Friday 18 September 2015

No Change.



Baltic Dry Index. 883 +69       Brent Crude 49.13

LIR Gold Target in 2019: $30,000.  Revised due to QE programs.

When Ebenezer Squid says jump, we only ask “how high?”

The talking chair.

To no one’s great surprise, The Fedster’s bottled out yesterday and left America’s key interest rate unchanged. The clue came earlier in the day when America’s top Goldmanite ordered “don’t do it.” It wasn’t part of God’s work, apparently. Perhaps as a Christmas treat.

Fed Leaves Interest Rates Unchanged

September 17, 2015 — 7:07 PM BST Updated on September 17, 2015 — 7:17 PM BST
Federal Reserve officials left interest rates unchanged, opting to delay an increase amid stubbornly low inflation, an uncertain outlook for global growth and recent financial-market turmoil.

“Recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term,” the Federal Open Market Committee said in a statement Thursday in Washington.
  • Read the full statement here.
In holding their benchmark federal funds rate at zero to 0.25 percent, policy makers showed they are still not convinced inflation will move gradually back to their 2 percent target, despite continued gains in the labor market. Unemployment in August fell to 5.1 percent, its lowest level since April 2008.

“On balance, labor market indicators show that underutilization of labor resources has diminished since early this year,” officials said.

The yield on the 10-year U.S. Treasury note fell to 2.23 percent at 2:10 p.m. in New York following the release of the statement from 2.30 percent late on Wednesday. The S&P 500 pared earlier gains.

Richmond Fed President Jeffrey Lacker dissented, saying he preferred to raise the target rate by 0.25 percentage point.
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Goldman chief Lloyd Blankfein on Fed rate rise: 'I wouldn't do it'

Lloyd Blankfein said the Federal Reserve should take its cues from economic data rather than sentiment about an interest rate hike

The chief executive of Goldman Sachs has cautioned the US Federal Reserve against raising interest rates, saying policymakers should resist the temptation to hike prematurely and “get it over with”.

As the world awaits a decision from the Fed at 7pm on whether rates will rise from their seven-year spell at rock bottom, Mr Blankfein told an event in New York that if a decision was made to hike “it’s not because there’s a tsunami of evidence of a hardening and quickening recovery”.

“It’s almost a question of wanting to get over that hurdle, and on that basis that’s probably not a reason to do it,” he said.

“I wouldn’t do it… because once you get pulled by, ‘gosh, they’ve been low too long’ and these kind of soft things, that really enters into the pressure and the politics and I think it should be data driven if you’re the Fed.”

Goldman Sachs’ economists have predicted a rate rise in December, having pushed back their prediction by several months over the summer in the face of worsening economic signals from China as well as lacklustre measures of the US economy.
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In other news, Europe’s migrant crisis is fuelling a swing to the right. Below, the latest news from Mrs Merkel’s German folly.

Germany's right-wing AfD rises in eastern Saxony amid refugee crisis

Wed Sep 16, 2015 8:33am EDT
Support for Germany's right-wing Alternative for Germany (AfD) party has strengthened in the eastern state of Saxony, reaching the level of Social Democrats (SPD) after an escalation in Europe's refugee crisis, a poll showed on Wednesday.
German towns are struggling to cope with a record influx of refugees and AfD has attacked the government's policy, calling it "asylum chaos".
Saxony is a stronghold for the far-right National Democratic Party and neo-Nazis, as well as the domicile of AfD's new leader Frauke Petry. The state's capital Dresden is home to the anti-Islam PEGIDA movement which drew about 5,000 people in a march earlier this week.
The infratest dimap survey put the AfD, which entered the Saxony assembly in 2014 with 9.7 percent of the vote, on 13 percent, equal to the SPD which currently shares power in the state with Chancellor Angela Merkel's conservatives.
The conservatives slipped 1.4 points to 38 percent from their result in the last year's state vote.
The poll also showed that 60 percent of people in Saxony are worried about the influx of refugees, compared to 38 percent in the whole country.
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Refugee crisis: Croatia seals border crossings with Serbia

Croatia closes seven out of eight border crossings with Serbia while Slovenia turns back train carrying migrants

By Matthew Holehouse, Brussels, Dan Nolan on the Serb-Croatia border and Colin Freeman
Croatia became the latest country to try to stem the flow of refugees, by closing seven of its eight border crossings with Serbia “until further notice,”

The move was announced by the country's interior ministry after 11,000 migrants crossed the border within 48 hours.

Meanwhile Slovenian police stopped a train carrying 150 refugees at its border with Croatia.

The migrants, who Slovenia said did not have the correct papers, will be sent back to the Zagreb, the Croatian capital, a border police spokesman said.

Earlier in the day Hungary declared success for its controversial efforts to seal its borders to migrants, as thousands of new arrivals begin heading into neighbouring Croatia instead.

In a defence of its decision to fence off its frontier and repel migrants with tear gas and water cannon, the government said the fact that migrants were now seeking other routes into Europe vindicated its strategy.
Janos Lazar, the chief of staff to Viktor Orban, the country's Right-wing prime minister, said the "assertive, uncompromising defence of the border has visibly held back human trafficking and forces them to change direction. That was the aim of the entire action".

Croatia became the latest country try to stem the flow of refugees by closing seven of its eight border crossings with Serbia "until further notice".

The move was announced by the country's interior ministry after 11,000 migrants crossed the border within 48 hours.

Meanwhile Slovenian police stopped a train carrying 150 refugees at its border with Croatia.
More

We end for the week with commodities. Dr. Copper wasn’t much affected by yesterday’s offshore Chilean earthquake.

Copper prices retreat as Chilean mines escape earthquake damage

Copper prices jumped to a near two month high before retreating after Chilean miners said workers were safe and operations were not damaged by the earthquake.

Copper prices retreated this morning amid reports Chile’s largest mines escaped damage from an earthquake which struck the South American country.

Prices spiked to $5,405 - the highest level in almost two months - as concerns about supply disruptions offset worries over weakening demand from China.

However, copper soon fell back to $5,341 as Chilean-based miners said workers were safe and their operations were undamaged by the 8.3 magnitude earthquake.

The earthquake struck 55km outside Illapel, Chile, the world's top supplier of copper, according to the US Geological Survey, threatening over 600,000 tonnes of annual capacity.

Copper prices have been rocked in recent times amid ongoing concerns that the world's second largest economy, China, is contracting.
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"The international monetary order is more precarious by far today than it was in 1929. Then, gold was international money, incorruptible, unmanageable, and unchangeable. Today, the U.S. dollar serves as the international medium of exchange, managed by Washington politicians and Federal Reserve officials, manipulated from day to day, and serving political goals and ambitions. This difference alone sounds the alarm to all perceptive observers."

Hans F. Sennholz

At the Comex silver depositories Thursday final figures were: Registered 46.86 Moz, Eligible 120.67 Moz, Total 167.53 Moz. 

Crooks and Scoundrels Corner

The bent, the seriously bent, and the totally doubled over.
Today, oil news.

Oil slips as Japan data outweighs stock draw, dollar

Thu Sep 17, 2015 9:20am EDT
Oil prices fell on Thursday after weak Japanese data sounded alarm bells over the prospects for global growth, outweighing the bullish impact of a weaker dollar and a bigger-than-expected decline in U.S. crude oil stocks.
Japan's exports slowed for a second straight month in August in a sign China's economic slowdown could be damaging the world's third-biggest economy.
The data follows worrying figures from other Asian economies, including South Korea and Taiwan, increasing anxiety over the consequences of a sharp slowdown in China.
---- Both global benchmarks had rallied sharply over the last three days as the dollar weakened on expectations that the U.S. central bank, the Federal Reserve, would maintain interest rateshttp://images.intellitxt.com/ast/adTypes/lb_icon1.png at their current, very low, levels.

---- This week's rally has made a further sharp sell-off in oil less likely, said Robin Bieber, a technical analyst and director of London brokerage PVM Oil Associates.

"It's out of dump-danger at the moment," Bieber said.

U.S. oil data this week suggested the world's biggest oil market may be beginning to tighten.

The U.S. Energy Information Administration (EIA) on Wednesday reported the largest crude drawdown since February 2014 at the Cushing, Oklahoma, delivery point.

"This is a result of higher refining activity and lower U.S. crude production, which is helping the U.S. inventory glut to ease off," Daniel Ang, analyst at Singapore brokerage Phillips Futures, said.
U.S. oil output has begun to ease after six years of sharp increases. EIA data shows U.S. crude and condensate production peaked at 9.612 million barrels per day (bpd) in April and had declined by 316,000 bpd by June.

But the world is still awash with oil, with global production still running at more than 2 million bpd above demand, filling oil stockpiles around the world.
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Solar  & Related Update.

With events happening fast in the development of solar power and graphene, I’ve added this new section. Updates as they get reported. Is converting sunlight to usable cheap AC energy mankind’s future from the 21st century onwards? DC? A quantum computer next?

Steve Holliday, CEO National Grid: “The idea of large power stations for baseload is outdated”

Steve Holliday, CEO of National Grid, the company that operates the gas and power transmission networks in the UK and in the northeastern US, believes the idea of large coal-fired or nuclear power stations to be used for baseload power is “outdated”. “From a consumer’s point of view, the solar on the rooftop is going to be the baseload. Centralised power stations will be increasingly used to provide peak demand”, he says, in an exclusive interview for World Energy Focus, a publication of the World Energy Council produced by Energy Post. The chief of National Grid also notes that energy markets “are clearly moving towards much more distributed production and towards microgrids”.
“This industry is going through a tremendous transformation. We used to have a pretty good idea of what future needs would be. We would build assets that would last decades and that would be sure to cover those needs. That world has ended. Our strategy is now centred around agility and flexibility, based on our inability to predict or prescribe what our customers are going to want.”
As CEO, since 2007, of a company active on two continents, and being responsible for both gas and electricity transmission and distribution, Steve Holiday finds himself smack at the centre of the whirlwind developments in the energy sector. And since National Grid is a regulated (albeit publicly listed) company, he can speak from a reasonably independent position. Which makes it fascinating to talk to him.
“What is crucial”, says Holliday, “is what consumers will want. In the past all consumers got the same. One size fits all. Now one size will not fit all. People will want to interact with energy in many different ways.” This is why he warns against people who think they can predict the future. “Some people think they have the answer, whatever it may be. But I believe there will be different answers for different places, rural and cities, and for different customers. That’s why flexibility and agility are key.”
---- For the UK National Grid works with four Future Energy Scenarios, which are available on the internet and updated every year. According to these scenarios, it is likely that by 2020 small-scale, distributed generation will represent a third of total capacity in the UK. Holliday: “This is a quadrupling in just a few years. It represents a massive increase from the old days of centrally dispatched generation.” Recent government measures in the UK to limit subsidies for renewable energy may affect the timing of this development, says Holliday, but not the trend.

He notes that the speed at which the energy system is changing has taken many people by surprise, including himself. “The amount of solar being added to the system is incredible. 1500 MW in the first three months of this year. That’s the capacity of two power stations. I made a comment to the Energy Minister four years ago that there was little probability we would have 20,000 MW of solar in the UK. Now three of our scenarios have more than 20,000 MW of solar by 2035.”
More

Another weekend, and a growing migrant crisis in Europe thanks to Germany. It’s getting hard to see the EUSSR surviving in its present erratic German diktat form. Time to place a bet on Brexit. Greece votes on Sunday but whoever wins they must implement German policy. I suspect that many won’t bother to vote. Have a great weekend everyone.

"Deficit spending is simply a scheme for the 'hidden' confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights."

Alan Greenspan

The monthly Coppock Indicators finished August

DJIA: +65 Down. NASDAQ: +168 Down. SP500: +92 Down. 

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