coming to a head after Ukraine and its allies accused separatists of undermining peace efforts with Nov. 2 elections in Donetsk and Luhansk. Russian President Vladimir Putin said Nov. 5 that Ukraine’s “civil war” isn’t subsiding as cities continue to come under shelling and the civilian death toll rises.
“Both Ukrainian government and separatist forces must immediately stop carrying out indiscriminate attacks in violation of the laws of war,” said John Dalhuisen, Europe and Central Asia director of Amnesty International in a report posted on the human rights group’s website yesterday. “They have killed and injured civilians, and destroyed civilian homes, and there would appear to be little impetus on both sides to end these violations.”
More
China Gold Buying Means Price Floor to Standard Chartered
Nov 7,
2014 3:11 AM GMT
The cheapest gold in four years is proving irresistible for shoppers in China and India,
where rebounding demand may signal an end to the longest price slump in more
than a decade. Purchases in Asia will help support prices that are headed for the first two-year decline since 2000, Standard Chartered Plc said. While surging equities and tame inflation have eroded gold’s appeal as a hedge, sending bullion tumbling to $1,137.94 an ounce this week, prices are nearing the lows forecast by banks from Citigroup Inc. to Goldman Sachs Group Inc.
China supplanted India as the world’s largest buyer last year, when the metal plunged 28 percent. Jewelry and bullion are viewed in both countries as a store of value and are popular as gifts. China’s gold imports from Hong Kong in September were the highest in five months. Indian jewelers are forecasting a surge in fourth-quarter sales.
“There is a floor around $1,100 set by Chinese retail demand,” Paul Horsnell, head of commodities research at Standard Chartered in London, said by e-mail on Nov. 5. “Physical demand indicators out of China and India are firming.”
Gold demand in China will rise 20 percent in three years, the World Gold Council forecast in September. The country’s net imports from Hong Kong that month totaled 61.7 metric tons, the most since April, according to calculations by Bloomberg News based on data from the Hong Kong Census and Statistics Department on Oct. 27.
More
We end for the day with more on our new lawless thieving bankster age.
Are any of our markets still unrigged?
Banks are an almost irresistible attraction for that element of our society which seeks unearned money.
J. Edgar Hoover.
Bank of America's Surprise Profit Is Wiped Out Amid Currency Probes
Nov 7, 2014 5:00 AM GMT
Bank of
America Corp. cut third-quarter earnings by $400 million, wiping out the
surprise profit it reported last month, as the firm braced for the end of
probes into foreign-exchange dealings. U.S. regulators faulted systems and controls for currency trading and called for fines and remedial actions in draft documents sent late last month, the firm said yesterday in a quarterly report. The lender posted a loss of $232 million, or 4 cents a share, for the three months ended Sept. 30.
Regulators in the U.K. and U.S. are preparing to levy fines on at least a half dozen firms after probing allegations they manipulated the $5.3 trillion-a-day currency market, people with knowledge of the situation have said. The reviews, including scrutiny of traders’ communications and how firms policed their activities, have prompted the world’s biggest banks to overhaul operations and bolster legal reserves.
“The attributes that make a strong currency trader is someone who’s aggressive and takes advantage of opportunities,” said Mark Williams, a former Federal Reserve bank examiner who’s now a lecturer at Boston University’s School of Management. “If controls are weak or not enforced properly, they’ll take advantage of weaknesses in the system.”
The probes have meant another legal headache for Bank of America Chief Executive Officer Brian T. Moynihan, 55, after he led the firm through more than $70 billion in costs tied to the takeovers of Countrywide Financial Corp. and Merrill Lynch & Co. Those cases culminated in a record $16.7 billion settlement of government mortgage probes in August. He has presided over five quarterly losses since taking the top job in 2010.
Authorities
on three continents have been looking into allegations that dealers at the
biggest banks traded ahead of clients and colluded to rig the WM/Reuters rate,
a benchmark used by pension funds and money managers to determine what they pay
for foreign currencies. More than 25 traders have been fired, suspended or put
on leave after the allegations became public last year, and disclosures from
banks in the past two weeks show a wave of settlements is approaching.
More
A large Bank is exactly the place where a vain and shallow person in authority, if he be a man of gravity and method, as such men often are, may do infinite evil in no long time, and before he is detected. If he is lucky enough to begin at a time of expansion in trade, he is nearly sure not to be found out till the time of contraction has arrived, and then very large figures will be required to reckon the evil he has done.
Walter Bagehot. Lombard Street. 1873
At the Comex silver
depositories Thursday final figures were: Registered 66.14 Moz, Eligible 114.10
Moz, Total 180.25 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Ow! A
billion here, a billion there, and pretty soon you’re talking serious money in
the Hans Christian Andersen Land of
Fairy Tales. Who can forget “The Emperor’s New Clothes?” A whole slew of banksters and now poorer
speculators, that’s who. Below, Fairy Tales Told for Children and Muppets by
Banksters, 21st century edition.
Below, OW Bunker A/S. Shareholder outlook Grimm.
"We finished the year, and we reported that we had $17 billion of cash sitting at the bank's parent company as a liquidity cushion. As the year has gone on, that liquidity cushion has been virtually unchanged."
Bear Stearns CEO Alan Schwartz. March 12, 2008. Bust March 17, 2008
IPO That Brought In $1 Billion in March Implodes in Denmark
Nov 6, 2014 10:41 AM GMT
Denmark’s second-biggest initial public offering since 2010 has just
imploded. OW Bunker A/S (OW), which provides fuel to the marine industry, said it couldn’t persuade its bankers to provide the cash it needs to keep doing business. That followed an announcement last night revealing senior
OW Bunker employees in Singapore committed fraud, costing as much as $125 million.
The company, whose shares have been suspended since yesterday, now says investors need to assume that its equity has been wiped out as it files for an in-court restructuring. Just eight months ago, investors were lining up, eager to throw their money into an IPO worth almost $1 billion and drove the company’s shares up 21 percent in their first day of trading.
Nordea Bank AB (NDA), which helped arrange the sale and has been urging clients to buy OW Bunker shares since Oct. 24 until suspending its recommendation today, says it’s “shocked” by the company’s subsequent collapse.
“No one can foresee fraudulent activity by individuals,” Stephan Ghisler-Solvang, the bank’s spokesman in Copenhagen, said in a phone interview. “No one could foresee that the company would incur losses of this magnitude after the IPO.”
He says the bank, Scandinavia’s largest, is now awaiting further updates from OW Bunker. Nordea was a bookrunner on the IPO, together with global co-leads Carnegie Investment Bank and Morgan Stanley.
“We strongly believe that we have conducted a thorough and correct process assisting OW Bunker in the IPO process together with the two joint global co-ordinators,” Ghisler-Solvang said.
At Carnegie, the view is that the bank is “just as much a spectator to this as anyone else,” spokesman Rickard Buch said today. “We had of course noted the communication from OW Bunker on the developments, but we have no insights or information on the matter.” Carnegie is “just as surprised as anyone else,” he said.
Altor Equity Partners, a private equity fund that had owned OW Bunker since 2007 until its IPO, said it is “deeply disturbed” by the revelations of fraud.
“This situation has snowballed over an extremely short period of time,” Soeren Johansen, a partner at Altor and a member of OW Bunker’s board, said today in a statement. “Since being informed of the situation, the board has done all it can to try to protect what was, before the breaches mentioned in the company’s release, a very sound business.”
Since its March listing and through yesterday, shares in OW Bunker have lost 42 percent.
The scandal surrounding the company comes as Europe’s appetite for IPOs cools following a surge earlier this year. Companies listing shares in Europe raised about $43 billion during the first nine months the year, more than three times last year’s $12.2 billion, according to a report by PricewaterhouseCoopers LLP. Yet since the start of the second quarter, 25 companies have pulled their IPOs, compared with just nine in the first nine months of last year, PwC said.
There are also signs some recent public offerings may have been overpriced. Listings such as Rocket Internet AG and online retailer Zalando SE sank in their first days of trading last month after being over-subscribed several times.
----OW Bunker’s March IPO gave the company a value of 5.33 billion kroner ($900 million), making it Denmark’s largest IPO after cleaning services provider ISS A/S, which went public in February in a 21.9 billion-krone listing.
More
"The secret of life is honesty and fair dealing. If you can
fake that, you've got it made."
Groucho Marx
Groucho Marx
Another weekend, will America’s War Part push for all out war in the
Ukraine? If they do, how will Russia respond? How many more Russian sanctions
before continental Europe collapses? We are living in interesting times. Have a
great late autumn weekend everyone. This winter looks set to be unusually cold.
The monthly Coppock Indicators finished October.
DJIA: +137 Down. NASDAQ: +275 Down. SP500: +210 Down.
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