Trump “Will Probably Win” and Gold “May Rise $100” Overnight – Jim Rickards

29 October 2016 — Saturday


The gold price was up a few dollars by noon in Far East trading on their Friday — and then it quietly headed lower, culminating in the 8:30 a.m. EDT smack-down to its low tick of the day.  It bounced around a bit — and was back above unchanged when the Hillary/FBI story hit the wires.  All markets when haywire at that juncture — and the gold price rally that erupted at that instant got capped and turned lower starting around 2:15 p.m. in the thinly-traded after-hours market.  By the close, JPMorgan et al — obviously in full ‘battle stations’ mode — had peeled back over half the gains.

The low and high tick, both occurring in the COMEX trading session, were recorded as $1,262.00 and $1,285.40 in the December contract.

Gold was closed in New York yesterday at $1,274.70 spot, up $6.60 on the day, but heaven only knows how far above $1,300 spot it would have closed at if ‘da boyz’ hadn’t appeared when they did.  No surprisingly, net volume was over the moon at a hair under 212,000 contracts.161029gold

Here’s the 5-minute gold tick chart courtesy of Brad Robertson.  There was a bit of futures volume in gold while London was open yesterday but, as is always the case 100 percent of the time, the only volume that really mattered occurred during the COMEX trading session, with the first big volume spike coming at 06:35 Denver time on the chart below, which was the volume associated with the price spike to gold’s low tick of the day at 8:30 a.m. in New York.  Volume didn’t really drop off to background until very shortly after 14:00 MDT, which was 4:00 p.m. EDT.

The vertical gray line is 10:00 p.m. Denver time, midnight in New York — and noon China Standard Time [CST] the following day in Shanghai—and don’t forget to add two hours for EDT.  The ‘click to enlarge‘ is a must here.161029-5-minute-gold

The price pattern in silver was much the same, except that silver’s low tick appeared to come at the noon silver fix in London — and silver then appeared to be in rally mode long before the Hillary/FBI news showed up.  Nevertheless, the powers-that-be capped the silver price at precisely 2:00 p.m. EDT — and by the close had taken over half its gains away as well.

The low and high ticks in this precious metal were reported by the CME Group as $17.505 and $17.935 in the December contract.

Silver was closed on Friday afternoon at $17.725 spot, up 13.5 cents from Thursday’s close.  Net volume was sky-high as well at a hair over 63,000 contracts.161029silver

And here’s the 5-minute silver tick chart courtesy of Brad Robertson.  Like in gold, the vertical gray line is 10:00 p.m. Denver time, midnight in New York — and noon China Standard Time [CST] the following day in Shanghai—and don’t forget to add two hours for EDT.  The ‘click to enlarge‘ is a must here as well.161029-5-minute-silver

Platinum was up 9 bucks by noon in Shanghai on their Friday — and then suffered the same price fate as silver and gold,  By shortly before 11 a.m. Zurich time it was back to unchanged on the day — and then didn’t do a lot until 8:30 a.m. in New York.  Then away it went to the upside, with only a minor 1-hour price setback after the Zurich close.  Like silver, it was capped at precisely 2:00 p.m. EDT as well, because if ‘da boyz’ hadn’t appeared at that juncture, it’s a near certainty that platinum would have closed above $1,000 spot — and we can’t have that as a talking point over the weekend, now can we?  From its 2:00 p.m. high tick, it was sold down around 8 dollars going into the 5:00 p.m. EDT close.  Platinum finished the Friday session at $977 spot, up 15 bucks from Thursday’s close.  It was up $23 bucks the ounce [and climbing] at its 2 p.m. high tick.161029platinum

Palladium was up 5 dollars by noon in Shanghai on their Friday, but by the Zurich open, it was down a buck on the day.  From there it rallied very unsteadily higher until a few minutes after the COMEX close — and it traded flat from there.  Palladium closed up 9 dollars on the day, but it’s obvious from the chart below that, like platinum, if allowed to hoe its own row during the COMEX trading session — and beyond — it would have closed much higher than it did.161029palladium

The dollar index closed very late on Thursday afternoon in New York at 98.91 — and chopped more or less sideways until around 9:25 a.m. BST in London on their Friday morning.  At that point it began to roll over — and really took a header at 1:00 p.m. EDT when the Hillary/FBI story broke.  ‘Gentle hands’ appeared a minute or two after the 1:30 p.m. EDT COMEX close — and at that moment, the low tick was recorded as 98.24.  It ‘rallied’ 20 basis points during the next hour of trading, before sliding hard into the close.  The dollar index finished the Friday session at 98.31 — down 60 basis points from Thursday.

Heaven only knows what the U.S. dollar Index would have closed at if allowed to seek its ‘intrinsic’ value.  Someday we may find out, but ‘da boyz’ didn’t want it to be yesterday.161029intraday-gif

And here’s the 3-year U.S. dollar index chart, so you get a longer-term view of the world’s ‘reserve currency’.161029-3-year-usd

The gold stocks more or less followed the gold price around yesterday — and the rally that began shortly after 1 p.m. EDT took them up about 4 percentage points.  But once it became apparent to the market that JPMorgan et al were back on the job, the gains quickly melted away — and the HUI finished up only 0.37 percent.161029hui

The price pattern in the silver equities was similar, but the rally that began minutes after 1 p.m. in New York was well under 2 percentage points — and when they sold off after the price was capped, they fell back for only a tiny gain as well, as Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed up by 0.32 percent.161029silver-7

And here are the usual three charts from Nick that tell all.  The first one shows the changes in gold, silver, platinum and palladium for the past week, in both percent and dollar and cents terms, as of Friday’s closes in New York — along with the changes in the HUI and Silver Sentiment/Silver 7 Index.  The Click to Enlarge feature really helps on all three charts.161029weekly

And the chart below shows the month-to-date changes as of Friday’s close.161029month-to-date

And below are the year-to-date changes as of the close of trading yesterday.161029year-to-date

The CME Daily Delivery Report showed that 341 gold and 39 silver contracts were posted for delivery within the COMEX-approved depositories on Monday.  These are the last of the October deliveries that I mentioned yesterday that were left until the last possible moment.  In gold, the only short/issuer was Macquarie Futures out of its own account.  The only two long/stoppers of note of the six mentioned, were Goldman Sachs with 163 contracts for its client account, plus 161 contracts for Canada’s Scotiabank for its own account.  Scotiabank doesn’t have a client account.  In silver, the only two short/issuers were Macquarie Futures once again with 33 out of its own account, plus JPMorgan with 6 out of its client account.  The only two short/issuers worthy of the name were ADM with 23 contracts — and Goldman with 9 — both for their respective client accounts.

The link to yesterday’s Issuers and Stoppers Report is here — and it also includes the First Day Notice data mentioned a couple of paragraphs further down.

The CME Preliminary Report for the Friday trading session showed that gold open interest fell by 342 contracts, leaving zero contracts left. Thursday’s Daily Delivery Report showed that 1 gold contract was posted for delivery on Monday, plus the 341 contracts mentioned in the previous paragraph, so that totals 341+1=342 contracts — and that’s why October open interest in gold shows zero, which is what it should.  Silver o.i. for October fell by 52 contracts, leaving zero left as well.  Thursday’s Daily Delivery Report showed that 13 silver contracts were posted for delivery on Monday — and when you add in the 39 contract from Friday’s Daily Delivery Report in the previous paragraph, you come up with 13+39=52 silver contracts to be delivered on Monday.  It’s all so neat and orderly.

First Day Notice for delivery in November showed that 875 gold and 338 silver contracts were posted for delivery on Tuesday, 01 November.  In gold, the largest short/issuer by far was Goldman Sachs with 826 contracts out of its client account.  ABN Amro and ADM were ‘also rans’ with 29 and 20 contracts issued.  Canada’s Scotiabank stopped 816 contracts — and the two ‘also rans’ in on the long/stopper side were ABN Amro and International F.C. Stone with 46 and 13 contracts out of their respective client accounts.  In silver, the two short/issuers were International F.C. Stone with 214 contracts — and ABN Amro with 124.  The three largest of the six long/stoppers were Canada’s Scotiabank with 125 contracts for its own account — and Goldman Sachs and ABN Amro with 110 and 88 contracts for their respective client accounts.  The link to all of this activity is in the Issuers and Stoppers Report link posted two paragraphs ago.

Gold open interest in November dropped by 430 contracts, leaving 1,374 still around, minus the 875 mentioned above.  Silver o.i. in November actually rose by 12 contracts, leaving 346 still around, minus the 338 mentioned at the top of the previous paragraph.

There were no reported changes in GLD yesterday — and as of 7:13 p.m. EDT on Friday evening, there were no reported changes in SLV, either.

There was a tiny sales report from the U.S. Mint yesterday, as they sold 1,000 troy ounces of 24K gold buffaloes.

Month-to-date the mint has sold 108,500 troy ounces of gold eagles — 25,500 one-ounce 24K gold buffaloes — and 3,675,000 silver eagles.  There’s one more reporting day left in October — and that’s Monday.

There was almost no gold movement at all in the COMEX-approved depositories on the U.S east coast on Thursday.  Nothing was reported received — and only 128.600 troy ounces/4 kilobars were shipped out of Manfra, Tordella & Brookes, Inc.  I shan’t bother linking this activity.

And as is almost always the case, it was much busier in silver, as 600,726 troy ounces were received — all of which went into the CNT Depository — and 343,998 troy ounces were shipped out the door.  Of the ‘out’ amount, there was 244,209 troy ounces shipped out of Brink’s, Inc. — and the rest came out of CNT.  The link to that activity is here.

It was another big day over at the COMEX-approved gold kilobar depositories in Hong Kong on their Thursday.  They reported receiving 1,850 of them — but they also shipped out a hefty 13,979.  As per usual, all that action was the Brink’s, Inc. depository — and the link to that is here.

The Commitment of Traders Report for positions held at the close of COMEX trading on Tuesday showed a small improvement in silver, but a fairly healthy deterioration in gold.

In silver, the Commercial net short position decreased by 1,515 COMEX contracts, or 7.6 million troy ounces of paper silver.  They arrived at this number during the reporting week by purchasing 3,349 long contracts, but they also increased their short position by 1,834 short contracts, with almost all of these contracts coming via the traders in the Managed Money category.  The difference between those two numbers is the change for the reporting week.

Ted said that the raptors, the commercial traders other than the Big 8, were responsible for the entire change for the week, as they added another 1,500 contracts to their already considerable long position, which is now a bit over 20,000 contracts in total.  Ted also said that the Big 4  commercial traders decreased their short position in silver by about 200 contracts, but the ‘5 through 8’ traders went the other way by 200 — so it was a wash for the Big 8.

Under the hood in the Disaggregated COT Report it was all the Managed Money traders and then some, as they sold 2,623 long contracts — and increased their short position by a tiny 42 contracts, for a total weekly change of 2,665 contract.  The difference between this number and the commercial net short position…2,665-1,515=1,150 contracts…was transacted by the thousands of traders that are counted in the ‘Other Reportables’ and ‘Nonreportable’/small trader categories.  This is why Ted says that silver and gold prices are set exclusively between JPMorgan et al on one side, as they game the Managed Money traders on the other side, for fun, profit — and price management purposes.

The commercial net short position in silver now stands at 367.0 million troy ounces — and Ted pegs JPMorgan’s short position in silver at unchanged from last week, which was 24,000 contracts, or 120 million troy ounces.  We get the November Bank Participation Report next Friday, so he’ll be able to recalibrate JPMorgan’s short position at that time.

Here’s the 9-year COT Report chart for silver — and even including the tiny change in this week’s report, we’re still miles away from anything that remotely resembles wildly bullish.  The click to enlarge feature really helps here.161029cot-silver

In gold, there was big deterioration in the Commercial net short position, as it increased by 14,928 contracts , or 1.49 million troy ounces of paper gold.  This came about as they sold 741 long contracts, plus they added 14,187 contracts to their short position.  The sum of those two numbers is the change for the reporting week.

Ted said that the Big 4 commercial traders actually decreased their short position by around 400 contracts — and he was equally surprised by the fact that the ‘5 through 8’ traders added about 7,700 contracts to their short positions during the reporting week.  The raptors, the commercial trader other than the Big 8 — and there are 47 of them — increased their short positions by around 7,600 contracts.

I’m sure Ted will have something to say about this in his weekly commentary that comes out on his website later today.

Under the hood in the Disaggregated COT Report, it was almost all a Managed Money affair as well.  Their change for the week totalled 12,956 contracts, as they added 9,086 longs, plus they covered 3,870 shorts — and the commercial traders were happy to pick up the other side of all these traders, plus about another 2,000 contracts from the ‘Other Reportables’ and ‘Nonreportable’/Small Trader categories.

The commercial net short position in silver is now up to 21.76 million troy ounces.

Here’s 9 years worth of COT Reports for gold — and this week’s report was a step backwards, so we’ve still got miles to go to get back to bullish territory once again.  Click to enlarge.161029cot-gold

Of course after yesterday’s big price surprises, which I wouldn’t exactly call a ‘black swan’ event, as it was more of the ‘black duck’ variety.  And because of that, yesterday’s COT Report can be considered ‘yesterday’s news’ by any metric you care to use.

But all attempts at humour aside, there should be no doubt in your mind that the powers-that-be were, as I said further up, in full ‘battle stations’ mode to get precious metal prices back in the box.  This mostly applied to gold and silver — and the amount of paper thrown at those two metals on Friday was awesome to behold — and without doubt, the commercial net short positions in both silver and gold deteriorated to an alarming extent yesterday.

Here’s Nick Laird’s “Days to Cover” chart updated with yesterday’s COT data for positions held at the close of COMEX trading on Tuesday.  It shows the days of world production that it would take to cover the short positions of the Big 4 — and Big ‘5 through 8’ traders in each physically traded commodity on the COMEX.  These are the same Big 4 and ‘5 through 8’ traders discussed in the COT Report.  Click to enlarge.161029days-to-cover

For the fourth week in a row we’ve moved further away from the ‘obscene’ and ‘grotesque’ situations that has existed in the COT Reports in silver.  And although those words are nice to write, it’s cold comfort after Friday’s price action.  ‘Grotesque’ and ‘Obscene’ could soon make a reappearance in further Saturday columns.  For the current reporting week, the Big 4 are short 136 days [4.5 months] of world silver production—and the ‘5 through 8’ traders are short an additional 59 days of world silver production—for a total of 195 days, which is 6 and a half months of world silver production, or about 474 million troy ounces of paper silver held short by the Big 8.  These numbers are virtually unchanged from the prior week.

And it should be pointed out here that in the COT Report above, the Commercial net short position in silver is 367.0 million troy ounces.  So the Big 8 hold a short position larger than the Commercial net position to the tune of 474.0-367.0=107 million troy ounces…give or take.  And don’t for get that Ted Butler pegs JPMorgan’s short position at 120 million ounces of the 474 million troy ounces held short by the Big 8.  How concentrated — and ridiculous is that?

And if that isn’t bad enough, the Big 8 are short 48.3 percent of the entire open interest in silver in the COMEX futures market.  And if you subtract out the market-neutral spread trades, it’s a reasonable assumption the Big 8 are short over 50 percent of the total open interest in silver.  In gold it’s 40.6 percent of the total open interest that the Big 8 are short.

And as an aside, the two largest silver shorts on Planet Earth—JPMorgan and Canada’s Scotiabank—are short about 85 days of world silver production between the two of them—and that 85 days represents around 63 percent of the length of the red bar in silver in the above chart.  The other two traders in the Big 4 category are short, on average, about 26 days of world silver production apiece.

And based on Ted’s estimate of JPMorgan’s short position of 24,000 contracts, JPMorgan is short around 49 days of world silver production all by itself.  Because of that, the approximate short position in silver held by Scotiabank works out to around 36 days of world silver production.

In gold, the Big 4 are short 54 days of world gold production, unchanged last week — and the ‘5 through 8’ another 19 days of world production [up from 17 days last week], for a total of 73 days.  Based on these numbers, the Big 4 in gold hold about 74 percent of the total short position held by the Big 8 — and that’s off the record high, but only by a bit.  How’s that for a concentrated short position within a concentrated short position?

The “concentrated short positions within a concentrated short position” in silver, platinum and palladium held by the Big 4 are 70, 69 and 69 percent respectively of the short positions held by the Big 8.  And despite the changes in the Commercial net short positions in all four precious metals during the reporting week just past, these “concentrated short positions within a concentrated short position” have barely changed, if at all, for silver, gold and platinum — but have decreased from 74 down 69 percent for palladium.

Here are two charts that Nick Laird passed around very late last night Denver time — and they show gold and silver imports into India for the month of September — and although they’re up slightly from August, they certainly “ain’t what they used to be” as the song goes.  Click to enlarge on both.161029india-gold


After a quiet week with not many stories, I have a few more today, so I hope you have enough time in what’s left of your weekend to read the ones that interest you the most.


Bond World Bloodied by Biggest Losses Since 2013 in Global Rout

After all central bankers have done since the financial crisis to prop up bond prices, it didn’t take much for them to send the global debt market reeling.

Bonds worldwide have lost 2.9 percent in October, according to the Bloomberg Barclays Global Aggregate Index, which tracks everything from sovereign obligations to mortgage-backed debt to corporate borrowings. The last time the bond world was dealt such a blow was May 2013, when then-Federal Reserve Chairman Ben S. Bernanke signaled the central bank might slow its unprecedented bond buying.

Europe led the losses that reverberated worldwide this week as signs of accelerating inflation and economic growth spurred speculation that the European Central Bank and its major counterparts are moving closer to curbing monetary stimulus, including asset purchases. The result is that investors are abandoning one of the year’s biggest trades — a bet on higher-yielding, long-term bonds — as they wake up to the limits of central-bank demand that drove bond yields to record lows as recently as July.

Portfolios, banks, and hedge funds stocked up on these government bonds on the belief that global central banks would be buying them for years,” said Tom di Galoma, managing director of government trading and strategy at Seaport Global Holdings in New York. “Now, there has been a shift in central-bank policy globally.’’

Why is anyone the least bit surprised?  And as bad as it has been so far this month, I don’t think the real pain has started.  We’ll find in December if the Fed has the gonads to raise interest rates.  No matter what they do, raise…or stand pat, they’re a spent force in the market — and Mr. Bond Market has started to sense that, along with a whiff of inflation in the air as well.  This Bloomberg offering showed up on their Internet site at 11:25 a.m. Denver time on their Friday morning — and it comes to us courtesy of Swedish subscriber Patrik Ekdahl.  Another link to it is here.

Doug Noland: Peak Monetary Stimulus

Fledgling “risk off” turned more apparent this week. Notably, the broader U.S. equities market came under pressure. Having outperformed over recent months, the now Crowded Trades in the mid- and small-caps saw prices drop 1.8{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} and 2.5{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}. In general, the beloved high dividend and low volatility stocks – colossal Crowded Trades – also badly lag the market. The REITS (VNQ) dropped another 3.6{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} this week, having declined 13{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} from August highs to trade at the lowest level since April. The homebuilders (XHB) declined to the low since March. It’s worth noting that Ford this week also traded to lows going back to March.

Abnormal has been around so long now we’ve grown accustomed. Fifteen-year mortgage rates at 2.78{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}. ARMs available at 2.75{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}. And I’m hearing automobile advertisements even more outrageous than 2007. “Lease Kia two for $222 a month.” How much future demand has been pulled forward by history’s lowest interest rates – and accompanying loose Credit.

QE is not disappearing any day soon. Yet there’s a decent argument that we’re at Peak Monetary Stimulus. The Fed is preparing for a hike in December. The Kuroda BOJ has lost its appetite for surprising markets with added stimulus. And I suspect the ECB is just over a month away from a contentious discussion of how to taper QE starting in March 2017. Market liquidity may not be a pressing concern today, but it will be in the not too distant future.

Doug’s weekly Credit Bubble Bulletin appeared on his website in the wee hours of this morning EDT — and another link to it is here.

Santelli Exchange: Infrastructure spending — Rigging or digging?

Former CBO Director and McCain Economic Advisor, Doug Holtz-Eakin and CNBC‘s Rick Santelli discuss GDP and infrastructure spending.

This 3:52 minute CNBC video clip appeared on their Internet site very late on Friday morning EDT — and I thank James Gullo for sending it along.

FBI Reopens Clinton Probe: Too Little Too Late? Surprising Krugman Tweet

It should be clear to even the casual observer that the FBI purposely failed to investigate the Hillary e-mail server scam as well as improprieties the Clinton foundation.

Today the FBI reconsidered. So here we are, 11 days from the election, with an unprecedented FBI probe of the likely next president of the United States, who will undoubtedly be given a pardon by president Obama in his final finger to U.S. citizens.

Paul Krugman: Comey needs to provide full info immediately. Otherwise he has clearly made a partisan intervention, betraying his office.

Glenn Greenwald: The full-scale attacks on the integrity of the FBI Director have commenced…

This worthwhile commentary on the situation appeared on Mish Shedlock’s website at 2:10 p.m. EDT on Friday afternoon — and I thank Roy Stephens for pointing it out.  Another link to it is here.  A story about this appeared on The New York Times Internet site yesterday.  It was headlined “F.B.I. Reviewing New E-mails in Hillary Clinton Case” — but has now been revised to read this…”New E-mails in Clinton Case Came From Devices Once Used by Anthony Weiner“.  This longish news item, which has obviously been extensively rewritten since Roy Stephens sent it to me at 1:55 p.m. EDT yesterday afternoon, is linked here — and I would think it’s worth reading.

Dr. Dave Janda speaks out on Hillary’s new e-mail scandal

The good doctor e-mailed these comments to me yesterday with the subject line that stated — Well Yogi was right—“It ain’t over till it’s over!” — and I thought they were worth sharing…..

Below is my take on what is happening to Hillary Clinton and her campaign.  This is based on information from a number of sources.


I heard around 1 this afternoon from friends in D.C. ….the case was re-opened because of 2 possible avenues…. Assange will drop a big hit within 48 hours…. could be Comey was given a coming attraction with the opportunity to get ahead of his announcement plus…. Abed in, Hillary’s trusted “assistant”,  e-mailed herself the e-mails between her and Hillary that were then part of the deleted 33,000 e-mails.  it so happens that her hubby…. Anthony Weiner  (Twitter pervert) got a hold of them as well…. so it appears America will be saved by Weiner’s weiner.  Her campaign is imploding…her manager Mook just deleted his entire Twitter file….too little…too late…..they are ALL lawyering up.

I knew something was up big time last night when all of the trolls coming after me for my opposition to Obama Care and Hillary Care stopped abruptly last night. I even sent a note to several of the scum asking them if they stopped “loving me”….no response.  Big time social media people like Cernovich also noted the pull back of the trolls.  In addition, I heard from my contacts in Chicago. ALL street money from Hillary stopped abruptly this morning….same in Philly.

She is done….I mean done.  Her Parkinson’s Disease is now the least of her very big problems. Being the jerk I am….this morning I ordered an orange jump suit from Amazon and had it delivered to Hillary’s H.Q.

I love the smell of burning Globalists!…[in the morning! – Ed]


Watergate’s Carl Bernstein: FBI Wouldn’t Reopen a Probe Unless it is “A Real Bombshell

In the aftermath of the so-called Cocktober surprise unveiled this afternoon by the FBI when the bureau announced it was reopening a probe into Hillary Clinton’s email server because “new evidence has come to light” after “materials” were found on equipment belonging to Anthony Weiner and Huma Abedin, the question on everyone’s lips – and certainly Hillary Clinton’s and most democrats – is why did the FBI do this now, 11 days before the election, in a way that did not even coordinate with the White House?

One opinion belongs to Watergate journalist Carl Bernstein, who just days after his infamous peer Bob Woodward said that the “Clinton foundation is corrupt, it’s a scandal” said that “her conduct in regard to the e-mails is really indefensible and if there was going to be more information that came out, it was the one thing, as I said on the air last night, actually that could really perhaps affect this election.

We don’t know what this means yet except that it’s a real bombshell. And it is unthinkable that the Director of the FBI would take this action lightly, that he would put this letter forth to the Congress of the United States saying there is more information out there about classified e-mails and call it to the attention of congress unless it was something requiring serious investigation. So that’s where we are…”

Right now we’re all talking in a vacuum but I want to add here that in the last, oh, 36, 48 hours, there has been an undercurrent of kind of speculative discussion among some national security people that something might surface in the next few days about e-mails, and I think the expectation in this chatter — and I took it as just chatter but informed chatter, to some extent — was that it would relate to another round of WikiLeaks e-mails, which our Justice Department people seem to be saying is not the case, but there has been some noise in the national security community the last day or two of this kind of possibility of some kind of revelation. 

But this is her Achilles heel and we have to remember that it also comes on the — back to the word heel — of the revelations about the Clinton Foundation. So the confluence of all of this is bad for her as it stands now but with some knowledge she might be able to stop, turn things around, and give us some idea of what’s going on in a way we might not otherwise know, and also it’s very possible that some members of congress very quickly are going to get an idea of what these e-mails are, and what this is all about, and for whatever purpose put some information out there.

This amazing news item appeared on the Zero Hedge website at 7:30 p.m. EDT last night — and it’s worth reading.  Another link to it is here.

Donald’s Right: The System is Rigged — Bill Bonner

For weeks, the top news headlines have been about politics.

And politics has been all about the Republican Party candidate for president of the United States, Donald Trump.

The Establishment, the media, and most right-thinking people look around and sniff the air.

Something stinks. And the smell, they say, is coming from that skunk, Trump.

Meanwhile, Hillary, all greased up with expensive perfume, glides by – all her double dealing… her millions in Wall Street speaking fees… her crony friends and supporters.

This most excellent commentary by Bill put in an appearance on the Internet site yesterday sometime — and it’s certainly worth reading as well.  The embedded video at the end narrated by Bonner, falls into the absolute must watch category, but beware of the big infomercial at the end.  Another link to it is here. [Reader Judy Sturgis sent me the Bonner video as stand-alone item on Thursday, but I passed on it then, but here it is now.]

Oregon militants acquitted of conspiracy in wildlife refuge seizure

A federal court jury delivered a surprise verdict on Thursday acquitting anti-government militant leader Ammon Bundy and six followers of conspiracy charges stemming from their role in the armed takeover of a wildlife center in Oregon earlier this year.

The outcome marked a stinging defeat for federal prosecutors and law enforcement in a trial the defendants sought to turn into a pulpit for airing their opposition to U.S. government control over millions of acres of public lands in the West.

Bundy and others, including his brother and co-defendant Ryan Bundy, cast the 41-day occupation of the Malheur National Wildlife Refuge as a patriotic act of civil disobedience. Prosecutors called it a lawless scheme to seize federal property by force.

Jubilant supporters of the Bundys thronged the courthouse after the verdict, hailing the trial’s outcome as vindication of a political ideology that is profoundly distrustful of federal authority and challenges its legitimacy.

We’re so grateful to the jurors who weren’t swayed by the nonsense that was going on,” defendant Shawna Cox told reporters. “God said we weren’t guilty. We weren’t guilty of anything.”

This Reuters news item, filed from Portland, Oregon, appeared on their website at 4:15 p.m. EDT on Friday afternoon — and I thank Tolling Jennings for sharing it with us.  Another link to it is here.

This Saturday, ‘pirates’ may take over Iceland

Parliamentary elections are held in Iceland on Saturday. And soon pirate politics and direct democracy might have increased influence on the small volcanic Iceland.

Because The Pirate Party is shifting between being the number one most popular political party and the second most popular political party in polls.

For instance, a poll conducted by the Social Science Research Institute of the University of Iceland used data from 14-19 October 2016 to conclude that the support of Pirate Party stood at 22,6 {f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}, ahead of all other parties.

The party was founded in 2012 and they are currently holding 3 out of 63 places in the Althing, the Icelandic parliament.

Here are a few of the things the Pirate Party wants to do:

– Give asylum to Edward Snowden
– Introduce a 35 hour-workweek
– Introduce a new, transparent, constitution
– Legalize drugs
– Raise taxes on natural resources.

This story was posted on the Internet site around 11 a.m. EDT on Friday morning — and it’s the second offering of the day from Patrik Ekdahl.  Another link to it is here.

Moody’s Warns Deutsche Bank is Dangerously Close to Falling Below Its “Default Point”

Moody’s Capital Markets Research issued a damning verdict on Deutsche Bank earlier this week. In a research report put together by the credit agency’s ‘Analytics’ research division, Moody’s analysts write that Deutsche Bank expected default frequency remains at one of the highest levels in the banking industry, despite the bank’s efforts to shore up its capital position.

In the report, Moody’s cites its Expected Default Frequency measure, which is a continuous measure of a firm’s default risk. The firm’s one-year EDF measure increased from 1.05{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} in January to its all-time high of 2.85{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} on February 9. Since then, the EDF measure has declined somewhat, but remains volatile, reflecting Deutsche Bank’s lingering financial problems. At present, the company’s current EDF measure is a 1.39{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}, which is still significantly above the Global Banks and S&Ls group’s optimal threshold level as calculated by Moody’s. The optimal threshold or value at which firms in the Global Banks and S&Ls Group should be flagged for additional review is 1.22{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}.

There are two key takeaways from the EDF measure of 1.39{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}. Firstly, only 15{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of companies in the Global Banks and S&Ls group have an EDF measure above this level suggesting that, compared to the rest of the global banking industry, Deutsche’s default risk is relatively high. That being said, the second key takeaway is the fact that Deutsche’s EDF is only slightly above the trigger level, implying that the firm is not facing imminent risk of default but requires close monitoring.

The bank’s market leverage, the ratio of a firm’s default point to its market value of assets, is in the 96 percentile, “making it one of the riskiest banks by that metric.” In fact, leveraged loan Deutsche is dangerously close to falling below its current “default point”.

“Since June 2008, Deutsche’s market value of assets has dropped by about 35{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} from $2.3 trillion to its current level of $1.5 trillion, significantly closer to its current default point of $1.4 trillion. Historically, when a firm’s market value of assets falls below the default point, it is highly likely that the firm will be unable to sell assets or raise additional capital to pay its creditors.”

I get the impression that EDFs in general, like most country’s credit ratings, are being doctored higher to prevent people from seeing that.  In fact, most of the world’s banks, like the countries that house them, are already insolvent.  This Zero Hedge piece was posted on their website at 10:44 a.m. on Friday morning EDT — and I thank West Virginia reader Elliot Simon for finding it for us.  Another link to it is here.

Ankara and Washington: It’s a New Deal

As Ankara is pushing Washington to hand over Fethullah Gulen, the man accused of orchestrating a failed July 15 coup in Turkey, Radio Sputnik’s Loud & Clear host Brian Becker discusses with former CIA analyst Ray McGovern the new relations between the two long-term allies.

Turkey’s Justice Minister Bekir Bozdağ traveled to the United States on Tuesday, for talks with U.S. Attorney General Loretta Lynch, primarily seeking the extradition of cleric Gulen. In McGovern’s view, Ankara should not expect that Washington will forcibly extradite the former ally of Turkish President Tayyip Erdogan.

“[Ankara] wants to have a pretext to dissociate themselves with the United States, [but the US is] not going to be bowing before you on things like Iraq’s Mosul and Syria’s Aleppo, both of which Erdogan seems still to consider parts of his Grand Ottoman Empire he would like to reestablish,” asserted the analyst on Loud & Clear program.

Larry Galearis, who provided this story/audio interview, had this to say about it…”Finally someone is discussing what Turkey is doing in Syria. And I agree with Ray here that Turkey’s interests are not necessarily in line with Russia’s or Syria’s or Washington’s. On the topic of a Turkish declaration of NATO Article 5, if Russia shoots down a Turkish aircraft up to no good in Syria, Ray did not clarify whether a NATO invading another country would neuter Article 5 as it is an aggressor nation in Syria. But note that the Russians were very clear about what its response would be to even unknown aircraft (IFFs can be turned off); they would be shot down. Nobody was talking about this in the American press, but unofficially that is a “no fly zone”. And so far both Turkey and Washington is taking it seriously. But Ray’s last comment about how the “cowboy” elements in the DOD could try to test out the this red line. That nobody is talking about this (MSM) is actually a sign that Washington is taking this seriously.

But the way Carter ended the ceasefire and the Russian unofficial no-fly zone imposed has essentially very much limited Washington’s military responses in Syria and I still wonder why Carter is still head of the DOD…..Perhaps he needs to show he can be on Hillary’s team too and knows he is protected?

I keep thinking that the Mafia would run Washington in a more benevolent fashion than the shadow government. I think everyone should take a moment and think about that…

This audio interview put in an appearance on the Internet site at 7:29 a.m. Moscow time on their Thursday morning, which was 12:29 a.m. on Thursday morning in Washington — EDT plus 7 hours.  Another link to this interview is here.

Malaysia to buy navy vessels from China in blow to U.S.

Malaysia will sign a contract to purchase Littoral Mission Ships from China when Prime Minister Najib Razak visits Beijing next week, according to a Facebook posting by the country’s Ministry of Defence.

The text of a speech to be delivered by Malaysian defence minister Hishammuddin Hussein was posted on Facebook on Tuesday, but was later removed after Reuters asked a defence ministry spokesman for comment.

The purchase of the patrol vessels, if it proceeds, would be Malaysia’s first significant defence deal with China and comes amid rising tensions in the South China Sea and as the United States and China compete for influence in the region.

China’s foreign ministry spokesman Lu Kang said on Friday he was “unclear on the specifics of the situation“. But responding to a Reuters question at the daily ministry briefing he noted China and Malaysia “continue to cooperate and communicate regularly across all spheres“.

Malaysia’s ties with the United States became strained after the Department of Justice filed lawsuits linked to a money-laundering investigation at state fund 1Malaysia Development Berhad (1MDB), which Najib founded and had overseen as chairman of its advisory council.

This Reuters article, co-filed from Manila and Kuala Lumpur, was posted on their Internet site at 3:21 p.m. IST on their Friday afternoon — and I found this story embedded in a Zero Hedge article in the wee hours of this morning.  Another link to it is here.

Private Eyes: The Little-Known Company That Enables Worldwide Mass Surveillance

It was a powerful piece of technology created for an important customer. The Medusa system, named after the mythical Greek monster with snakes instead of hair, had one main purpose: to vacuum up vast quantities of internet data at an astonishing speed.

The technology was designed by Endace, a little-known New Zealand company. And the important customer was the British electronic eavesdropping agency, Government Communications Headquarters, or GCHQ.

Dozens of internal documents and emails from Endace, obtained by The Intercept and reported in cooperation with Television New Zealand, reveal the firm’s key role helping governments across the world harvest vast amounts of information on people’s private emails, online chats, social media conversations, and internet browsing histories.

The leaked files, which were provided by a source through SecureDrop, show that Endace listed a Moroccan security agency implicated in torture as one of its customers. They also indicate that the company sold its surveillance gear to more than half a dozen other government agencies, including in the United States, Israel, Denmark, Australia, Canada, Spain, and India.

Some of Endace’s largest sales in recent years, however, were to the United Kingdom’s GCHQ, which purchased a variety of “data acquisition” systems and “probes” that it used to covertly monitor internet traffic.

This very interesting, but very disturbing essay appeared on Internet site last Sunday — and for obvious content reasons, had to wait for today’s missive.  I thank Roy Stephens for finding it for us — and another link to it is here.

There will never be a sound currency system — Egon von Greyerz

It is so fascinating that the destruction of currencies has been the norm throughout history, as no paper or fiat currency has ever survived. Therefore, there seems to be little hope to permanently introduce a sound money system. Yes, there have been periods of sound money but they are seldom long lasting. Power seems to have such a corrupting effect on everyone who enters politics that the urge to print and spend worthless paper money seems completely irresistible.

The simple solution would be to firstly get rid of all central banks because central banks is the main reason why money never remains money but always returns to just the value of the paper it is printed on. Central banks perform two principal functions. They artificially manipulate interest rates and they print money. By manipulating interest rates, they destroy the natural laws of supply and demand. If there is high demand for money, interest rates will in a free market go up to dampen the demand for money. Also, higher rates properly compensate depositors for the increased risks they take.

What is happening today is the total opposite of a free market. Global debt has grown over ten times in 25 years and interest rates are zero or negative. This is financial repression or manipulation of a degree never seen in history. It totally destroys free market forces and is therefore the seeds of a financial Armageddon never seen before. Whenever natural laws of supply and demand are interfered with, it always has severe consequences.

One thing is certain. The current financial system will not survive because it is based on principles which are not sustainable. In such a defective system, there is no sound money.

What is also certain is that gold, as the only real money, will continue to reflect the mismanagement of the world economy as the currencies in the next few years finish the move to zero.

My feelings exactly!  This very worthwhile commentary by Egon was posted on the Internet site on Friday sometime — and I found it embedded in a GATA release.  Another link to this article is here.

How Big is Your Gold and Silver Picture? — David H. Smith

Whether you surf the Internet for information about the precious metals and mining stocks or receive newsletters by snail mail, you’re exposed to predictions by all and sundry:

  • How high will prices go?
  • How long will it take?
  • Will they remain elevated if/when they reach record nominal and/or inflation-adjusted highs?

Truth be told, all of us are “inquiring minds who would like to know.” We want to believe that someone somewhere can predict the future. So we seek out gurus who might have special knowledge that puts us on the inside track.

This worthwhile commentary by David, who is senior analyst over at Internet site, was posted on the Internet site yesterday — and my thanks go out to Doug Clark for sending it our way.  Another link to it is here.

Trump “Will Probably Win” and Gold “May Rise $100” Overnight — Jim Rickards

The U.S. election is just two weeks away on November 8th, and one of Hillary Clinton’s most vocal critics on the business side is finance commentator and monetary expert Jim Rickards. Jim is in Sydney this week, armed with his latest book, hot off the press entitled ‘The Road to Ruin – The Global Elites’ Secret Plan for the Next Financial Crisis’ and gave an interesting television interview to ‘The Business’ on ABC Australia.

Rickards says that Trump “will probably win” and, if he does, the stock markets will crash 10{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} and gold will rise $100 overnight.

The markets and polls believe Clinton will win and that is priced into markets in the same way that a ‘Bremain’ was priced into markets prior to the ‘Brexit’ vote.

What Hillary did was appalling Rickards says in relation to the Clinton email scandal. There will be ‘another reckoning on November 8th’ which the market has failed to price in, creating a good scenario for gold. He says you don’t have to agree that Trump will win, but agree that that in reality he could win.For Rickards, this is an excellent opportunity for investors, particularly those who have an allocation to physical gold which he believes is set to rise in the coming months and years.

This commentary by Jim, which I consider to be highly speculative, showed up on Mark O’Byrne’s website on Thursday.  It’s worth reading — and the embedded 5:51 minute video interview [recorded on Tuesday] with Ticky Fullerton is certainly worth watching as well.  I had several subscribers send me this, but the first person through the door with it was Doug Clark — and another link to it is here.


Reader Bob Anthony just returned from a trip to South Africa — and he sent me some of his photos.  The first is of a couple of younger male kudus, both of which were right outside the door of the lodge they were staying at.  I’ll be posting his photos for a while, as some of them are world class — and these are two of them.161029photo-1



Today’s pop ‘blast from the past’ is the bass cover of a wildly popular ABBA tune that was released in late 1979 — which was a depressing 37 years ago.  Until I ran into these ‘cover’ type of recordings on YouTube just recently, I had no idea of the depth of most pop/rock compositions.  The musicianship required is of the highest order — and this base cover of “Gimme! Gimme! Gimme! [A Man After Midnight]” certainly falls into that category.  This is the full-length European version at 4:51 minutes.  The U.S. release was cut down to 3:36 minutes.  The link to it is here.  Enjoy!

Today’s classical blast from the past is from Antonio Vivaldi‘s “Four Seasons“.  It’s late fall at this latitude in North America — and the first three snowfalls of the season have all melted away, but it’s a given that the next one won’t.  So here’s the “Autumn” selection from that famous work, with Anne Sophie Mutter doing the honours.  I saw her live in Hong Kong playing Beethoven’s violin concerto when we were both a lot younger.  The link is here.

It was a pretty wild one yesterday — and as I’ve already stated, JPMorgan et al pulled out all the stops to prevent a blow-up in the precious metals — along with a corresponding melt-down in the equity markets and the U.S. dollar.  No expense was spared — and that certainly showed up in the volume numbers in both gold and silver.

Here are the four precious metals charts — and yesterday’s excitement is certainly obvious in gold and platinum, but silver not so much.  I’m dispensing with the other three charts that I normally post in my Saturday column, as I’m way behind schedule.161029-6-month-gold


Well, the events of yesterday regarding Hillarygate threw a shadow over everything.  What was a manageable annoyance for the Hillary campaign has now blown into something far more serious — and there isn’t enough Teflon in the world to prevent whatever’s coming from sticking to her.

Do not kid yourself, this is now a crisis situation, not only for the presidential election which is only a week or so away now, but for the country as a whole.  It’s horrifying to watch from outside the U.S. border — and it remains to be seen how this unfolds in the days ahead.  There’s criminality everywhere — and Watergate pales in comparison.

Of course I made the comment earlier in this column that this event was a “black duck” rather than a “black swan” — but it could morph into the latter at any moment as the weekend unfolds.

As to how the markets react to this on Sunday evening when trading begins in the Far East on their Monday morning, remains to be seen.  I would expect that the Plunge Protection Team, which would certainly include JPMorgan et al, will be there in attempt to throw oil on troubled waters, just as they were in the New York trading session today.  The FBI was wise to wait until after London and Europe had closed before they dropped the bombshell.

Ted has always been of the opinion — and rightly so — that there will come a time when the positions held in the COMEX futures market in the precious metals don’t matter, as unfolding events such as this one could overwhelm a large segment of the smaller commercial traders, leaving only the Big 4 — plus a couple of the ‘5 through 8’ traders — to hold back the tide.

And as he pointed out in his mid-week commentary on Wednesday, are these same traders prepared to put their heads back in the proverbial lion’s mouth after their near-death experience over the summer when they were, collectively, $4 billion in the hole?  And as he has pointed out on numerous occasions, a large foreign bank didn’t escape — and had to be bailed out by the Big 4 back in July.

If Friday’s enormous volume numbers were any indication, that thesis may be put to the test at this point in time.

It’s useless to speculate on how things develop from here, as the situation is far too fluid.  All we can do is watch and wait to see if the Deep State attempts to save their anointed one, or throws her to the wolves.

How did it come to this?

See you on Tuesday.


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