Baltic Dry Index. 922 +01 Brent Crude
53.05
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
“The EUSSR creatures outside looked from Draghi to Juncker, and from Juncker to Draghi, and from Draghi to Juncker again; but already it was impossible to say which was which.”
With apologies to George Orwell, Animal Farm
We open today with level playing fields. Up first, more on the EUSSR’s “level playing field” for Deutsche Bank. In Euroland, some animals are more equal than others it seems. Well some banksters anyway, especially German banksters. No word yet from the Greeks, neither their banksters nor their bailed-in victims. I wonder how the Spanish and Italian banksters feel?
The
larger the German body, the smaller the German bathing suit and the louder the
German voice issuing German demands and German orders to everybody who doesn’t
speak German.”
P. J.
O’Rourke. Holiday’s in Hell.
Deutsche Bank was given special treatment in EU stress tests
German lender’s result was boosted by a special
concession agreed by the European Central Bank
10 October 2016
Deutsche Bank was given
special treatment in the summer EU stress tests that promised to restore faith
in Europe’s banks by assessing all of their finances in the same way.
Germany’s biggest lender, which has seen its share
price fall as much as 22 per cent in recent weeks on fears that it could face a
US fine of up to
$14bn,
has been using the results of the July stress tests as evidence of its healthy
finances.
But
the Financial Times has learnt that Deutsche’s result was boosted by a special
concession agreed by its supervisor, the European Central Bank.
Deutsche’s results
included the $4bn proceeds from selling its stake in Chinese lender Hua Xia
even though the deal had not been done by the end of 2015, the official cut-off
point for transactions to be included.
The
Hua Xia sale was agreed in December 2015. It has still not been completed and
now faces a delay after missing a regulatory
deadline
last month, though the bank is still confident of completion this year.
The Hua Xia treatment was disclosed in a footnote to Deutsche’s stress
test results. None of the other 50 banks in the stress tests had similar
footnotes, even though several also had deals agreed but not completed at the
end of 2015.
In one case, Spanish lender Caixabank completed the €2.65bn sale of
foreign assets to its parent company Criteria Holding in March but was still
not allowed to include the impact of that sale in its results.
More
Next, what American banksters really
think of the wealth and jobs destroying EUSSR fiat euro. Stay long fully paid
up physical gold and silver, held outside of the banking system, unless you
don’t mind it being “Corzined,” passed from hypothecation to hypothecation until
it’s all gone.
"Finance is the
art of passing customer segregated funds from hypothecation to hypothecation
until it finally disappears."
Brexit makes euro zone sustainability less likely: JPMorgan CEO
Speaking at the same event, James Gorman, the chief executive of Morgan Stanley (MS.N), said that the big winner from Brexit would be New York because business currently carried out in London would shift there.
Elsewhere, it’s an ill wind and all that. With the Samsung Note 7, the
suspicion is rising that the problem is something more than just the batteries.
Still what’s bad for Samsung is good for competitor Apple. The playing field
here just tipped massively in favour of Apple.
Samsung reeling as Galaxy Note 7 sales frozen
Published: Oct 10, 2016 8:40 p.m. ET
Samsung Electronics Co.'s recall of one of its most advanced smartphones
descended further into confusion, as the technology giant halted production and
distribution of the Galaxy Note 7 while investigators probed recent reports of
overheating batteries on devices that were supposed to be safe.
The company late on Monday U.S. time said it was asking all telecom
carriers and retailers that sell the Note 7 globally to stop sales and
exchanges of the device pending investigation into the latest incidents. Major
U.S. carriers already had made that move on their own.
The Samsung announcement came after the company suspended production of
the Note 7, a decision that raised questions about Samsung's initial diagnosis
of the problem, which attributed overheating batteries in some Note 7s to
manufacturing issues at one of its suppliers. Samsung said last month that it
stopped using batteries from that supplier.
The turn of events has shaken already-damaged confidence in the global
recall of 2.5 million Note 7s that began more than a month ago, creating a
headache for consumers, carriers and airlines worried that the smartphone's
faulty batteries could cause smoke or fires in midflight.
More
Apple could sell another 15 million iPhones as Samsung halts Note 7 sales
Published: Oct 10, 2016 6:53 p.m. ET
Apple shares trade at highest prices of 2016 amid Samsung woes
Shares of Apple Inc. hit their highest prices of 2016 on Monday as Samsung Electronics Co. Ltd.’s exploding-phone saga worsened and one analyst said Apple could sell millions of iPhones because of it.Samsung 005930, -6.07% announced Monday afternoon that any Galaxy Note 7 devices that have been sold should be turned off, and said it was halting sales of the smartphone after replacements suffered a similar overheating issue to the original devices. Samsung had already decided to stop production of its Note 7 smartphone after several more phones caught fire over the weekend, telling MarketWatch that it was “temporarily adjusting the Galaxy Note 7 production schedule in order to take further steps to ensure quality and safety manners.”
The company issued a global recall of the phone in early September, roughly a month after introducing it, due to a number of incidents in which the phone unexpectedly exploded. Samsung replaced the first batch of phones with new ones, but the problem has seemingly persisted even in replacement models.
The saga might be a boon to iPhone sales in an otherwise slower-than-normal year for Apple AAPL, +1.74% . In a Monday note to clients issued before Samsung completely halted sales, S&P analyst Angelo Zino said he expects the Note 7 issues to help drive some Android users over to iOS, which he estimates would increase Apple’s share of the global smartphone market by 1%. Samsung had a 22.4% share of the market in the second quarter, double Apple’s share, which was 11.8%, according to industry tracker IDC.
Zino said this could help Apple sell an additional 14 million to 15 million units during the September quarter, which would mean a 7% increase from the analyst’s previous sales forecast.
More
http://www.marketwatch.com/story/apple-could-sell-another-15-million-iphones-because-of-samsungs-note-7-explosions-2016-10-10
In other criminal news, not all playing fields are level. It turns out not all Russian hackers are Russian. A very strange case gets stranger as more details come out. Was Mr Aaron a real crook or an undercover plant? If the later, by and for whom? In London, when is a fraud authorised? But can a bank, even a Swiss one, authorise fraud? And just why did it take 3 years to find out Mr Jha was “specifically authorised” by Credit Swiss to act as he did? How could alleged losses become profits? Credit Swiss has a whole lot of explaining to do, as will likely come out when Mr Jha sues. The playing field in London just tipped massively against Credit Swiss.
“The
world is a place that’s gone from being flat to round to crooked.”
Mad
Magazine.
The American Fugitive From the JPMorgan Hack Turns Up in a Russian Cell
October 10, 2016 — 10:00 PM BST
The
only American suspect named in the largest known hack of Wall Street is
negotiating his return to the U.S. from a detention cell in Russia, where he’s
no longer welcome, people familiar with the talks said.
Joshua Aaron, a Maryland native who attended Florida State University, has been held at a facility for illegal immigrants outside Moscow since failing to show police a valid passport during a midnight check at his apartment above the Beverly Hills Diner near downtown in May, court records show.
He and two Israelis are suspected of perpetrating what U.S. Attorney Preet Bharara called “securities fraud on cyber steroids” from 2007 to mid-2015. They’re accused of stealing data on more than 100 million customers from JPMorgan Chase & Co. and other companies, using it in schemes such as stock manipulation that generated hundreds of millions of dollars in illicit gains.
Along the way, members of the ring tried to extract nonpublic information from financial corporations, processed payment information for fake pharmaceuticals and fake anti-virus software, falsified passports and took control of a New Jersey credit union, prosecutors say. They used 75 companies and bank and brokerage accounts around the world to launder money, authorities allege.
But one mystery of the case has remained: While Aaron, 32, and the two Israelis are described as the architects of a global cyber criminal enterprise, the identity of the hacker behind it all has remained unknown.
Aaron’s frequent trips to Russia during the time the alleged schemes took place raises the possibility that he may have met in person with the hacker, who is believed to be Russian or Russian-speaking. His cooperation in the case could provide new insight into the county’s cyber underworld at a moment when U.S. officials are publicly accusing Russia of trying to destabilize the American elections with state-sponsored hacks.
A
Russian judge on May 20 ordered Aaron deported and fined him 5,000 rubles ($80)
for violating the rules of his three-year visa, which requires holders to exit
and re-enter the country every six months. He arrived via Ukraine on May 23,
2015, just weeks before the U.S. issued arrest warrants for him and
co-defendants Gery Shalon and Ziv Orenstein. A second judge rejected his appeal
of the deportation ruling in June.
In statement to Russian prosecutors on the day of his detention, Aaron
said he wasn’t aware of the arrest warrant and denied breaking any U.S. laws.
Russia, which doesn’t extradite its citizens or have an extradition treaty with
the U.S., offered to hand him over in exchange for a “reciprocal” act, but
received no reply from the U.S. Embassy, according to court transcripts. He is
presumably free to leave Russia for a county of his choice.
Talks between Aaron’s lawyers and U.S. officials are progressing and a
deal paving the way for his return home, where he would be subject to immediate
arrest, may be reached this month, the people familiar with the matter said.
----Ilya Sachkov, head of Moscow-based cyberforensics firm Group-IB, called Aaron’s case particularly "strange," the first one he knows of involving a U.S. citizen accused of cybercrime who was then detained in Russia.
“Naturally, he is not alone, and his group most probably includes
Russian citizens,” Sachkov said. "Putin and Obama agreed to cooperate
against cybercriminals. This case doesn’t look like there is any
cooperation."
More
Ex-Credit Suisse Banker Wins Dismissal of Rogue Trader Charges
October 10, 2016 — 10:32 AM BST Updated on October 10, 2016 — 12:47 PM
BST
A former Credit Suisse Group AG trader accused by U.K. prosecutors of
concealing about $18 million of losses after taking inappropriately risky
positions won the dismissal of criminal charges after years of investigations.Rohit Jha, who handled exchange-traded funds, was dismissed from the Swiss bank in October 2013 after the firm discovered the alleged losses he incurred in December 2012. Credit Suisse notified regulators of the discovery when he was dismissed and Jha was later charged.
Judge David Tomlinson dismissed the charges at a hearing Monday after prosecutors said there were inconsistencies with the evidence that compromised the case. Jha, 39, was first interviewed by police in January 2013, but wasn’t charged until mid-2015.
"After almost four years the Crown disclosed evidence that fundamentally undermined their case," Anthony Edwards, Jha’s lawyer, said in a statement. "It showed that Rohit Jha has been specifically authorized to act as he did, and had made a profit, not a loss, on a number of the questioned transactions."
Jha, charged with fraud by abuse of position and fraud by false representation, was accused of mis-marking certain ETF positions in a bid to hide the losses and to make a profit for himself, prosecutors said.
“This was a criminal matter, prosecuted by the City of London Police and the Crown Prosecution Service," Sofia Rehman, a spokeswoman for Credit Suisse said. The bank "fully cooperated with the authorities during the course of the investigation.”
Jha, an Indian national who only spoke to officially deny the charges, hasn’t been able to work since he was fired as his visa was contingent on him working for Credit Suisse. Judge Tomlinson said he was sympathetic to Jha but the case was "very complex" and took time to resolve.
We close with an update from the weekend’s, new season, inaugural
Formula-E race in Hong Kong. To this old armchair racer, all Formula-E seems to
be doing at present, is confirming just how unready pure electric vehicles are
for today’s roads, given current technology. How realistic is it to have to
change cars half way through your journey? HK was a street circuit, of 45 laps
of 1.86 km. HK’s high humidity created problems with cooling the batteries. So
how will pure EV get on in the tropics?
Hong Kong ePrix: Buemi wins chaotic race, di Grassi second from 19th
Reigning champion Sebastien Buemi took victory in a breathless inaugural Hong Kong ePrix, while Lucas di Grassi made up 17 places to finish second.
The Renault e.dams driver was able to take advantage of an earlier than scheduled pitstop under Safety Car conditions and also problems for DS Virgin’s Sam Bird to start his title defence in the best possible way.Buemi fought with soaring temperatures in his Renault to hold on for the win, but it was a major concern as he explained after the 45 lap race.
“I had to save a lot of energy and then the temperatures were really high at the end,” said the season two champion. “I’m not sure I could have done another lap.”
Buemi took the lead after Bird’s DS Virgin refused to start when he swapped cars, shuffling the British driver down to an eventual 13th-place finish.
More
“The
only good bankster is a dead one.”
With
apologies to George Orwell, Animal Farm
At the Comex silver depositories Monday final figures were: Registered
29.29 Moz,
Eligible 144.44 Moz, Total 173.73 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled
over.
Wonder of wonders, for once Bloomberg publishes a
sensible article on Brexit. Now if only Bloomberg could get some sensible
balance into their daily Brexit update.
Ditch the 'Hard Brexit' Fallacy
Oct 9, 2016 3:00 AM EDT
Will Brexit be hard or soft? The question preoccupies British politicians
and commentators -- not to mention global currency markets, if the sharp fall
in sterling this week is any guide. Despite its command of the discussion,
however, this hard-or-soft framing is unhelpful. It's best dropped altogether.Sterling slumped after Prime Minister Theresa May announced on Oct. 2 that she would start the European Union's Article 50 exit process no later than the end of next March. She also repeated that she'll insist on restoring national control of immigration even if that means no longer being a member of the EU's single market.
The reaction was uniform. The government has chosen a hard Brexit. Let panic commence.
This hard-or-soft framing conflates a bundle of very different questions. Will Brexit take the U.K out of the single market? Will Britain face trade barriers? Will Brexit mean strict immigration controls? Will Britain and the EU separate on acrimonious terms, ending close cooperation on issues other than trade? Will exit be disorderly and disruptive? Declaring that Brexit will be hard implies (and is usually intended to imply) that the answer to all those questions must be yes -- and that hard thus equals disastrous.
Not so. Let's take each in turn.
Will Brexit take the U.K. out of the single market? Membership of the single market, according to the EU treaty and settled EU doctrine, requires upholding four supposedly indivisible freedoms -- free trade in goods, services and capital, and free movement of people. The fourth freedom is avowedly political, not economic: Its purpose is to dissolve the EU's internal borders. This supranational character of the European Union project is the very thing Britain objects to, and the very thing the EU insists on. So yes, Brexit means rejecting the fourth freedom, which in turn means no longer being a member of the single market.
---- Moving on, will Britain face new trade barriers? This remains to be seen. Membership of the single market guarantees free trade, but non-membership doesn't in any way rule it out. May's government says it wants free trade. EU governments say, we'll have to see. This second kind of "hard Brexit" -- trade restrictions -- could happen. But it isn't something May just chose, either as a goal or as the unavoidable consequence of resigning Britain's single-market membership. Rather, it's something the EU might decide to inflict. This kind of hard Brexit would be Europe's choice, not Britain's.
Let's pause to ask whether such a response on the EU's part would be just or sensible. Neither, in fact. Britain is accused of wanting to "cherry-pick" its future relations with the EU -- but the charge, never questioned, makes no sense. (Is the EU saying that the fourth freedom is a cost to be borne by all? Freedom of movement is supposed to be a benefit. If Britain rejects it, according to EU theory, Britain loses. How is that "cherry-picking"?) Equally, the EU has a strong economic interest in free trade with the U.K. -- including in financial services. Neither fairness nor economic self-interest requires the EU to raise trade barriers against the U.K.
---- Will Britain and the EU separate on acrimonious terms, bringing close cooperation on issues other than trade to an end? Again, this needn't happen. Again, mutual interest argues for the friendliest possible divorce -- and for continued, indeed closer, cooperation on issues such as defense and security.
Will exit be disorderly and disruptive, or calm and methodical? Calm and methodical would obviously be best, and calm and methodical are obviously what Britain will want. The early signs are that other EU governments have mixed feelings on the point. The desire to punish Britain for its rebellion is palpable -- and up to a point forgivable, because if Britain makes a success of Brexit, other EU members might be inclined to give it a try.
Yet the EU can't impose heavy costs on the U.K. without imposing at least some costs on itself. Europe's economies aren't exactly flourishing these days. The best way to make the EU more popular is to promote growth and raise living standards. Putting that goal second to punishing the U.K. might have the opposite effect to the one intended.
More
“The bankster is the
only creature that consumes without producing. He does not give
milk, he does
not lay eggs, he is too weak to pull the plough, he cannot run fast enough to
catch rabbits. Yet he is lord of all the workers. He sets them to work, he
gives back to them the bare minimum that will prevent them from starving, and
the rest he keeps for himself.”
With apologies to
George Orwell, Animal Farm
Solar & Related Update.
With events
happening fast in the development of solar power and graphene, I’ve added this
section. Updates as they get reported. Is converting sunlight to usable cheap
AC or DC energy mankind’s future from the 21st century onwards? DC?
A quantum computer next?
Exotic property confirmed in natural material could lead to fundamental studies
Date:
October 6, 2016
Source:
Purdue University
Summary:
Researchers have confirmed the existence of a naturally occurring exotic
property in which a material becomes thicker when stretched -- the opposite of
most materials -- a discovery that could lead to new studies into the
fundamental science of nano-materials behavior, say researchers.
Researchers have confirmed the existence of a naturally occurring exotic
property in which a material becomes thicker when stretched -- the opposite of
most materials -- a discovery that could lead to new studies into the
fundamental science of nano-materials behavior.
The counterintuitive phenomenon, called auxetic behavior, has been
extensively studied in engineered structures that have potential applications
in medicine, tissue engineering, body armor and "fortified armor enhancement."
However, until now the behavior has not been confirmed in natural
materials, said Peide Ye, Purdue University's Richard J. and Mary Jo Schwartz
Professor of Electrical and Computer Engineering.
The auxetic behavior was discovered in a material called black
phosphorus.
The phenomenon is governed by a fundamental mechanical property of
materials called the Poisson's ratio, which characterizes how a material
behaves when stretched. Most materials when stretched become thinner and when
compressed become thicker, and they are said to have a positive Poisson's
ratio.
"A negative Poisson's ratio is theoretically possible but until now
has not, with few exceptions of human-made structures, been experimentally
observed in any natural materials," Ye said. "Here, we show that the
negative Poisson's ratio exists in the natural material black phosphorus."
Findings are detailed in a research paper that appeared on Sept. 23 in
the journal Nano Letters.
"Until now, there has been a lack of experimental evidence since
the measurement of internal deformation in auxetic materials, in particular at
the atomic level, is extremely difficult," Ye said.
Researchers used a technique called Raman spectroscopy to document the
negative Poisson's ratio in extremely thin, individual layers of black
phosphorus called phosphorene. The research was based at the Birck
Nanotechnology Center in Purdue's Discovery Park.
MoreThe monthly Coppock Indicators finished September
DJIA: 18308
+28 Up NASDAQ: 5312 +21 Up. SP500: 2168 +32 Up.
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