The Death Warrant For King Dollar?

27 January 2018 — Saturday


The gold price was up 8 dollars by the London open on continued dollar weakness.  But the dollar decline and the gold price rally both ended a few minutes after 8 a.m. GMT — and the gold price and dollar index began to head in the other direction.  The gold price was back to just about unchanged by 9 a.m. EST in New York as the dollar index topped out around the 89.23 mark.  From that point the gold price rallied weakly until a few minutes after 2 p.m. in the thinly-traded after-hours market — and it was sold a bit into the 5 p.m. close of trading from there.

The low and high ticks definitely aren’t worth looking up.

Gold was closed in New York on Friday afternoon at $1,349.30 spot, up only $2.00 from Thursday.  It was another monster volume day…gross volume was 491,038 contracts — but minus all the roll-over/switch volume, which was around 152,000 contracts, net HFT gold volume was only about 186,000 contracts.

The price path for silver was, tick for tick, almost the same as gold, with the low on Thursday evening in New York shortly after the open — and the high tick, minutes after trading began at London, when the dollar index decline got reversed.

The low and high ticks in silver were recorded by the CME Group as $17.235 and $17.53 in the March contract.

Silver was closed at $17.38 spot, up 12.5 cents from Thursday’s close.  Net volume, like in gold, was much reduced from what it has been all week, at only about 75,200 contracts, with only 4,000 contracts worth or roll-over/switch volume on top of that.

The platinum price more or less chopped sideways until shortly after 1 p.m. China Standard Time on their Friday afternoon.  It began to ‘rally’ from there — and that lasted until shortly before 1 p.m. CET in Zurich.  The price began to chop quietly lower from there — and it was closed on its low tick of the day…$1,006 spot — and down 6 dollars from Thursday.

Palladium didn’t do anything until shortly after 3 p.m. CST on their Friday — and it gradually ticked higher and was up about 4 bucks by noon in Zurich.  That lasted for a bit over an hour before the selling pressure appeared — and the spike low below $1,070 spot came shortly before 12:30 p.m. in New York.  It rallied a bunch of dollars from there until minutes after 2 p.m. in the thinly-traded after-hours market — and then traded flat into the close.  Palladium finished the Friday session at $1,083 spot, down 4 bucks on the day.

The dollar index closed very late on Thursday afternoon in New York at 89.46 — and ticked a few basis points higher once trading began at 6 p.m. in New York a few minutes later on Thursday evening.  It was sold lower to just below the 89.20 mark by minutes before 10 a.m. CST in Shanghai on their Friday morning — and then traded pretty flat until shortly after 1 p.m. CST.  Then down it went in a fairly big hurry, blasting through the 89.00 mark like a hot knife through soft butter, with the 88.70 low tick coming a minute or so after the 8 a.m. London open.  ‘Gentle hands’ began to work their magic at that juncture — and the DXY topped out around the 89.32 mark minutes after 9 a.m. in New York.  It chopped lower from there until a minute or so after 2 p.m. — and back below the 89.00 mark once again.  That was no way to end the week, so it was ramped back above the 89.00 mark in short order — and mercifully the markets closed before it could fall back below that number.  The dollar index finished the day and the week at 89.04…down 42 basis points from its Thursday close.

Make no mistake about it, dear reader, but the U.S. dollar is toast — and the remaining currencies are only better by default.  With the powers-that-be in the U.S tossing it around like a rag doll in the public press — and getting saved, but only temporarily, by the ‘The Donald’ on Thursday afternoon, it’s now a currency to run away from as fast as one can.  And if one thinks of the U.S. bond/treasury market in those terms, it boggles the mind. I’ll have more about this in The Wrap.

And here’s the 5-year U.S. dollar index — and as I said last Saturday at this time, there’s not a thing between its current ‘value’ — and the 80.00 mark, except thin air.  But after the Mnuchin/Draghi/Trump bun fight in the currency markets over the last three days…80.00 might just be ‘jacks for openers’.

The gold stocks gapped up a mere one percent and change at the open — and then spent the rest of the Friday session giving back half of even those meagre gains.  The HUI closed higher by only 0.60 percent.

The silver equities gapped up a bit higher at the open, but by 11:30 a.m. they began to head lower and thankfully finished up on the day, as Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed higher by 0.45 percent.  Click to enlarge if necessary.


And here’s the 1-year Silver Sentiment/Silver 7 Index chart.  Click to enlarge.

Here are the usual charts from Nick that show what’s been happening for the week, month-to-date — and year-to-date.  The first one shows the changes in gold, silver, platinum and palladium for the past trading week, in both percent and dollar and cents terms, as of their Friday closes in New York — along with the changes in the HUI and the Silver 7 Index.

Here’s the weekly chart — and it’s a mixed bag, with the silver equities down on the week, even though silver closed higher for the week by a very decent amount.  Click to enlarge.

And since only three weeks are gone from the New Year so far, the year-to-date chart will serve double duty as the month-to-date chart as well.  Click to enlarge.

Of course the shares continue to underperform the metals themselves, particularly in silver this past week, but I expect that to change as time goes along.  Don’t forget that JPMorgan et al continue to have precious metal prices in their iron grip — and until that changes, nothing changes.

With January open interest down to a tiny handful of contracts in both gold and silver, the CME Daily Delivery Report showed that only 1 silver contract was posted for delivery within the COMEX-approved depositories on Tuesday.  The CME Group stopped that contract and immediately reissued it as 5 contracts in the 1,000 ounce mini-silver contract for delivery in January.

The CME Preliminary Report for the Friday trading session showed that gold open interest in January declined by 2 contracts, leaving 2 left.  Thursday’s Daily Delivery Report showed that 1 gold contract was posted for delivery on Monday.  Silver o.i. in January declined by 1 contract, leaving 2 still open, minus the 1 contract mentioned in the previous paragraph.

For all intents and purposes, the January delivery month is done in both gold and silver — and I won’t bother with the Daily Delivery or Preliminary Reports until First Day Notice on Wednesday, which will be in my Thursday column.

There was a withdrawal from GLD yesterday, as an a.p. took out 37,955 troy ounces.  Based on the current price action, it’s reasonable to assume that this was another one of Ted’s ‘conversion of GLD shares for physical metal’.  There were no reported changes in SLV.

The folks over at the Internet site update their website with the short positions in both SLV and GLD as of the close of trading on Monday, January 15 — and this is what they had to report.  The short position in SLV dropped from 12,322,000 shares/troy ounces, down to 10,975,500 shares/troy ounces, which works out to a decline of 10.9 percent.  But things were far different in GLD, as the short position increased from 871,560 troy ounces up to a whopping 1,719,630 troy ounces, a jump of 97.3 percent…virtually double what it was at the end of December.  Ted and I spoke about this big increase on the phone yesterday, but both of us had other fish to fry, so I didn’t spend too much time on it.  I have my suspicions, but I’ll keep them to myself until I see what Ted has to say about it.

There was no sales report from the U.S. Mint yesterday.

Month-to-date the mint has sold 57,000 troy ounces of gold eagles — 23,500 one-ounce 24K gold buffaloes — and 3,095,000 silver eagles.  These aren’t anywhere close to being record sales numbers for January.

There was no in or out gold movement at the COMEX-approved gold depositories on the U.S. east coast on Thursday.  The only activity was a paper transfer of 2,339 troy ounces from Eligible and into Registered at Delaware.  I won’t bother linking this.

It was much different in silver, of course, as 1,186,241 troy ounces were received — and another 2,338,047 troy ounces were shipped out.  One truck load…599,110 troy ounces…was left at JPMorgan’s vault — and another truck load…587,131 troy ounces…was dropped off at Canada’s Scotiabank.  In the ‘out’ category, two truck loads…1,193,538 troy ounces…departed CNT — and 302,956 troy ounces left Brink’s, Inc. — and the remaining 841,551 troy ounces was shipped out of HSBC USA.  The link to all this action is here.

I would suspect, but do not know for sure, that all this in/out silver activity has to do with deliveries from what was issued and stopped in December.  All I know is that it’s been one hell of a frantic in/out week — and it’s a given that Ted will have lots to say about this in his weekly missive this afternoon.

And before leaving silver, JPMorgan’s COMEX silver inventory now stands at 124.6 million troy ounces — and with that deposit on Thursday, it pushes them over the 50 percent mark, as they now hold over 50 percent of all the physical silver in the COMEX warehouses system.  Here’s the applicable chart.

It was another huge day over at the COMEX-approved gold kilobar depositories in Hong Kong on their Thursday.  They received a chunky 12,551 kilobars — and shipped out 9,657.  All of this action was at Brink’s, Inc. as per usual — and the link to that, in troy ounces, is here.

The Commitment of Traders Report for positions held at the close of COMEX trading on Tuesday, showed a huge improvement in the Commercial net short position in silver — and only a minor deterioration in gold.  But even this ‘good news’ in gold was ‘bad news’ in a way, which I’ll get into once I’m done with silver.

In silver, the Commercial net short position dropped by a very decent 8,646 contracts, or 43.2 million troy ounces of paper silver.

They arrived at that number by adding 3,730 long contracts, plus they reduced their short position by 4,916 contracts — and the sum of those two numbers represents the change for the reporting week.

Ted said that the Big 4 traders, read JPMorgan, reduced their short position by around 1,500 contracts, but the ‘5 through 8’ large traders actually increased their short position by about 600 contracts.  The big change was in Ted’s raptors, the 41-odd small Commercial traders other than the Big 8, as they increased their long position by approximately 7,700 contracts.

Under the hood in the Disaggregated COT Report, it was an entirely Managed Money affair plus a bit more, as they decreased their long position by 6,192 contracts, plus they added 3,645 contracts to their short position.  The sum of those two numbers…9,837 contracts…was their change for the reporting week.  The difference between that number — and the Commercial net short position…9,837 minus 8,646 equals 1,191 contracts…was made up, as it always is, by the traders in the ‘Other Reportables’ and ‘Nonreportable’/small trader categories.

As is usually the case, Ted assigned the entire 1,500 contract decline of the Big 4 traders to JPMorgan — and he estimates their current short position at around 31,000 contracts.  The Commercial net short position in silver is now sitting at 207.5 million troy ounces.

Here is the 3-year COT chart for silver — and it’s nice to see that decline, although I suspect that there’s been some deterioration since the cut-off.  However, I wouldn’t be prepared to bet any money on that.  Click to enlarge.

In gold, the commercial net short position only increased by 2,045 contracts, or 204,500 troy ounces of paper gold.

They arrived at that number by adding 3,256 contracts to their long positions — and they increased their short position by 5,301 contracts.  The difference between those two numbers is the change for the reporting week.

But it was the activity of the Big 8 traders that was cause for concern.  The Big 4 increased their short position by 6,400 contracts — and the ‘5 through 8’ large traders increased their short position by 2,300 contracts as well.  Ted’s raptors, the 46-odd small commercial traders other than the Big 8, added 6,700 long contracts.

Under the hood in the Disaggregated COT Report, it was all Managed Money traders by at least a country mile, as they increased their long position by 8,630 contracts, plus they added a smallish 626 short contracts.  The difference between those two numbers…8,004 contracts…was their change for the reporting week.  Of course the difference between that number — and the commercial net short position…8,004 minus 2,045 equals 5,959 contracts…was, like in silver and every other commodity, made up by the traders in the other two categories, the ‘Other Reportables’ and the ‘Nonreportable’/small traders.  This week, the lion’s share of that difference was taken up by the ‘Other Reportables’…as they reduced their long position by a considerable amount, plus added a small amount of new shorts.

The commercial net short position in gold is now at 23.46 million troy ounces — and I would suspect that it has risen a bit more since the Tuesday cut-off.

Here’s the 3-year COT chart for gold.  Click to enlarge.

It remains to be seen just how far on the long side that the Managed Money traders are willing to go — and how quickly prices are allowed to rise from here depends entirely on how aggressively that JPMorgan et al stand there as sellers of last resort.  At the moment these rallies are orderly, but if the Big 8 traders ever decide to put their hands in their pockets, both silver and gold will explode to the upside — and I say that with the same certainty that I know that the sun will set in the west tonight.

JPMorgan is insulated from any price rallies by the fact that they have 675 million troy ounces of physical silver backing a 155 million troy ounce short position in the COMEX futures market.  Ted has also determined that JPMorgan holds 20+ million troy ounces of physical gold, against an approximate futures market short position of around 7.5 million troy ounces.  ‘Da boyz’ over at JPM could walk away from the futures market any time they wish — and let the other Big 7 shorts burn in hell.  Some day they just might do that.  But as to which day, nobody knows.

I look forward to what Ted has to say in his weekly review this afternoon, as he’s the real authority on all this.

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 above.  Click to enlarge.

For the current reporting week, the Big 4 are short 127 days of world silver production—and the ‘5 through 8’ large traders are short an additional 65 days of world silver production—for a total of 192 days, which is over 6 months of world silver production, or about 466.5 million troy ounces of paper silver held short by the Big 8.  [In the COT Report last week, the Big 8 were short 194 days of world silver production.]

In the COT Report above, the Commercial net short position in silver was reported as 207.5 million troy ounces.  As mentioned in the previous paragraph, the short position of the Big 8 traders is 466.5 million troy ounces.  The short position of the Big 8 traders is larger than the total Commercial net short position by a chunky 471.4 minus 207.5 = 263.9 million troy ounces.  The reason for the difference in those numbers is that Ted’s raptors, the 41-odd small commercial traders other than the Big 8, are long that amount.  And why they haven’t been selling these positions more aggressively during this 4-week long silver rally still remains a mystery, but by holding off as long as they have, they have been making just oodles more money.  They also added to their long position during this reporting week as well.

As I also stated in the above COT Report analysis, Ted pegs JPMorgan’s short position at about 31,000 contracts, or around 155 million troy ounces, basically unchanged from what they were short in last week’s COT Report.  155 million ounces works out to around 64 days of world silver production that JPMorgan is short.  That’s compared to the 192 days that the Big 8 are short in total.  JPM holds about 33 percent of the entire short position held by the Big 8 traders.

Until last Sunday, when I was preparing my presentation at the Vancouver Investment Conference, I had estimated the short position in silver held by Scotiabank/ScotiaMocatta at approximately 32 days of world silver production minimum.  That turned out to be high by quite a bit.  Now that I’ve recalibrated their short position, it’s now down to about 23 days.  So it’s obvious that Scotiabank has been actively reducing their short position in the COMEX futures for the last year.  I’m sure they’ve covered a certain portion of it during the normal course of business, but it’s obvious that JPMorgan has taken up some of the slack, as have some of the other traders in the Big 8 category.

Here are the two charts from my presentation, which I also posted earlier this week, that caused me to change my mind about Scotiabank.  The first is from January 2017 — and the second from last weekend…January 19, 2018.  Note the huge changes in the positions of JPM and Scotia, plus the increases in the short position of the ‘5 through 8’ traders since January 2017.  Their collective short positions have risen about a third during that period.  Click to enlarge for both charts.

That’s why I keep saying that JPMorgan has been forced by circumstance to pick up Scotiabank’s trading/price management duties in silver and gold.  So JPMorgan is by far the No. 1 silver short on Planet Earth — and likely to remain that way indefinitely.  Of course they have 675+ million troy ounces of physical silver [and counting!] stashed away to cover that, so they are in no danger.  That can’t be said of the remaining Big 7, unless JPMorgan plans to bail out some, or all of them.  And if that’s the case…at what price?  I get the feeling, as I said last week, that it wouldn’t come cheap.

The two largest silver shorts on Planet Earth—JP Morgan and one other, which may or may not be Scotiabank, are short about 87 days of world silver production between the two of them—and that  87 days represents about 68 percent of the length of the red bar in silver in the ‘Days to Cover’ chart…a bit more than two thirds of it.  The other two traders in the Big 4 category are short, on average, about 20 days of world silver production apiece.

The four traders in the ‘5 through 8’ category are short, on average…16.25 days of world silver production each, which is up 0.25 days from what they were short in last week’s COT Report.

This is just more proof of the fact, if any was needed, that it’s only what JPMorgan does in the COMEX silver market that matters, as it’s only their position that ever changes by any material amount.

The Big 8 commercial traders are short 46.7 percent of the entire open interest in silver in the COMEX futures market, which is down a bit from last week’s COT Report — and that number would be almost 50 percent once the market-neutral spread trades are subtracted out.  In gold, it’s now 47.4 percent of the total COMEX open interest that the Big 8 are short, up a bit from last week’s report — and a hair over 50 percent once the market-neutral spread trades are subtracted out.

In gold, the Big 4 are short 70 days of world gold production, which is up 2 days from what they were short last week — and the ‘5 through 8’ are short another 28 days of world production, which is up 1 day from what they were short the prior week, for a total of 98 days of world gold production held short by the Big 8 — which is up 3 days from the 95 days they were short in last week’s report.  Based on these numbers, the Big 4 in gold hold about 71 percent of the total short position held by the Big 8…which is unchanged from last week’s COT Report.

The “concentrated short positions within a concentrated short position” in silver, platinum and palladium held by the Big 4 commercial traders are 66, 72 and 79 percent respectively of the short positions held by the Big 8.  Silver is up 1 percentage point from the previous week’s COT Report — and platinum and palladium are also up 1 percent from what they were in last week’s COT Report.

These concentration numbers show that the Big 4 traders still have an iron grip on precious metal prices — and as I keep going on endlessly about…until this situation changes…nothing else will change either…including their respective prices.

I have a very decent number of stories for you today, including the Cohen/Batchelor interview, which comes in four parts this week.


Core Durable Goods Orders Tumble Most In a Year

While headline durable goods orders showed a 2.9% MoM surge, but away from aircraft orders and war-spending, capital goods orders dropped 0.3% MoM in December – the most in 12 months.

But this surge was all thanks to aircraft and war-spending:

*  Bookings for commercial aircraft climbed 15.9% MoM
*  Orders for Aircraft Engine and Engine Parts rose 24.4% MoM
*  Defense capital goods orders increased 19.5% MoM
*  Defense aircraft and parts soared 55.3% MoM

So, at the core, orders tumbled most in a year…in other words, we’re gonna need more war to get that GDP up over 3.0%…

This brief 3-chart news item showed up on the Zero Hedge website at 8:39 a.m. EST on Friday morning — and I thank Brad Robertson for pointing it out.  Another link to it is here.

Flying Blind, Part 3: Why Now is Not the Time and Place for Nosebleed P/E Multiples — David Stockman

As we indicated in Part 2, the very idea that you would pay 26X EPS for the S&P 500 at the tail end of a 103 month long recovery cycle is truly ludicrous. That is, there is a time to anticipate a strong profits rebound during the early years of a recovery, thereby meriting a robust P/E multiple.

But there is also the obvious point that expansions eventually become long in the tooth and end in recession. Even by the lights of the central bank money printers, the business cycle has not yet been outlawed.

After all, that’s why the Eccles Building is now motoring head-down and straight into an epochal pivot which it is pleased to call interest rate “normalization” and balance sheet shrinkage (QT). In plain English, however, that is just central banker-speak for bond dumping on an unprecedented and epic scale. And it is being done out of deathly fear that the next recession will make its appointed rounds with the Fed out of dry powder and impotent.

Folks, these people aren’t totally stupid. They have amassed extraordinary power and plenary dominance over the nation’s $19 trillion capitalist economy only by assiduously cultivating the mother of all Big Lies.  Namely, the myth that private capitalism is dangerously unstable and possessed of an economic death wish for periodic cyclical collapses, which can be forestalled only by the deft interventions of the central bank.

That’s self-serving malarkey, of course. Every recession of the modern Keynesian era has been caused by the Federal Reserve, and most especially the calamity of 2008-2009. And the “recovery” from that one, as well as those stretching back to the 1950s, was owing to the inherent regenerative powers of the free market, not the interest rate and credit supply machinations of the Fed.

This long chart-filled commentary by David appeared on the Zero Hedge website at 11:02 a.m. EST on Friday morning — and I thank Richard Saler for sending it our way.  Another link to it is here.

Doug Noland: America First and the Decapitation of King Dollar

Historians may look back at Team Trump’s jaunt to chilly Davos as a pivotal juncture in global finance. Was it naivety, gall or a combination – or just typical of today’s overabundance of complacency? The U.S. Treasury Secretary – facing enormous fiscal deficits, rising rates, $16.5 TN of federal debt, a nervous bond market and suspicious foreign officials – openly advocating a weaker dollar.

There are certainly plenty of dollars in the world available to sell or hedge. What is the likelihood of dollar selling turning disorderly? One might look at several years of incredible ECB and BOJ “whatever it takes” liquidity creation and rate suppression (and interest-rate differentials you could drive a truck through) and ponder Friday’s closing prices of 1.24 for the euro and 108.58 for the dollar/yen. Those are two flashing warning signs of dollar vulnerability.

In all the euphoria, markets can be excused for presuming dollar weakness ensures a further delay in global rate normalization. Yet things turn quite interesting the day unruly currency markets begin indicating disorderly trading. The almighty central bankers might have little to offer. What if they intervene to no avail? This could prove the juncture when markets begin questioning the Indomitable Central Banks in Control thesis. The price of market “insurance” would begin to creep (or, not unlikely, spike) higher, and the availability of cheap risk protection would wane (possibly abruptly). In such a development, I would expect the more sophisticated market operators to begin (aggressively) pulling back on risk and leverage. Such a dynamic, especially after such a spectacular melt-up, would mark an important inflection point for market liquidity.

Doug’s weekly Credit Bubble Bulletin showed up on his Internet site in the wee hours of Saturday morning EST — and another link to it is here.

Davos Dumbbells — Bill Bonner

In the Financial Times is a photo of a smiling Christine Lagarde.

The former French finance minister… former partner at multinational law firm Baker McKenzie… former student at the Holton-Arms School for girls in Bethesda, Maryland… and permanent member of the international Deep State Establishment… is now head of the IMF.

Writing in the newspaper, preparatory to her visit to the Swiss citadel of globalism, elitism, and good-intentions-gone-bad, Ms. Lagarde seemed to be picking up on our theme from yesterday’s Diary:

Despite the improved economic outlook, there are still far too many people left out. There is still too much inequality and still a great deal of uncertainty about the future.”

How she knows what is “too much” or “too many” was not disclosed. But in the public space, there’s no check on B.S.

This longish, but very worthwhile commentary by Bill was posted on the Internet site on Friday sometime — and another link to it is here.

U.S. CFTC to fine UBS, Deutsche Bank, HSBC for spoofing, manipulation: sources

The U.S. derivatives regulator is set to announce it has fined European lenders UBS, HSBC and Deutsche Bank millions of dollars each for so-called “spoofing” and manipulation in the U.S. futures market, three people with direct knowledge of the matter told Reuters.

The enforcement action by the Commodity Futures Trading Commission (CFTC) is the result of a multi-agency investigation that also involves the Department of Justice (DoJ) and the Federal Bureau of Investigation (FBI) – the first of its kind for the CFTC, the people said.

The fines for UBS and Deutsche Bank will be upward of ten million, while the fine for HSBC will be slightly less than that, the people said, without providing exact figures.

Spokesmen for HSBC, Deutsche Bank and UBS declined to comment.

The settlement is the most high-profile brought so far by the CFTC’s head of enforcement James McDonald who was appointed to the role in March 2017.

And what about JPMorgan et al –and the four precious metals, Mr. McDonald?????  This Reuters article, filed from Washington, put in an appearance on their Internet site at 4:40 p.m. on Friday afternoon EST — and I plucked it from a GATA dispatch.  Another link to it is here.

Moody’s upgrades outlook on Russia’s sovereign rating to positive from stable

Moody’s rating agency has changed the outlook on Russia’s Ba1 long-term issuer and senior unsecured debt ratings to positive from stable. Concurrently, Moody’s affirmed Russia’s long-term ratings at ‘Ba1’, the agency said in a press release.

Growing evidence of institutional strength” and “increased evidence of economic and fiscal resiliency” were the key factors of the change in the outlook, the agency said.

Russia’s macroeconomic framework coped well with the oil price shock and with the impact of sanctions imposed to date, and enhancements have been made to the government’s rule-based fiscal framework,” the press release said.

In Moody’s view, the rating “appropriately balances Russia’s fiscal strength, somewhat improved economic prospects and effective policy-making against the combination of longer-term economic challenges and continued nearer-term exposure to external events.”

In a related decision, Moody’s raised Russia’s country ceilings for foreign currency debt to ‘Baa3/P-3’ from ‘Ba1/ NP’ “to reflect diminished concerns that the government might impose capital controls or otherwise ration foreign exchange reserves.”

As I’ve said quite a number of times, Russia is the most solvent and well managed country on Planet Earth.  This TASS news item was picked up by the folks over at the Internet site on Friday sometime — and it comes courtesy of Roy Stephens.  Another link to it is here.

Putin’s message at annual Leningrad siege WW2 memorial: never again

He who does not learn from history is doomed to repeat it; Russians understand this fact better than any when they call to mind the storms of the WW2 and the bloody Seige of Leningrad. Russia can not afford to forget, more than 20 million Russians perished in the ‘Great Patriotic War’, which is more than the population of several modern countries including Romania, The Netherlands, Greece, and many more. Take a moment and imagine an entire country obliterated, that is how great the death toll was for Russia.

But those millions of Russians, Ukrainians, Belarusians, Poles, other Slavs, and Soviet Citizens were not obliterated from existence. Their eternal memory and resolve gave the living strength, and with it, they endured as they always have, and they captured Berlin, ending the largest holocaust in human history.

By far one of the bloodiest battles in human history was the Siege of Leningrad (also called Petrograd and Saint Petersburg today). Casualties were around one million people…one million, for one city. The real number is possibly much higher, as many people were missing.

When the Russian President speaks the words you are about to hear, bare one thing in mind, remember it and never forget it…His brother was among the dead. President Putin’s own brother died of disease as a child during the terrible siege.

Here is what the President said to veterans and celebrants at the anniversary as reports TASS news:

This article was posted on the Internet site around 8 a.m. Moscow time on their Friday morning.  It’s the second offering in a row from Roy Stephens — and another link to it is here.

Tales of the New Cold War: The 2018 Containment Theory (1 of 4) — John Batchelor interviews Stephen F. Cohen

Part 1: Batchelor opens this week with an introductory bombshell fresh from the American Council on Foreign Relations. Their published report reconfirms all of the Russiagate allegations and goes on to state that Russia is preparing for full spectrum interference of numerous American institutions including elections in the future.   The professor quickly points out that the CFR is composed of the elites of the elites of American foreign affaires experts, council to presidents (Cohen states he has membership – now to be short-lived), and is unabashedly anti Russia, as it states its conclusions that are based on the usual culprits in the MSM. It not only accepts the reality of the New Cold War, but without lament, but accepts the Trumps Putin/Trump collusion. However, to counter this amazing document is one issued from the House of Representatives by three committee chairmen representing Judiciary, Oversight and House Intelligence working together from DOJ documents about what the Obama Administration has done during the Trump election. It concluded that there is firm doubt about the validity of Russiagate.  The link to Part 1 is here as well.

Part 2: The CFR core message, according to Cohen, is a legitimization of this cold war that the U.S. should be “escalating and promoting” and not open to détente. The report itself (if accepted as policy) may be, according to Batchelor, a document with which to go to war. And unsurprisingly Cohen finds the timing, in light of the rapid debunking on all sides of Russiagate, as strange. Again the notes accompanying these podcasts do expand on this commentary and are a recommended read as well.  The link to Part 2 is here.

Part 3:  Batchelor’s opening words to Part 3 introduces the idea that the CFR appears to be advocating the US to move to a full war footing with Russia, and a total propaganda smear campaign against individual countries friendly to Russia and individuals in Russia –  a “you’re either with us or against us” situation. More worrisome for Batchelor is the advocacy of military spending including the modernization of the US nuclear arsenal – and the dismissal for the dangers of doing this – and that there will be no treaties to limit development of nuclear delivery systems. Cohen agrees and states that the CFR is prestigious enough to strongly influence policy direction and with much support from other political entities, including apparently a change of the Trump White House to a more hard line against Russia, that this is more than worrisome. Cohen concludes that those that support the CFR position are actually stating that Russia and China are the greater threats, and that international terrorism is not a concern. (More about this in my commentary.) Cohen considers that the purpose of this document, as odious and inept as it is, is to legitimatize a new cold war and to manage it as orthodoxy without discussion or criticism or moderation – in other words to exclude any official détente between Russia and Washington. It even calls for censorship, an assault on the American Constitution.   The link to Part 3 is here.

Part 4:  The last and shortest sections of this podcast Batchelor hazards the comment that the document is “resting on thin air” given that Russiagate is debunked. Cohen (he calls himself the optimist in this) states that the solution may lie with Putin and Europe. Will Europe go along? Will NATO countries? He does not count on Congress or the Senate – that are both anti-Russiagate AND anti-Russia. The US citizen has other priorities. That brings us back to Trump – who may be the only domestic solution.  The link to Part 4 is here.

“They” just won’t give up! Last week I suggested that government had already discounted any importance given to the U.S. citizens, that their opinion in the Russiagate debate counted for nothing. Although I agree with most of what Batchelor and Cohen say here, I also think that the CFR document from such an important policy institution shows that the CFR has been subverted by Deep State/Military Industrial Complex interests and the real meaning is a kind of declaration that not only is the political position of the citizen not relevant to foreign policy, to the massive procedural irregularities, and to political crimes but neither is that of the Senate, Congress and even the president . Resistance and discussion of any aspect of Russiagate and policy positions involving the validity of the New Cold War should be officially censored according to the orthodoxy of Russiagate in this document. This may also see the dismissal of all criminal acts behind Russiagate, including those of Hillary. I wonder that our pundits have not concluded the same thing. The single minded insistence of conformity to what has been debunked reveals that the Deep State requires total conformity of its views. There is no partnership with Putin’s Russia possible, given that the direction of M.E. terrorism is a direct product of Washington foreign policy. The only question remaining is whether the neocon/war party elements can force this Russiagate madness on government against all the facts emerging in the front lines of Washington? If they can, the United States government becomes a de facto military dictatorship regardless of constitutionality. After all, legitimacy is a trait that has been long abandoned in Washington and this has only become very obvious since just before the Trump election and during the agonizing subversion of Russiagate. The devolution of the Washington government is an on going process that is about to target the congress and the senate.

This extensive executive summary, plus concluding comments, comes to us courtesy of Larry Galearis — and he really outdid himself this week, with four parts in total.  I thank him on your behalf.  All of this was posted on the Internet site on Tuesday — and the links to each part is as indicated.

Kurds call on Syrian regime to intervene in Afrin battle

Kurdish militias fighting against Turkey in the Syrian enclave of Afrin have called on the government of Bashar al-Assad to intervene and protect the area’s borders.

The latest development, nearly a week into Turkey’s military offensive, could undermine Kurdish aspirations for self-governance and, if heeded, could set the stage for a direct military confrontation between Ankara and Damascus.

It could also create an open alliance between the U.S.-backed Kurdish forces and a government that Washington had sought to unseat for years.

While we insist that we will continue to defend Afrin against rabid external attacks and will confront the Turkish attempts at occupying Afrin, we invite the Syrian state to carry out its sovereign duties towards Afrin and to protect its borders with Turkey from attack,” the autonomous authority governing Afrin said in a statement on Thursday.

Ankara launched a military offensive into Afrin spearheaded by its Syrian rebel allies on Saturday in order to oust the People’s Protection Units (YPG) from the Kurdish enclave, which borders Turkey.

This news story was posted on Internet site at 10:55 p.m. GMT on Thursday evening, which was 5:55 p.m. EST in Washington.  I thank Roy Stephens for sending it our way — and another link to it is here.  There was a piece about this by Alex Mercouris on Internet site early on Friday morning.  It’s headlined “First sign of end to Afrin crisis as Kurds call on Assad for help” — and that comes to us via Larry Galearis.

Uncle Sam Dumps the Kurds (Yet Again) — The Saker

The drama which is unfolding in northern Syria is truly an almost ideal case to fully assess how weak and totally dysfunctional the Anglo/Zionist Empire has really become. Let’s begin with a quick reminder.

The U.S.-Israeli goals in Syria were really very simple. As I have already mentioned in a past article, the initial Anglo/Zionist plan was to overthrow Assad and replace him with the Takfiri crazies (Daesh, al-Qaeda, al-Nusra, ISIS – call them whatever you want).  Doing this would achieve the following goals…[list]…

With the joint Russian-Iranian military intervention, this plan completely collapsed. For a while, the USA tried to break up Syria under various scenarios, but the way the Russian Aerospace forces hammered all the “good terrorists” eventually convinced the Anglo/Zionists that this would not work.

The single biggest problem for the Empire is that while it has plenty of firepower in the region (and worldwide), it cannot deploy any “boots on the ground”. Being the Empire’s boots on the ground was, in fact, the role the AngloZionists had assigned to the Takfiri crazies (aka Daesh/IS/ISIS/al-Qaeda/al-Nusra/etc/), but that plan failed. The only U.S. allies left in the region are Israel and Saudi Arabia. The problem with them is that, just like the USA themselves, these countries do not have ground forces capable of actually deploying inside Syria and taking on not only the Syrian military, but the much more capable Iranian and Hezbollah forces. Murdering civilians is really the only thing the Israelis and Saudis are expert in, at least on the ground (in the skies the Israeli Air Force is a very good one). Enter the Kurds.

The Anglo/Zionist wanted to use the Kurds just like NATO had used the KLA in Kosovo: as a ground force which could be supported by U.S./NATO and maybe even Israeli air power. Unlike the Israelis and Saudis, the Kurds are a relatively competent ground force (albeit not one able to take on, say, Turkey or Iran).

This longish commentary by the Saker showed up on the Internet site on Friday sometime — and I thank Larry Galearis for bringing it to our attention.  Another link to it is here.

How the seizure of a U.S. spy ship by North Korea nearly sparked nuclear war

This is it, they’re taking us out here to kill us,” Stu Russell thought as he trudged through the snow in the middle of the night into a dark forest.

Russell was one of 83 Americans held captive inside North Korea, following the seizure of the USS Pueblo spy ship in international waters, on January 23, 1968.

For weeks they were kept in a sparse, freezing-cold building they nicknamed “the Barn.” It had no running water and was infested with rats and bed bugs. Inside, the men were denied sleep, forced into stress positions, whipped and beaten. Their officers, particularly Lloyd Bucher, the ship’s commander, came in for vicious punishments, as their interrogators demanded they sign “confessions” stating they were illegally spying in North Korean territorial waters when they were captured.

Like today, 1968 was a period of heightened tensions on the Korean Peninsula. The war that led to the division of the country had only stopped 15 years earlier and bloody skirmishes were still common.

This very interesting and worthwhile detailed walk down memory lane, which I certainly remember hearing about on the radio way back then, was posted on the Internet site last Saturday — and for content reasons, had to wait for today’s column.  I thank Garry Robinson for sending it along — and another link to it is here.

Some Reflections on History and Economics — Hugo Salinas Price

Unfortunately, the governments of the whole world and their guides, the professors of the erroneous doctrines of the inductive school of economics, studiously avoid any reference to truly scientific economics as presented by the Austrian Schools. And they do so, because they are under the surviving influence of the ideas of the French Revolution, that postulated a reformed world where there would be no suffering. Today, if an economics professor publicly accepts that a world without suffering is an impossible proposition, he is in great danger of losing his job.
The predictable consequence of a whole world under the management of a false economics based on induction – i.e. experimentation – is an inevitable total disaster for the world.

The thinkers of the world are hoping that Christian Russia and Confucian China, the two great powers of Eurasia, will return to gold as money, by virtue of their military power, and sweep away, as Napoleon did before them, the present existence of “Assignat-like” fiat moneys in the world.

Such a transformation, in full concordance with the doctrines of the Austrian Schools of Economics, would immediately re-vitalize the world’s economy, due to its inevitable consequences: 1. The immediate stimulation of hope for a better future, in all nations. 2. The immediate activation of all able-bodied individuals to work as hard as possible, in order to obtain the precious money of gold and silver. 3. The re-emergence of the principle which has ruled human life in all ages past: “He who does not work, shall not eat” to motivate all those who waste their lives in idleness.

That’s a big 10-4 good buddy!  This very worthwhile commentary by Hugo appeared on the Internet site on Tuesday — and I thank Hellmuth Vedder for bringing it to my attention — and now to yours.  Another link to this commentary is here.

Days Are Numbered for Price Manipulation — Ed Steer

This 7:30 minute video interview with your humble scribe was hosted by Charlotte McLeod — and was conducted on Monday at the Vancouver Investment Resource Conference.  It was posted on the Internet site yesterday.

Divers find stash of rare gold coins at site of 1800s wreck off North Carolina coast

A stash of gold coins found Monday is the latest piece of evidence that a shipwreck 40-plus miles off the North Carolina coast is that of the steamship Pulaski, which took half its wealthy passengers to the bottom of the Atlantic in 1838.

Divers found 14 gold coins and 24 silver coins in a spot “no bigger than a cigar box.” All predate the ship’s sinking and include one British coin that experts say could be worth $100,000. Other gold coins in the collection are valued in the $10,000 to $12,000 range, officials said.

James Sinclair, a marine archaeologist involved in project, says finding gold coins proves the team is in the right spot.

This evidence supports reports that valuables, including gold and silver, were aboard the Pulaski when she sank,” Sinclair said in a statement.

The disappearance of Pulaski remains one of the nation’s most dramatic and deadly maritime disasters, partly because half on board died, but also because its passengers included some of the most prominent families in the southeast. Among those lost was New York Congressman William B. Rochester and six members of the Lamar family, then among the richest families in the southeast. The luxury steamship that went to the bottom of the Atlantic in 1838 with half its affluent passengers may have been found 40 miles off the coast of North Carolina.

This very interesting news item put in an appearance on the Internet site at 4:20 p.m. EST on Friday afternoon — and was updated about three hours later.  I found it on the Internet site — and another link to it is here.


Here are two more award-winning bird photos from 2017.  The first is headlined “Camouflage” by Daniel Stenberg from Sweden.  The second is entitled “Bravery” as a pied crow takes on a white-backed vulture.  This photograph is by Hungarian wildlife photographer Bence Máté.  The ‘click to enlarge‘ feature helps with both shots.


Today’s pop ‘blast from the past’ is from the very early 1980s — and is all Canadian once again.  It’s one of the biggest rock and roll hits by any band that this country has ever produced in any generation.  I’ve posted it before, but it’s been a while.  The link is here.

Today’s classical ‘blast from the past’ dates from 1845.  It’s Robert Schumann‘s Piano Concerto in A minor, Op. 54.  It was premiered in Leipzig on January 1, 1846 with his wife Clara at the keyboard.  Here’s another gifted female pianist doing the honours for us today.  It’s the very yummy Georgian-born Khatia Buniatishvili, accompanied by the Frankfurt Radio Symphony, under the baton of Paavo Järvi.  The link is here.

Once again I was more than underwhelmed by the price action in silver and gold yesterday, especially considering the fact that the U.S. dollar index continues to proceed almost unimpeded towards its true intrinsic value.  It will be interesting to see if the powers-that-be will allow free-market forces to determine what that is — and although they’re allowing precious metal prices to rise, they’ve got them on a very short leash.  That’s certainly being reflected in the corresponding equities, as they continue to underperform.

I certainly don’t expect the above situation to continue indefinitely, but it is what it is for the moment — and there’s nothing that can be done about it.  Once the bloom is off the world’s bond and equity markets, I expect things will change for the better in a hurry for both silver and gold.

Of course there’s still JPMorgan to contend with, but this price management scheme is now very long in the tooth — and everyone that matters is on to them.  The latest indication came from The Central Bank of the Russian Federation…with their own version of “Fort Knox” now stacked high with pallets of 1,000 troy ounce good delivery silver bars.

Like I said in that interview with Charlotte McLeod posted in the Critical Reads section, I’d rather be years early, than one day late when this all comes to an end.

Here are the 6-month charts for all four precious metals, plus copper once again.  And how far these rallies can run without getting really, really, really overbought, remains to be seen.  The ‘click to enlarge‘ feature helps a bit with the first four.

As Doug Noland said in the title to his weekly Credit Bubble Bulletin...America First — and the Decapitation of King Dollar…this event has thrown a spanner into the works of the international financial system.  Where we go from here is completely uncharted territory.

I doubt very much of the powers-that-be will be able to put this genie back in the bottle, at least not in my lifetime.  Anyone with dollar holdings, which includes every central bank, government and big business, is certainly looking over their collective shoulders now — and it wouldn’t surprise me in the slightest if there wasn’t some sort of rush for the exits — and soon.

And with King Dollar now on a death watch, the other fiat currencies that comprise the world’s financial system, whether they’re part of the dollar index or not, can no longer be considered safe havens.  The only alternative is precious metals — and when that rush begins, it will certainly spell ‘game over’ for the short holders in the COMEX futures market…except for JPMorgan, of course.

As I approach my seventieth birthday, never once in my lifetime did I ever entertain the idea that I would be living in the world we’re in today…one that has now totally gone off the rails.

Although I’m happy to be ‘all in’ with my precious metal holdings — and certainly hope that they will save me from whatever circumstance that comes shambling forth from this day onward, it’s cold comfort knowing that the safety catch has now been taken off the world’s financial system.

But other than what I’ve done to personally prepare, there’s not much I, or anyone else can do, except watch events unfold — and hope that what I/we have done, proves to be enough.

How did it come to this?

I’m done for the day — and the week — and I’ll see you here on Tuesday.