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EXCHANGE: COMEX

EXCHANGE: COMEX
CONTRACT: JULY 2022 COMEX 100 GOLD FUTURES
SETTLEMENT: 1,734.900000000 USD
INTENT DATE: 07/06/2022 DELIVERY DATE: 07/08/2022
FIRM ORG FIRM NAME ISSUED STOPPED

323 H HSBC 212
435 H SCOTIA CAPITAL 75
657 C MORGAN STANLEY 2
661 C JP MORGAN 1096 1032
737 C ADVANTAGE 5 6
800 C MAREX SPEC 2 7
905 C ADM 77

TOTAL: 1,257 1,257
MONTH TO DATE: 2,270

no. of contracts issued by JPMorgan: 1072/1257

_____________________________________________________________________________________

NUMBER OF NOTICES FILED TODAY FOR JULY CONTRACT 1257 NOTICE(S) FOR 125,700 Oz//3.9097 TONNES)

total notices so far: 2270 contracts for 227,000 oz (7.0606 tonnes)

SILVER NOTICES:

75 NOTICE(S) FILED 375,000 OZ/

total number of notices filed so far this month 2588 : for 12,940,000 oz

END

Russia is a major supplier of silver to London while Mexico supplies the COMEX

With the sanctions, London has no way to obtain silver other than compete with NY.

GLD

WITH GOLD UP $1.35

WITH RESPECT TO GLD WITHDRAWALS: (OVER THE PAST FEW MONTHS):

GOLD IS “RETURNED” TO THE BANK OF ENGLAND WHEN CALLING IN THEIR LEASES: THE GOLD NEVER LEAVES THE BANK OF ENGLAND IN THE FIRST PLACE. THE BANK IS PROTECTING ITSELF IN CASE OF COMMERCIAL FAILURE

ALSO INVESTORS SWITCHING TO SPROTT PHYSICAL (phys) INSTEAD OF THE FRAUDULENT GLD//

BIG CHANGES IN GOLD INVENTORY AT THE GLD: A HUGE WITHDRAWAL OF 7.61 TONNES FROM THE GLD//

INVENTORY RESTS AT 1024.43 TONNES

Silver//SLV

WITH NO SILVER AROUND AND SILVER UP 3 CENTS

AT THE SLV// ://HUGE CHANGES IN SILVER INVENTORY AT THE SLV//: A WITHDRAWAL OF 4.889 MILLION OZ FROM THE LV//

INVESTORS ARE SWITCHING SLV TO SPROTT’S PSLV

CLOSING INVENTORY: 523.262 MILLION OZ

Let us have a look at the data for today

SILVER//OUTLINE

SILVER COMEX OI FELL BY A HUGE SIZED 2862 CONTRACTS TO 137,601 AND FURTHER FROM THE NEW RECORD OF 244,710, SET FEB 25/2020 AND THE GAIN IN OI WAS ACCOMPLISHED DESPITE OUR $0.01 GAIN IN SILVER PRICING AT THE COMEX ON WEDNESDAY. OUR BANKERS WERE UNSUCCESSFUL IN KNOCKING THE PRICE OF SILVER DOWN (IT ROSE BY $0.01) BUT WERE SUCCESSFUL IN KNOCKING OFF SOME SILVER LONGS//BUT MAINLY WE HAD ADDITIONAL SPECULATOR ADDITIONS.

WE MUST HAVE HAD:
I) HUGE SPECULATOR SHORT ADDITIONS /. II) WE ALSO HAD SOME REDDIT RAPTOR BUYING//. iii) A GOOD ISSUANCE OF EXCHANGE FOR PHYSICALS iiii) A POOR INITIAL SILVER STANDING FOR COMEX SILVER MEASURING AT 15.220 MILLION OZ FOLLOWED BY TODAY’S 155,000 OZ QUEUE JUMP / // V) HUGE SIZED COMEX OI LOSS

I AM NOW RECORDING THE DIFFERENTIAL IN OI FROM PRELIMINARY TO FINAL:

THE DIFFERENTIAL FROM PRELIMINARY OI TO FINAL OI SILVER TODAY: CONTRACTS : -118

HISTORICAL ACCUMULATION OF EXCHANGE FOR PHYSICALS JULY. ACCUMULATION FOR EFP’S SILVER/JPMORGAN’S HOUSE OF BRIBES/STARTING FROM FIRST DAY/MONTH OF JULY:

TOTAL CONTACTS for 4 days, total 5662 contracts: 28.310 million oz OR 7.077MILLION OZ PER DAY. (1415 CONTRACTS PER DAY)

TOTAL EFP’S FOR THE MONTH SO FAR: 28.31 MILLION OZ

LAST 11 MONTHS TOTAL EFP CONTRACTS ISSUED IN MILLIONS OF OZ:

MAY 137.83 MILLION

JUNE 149.91 MILLION OZ

JULY 129.445 MILLION OZ

AUGUST: MILLION OZ 140.120

SEPT. 28.230 MILLION OZ//

OCT: 94.595 MILLION OZ

NOV: 131.925 MILLION OZ

DEC: 100.615 MILLION OZ

JAN 2022// 90.460 MILLION OZ

FEB 2022: 72.39 MILLION OZ//

MARCH: 207.430 MILLION OZ//A NEW RECORD FOR EFP ISSUANCE AND WE ARE STILL GOING STRONG THIS MONTH.

APRIL: 114.52 MILLION OZ FINAL//LOW ISSUANCE

MAY: 105.635 MILLION OZ//

JUNE: 94.470 MILLION OZ

JULY : 28.31 MILLION OZ

RESULT: WE HAD A HUGE SIZED DECREASE IN COMEX OI SILVER COMEX CONTRACTS OF 2862 DESPITE OUR $0.01 GAIN IN SILVER PRICING AT THE COMEX// WEDNESDAY.,. THE CME NOTIFIED US THAT WE HAD A STRONG SIZED EFP ISSUANCE CONTRACTS: 500 CONTRACTS ISSUED FOR SEPT AND 0 CONTRACTS ISSUED FOR ALL OTHER MONTHS) WHICH EXITED OUT OF THE SILVER COMEX TO LONDON AS FORWARDS THE DOMINANT FEATURE TODAY: /HUGE BANKER SHORT COVERING AS THEY GET OUT OF DODGE//// WE HAVE A HUGE INITIAL SILVER OZ STANDING FOR JUNE. OF 15.22 MILLION OZ FOLLOWED BY TODAY’S QUEUE JUMP OF 105,000 OZ // .. WE HAD A VERY STRONG SIZED LOSS OF 2362 OI CONTRACTS ON THE TWO EXCHANGES FOR 11.810 MILLION OZ DESPITE THE TINY GAIN IN PRICE..

WE HAD 75 NOTICES FILED TODAY FOR 375,000 OZ

THE SILVER COMEX IS NOW BEING ATTACKED FOR METAL BY LONDONERS ET AL.

GOLD//OUTLINE

IN GOLD, THE COMEX OPEN INTEREST ROSE BY A FAIR SIZED 3024 CONTRACTS TO 498,210 AND CLOSER TO THE RECORD (SET JAN 24/2020) AT 799,541 AND PREVIOUS TO THAT: (SET JAN 6/2020) AT 797,110.

THE DIFFERENTIAL FROM PRELIMINARY OI TO FINAL OI IN GOLD TODAY: —2004 CONTRACTS.

THE FAIR SIZED INCREASE IN COMEX OI CAME DESPITE OUR FALL IN PRICE OF $26.70//COMEX GOLD TRADING/WEDNESDAY / WE MUST HAVE HAD SOME SPECULATOR SHORT COVERING ACCOMPANYING OUR GOOD SIZED EXCHANGE FOR PHYSICAL ISSUANCE. WE HAD ZERO LONG LIQUIDATION //AND SOME SPECULATOR SHORT COVERING

WE ALSO HAD A HUGE INITIAL STANDING IN GOLD TONNAGE FOR JULY AT 2.914 TONNES ON FIRST DAY NOTICE FOLLOWED BY TODAY’S QUEUE JUMP OF 199,900 OZ

YET ALL OF..THIS HAPPENED DESPITE OUR LOSS IN PRICE OF $26.70 WITH RESPECT TO WEDNESDAY’S TRADING

WE HAD A STRONG SIZED GAIN OF 8052 OI CONTRACTS 25.045 PAPER TONNES) ON OUR TWO EXCHANGES..

E.F.P. ISSUANCE

THE CME RELEASED THE DATA FOR EFP ISSUANCE AND IT TOTALED A STRONG SIZED 5028 CONTRACTS:

The NEW COMEX OI FOR THE GOLD COMPLEX RESTS AT 501,234

IN ESSENCE WE HAVE A STRONG SIZED INCREASE IN TOTAL CONTRACTS ON THE TWO EXCHANGES OF 8,052, WITH 3024 CONTRACTS INCREASED AT THE COMEX AND 5028 EFP OI CONTRACTS WHICH NAVIGATED OVER TO LONDON. THUS TOTAL OI GAIN ON THE TWO EXCHANGES OF 8,052 CONTRACTS OR 25.045 TONNES.

CALCULATIONS ON GAIN/LOSS ON OUR TWO EXCHANGES

WE HAD A STRONG SIZED ISSUANCE IN EXCHANGE FOR PHYSICALS (5028) ACCOMPANYING THE FAIR SIZED GAIN IN COMEX OI (3024,): TOTAL GAIN IN THE TWO EXCHANGES 8,052 CONTRACTS. WE NO DOUBT HAD 1) SOME SPECULATOR SHORT COVERING AND SOME ADDITION TO SPECULATOR SHORTS ,2.) STRONG INITIAL STANDING AT THE GOLD COMEX FOR JULY. AT 2.914 TONNES FOLLOWED BY TODAY’S 19,900 OZ QUEUE JUMP 3) ZERO LONG LIQUIDATION//SOME SPECULATOR SHORT COVERING//SOME SPECULATOR SHORT ADDITIONS //.,4) FAIR SIZED COMEX OPEN INTEREST GAIN 5) GOOD ISSUANCE OF EXCHANGE FOR PHYSICAL/

HISTORICAL ACCUMULATION OF EXCHANGE FOR PHYSICALS IN 2022 INCLUDING TODAY

JULY

ACCUMULATION OF EFP’S GOLD AT J.P. MORGAN’S HOUSE OF BRIBES: (EXCHANGE FOR PHYSICAL) FOR THE MONTH OF JULY :

26,409 CONTRACTS OR 2,640,900 OZ OR 82.14 TONNES 4 TRADING DAY(S) AND THUS AVERAGING: 6602 EFP CONTRACTS PER TRADING DAY

TO GIVE YOU AN IDEA AS TO THE SIZE OF THESE EFP TRANSFERS : THIS MONTH IN 4 TRADING DAY(S) IN TONNES: 82.14 TONNES

TOTAL ANNUAL GOLD PRODUCTION, 2021, THROUGHOUT THE WORLD EX CHINA EX RUSSIA: 3555 TONNES

THUS EFP TRANSFERS REPRESENTS 82.14/3550 x 100% TONNES 2.30% OF GLOBAL ANNUAL PRODUCTION

ACCUMULATION OF GOLD EFP’S YEAR 2021 TO 2022

JANUARY/2021: 265.26 TONNES (RAPIDLY INCREASING AGAIN)

FEB : 171.24 TONNES ( DEFINITELY SLOWING DOWN AGAIN)..

MARCH:. 276.50 TONNES (STRONG AGAIN/

APRIL: 189..44 TONNES ( DRAMATICALLY SLOWING DOWN AGAIN//GOLD IN BACKWARDATION)

MAY: 250.15 TONNES (NOW DRAMATICALLY INCREASING AGAIN)

JUNE: 247.54 TONNES (FINAL)

JULY: 188.73 TONNES FINAL

AUGUST: 217.89 TONNES FINAL ISSUANCE.

SEPT 142.12 TONNES FINAL ISSUANCE ( LOW ISSUANCE)_

OCT: 141.13 TONNES FINAL ISSUANCE (LOW ISSUANCE)

NOV: 312.46 TONNES FINAL ISSUANCE//NEW RECORD!! (INCREASING DRAMATICALLY)//SIGN OF REAL STRESS//SURPASSING THE MARCH 2021 RECORD OF 276.50 TONNES OF EFP

DEC. 175.62 TONNES//FINAL ISSUANCE//

JAN:2022 247.25 TONNES //FINAL

FEB: 196.04 TONNES//FINAL

MARCH: 409.30 TONNES INITIAL( THIS IS NOW A RECORD EFP ISSUANCE FOR MARCH AND FOR ANY MONTH.

APRIL: 169.55 TONNES (FINAL VERY LOW ISSUANCE MONTH)

MAY: 247,44 TONNES FINAL//

JUNE: 2238.13 TONNES FINAL

JULY: 82.14 TONNES

SPREADING OPERATIONS

(/NOW SWITCHING TO GOLD) FOR NEWCOMERS, HERE ARE THE DETAILS

SPREADING LIQUIDATION HAS NOW COMMENCED AS WE HEAD TOWARDS THE NEW ACTIVE FRONT MONTH OF JUNE. WE ARE NOW INTO THE SPREADING OPERATION OF SILVER

HERE IS A BRIEF SYNOPSIS OF HOW THE CROOKS FLEECE UNSUSPECTING LONGS IN THE SPREADING ENDEAVOUR ;MODUS OPERANDI OF THE CORRUPT BANKERS AS TO HOW THEY HANDLE THEIR SPREAD OPEN INTERESTS:HERE IS HOW THE CROOKS USED SPREADING AS WE ARE NOW INTO THE NON ACTIVE DELIVERY MONTH OF JUNE HEADING TOWARDS THE ACTIVE DELIVERY MONTH OF JULY, FOR SILVER:

YOU WILL ALSO NOTICE THAT THE COMEX OPEN INTEREST STARTS TO RISE BUT SO IS THE OPEN INTEREST OF SPREADERS. THE OPEN INTEREST IN WILL CONTINUE TO RISE UNTIL ONE WEEK BEFORE FIRST DAY NOTICE OF AN UPCOMING ACTIVE DELIVERY MONTH (JULY), AND THAT IS WHEN THE CROOKS SELL THEIR SPREAD POSITIONS BUT NOT AT THE SAME TIME OF THE DAY. THEY WILL USE THE SELL SIDE OF THE EQUATION TO CREATE THE CASCADE (ALONG WITH THEIR COLLUSIVE FRIENDS) AND THEN COVER ON THE BUY SIDE OF THE SPREAD SITUATION AT THE END OF THE DAY. THEY DO THIS TO AVOID POSITION LIMIT DETECTION. THE LIQUIDATION OF THE SPREADING FORMATION CONTINUES FOR EXACTLY ONE WEEK AND ENDS ON FIRST DAY NOTICE.”

WHAT IS ALARMING TO ME, ACCORDING TO OUR LONDON EXPERT ANDREW MAGUIRE IS THAT THESE EFP’S ARE BEING TRANSFERRED TO WHAT ARE CALLED SERIAL FORWARD CONTRACT OBLIGATIONS AND THESE CONTRACTS ARE LESS THAN 14 DAYS. ANYTHING GREATER THAN 14 DAYS, THESE MUST BE RECORDED AND SENT TO THE COMPTROLLER, GREAT BRITAIN TO MONITOR RISK TO THE BANKING SYSTEM. IF THIS IS INDEED TRUE, THEN THIS IS A MASSIVE CONSPIRACY TO DEFRAUD AS WE NOW WITNESS A MONSTROUS TOTAL EFP’S ISSUANCE AS IT HEADS INTO THE STRATOSPHERE.

First, here is an outline of what will be discussed tonight:

1.Today, we had the open interest at the comex, in SILVER, FELL BY A HUGE SIZED 2862 CONTRACT OI TO 137,719 AND FURTHER FROM OUR COMEX RECORD //244,710(SET FEB 25/2020). THE LAST RECORDS WERE SET IN AUG.2018 AT 244,196 WITH A SILVER PRICE OF $14.78/(AUGUST 22/2018)..THE PREVIOUS RECORD TO THAT WAS SET ON APRIL 9/2018 AT 243,411 OPEN INTEREST CONTRACTS WITH THE SILVER PRICE AT THAT DAY: $16.53). AND PREVIOUS TO THAT, THE RECORD WAS ESTABLISHED AT: 234,787 CONTRACTS, SET ON APRIL 21.2017 OVER 5 YEARS AGO.

EFP ISSUANCE 500 CONTRACTS

OUR CUSTOMARY MIGRATION OF COMEX LONGS CONTINUE TO MORPH INTO LONDON FORWARDS AS OUR BANKERS USED THEIR EMERGENCY PROCEDURE TO ISSUE:

SEPT 500 ALL OTHER MONTHS: ZERO. TOTAL EFP ISSUANCE:500 CONTRACTS. EFP’S GIVE OUR COMEX LONGS A FIAT BONUS PLUS A DELIVERABLE PRODUCT OVER IN LONDON. IF WE TAKE THE COMEX OI LOSS OF 2862 CONTRACTS AND ADD TO THE 500 OI TRANSFERRED TO LONDON THROUGH EFP’S,

WE OBTAIN A GIGANTIC SIZED LOSS OF 2362 OPEN INTEREST CONTRACTS FROM OUR TWO EXCHANGES.

THUS IN OUNCES, THE LOSS ON THE TWO EXCHANGES 11.810 MILLION OZ

OCCURRED DESPITE OUR RISE IN PRICE OF $0.01 .

OUTLINE FOR TODAY’S COMMENTARY

1/COMEX GOLD AND SILVER REPORT

(report Harvey)

2 ) Gold/silver trading overnight Europe,

(Peter Schiff,

end

3. Egon von Greyerz///Matthew Piepenburg via GoldSwitzerland.com,

4. Chris Powell of GATA provides to us very important physical commentaries

end

5. Other gold commentaries

6. Commodity commentaries//

3. ASIAN AFFAIRS

i)WEDNESDAY MORNING// TUESDAY NIGHT

SHANGHAI CLOSED UP 9.05 PTS OR 0.27% //Hang Sang CLOSED UP 56.92 OR 0.26% /The Nikkei closed UP 382.88 OR % 1.47 //Australia’s all ordinaires CLOSED UP .78% /Chinese yuan (ONSHORE) closed UP 6.7018 /Oil DOWN TO 99.50 dollars per barrel for WTI and DOWN TO 101.66 for Brent. Stocks in Europe OPENED ALL GREEN // ONSHORE YUAN CLOSED UP AGAINST THE DOLLAR AT 6.7018 OFFSHORE YUAN CLOSED UP ON THE DOLLAR AT 6.7030: /ONSHORE YUAN TRADING ABOVE LEVEL OF OFFSHORE YUAN/ONSHORE YUAN TRADING STRONGER AGAINST US DOLLAR/OFFSHORE STRONGER

a)NORTH KOREA/SOUTH KOREA

outline

b) REPORT ON JAPAN/

OUTLINE

3 C CHINA

OUTLINE

4/EUROPEAN AFFAIRS

OUTLINE

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS

OUTLINE

6.Global Issues

OUTLINE

7. OIL ISSUES

OUTLINE

8 EMERGING MARKET ISSUES

COMEX DATA//AMOUNTS STANDING//VOLUME OF TRADING/INVENTORY MOVEMENTS

GOLD

LET US BEGIN:

THE TOTAL COMEX GOLD OPEN INTEREST ROSE BY A FAIR SIZED 3024 CONTRACTS TO 501,234 AND CLOSER TO THE RECORD THAT WAS SET IN JANUARY/2020: {799,541 OI(SET JAN 16/2020)} AND PREVIOUS TO THAT: 797,110 (SET JAN 7/2020). AND THIS FAIR COMEX INCREASE OCCURRED DESPITE OUR LOSS OF $26.70(???) IN GOLD PRICING WEDNESDAY’S COMEX TRADING. WE ALSO HAD A STRONG SIZED EFP (5028 CONTRACTS). . THEY WERE PAID HANDSOMELY NOT TO TAKE DELIVERY AT THE COMEX AND SETTLE FOR CASH. IT NOW SEEMS THAT THE COMMERCIALS HAVE GOADED THE SPECS TO GO SHORT BIG TIME AND THEY ADDED TO THEIR SHORT POSITIONS

WE NORMALLY HAVE WITNESSED EXCHANGE FOR PHYSICALS ISSUED BEING SMALL AS IT JUST TOO COSTLY FOR THEM TO CONTINUE SERVICING THE COSTS OF SERIAL FORWARDS CIRCULATING IN LONDON. HOWEVER, MUCH TO THE ANNOYANCE OF OUR BANKERS, THE COMEX IS THE SCENE OF AN ASSAULT ON GOLD AS LONDONERS, NOT BEING ABLE TO FIND ANY PHYSICAL ON THAT SIDE OF THE POND, EXERCISE THESE CIRCULATING EXCHANGE FOR PHYSICALS IN LONDON AND FORCING DELIVERY OF REAL METAL OVER HERE AS THE OBLIGATION STILL RESTS WITH NEW YORK BANKERS. IT SEEMS THAT ARE BANKERS FRIENDS ARE EXERCISING EFP’S FROM LONDON AND NOW THEY ARE LOATHE TO ISSUE NEW ONES.

EXCHANGE FOR PHYSICAL ISSUANCE

WE ARE NOW IN THE NON ACTIVE DELIVERY MONTH OF JULY.. THE CME REPORTS THAT THE BANKERS ISSUED A STRONG SIZED TRANSFER THROUGH THE EFP ROUTE AS THESE LONGS RECEIVED A DELIVERABLE LONDON FORWARD TOGETHER WITH A FIAT BONUS.,

THAT IS 5028 EFP CONTRACTS WERE ISSUED: ;: , . 0 AUG :5028 & ZERO FOR ALL OTHER MONTHS:

TOTAL EFP ISSUANCE: 5028 CONTRACTS

WHEN WE HAVE BACKWARDATION, EFP ISSUANCE IS VERY COSTLY BUT THE REAL PROBLEM IS THE SCARCITY OF METAL AND IT IS FAR BETTER FOR OUR BANKERS TO PAY OFF INDIVIDUALS THAN RISK INVESTORS ESPECIALLY FROM LONDON STANDING FOR DELIVERY. THE LOWER PRICES IN THE FUTURES MARKET IS A MAGNET FOR OUR LONDONERS SEEKING PHYSICAL METAL. BACKWARDATION ALWAYS EQUAL SCARCITY OF METAL!

ON A NET BASIS IN OPEN INTEREST WE GAINED THE FOLLOWING TODAY ON OUR TWO EXCHANGES: A HUGE SIZED TOTAL OF 10,056 CONTRACTS IN THAT 5028 LONGS WERE TRANSFERRED AS FORWARDS TO LONDON AND WE HAD A GOOD SIZED COMEX OI GAIN OF 5028 CONTRACTS..AND THIS STRONG GAIN ON OUR TWO EXCHANGES HAPPENED DESPITE OUR FALL IN PRICE OF GOLD $26.70.

// WE HAVE A STRONG AMOUNT OF GOLD TONNAGE STANDING JULY (7.7729),

HERE ARE THE AMOUNTS THAT STOOD FOR DELIVERY IN THE PRECEDING 12 MONTHS OF 2021-2022:

DEC 2021: 112.217 TONNES

NOV. 8.074 TONNES

OCT. 57.707 TONNES

SEPT: 11.9160 TONNES

AUGUST: 80.489 TONNES

JULY: 7.2814 TONNES

JUNE: 72.289 TONNES

MAY 5.77 TONNES

APRIL 95.331 TONNES

MARCH 30.205 TONNES

FEB ’21. 113.424 TONNES

JAN ’21: 6.500 TONNES.

TOTAL SO FAR THIS YEAR (JAN- DEC): 601.213 TONNES

YEAR 2022:

JANUARY 2022 17.79 TONNES

FEB 2022: 59.023 TONNES

MARCH: 36.678 TONNES

APRIL: 85.340 TONNES FINAL.

MAY: 20.11 TONNES FINAL

JUNE: 74.933 TONNES FINAL

JULY 7.7729 TONNES

THE BANKERS WERE SUCCESSFUL IN LOWERING GOLD’S PRICE //// (IT FELL $26.70) BUT WERE UNSUCCESSFUL IN KNOCKING OFF SPECULATOR LONGS/COMMERCIAL LONGS BUT SPECULATOR SHORTS CONTINUED TO ADD TO THEIR POSITIONS//// WE HAVE REGISTERED A STRONG SIZED GAIN OF 25.045 TONNES ON TOTAL OI FROM OUR TWO EXCHANGES, ACCOMPANYING OUR GOLD TONNAGE STANDING FOR JULY (7.7729 TONNES)…

WE HAD -2004 CONTRACTS REMOVED FROM COMEX TRADES. THESE WERE REMOVED AFTER TRADING ENDED LAST NIGHT

NET GAIN ON THE TWO EXCHANGES 8,052 CONTRACTS OR 805,200 OZ OR 25.045 TONNES

Estimated gold volume 165,906/// poor/

final gold volumes/yesterday 334,627 /STRONG/RAID

INITIAL STANDINGS FOR JULY ’22 COMEX GOLD //JULY 7

Gold	Ounces
Withdrawals from Dealers* Inventory in oz*	nil oz
Withdrawals from Customer* Inventory in oz*	2,990.042 oz Int. Delaware Delaware 62 kilobars 31 kilobars
Deposit to the Dealer* Inventory in oz*	nil OZ
Deposits to the Customer* Inventory, in oz*	nil
No of oz served (contracts) today	1257 notice(s) 125,700 OZ 3.9090 TONNES
No of oz to be served (notices)	229 contracts 22900 oz 0.7122 TONNES
Total monthly oz gold served (contracts) so far this month	2270 notices227,000 OZ 7.0606 TONNES
Total accumulative withdrawals of gold from the Dealers* inventory this month*	NIL oz
Total accumulative withdrawal of gold from the Customer* inventory this month*	xxx oz

Gold

total dealer deposit 0

No dealer withdrawals

0 customer deposits

total deposits: nil oz

2 customer withdrawals:

i) Int. Delaware: 1993.362 (62 kilobars)

ii) Delaware: 996.680 oz (31 kilobars)

total withdrawal: 2990.042 oz

ADJUSTMENTS:2 all dealer to customer

Brinks 13,021.155 oz

JPMorgan 160,457.274 oz

CALCULATIONS FOR THE AMOUNT OF GOLD STANDING FOR JULY.

For the front month of JULY we have an oi of 1486 contracts gaining 1378 contracts . We had

621 notices filed on Wednesday so we gained a whopping 1999 contracts or an additional 199,900 oz will stand in this non active

delivery month of July.

August has a LOSS OF 12,130 contracts down to 369,806 contracts

Sept. gained 322 contracts to 1325.

We had 1257 notice(s) filed today for 125,700 oz FOR THE July 2022 CONTRACT MONTH.

Today, 0 notice(s) were issued from J.P.Morgan dealer account and 1096 notices were issued from their client or customer account. The total of all issuance by all participants equate to 1257 contract(s) of which 1072 notices were stopped (received) by j.P. Morgan dealer and 0 notice(s) was (were) stopped/ Received) by J.P.Morgan//customer account and 0 notice(s) received (stopped) by the squid (Goldman Sachs)

To calculate the INITIAL total number of gold ounces standing for the JULY /2022. contract month,

we take the total number of notices filed so far for the month (2270) x 100 oz , to which we add the difference between the open interest for the front month of (JULY 1486 CONTRACTS ) minus the number of notices served upon today 1257 x 100 oz per contract equals 249,900 OZ OR 7.7729 TONNES the number of TONNES standing in this active month of July.

thus the INITIAL standings for gold for the JULY contract month:

No of notices filed so far (2270) x 100 oz+ (1486) OI for the front month minus the number of notices served upon today (1257} x 100 oz} which equals 249,900 oz standing OR 7,7729 TONNES in this active delivery month of JULY.

TOTAL COMEX GOLD STANDING: 7.7729 TONNES (A FAIR STANDING FOR A JULY ( NON ACTIVE) DELIVERY MONTH)

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

COMEX GOLD INVENTORIES/CLASSIFICATION

NEW PLEDGED GOLD:

241,794.285 oz NOW PLEDGED /HSBC 5.94 TONNES

204,937.290 PLEDGED MANFRA 3.08 TONNES

83,657.582 PLEDGED JPMorgan no 1 1.690 tonnes

265,999.054, oz JPM No 2

1,152,376.639 oz pledged Brinks/

Manfra: 33,758.550 oz

Delaware: 193.721 oz

International Delaware:: 11,188.542 o

total pledged gold: 2,419,784.828 oz 75.26 tonnes

TOTAL OF ALL GOLD ELIGIBLE AND REGISTERED: 32,984,567.40 OZ

TOTAL ELIGIBLE GOLD: 16,293,532.012 OZ

TOTAL OF ALL REGISTERED GOLD: 16,691,035 OZ

REGISTERED GOLD THAT CAN BE SERVED UPON: 14,271,251.0 OZ (REG GOLD- PLEDGED GOLD)

END

SILVER/COMEX/JULY 7

Silver	Ounces
Withdrawals from Dealers* Inventory*	NIL oz
Withdrawals from Customer Inventory	729,554.145 oz Brinks CNT Delaware Int. Delaware
Deposits to the Dealer* Inventory*	nil OZ
Deposits to the Customer Inventory	1,515,631.421 oz CNT Delaware JPMorgan
No of oz served today (contracts)	75CONTRACT(S)375,000 OZ)
No of oz to be served (notices)	325 contracts (1,625,000 oz)
Total monthly oz silver served (contracts)	2588 contracts 12,940,000 oz)
Total accumulative withdrawal of silver from the Dealers* inventory this month*	NIL oz
Total accumulative withdrawal of silver from the Customer* inventory this month*

And now for the wild silver comex results

i) 0 dealer deposit

total dealer deposits: 0 oz

i) We had 0 dealer withdrawal

total dealer withdrawals: x oz

We have 3 deposits into the customer account

i) Into JPMorgan: 583,128.300 oz

ii) Into Delaware: 353,864.731 oz

iii0 Into CNT: 578,638.390 oz

total deposit: 1,515,631.421 oz

JPMorgan has a total silver weight: 173.503 million oz/337.890 million =51.34% of comex

Comex withdrawals: 4

i) Out of Brinks: 600,509.850 oz

ii) out of Int. Delaware 25,261,280 oz

iii) Out of CNT 101,776.480 oz

iv) Out of Delaware 2006.280 oz

total withdrawal 729,554.145 oz

adjustments: 0/

the silver comex is in stress!

TOTAL REGISTERED SILVER: 68.732 MILLION OZ

TOTAL REG + ELIG. 337.860 MILLION OZ

CALCULATION OF SILVER OZ STANDING FOR JUNE

silver open interest data:

FRONT MONTH OF JULY OI: 400 CONTRACTS HAVING LOST 590. WE HAD 621 NOTICES FILED

ON WEDNESDAY, SO WE GAINED 31 CONTRACTS OR AN ADDITIONAL 155,000 OZ WILL STAND FOR METAL AT THE COMEX.

AUGUST LOST163 CONTRACTS TO STAND AT 1300

SEPTEMBER HAD A LOSS OF 2771 CONTRACTS DOWN TO 114,756 CONTRACTS.

TOTAL NUMBER OF NOTICES FILED FOR TODAY: 75 for 375,000 oz

Comex volumes:42,772// est. volume today// poor

Comex volume: confirmed yesterday: 70,191 contracts ( GOOD )

To calculate the number of silver ounces that will stand for delivery in JULY we take the total number of notices filed for the month so far at 2588 x 5,000 oz = 12,940,000 oz

to which we add the difference between the open interest for the front month of JULY(400) and the number of notices served upon today 75 x (5000 oz) equals the number of ounces standing.

Thus the standings for silver for the JULY./2022 contract month: 2588 (notices served so far) x 5000 oz + OI for front month of JULY (400) – number of notices served upon today (75) x 5000 oz of silver standing for the JULY contract month equates 14,565,000 oz. .

the record level of silver open interest is 234,787 contracts set on April 21./2017 with the price on that day at $18.42. The previous record was 224,540 contracts with the price at that time of $20.44

END

GLD AND SLV INVENTORY LEVELS:

JULY 7/WITH GOLD UP $1.35: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 7.61 TONNES FORM THE GLD///INVENTORY REST AT 1024.43 TONNES

JULY 6/WITH GOLD DOWN $26.70: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 9.86 TONNES FROM THE GLD//INVENTORY REST AT 1032.04 TONNES

JULY 5/WITH GOLD DOWN $36.55//BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 8.41 TONNES FROM THE GLD///INVENTORY RESTS AT 1041.90 TONNES

JULY 1/WITH GOLD DOWN $5.40: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.32 TONNES//INVENTORY RESTS AT 1050.31 TONNES

JUNE 30/WITH GOLD DOWN $9.20: big CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.74 TONNES FROM THE GLD///INVENTORY RESTS AT 1052.63 TONNES//

JUNE 28/WITH GOLD DOWN $3.05//BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 4.64 TONNES FROM THE GLD///INVENTORY RESTS AT 1056.40 TONNES

JUNE 27/WITH GOLD DOWN $4.90 CENTS TODAY: BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.03 TONNES FROM THE GLD///INVENTORY RESTS AT 1061.04 TONNES

JUNE 24/WITH GOLD UP 45 CENTS TODAY: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 8.70 TONNES FROM THE GLD//INVENTORY RESTS AT 1063.07 TONNES

JUNE 23/WITH GOLD DOWN $8.60:HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 2.03 TONNES FROM THE GLD//INVENTORY RESTS AT 1071.77 TONNES

JUNE 22/WITH GOLD UP 15 CENTS:BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.74 TONNES FROM THE GLD////INVENTORY RESTS AT 1073.80 TONNES

JUNE 21/WITH GOLD DOWN $2.00: NO CHANGES IN GOLD INVENTORY AT THE GLD/INVENTORY RESTS AT 1075.54 TONES

JUNE 17/WITH GOLD DOWN $11.25: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 11.60 TONNES INTO THE GLD.///INVENTORY RESTS AT 1075.54 TONNES

JUNE 16/WITH GOLD UP $28.95: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 1063.74 TONNES

JUNE 15/WITH GOLD UP $6.50/BIG CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.65 TONNES FROM THE GLD////INVENTORY RESTS AT 1063.74 TONNES

JUNE 14/WITH GOLD DOWN $18.80/NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 1065.39 TONNES

JUNE 13/WITH GOLD DOWN $41.55: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 1065.39 TONNES

JUNE 10/WITH GOLD UP $21.40: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 1065.39 TONNES

JUNE 9/WITH GOLD DOWN $3.50: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A DEPOSIT OF 2.32 TONNES OF GOLD INTO THE GLD////INVENTORY RESTS AT 1065.39 TONNES

JUNE 8/WITH GOLD UP $4.75: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 1063.07 TONNES

JUNE 7/WITH GOLD UP $7.45: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 1063.07 TONNES

JUNE 6/WITH GOLD DOWN $5.85: NO CHANGES IN GOLD INVENTORY AT THE GLD//INVENTORY RESTS AT 1066.04 TONNES

JUNE 3/WITH GOLD DOWN $19.75//A BIG CHANGE IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.16 TONNES FROM THE GLD//INVENTORY RESTS AT 1066.04 TONNES

JUNE 2/WITH GOLD UP $22.50: HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.64 TONNES FROM THE GLD//INVENTORY RESTS AT 1067.20 TONNES

JUNE 1/WITH GOLD UP $1$ HUGE CHANGES IN GOLD INVENTORY AT THE GLD: A WITHDRAWAL OF 1.45 TONNES FROM THE GLD///INVENTORY RESTS AT 1068.36 TONNES

GLD INVENTORY: 1024.43 TONNES

Now the SLV Inventory/( vehicle is a fraud as there is no physical metal behind them

JULY 7/WITH SILVER UP 3 CENTS TODAY: BIG CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 4.889 MILLION OZ FROM THE SLV//INVENTORY RESTS AT 523.262 MILLION OZ/

JULY 6/WITH SILVER UP ONE CENT: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 12.558 MILLION OZ FORM THE SLV///INVENTORY RESTS AT 528.151 MILLION OZ

JULY 5/WITH SILVER DOWN 55 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 540.709MILLION OZ//

JULY 1/WITH SILVER DOWN 61 CENTS TODAY: A SMALL CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 553,000 OZ//INVENTORY RESTS AT 540.709 MILLION OZ//

JUNE 30/WITH SILVER DOWN 41 CENTS : SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 738,000 OZ FROM THE SLV//INVENTORY RESTS AT 541.262 MILLION OZ//

JUNE 28/WITH SILVER DOWN 26 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 542.00 MILLION OZ..

JUNE 27/WITH SILVER DOWN 4 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 542.000 MILLION OZ

JUNE 24/WITH SILVER UP 10 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 3.137 MILLION OZ FROM THE SLV////INVENTORY RESTS AT 542.000 MILLION OZ

JUNE 23/WITH SILVER DOWN 41 CENTS TODAY; HUGE CHANGES IN SILVER INVENTORY AT THE SL: A WITHDRAWAL OF 2.029 MILLION OZ FROM THE SLV//INVENTORY RESTS AT 545.137 MILLION OZ//

JUNE 22/WITH SILVER DOWN 14 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 547.166 MILLION OZ.

JUNE 21/WITH SILVER UP 9 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 3.506 MILLION OZ INTO THE SLV///INVENTORY RESTS AT 547.166 MILLION OZ//

JUNE 17/WITH SILVER DOWN 15 CENTS TODAY: SMALL CHANGES IN SILVER INVENTORY AT THE SLV/: A WITHDRAWAL OF 739,000 OZ FROM THE SLV./:INVENTORY RESTS AT 543.660 MILLION OZ/

JUNE 16/WITH SILVER UP 46 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 544.399 MILLION OZ

JUNE 15/WITH SILVER UP 44 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 544.399 MILLION OZ

JUNE 14/WITH SILVER DOWN 32 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 544.399 MILLION OZ//

JUNE 13/WITH SILVER DOWN 62 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 544.399 MILLION OZ//

JUNE 10.WITH SILVER UP 13 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 830,000 Z FROM THE SLV//INVENTORY RESTS AT 544.399 MILLION OZ//

JUNE 9/WITH SILVER DOWN 27 CENTS TODAY:HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A DEPOSIT OF 923,000 OZ INTO THE SLV////INVENTORY RESTS AT 545.229 MILLION OZ

JUNE 8/WITH SILVER DOWN 8 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV/INVENTORY RESTS AT 544.306 MILLION OZ//

JUNE 7/WITH SILVER UP 6 CENTS TODAY: NO CHANGES IN SILVER INVENTORY AT THE SLV//INVENTORY RESTS AT 544.306 MILLION OZ/

JUNE 6/WITH SILVER UP 20 CENTS TODAY: A HUGE CHANGE IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 6.459 MILLION OZ FROM THE SLV///INVENTORY RESTS AT 547.167 MILLION OZ//

JUNE 3/WITH SILVER DOWN $.34: A SMALL CHANGES IN SILVER INVENTORY AT THE SLV: A WITTHDRAWAL OF 246,000 OZ FORM THE SLV//INVENTORY RESTS AT 553.626 MILLION OZ..

JUNE 2/WITH SILVER UP 57 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV: A WITHDRAWAL OF 2.261 MILLION OZ FORM THE SLV.//INVENTORY RESTS T 553.872 MILLION OZ

JUNE 1/WITH SILVER UP 19 CENTS TODAY: HUGE CHANGES IN SILVER INVENTORY AT THE SLV//: A WITHDRAWAL OF 2.538 MILLION OZ FROM THE SLV//INVENTORY RESTS AT 556.133 MILLION OZ//

CLOSING INVENTORY 523.262 MILLION OZ//

PHYSICAL GOLD/SILVER STORIES

1.PETER SCHIFF

Is The Chinese Yuan Beginning To Chip Away At Dollar Dominance?

WEDNESDAY, JUL 06, 2022 – 10:45 PM

Via SchiffGold.com,

China appears to be chipping away at dollar dominance.

While there is no indication that the dollar is in imminent danger of toppling from its perch as the global reserve currency, more central banks are warming up to the yuan.

According to UBS Asset Management’s annual reserve manager survey, about 85% of central banks said they are invested in or are considering investing in the Chinese yuan. That’s up from 81% a year earlier.

USB surveyed 30 top central banks.

On average, central bank foreign exchange managers plan to hold about 5.8% of reserves in yuan within the next 10 years. That would represent a sharp increase from the 2.9% level of global reserve yuan holdings reported by the International Monetary Fund in late June.

Meanwhile, the average share of US dollar holdings dropped to 63% as of June 2022, according to the survey. That was down from 69% in the previous year.

According to Business Insider, the response to the invasion of Ukraine “has increased talk about a ‘multipolar’ world, in which the US is no longer the overwhelmingly dominant force.

There is some speculation that the weaponization of the dollar to punish Russia for the invasion of Ukraine has motivated some countries to diversify away from the dollar. Less exposure to the greenback means less exposure to diplomatic and economic pressure from Washington DC.

Declining confidence in the dollar started long before recent events in Ukraine. The Federal Reserve printed trillions of dollars out of thin air in response to COVID-19. This devalued the dollar as evidenced by the surge in prices over the last year. This was the predictable result of creating money out of thin air and handing it out to spend. More money chasing the same amount (or with governments shutting down economies fewer) goods and services will always lead to a general rise in prices.

The only reason the US can get away with this policy to the extent that it does is its role as the world reserve currency. There is a built-in global demand for dollars that helps absorb the money printing. But what happens if that demand drops? What happens if China and other countries decide they don’t want to hold a currency that is losing value every day?

After Russia invaded Ukraine, the US cut some Russian banks, including the central bank, off from the SWIFT payment system.

SWIFT stands for the Society for Worldwide Interbank Financial Telecommunication. The system enables financial institutions to send and receive information about financial transactions in a secure, standardized environment. Since the dollar serves as the world reserve currency, SWIFT facilitates the international dollar system.

SWIFT and dollar dominance gives the US a great deal of leverage over other countries.

And the US went a step further. In an unprecedented move, the Federal Reserve froze Russia’s dollar reserves. In effect, Russia’s dollar assets are valueless to the country. It can’t use them at all.

Even if you think Russia deserves these draconian economic sanctions, it’s important to remember that they could come at a cost.

Recent dollar strength compared to other world currencies suggests that the dollar remains in a strong position. But things could shift quickly. How much more borrowing and printing will the world tolerate before they become wary of holding dollars? And will the US propensity to use the dollar as a foreign policy weapon undermine trust in the greenback?

The world is watching.

END

How Long Will The Fed Hawks Keep Flying?

THURSDAY, JUL 07, 2022 – 01:05 PM

Authored by Michael Maharrey via SchiffGold.com,

After the June FOMC meeting and the Fed’s 75-basis-point interest rate hike, I argued that the central bank is totally winging it. Reading between the lines in the minutes from that June meeting seems to bear this out. The Fed appears to be in reaction mode. The question becomes what will it react to next? How long will the hawks keep flying as the economy tanks?

It’s pretty clear that the big rate hike was a knee-jerk reaction to hotter-than-expected May inflation data. You’ll recall that just weeks before the June meeting, a 3/4% rate hike wasn’t even on the table.

Then it was.

Near-term policy rate expectations shifted markedly toward the end of the period, particularly after the release of the May consumer price index (CPI) report. Ahead of the release of the report, market expectations reflected a broad consensus that there would be 50 basis point rate increases at both the June and July FOMC meetings. After the release of the higher-than-expected inflation data, policy-sensitive rates pointed instead to a considerable probability of 75 basis point moves at both the June and July meetings.”

In a nutshell, Powell & Company hoped inflation had peaked earlier in the spring, but with the “surprising” increase in CPI, the central bankers felt compelled to go big. Why? Because they are suddenly concerned about their credibility.

Many participants judged that a significant risk now facing the Committee was that elevated inflation could become entrenched if the public began to question the resolve of the Committee to adjust the stance of policy as warranted.”

In other words, the Fed is like a kid in the schoolyard concerned that if he doesn’t act tough, everybody will think he’s a chicken. The problem is, he’s not a tough guy. As my dad used to say, “He’s writing checks his body can’t cash.”

The minutes indicate the FOMC expects another big hike in July.

In discussing potential policy actions at upcoming meetings, participants continued to anticipate that ongoing increases in the target range for the federal funds rate would be appropriate to achieve the Committee’s objectives. In particular, participants judged that an increase of 50 or 75 basis points would likely be appropriate at the next meeting.”

But the central bank has a problem. It has already driven rates very close to the limit. If rates go much higher, there is every reason to believe the economy will completely implode. In 2019, 2.5% was the max. At that point, the economy got shaky, the stock market crashed, and the Fed went right back to loose monetary policy. (Not that 2.5% interest rates are particularly tight.) In 2019, the Fed cut rates three times and had already gone back to QE – even before the pandemic.

So, what makes anybody think the Fed can push rates to 3 or 3.5% today with even more debt in the economy?

And again, the Fed seems to be in reaction mode. There is no long-term plan. My guess is if we see any relief in the June CPI data, the Fed will start signaling that they’ve tightened enough. And some inflation relief seems likely. Commodity prices have dropped – most significantly the price of oil – in anticipation of a recession. This will likely relieve some of the price pressures in the economy.

But the relief will be temporary if the Fed pivots back to rate cuts and quantitative easing.

Speaking of quantitative easing, the Fed seems to have completely forgotten all about balance sheet reduction. The FOMC had signaled quantitative tightening would start in June.

It didn’t.

The Fed managed to shed less than $1 billion from its balance sheet during the first month of QT. Meanwhile, the Fed’s mortgage-backed security holdings actually increased by over $1 billion.

So while the tone coming out of the Fed might be hawkish – the reality is much less so.

And it will likely get even less so once the economic realities set in.

Federal Reserve Chairman Jerome Powell has been running around insisting the economy is strong enough to handle rate hikes.

But if you look at the strength of the economy, households are in very strong financial shape, they’ve still got a lot of excess savings – from forced saving of not being able to travel and things like that – and fiscal transfers. The same thing is true with business, with very low rates of default and lots of cash on the balance sheet. The labor market is also tremendously strong, still averaging very high job growth per month. Overall, the US economy is in the position to withstand tighter monetary policy, we think.”

Keep in mind that this message is brought to you by the same guy who gave us “transitory” inflation.

And this messaging seem just as dubious.

The Atlanta Fed has downgraded its Q2 GDP forecast to -2.1%. That would mean the economy has been in an official recession since the first of the year.

That brings us back to the burning question – will the hawks keep flying if it turns out we really are in a recession? Will the Fed be willing to go 50 or 75 basis points with the economy sliding and inflation seemingly cooling?

I don’t think so. As Rick Rule put it, the Fed will almost certainly chicken out in this inflation fight. The Fed is in reaction mode, and the reaction will likely be — run!

END

2. Lawrie Williams//Pam and Russ Martens/Jim Rickards/Mathew Piepenburg/Von Greyerz

Rickards: Welcome To 1984

THURSDAY, JUL 07, 2022 – 11:45 AM

Authored by James Rickards via DailyReckoning.com,

I’ve been addressing the war on cash lately, and for good reason. While everyone’s attention is focused on the war in Ukraine, inflation and the Supreme Court, government plans to eliminate cash are accelerating.

For example, central bank digital currencies (CBDCs) are coming even faster than many anticipated. The digital yuan is already here; it was introduced in China last February during the Winter Olympics.

Visitors to the Olympics were required to pay for meals, hotels, transportation, etc., using QR codes on their mobile phones that linked to digital yuan accounts. Nine other countries have already launched CBDCs. Europe is not far behind and is testing the digital euro under the auspices of the European Central Bank.

The U.S. was lagging, but is catching up fast.

The Federal Reserve was studying a possible Fed CBDC at a research facility at MIT. Now the idea has moved from the research stage to preliminary development.

Fed Chair Jay Powell said, “A U.S. CBDC could… potentially help maintain the dollar’s international standing.”

But this has little to do with technology or monetary policy and everything to do with herding you into digital cattle chutes where you can be slaughtered with account freezes, seizures, etc.

NOT Crypto

First off, CBDCs are not cryptocurrencies. The CBDCs are digital in form, are recorded on a ledger (maintained by a central bank or finance ministry and the message traffic is encrypted. Still, the resemblance to cryptos ends there.

The CBDC ledgers do not use blockchain, and CBDCs definitely do not embrace the decentralized issuance model hailed by the crypto crowd. CBDCs will be highly centralized and tightly controlled by central banks.

The CBDC ledger can be maintained in encrypted form by the central bank itself without the need for bank accounts or money market funds. Payments can be done with an iPhone or other device, with no need for credit cards or costly wire transfers.

Who needs bank accounts, checks, account statements, deposit slips and the other clunky features of a banking relationship when you can go completely digital with the Fed?

CBDCs are a technological advance, but they do not replace existing reserve currencies.

Not a New Currency

It’s important to understand that a CBDC is not a new currency. It’s just a new payment channel. A digital dollar is still a dollar. A digital euro is still a euro. It’s just that the currency never exists in physical form. It is always digital, and ownership is recorded on a ledger maintained by the central bank.

You will have an account showing how many digital dollars you own. They are transferred by an app on a smartphone or a desktop computer.

Of course, in many ways, dollar transactions are already digital. Most people receive money by wire transfer, go shopping with credit cards and pay bills online. All of those transactions are digital and encrypted. The difference with CBDCs is that you don’t need banks or credit card companies or even PayPal.

Again, everything can be done through the Fed with a single account for payment and receipt. CBDCs could disintermediate the entire banking and credit card sectors to a great extent.

Welcome to 1984

The other big difference is that it will give the government control of your money and the ability to put you under constant surveillance. In a world of CBDCs, the government will know every purchase you make, every transaction you conduct and even your physical whereabouts at the point of purchase.

It’s a short step from there to negative interest rates, account freezes, tax withholding from your account and even putting you under FBI investigation if you vote for the wrong candidate or give donations to the wrong political party.

If that sounds like a stretch, it’s not.

China is already using its CBDC to deny travel and educational opportunities to political dissidents. Canada seized the bank accounts and crypto accounts of nonviolent trucker protesters last winter.

These kinds of “social credit scores” and political suppression will be even easier to conduct when CBDCs are completely rolled out.

How does this relate to what is sometimes called the Great Reset? This would be the movement toward a single global reserve currency.

CBDCs and the Great Reset

Displacing the dollar would involve a meeting and agreement similar to the original Bretton Woods agreement of 1944. The agreement could take many forms. Still, the process would conform to what many call the Great Reset.

Still, things don’t happen that quickly in elite circles. Even Bretton Woods took over two years to design and another five years to implement even under the duress of World War II. The transition from sterling to the U.S. dollar as the leading reserve currency took 30 years from 1914 to 1944.

As they say, it’s complicated. Still, there are some huge changes that could emerge from the Great Reset.

For example, a new global currency regime would be an opportunity to devalue all major currencies in order to steal wealth from savers.

All currencies cannot devalue against all other currencies at the same time; that’s a mathematical impossibility. Yet all currencies could devalue simultaneously against gold. This could easily drive gold prices to $5,000 per ounce or much higher to increase the “inflation tax” (I’m sure you agree that you’re paying more than enough already!).

The Surveillance State on Steroids

Another change would be that CBDCs make it much easier to impose negative interest rates, confiscations and account freezes on some or all account holders.

This can be used for simple policy purposes or as a tool of the total surveillance state. Surveillance of incorrect behavior as defined by the Communist Party is the real driver of the digital yuan more than any aspirations to a yuan reserve currency role.

All of these shifts are now underway. The U.S. won’t adopt its own CBDC overnight, but it’s coming sooner or later.

The endgame for CBDCs would closely resemble George Orwell’s dystopian novel Nineteen Eighty-Four. It would be a world of negative interest rates, forced tax collection, government confiscation, account freezes and constant surveillance.

You might not be able to fight back easily in the world of CBDCs, but there is one nondigital, nonhackable, nontraceable form of money you can still use.

It’s called gold.

END

3. Chris Powell of GATA provides to us very important physical commentaries

Inflation is still with us even though it eases somewhat

(Lee/Yahoo News/GATA)

Prices don’t drop when inflation eases

Submitted by admin on Tue, 2022-07-05 22:47Section: Daily Dispatches

By Medora Lee
USA Today, McLean, Virginia
via Yahoo News, Sunnyvale, California
Tuesday, July 5, 2022

When it comes to prices during inflation what goes up doesn’t always come down.

When talking about inflation, it’s important to remember that inflation is a rate that measures how fast prices are rising. If the consumer inflation rate drops from its 40-year high of 8.6% in May, prices are still rising — just not as fast.

Consumers won’t feel immediate relief even as the inflation rate slows because many of those elevated prices are likely here to stay, said Michael Ashton, managing principal at Enduring Investments in Morristown, New Jersey.

“The price level has permanently changed,” Ashton said. “Until your wages catch up, it will continue to hurt.”

And wages have a long way to climb to catch up.

In May inflation-adjusted average hourly earnings decreased a seasonally adjusted 3% from a year ago. When combined with a decrease in weekly hours worked, that resulted in a 3.9% decrease in real wages, the Bureau of Labor Statistics says. …

… For the remainder of the report:

https://www.yahoo.com/finance/news/prices-dont-drop-inflation-eases-090014063.html

END

Peter Hambro has finally come a long way and now admits that gold is being manipulated

(Peter Hambro/Manly/Bullion star)

Bullion Star’s Ronan Manly: Peter Hambro’s declaration is a big deal

Submitted by admin on Wed, 2022-07-06 16:42Section: Daily Dispatches

4:40p ET Wednesday, July 6, 2022

Dear Friend of GATA and Gold:

Bullion Star’s Ronan Manly thinks it’s remarkably important that gold mining and bullion banking veteran Peter Hambro this week came out flatly declaring that central banks and their agent investment banks operate a largely surreptitious system of suppressing international gold prices.

Hambro’s declaration came in an essay called to your attention by GATA on Monday:

https://gata.org/node/22039

Manly writes: “While Hambro has previously been known to understand and discuss gold price manipulation, his latest comments may be coming now as he senses a geopolitical shift in the monetary role of gold.”

Yes, Hambro’s statement is encouraging, but the Financial Times, The Wall Street Journal, Bloomberg News, Reuters, and all other major mainstream financial news organizations almost certainly will ignore it, since the reality of the gold market remains a prohibited subject for them, even a matter of national security.

Manly’s analysis is headlined “Peter Hambro – BIS, Central Banks Are Rigging Gold Market Using Bullion Banks’ Paper Gold” and it’s posted at Bullion Star here:

https://www.bullionstar.com/blogs/ronan-manly/peter-hambro-bis-central-banks-are-rigging-gold-market-using-bullion-banks-paper-gold/

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org

4. OTHER GOLD COMMENTARIES

Special thanks to Doug C for sending this to us:

JPMorgan’s ‘Big Hitters’ of Gold Market Face Trial Over Spoofing – Bloomberg

Inbox

douglas cundey

https://www.bloomberg.com/news/articles/2022-07-07/jpmorgan-s-big-hitters-of-gold-market-face-trial-over-spoofing?srnd=premium#xj4y7vzkg

JPMorgan’s ‘Big Hitters’ of Gold Market Face Trial Over Spoofing

Three face prison if convicted of rigging prices for years JPMorgan dominates precious metals US says were manipulated

Tom SchoenbergJuly 7, 2022, 8:30 AM EDT

Photographer: Lisi Niesner/Bloomberg

Michael Nowak was once the most powerful person in the gold market.

The former JPMorgan Chase & Co. managing director ran the bank’s precious metals business for more than a decade, making hundreds of millions of dollars in profit trading everything from silver to palladium. Now, he and two of his former colleagues face a federal jury in Chicago on criminal charges for thousands of so-called spoofing trades, which prosecutors say were used for years to generate illicit gains for JPMorgan and its top clients.

JPMorgan’s ‘Big Hitters’ of Gold Market Face Trial Over SpoofingThree face prison if convicted of rigging prices for years JPMorgan dominates precious metals US says were manipulatedTom Schoenberg July 7, 2022, 8:30 AM EDTMichael Nowak was once the most powerful person in the gold market.The former JPMorgan Chase & Co. managing director ran the bank’s precious metals business for more than a decade, making hundreds of millions of dollars in profit trading everything from silver to palladium. Now, he and two of his former colleagues face a federal jury in Chicago on criminal charges for thousands of so-called spoofing trades, which prosecutors say were used for years to generate illicit gains for JPMorgan and its top clients.

https://www.bloomberg.com/news/articles/2022-07- 07/jpmorgan-s-big-hitters-of-gold-market-face-trial-over- spoofing?srnd=premium#xj4y7vzkg

If Inflation Doesn’t Rapidly Dissipate, Gold Prices Will Prove Dramatically Undervalued

THURSDAY, JUL 07, 2022 – 02:24 PM

Authored by Jesse Felder via The Felder Report,

Volatility in the markets this year has largely been driven by the rise in inflation.

So if rapidly rising price pressures are going to quickly dissipate, taking inflation back below 2%, then perhaps the moves in markets this year will be seen in hindsight as, “filled with sound and fury, signifying nothing,” to quote Shakespeare.

Certainly, this is what markets are still discounting even after their recent ructions. Equity prices remain extremely elevated while gold prices remain relatively depressed.

Episodes of rising inflation typically see just the opposite.

Therefore, if inflation proves more durable than markets currently discount, the recent volatility may be merely prelude to a more significant repricing across a number of asset classes.

In fact, the level of CPI today already suggests that gold, relative to equities, may be just about as undeservedly cheap as it was a half century ago, the last time inflation really became a problem.

And if inflation remains elevated, gold prices could have a terrific amount of upside ahead, especially relative to stock prices.

END

5.OTHER COMMODITIES:

END

COMMODITIES IN GENERAL/

END

6.CRYPTOCURRENCIES

7. GOLD/ TRADING

Your early currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings THURSDAY morning 7:30 AM

ONSHORE YUAN: CLOSED UP 6.7018

OFFSHORE YUAN: 6.7030

HANG SANG CLOSED UP AT 56.92 PTS OR 0.26%

2. Nikkei closed UP 382.88 OR 1.47%

3. Europe stocks CLOSED ALL GREEN

USA dollar INDEX DOWN TO 106.72/Euro RISES TO 1.0192

3b Japan 10 YR bond yield: RISES TO. +.247/ !!!!(Japan buying 100% of bond issuance)/Japanese yen vs usa cross now at 135.76/JAPANESE FALLING APART WITH YEN FALTERING AS WELL AS LONG TERM YIELDS RISING BREAKING THE JAPANESE CENTRAL BANK.

3c Nikkei now ABOVE 17,000

3d USA/Yen rate now well ABOVE the important 120 barrier this morning

3e Gold UP /JAPANESE Yen UP CHINESE YUAN: UP -// OFF- SHORE UP

3f Japan is to buy the equivalent of 108 billion uSA dollars worth of bond per month or $1.3 trillion. Japan’s GDP equals 5 trillion usa./“HELICOPTER MONEY” OFF THE TABLE FOR NOW /REVERSE OPERATION TWIST ON THE BONDS: PURCHASE OF LONG BONDS AND SELLING THE SHORT END

Japan to buy 100% of all new Japanese debt and by 2018 they will have 25% of all Japanese debt. EIGHTY percent of Japanese budget financed with debt.

3g Oil DOWN for WTI and DOWN FOR Brent this morning

3h European bond buying continues to push yields lower on all fronts in the EMU. German 10yr bund DOWN TO +1.271%/Italian 10 Yr bond yield RISES to 3.35% /SPAIN 10 YR BOND YIELD RISES TO 2.38%…

3i Greek 10 year bond yield RISES TO 3.54//

3j Gold at $1743.90 silver at: 19.42 7 am est) SILVER NEXT RESISTANCE LEVEL AT $30.00

3k USA vs Russian rouble;// Russian rouble UP 0 AND 1/2 roubles/dollar; ROUBLE AT 62.95

3m oil into the 99 dollar handle for WTI and 100 handle for Brent/

3n Higher foreign deposits out of China sees huge risk of outflows and a currency depreciation. This can spell financial disaster for the rest of the world/

JAPAN ON JAN 29.2016 INITIATES NIRP. THIS MORNING THEY SIGNAL THEY MAY END NIRP. TODAY THE USA/YEN TRADES TO 135.76DESTROYING JAPANESE CITIZENS WITH HIGHER FOOD INFLATION

30 SNB (Swiss National Bank) still intervening again in the markets driving down the FRANC. It is not working: USA/SF this morning 0.9723– as the Swiss Franc is still rising against most currencies. Euro vs SF 0.9909well above the floor set by the Swiss Finance Minister. Thomas Jordan, chief of the Swiss National Bank continues to purchase euros trying to lower value of the Swiss Franc.

USA 10 YR BOND YIELD: 2.930 UP 2 BASIS PTS

USA 30 YR BOND YIELD: 3.131 UP 1 BASIS PTS

USA DOLLAR VS TURKISH LIRA: 17.25

Futures Extend Gains, Escape Technical Bear Market After China Hints At Massive Stimulus

THURSDAY, JUL 07, 2022 – 08:07 AM

US equity futures rose for a 3rd day, rising above the -20% clutches of a technical bear market, and validating the best period of the year for risk assets…

… as investor fears about surging inflation were assuaged by the cooling of the oil rally and comments from the Federal Reserve about taking a tougher stance to cool price increases. Nasdaq 100 futures rose 0.4% by 730 a.m. ET, while S&P 500 contracts added 0.3%. Both indexes finished Wednesday’s session higher following the minutes from the Fed’s latest policy meeting, which showed officials considered raising interest rates for longer to tame runaway inflation.

Global stocks also rose as did bond yields, adding to cheapening pressure on Treasuries after a Bloomberg report that China is weighing a $220 billion stimulus plan. Europe’s Estoxx50 gained 1.7%; Asia stocks closed higher led by Nikkei’s 1.5% rise as a revenue surge by Samsung assuaged fears about weakening consumer demand and soaring material costs. That sparked a rally in chipmakers, helping MSCI Inc.’s Asia-Pacific share index add more than 1%. The British pound gained after sources report PM Boris Johnson plans to resign.

Among notable premarket movers, Freeport-McMoRan Inc. advanced 4.3%. Copper rebounded from a five-day selloff in London, heading for the biggest gain since September 2018. Shares of US semiconductor companies rose in premarket trading on Thursday after Samsung Electronics reported a better-than-anticipated 21% jump in revenue. Bed Bath & Beyond shares jumped 9% after the home furnishings retailer’s interim chief executive officer and a pair of directors bought shares in the firm. GameStop shares surged 9.8% in premarket trading on Thursday after the video game retailer announced a four-for-one stock split in the form of a dividend. Other notable premarket movers:

US biotech stocks, especially those involved in developing cancer-related treatments, could be active following a Wall Street Journal report that Merck and Co. (MRK US) is said to be in advanced talks to buy Seagen (SGEN US) for above $200 a share. Watch shares in Iovance Biotherapeutics (IOVA US), Mirati Therapeutics (MRTX US), Arcus Biosciences (RCUS US), ALX Oncology (ALXO US), Cullinan Oncology (CGEM US). Seagen rises 5.4% in premarket trading; Merck slides 1%
Watch Endeavor Group (EDR US) and Lamar Advertising (LAMR US) shares as they were upgraded to buy from neutral at Citi, which in note says that even with new lower estimates, both stocks have attractive risk/reward at current levels.
Keep an eye on Consolidated Communications Holdings (CNSL US) as it was cut to sell at Citi, with the bank citing outperformance compared to some wireline pure-play peers, which leaves the stock trading on a “meaningful” valuation premium.

Fears of a recession have haunted US stocks this year, sending S&P 500 Index into a bear market, although as of this morning futures are once again out of the -20% drawdown. And with the FOMC minutes indicating the Fed remains on hiking autopilot for now, investors are now looking to the second-quarter earnings season to gauge whether the company profits are holding up against the surge in prices and supply constraints.

“Global equities bounce as pressure points such as rates, oil and the dollar begin to ease,” Stephen Innes, managing partner at SPI Asset Management, wrote in a note. “Momentum has swung higher, with tech-heavy benchmarks outperforming after Samsung’s revenue was better than feared.”

European equities trade well. Euro Stoxx 50 rises as much as 1.9%, completely erasing Tuesday’s rout. Miners, autos and energy names outperform within the Stoxx 600 which rose 1.4%, while UK mid-cap shares slightly increased gains following a report that Boris Johnson plans to resign as prime minister. Miners outperformed the rising Stoxx Europe 600 index amid a rebound in metals and iron ore on news China is mulling $200 billion stimulus package to boost economy, while iron ore and metals rebound after recent declines; energy stocks also outpace broader market gains this morning after losing almost 8% over the last two sessions. Iron ore in Singapore and copper in London rose about 2%, recovering some ground after recent declines. Citigroup expects iron ore to outperform base metals amid China policy easing, while UBS downgraded its 2022-2023 estimate for the raw material, pointing to a demand slowdown. The Stoxx Energy sub- index rises 2.2% as oil edged higher with investors weighing concerns about a potential global slowdown against signs of still-tight physical markets. Carmakers posted some of the biggest gains in the benchmark Stoxx 600 index, which gained for a second day. Here are the most notable European movers:

Tenaris shares advance as much as 8.8% as Jefferies analysts upgraded the stock to buy, noting that they prefer Oil Country
Tubular Goods exposure among steel sector. Analysts upgrade OCTG steel price forecasts, while cutting stainless and carbon prices.
Drax jumps as much as 7.2% following an update that saw the power company forecast adjusted Ebitda for 2022 that’s above analyst expectations and an agreement to support the security of UK electricity supplies during the winter.
Nordex shares gain as much as 7.6% after reporting stronger than expected 2Q order volumes. Jefferies expects an acceleration of order volumes for the remainder of the year, mainly driven by additional onshore installations in the European market.
Storytel shares soar as much as 15% after the Swedish audiobook company released a 2Q streaming update that DNB’s analyst calls a “step in the right direction.”
Semiconductor equipment makers lead a rally in European chip stocks after Samsung posted preliminary 2Q sales that were slightly above expectations, easing fears that global chip demand might have already started tapering off. ASML rises as much as 4.9%, ASM International +5%, BE Semi +5%
Persimmon drops as much as 6.7% after it reported revenue for the first half that missed the average analyst estimate. Citi said home completions missed its estimate amid planning delays and labor shortages.
Chr. Hansen falls as much as 11% after narrowing its topline growth guidance. Based on quarter’s performance, company narrows organic revenue growth target for 2021/22 to 8-10%, from previous outlook of 7-11%.
SAS saw its share price fall 5% on Thursday as the airline revealed a drop in bookings toward the end of June due to notice of a pilot strike that became a reality on July 4.
SUSE shares slide as much as 11% before paring losses, after the software firm cuts its growth target for the annual contract value in the emerging segment. Jefferies says the 2Q results are in-line with expectations, but the outlook references macro impacts

Earlier in the session, Asian stocks rose, recovering most of their losses from yesterday, as semiconductor shares rallied and investors assessed the outlook for oil prices. The MSCI Asia Pacific Index climbed as much as 1.3%, hauled up by chip shares after Samsung Electronics reported a better-than-expected jump in revenue in the latest quarter. A gauge of chip stocks soared nearly 4%, on track for its best day since March. The surge in tech shares helped benchmarks in Taiwan and South Korea lead gains in the region. Meanwhile, Hong Kong shares reversed losses as an easing of travel curbs in the city overshadowed broader concerns about a resurgence of Covid outbreaks in China. Traders in Asia also took some solace in lower oil prices with the West Texas Intermediate futures trading below $100 a barrel, supporting the outlook for earnings in the oil-importing region. “We are seeing short squeezes in tech,” said Jessica Amir, a strategist at Saxo Capital Markets. Meanwhile, there’s optimism that a retreat in oil prices will allow people to spend less at the pump and more on retail goods, she said. Still, higher input costs and worries about a global slowdown have pushed Asia’s stock benchmark down more than 18% this year, with traders debating over the scope of future US interest-rate hikes and the outlook for inflation. The record of the Fed’s June meeting showed the potential for even more restrictive policy to curb inflation. “The market correction over 1H2022 has improved the valuation proposition of equities, and the key going forward is for companies to better manage their profit margins,” Tai Hui, chief Asia market strategist at JPMorgan Asset Management, wrote in a note. “Value and quality should remain in favor until there is a clear peak in interest rates.”

Japanese stocks gained amid lower commodity prices, which could ease inflationary pressures moving forward and potentially lead to a softer stance from the Federal Reserve. The Topix Index rose 1.4% to 1,882.33 as of market close Tokyo time, while the Nikkei advanced 1.5% to 26,490.53. Sony Group Corp. contributed the most to the Topix Index gain, increasing 3.7%. Out of 2,170 shares in the index, 1,550 rose and 526 fell, while 94 were unchanged. “The situation has changed since the June FOMC meeting. With weaker economic indicators and the price of crude oil falling below $100 per barrel, some believe that perhaps the hawkish stance may not be as strong as it was in June at this point,” said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management.

Australia’s S&P/ASX 200 index rose 0.8% to close 6,648.00, boosted by banks and rebounding mining shares as iron ore prices rose. The index was still trading near a seven-month low. Australia’s trade surplus skyrocketed to a record high in May, driven by stronger prices of its key export – coal -while imports surged too in a sign of solid domestic demand. In New Zealand, the S&P/NZX 50 index fell 0.3% to 11,112.16.

In FX, Bloomberg dollar spot index falls 0.3%. JPY and CHF are the weakest performers in G-10 FX, AUD and NZD outperform. Cable pops higher, stalling just shy of a 1.20-handle after news of PM Johnson’s resignation. The dollar fell versus most of its Group-of-10 currency peers as risk assets advanced. Antipodean currencies led gains while the Swiss franc and the yen underperformed. The euro fluctuated around $1.02. The pound rose by as much as 0.6% to $1.1999 on UK Prime Minister Boris Johnson’s plans to resign, following an unprecedented wave of resignations from his government over the past two days. He will stay on as caretaker prime minister until October, with a new Conservative leader set to be installed in time for the party’s annual conference. Gilts fell, led by shorter maturities. The Aussie and kiwi strengthened in risk-on price action as rising stocks and a weaker US dollar fuel a position squeeze. Aussie was also boosted by a report showing the trade surplus widened to a record high in May.

In rates, Treasuries were cheaper across the curve, extending Wednesday’s aggressive bear-flattening move following release of FOMC meeting minutes. 10Y TSYs traded around 2.93% after rising 12bp in Wednesday’s selloff; 10-year bund yields are higher by 8.6bp, gilts by 3.9bp. US curve spreads are within a basis point of Wednesday’s close, which for inverted 2s10s was -7.6bp, approaching YTD low. The IG dollar issuance slate remains empty so far; just two names priced $4.2b Wednesday, paying more than 20bps in concessions on demand just shy of 3 times covered. Bunds extended their bear flattening move as haven buying waned and money markets raised wagers on the pace of ECB tightening. Short-dated German bonds lead a pronounced sell off with 2y yields rising over 13bps near 0.53%. Gilts follow with both curves bear-flattening. Peripheral bonds are mixed: tighter to core at the short end, wider in long-dates. Red pack euribor futures drop 18-19 ticks as money markets raise wagers on the pace of ECB tightening.

In commodities, WTI trades within Wednesday’s range, adding 1% to trade near $99.48. Base metals trade in the green; LME copper and tin rise over 4%. Spot gold rises roughly $6 to trade near $1,745/oz.

Looking at the day ahead now, data releases include the US trade balance for May and the weekly initial jobless claims, as well as German industrial production for May. Meanwhile from central banks, we’ll get the ECB’s minutes from their June meeting, and hear from the Fed’s Waller and Bullard, the ECB’s Lane, Stournaras, Centeno and Herodotou, and the BoE’s Mann and Pill.

Market Snapshot

S&P 500 futures up 0.4% to 3,864.25
STOXX Europe 600 up 1.4% to 413.23
German 10Y yield little changed at 1.29%
Euro up 0.3% to $1.0209
Brent Futures little changed at $100.77/bbl
MXAP up 1.1% to 157.65
MXAPJ up 1.1% to 521.21
Nikkei up 1.5% to 26,490.53
Topix up 1.4% to 1,882.33
Hang Seng Index up 0.3% to 21,643.58
Shanghai Composite up 0.3% to 3,364.40
Sensex up 0.7% to 54,101.85
Australia S&P/ASX 200 up 0.8% to 6,647.96
Kospi up 1.8% to 2,334.27
Gold spot up 0.2% to $1,741.73
U.S. Dollar Index down 0.22% to 106.86

Top Overnight News from Bloomberg

Gone are the days when investors would be buying cheap euro options on a relative basis ahead of this month’s meetings by the European Central Bank and the Federal Reserve. The relative premium to own exposure is now near 200 basis points on both the two-week tenor, that captures the ECB decision, and the three- week tenor, that envelopes the Fed meeting
The French government’s new round of measures to combat surging inflation will cost about 20 billion euros ($20.4 billion), according to Finance Minister Bruno Le Maire
The Bank of Japan is likely to consider revising its inflation and growth forecasts later this month as a weaker yen and cost-push inflation force more companies to pass on higher costs to consumers, according to people familiar with the matter
Treasury yields surged after minutes of the most recent Federal Reserve meeting underscored commitment to tighten aggressively to keep inflation from becoming entrenched
European electricity prices broke new records Thursday as gas futures soared, further squeezing households and businesses across the continent and forcing politicians to find ways to ease the pain of relentless cost increases
Hungary’s biggest interest rate increase since 2008 failed to stem the forint’s plunge as policy makers sought to support the weakest currency in emerging markets

A more detailed look at global markets courtesy of Newsquawk

Asia-Pac stocks traded mostly positive but with gains capped following the choppy performance on Wall St and after an uneventful FOMC Minutes which noted participants judged a rate increase of 50bps or 75bps would likely be appropriate at the July meeting. ASX 200 was kept afloat alongside strength in the mining and materials sectors, as well as encouraging trade data. Nikkei 225 was underpinned amid reports the BoJ was said to be completely committed to its easing policy. Hang Seng and Shanghai Comp. were mixed with Hong Kong pressured by tech weakness, while the mainland was initially subdued after the PBoC drained liquidity and with Beijing to impose China’s first-ever COVID-19 vaccine mandate, although Chinese bourses then pared losses as markets also digested MOFCOM’s announcement to rollout measures to support auto consumption.

Top Asian News

China Builder CIFI Says No Perp-Bond Talks as USD Notes Tumble
China Official Reserves Drop to Lowest Since June 2020
China’s Cabinet Urges Greater Cybersecurity After Data Leak
Tokyo Reports 8,529 New Covid Cases, Most Since April

European bourses are firmer across the board, Euro Stoxx 50 +1.7%, in a continuation of the constructive APAC handover though action remains choppy. Stateside, futures are firmer across the board but the magnitudes more contained that European peers after yesterday’s choppy action; note, relatively brief upside was sparked on China stimulus reports, via BBG. Within Europe, sectors feature noted outperformance in Basic Resources and Autos while some of the more defensively-inclined components are in the red.

Top European News

UK PM Johnson is to resign today (expected around 12:00-13:00BST/07:00-08:00ET), according to multiple reports. As it stands, it appears that Johnson wants to remain in place as a caretaker until a new Conservative Party leader can be assigned, which is likely to occur around the autumn given the impending summer recess. However, MPs are seemingly divided on whether they want to allow Johnson to remain, with some calling for the immediate appointment of an alternative caretaker such as current Deputy PM Raab.
Hungarian PM Orban’s Chief of Staff says discussions with the EU have progressed re. funds, adopted the Commission’s stance on four issues. Accepted the proposal that funds must be spent on energy independence, via Reuters.
Pound Rises on Report UK Prime Minster Johnson Plans to Resign
Sanctions Act as ‘Weapons of Mass Destruction,’ Says Melnichenko
France’s Public Finances Are a Risk for Euro Zone, Auditor Says

Central Banks

ECB’s Enria (supervisory board) says conservative capital trajectories should be utilized by banks when announcing distribution plans; from the point of view of capital adequacy, we are asking individual banks to review their capital trajectories.
BoJ is expected to increase its FY22 inflation forecast marginally to slightly above 2% from 1.9% in its quarterly outlook due on July 21st, according to Reuters sources. Expected to lower economic growth forecast (currently 2.9%). BoJ will likely maintain ultra-low interest rates and dovish policy bias.

Pound perks up as UK PM prepares to stand down in face of mass ministerial and party mutiny, Cable back over 1.2000 vs low 1.1900 base, EUR/GBP closer to 0.8500 than 0.8550.
Aussie rebounds with risk sentiment and on back of record trade surplus, AUD/USD approaching 0.6850 from recent lows near 0.6760.
Greenback fades after forging further gains in advance of hawkish line from Fed minutes, DXY pivoting 107.000 within range below 107.270 high on Wednesday.
Loonie regroups with WTI ahead of Canadian trade and Ivey PMIs as USD/CAD probes 1.3000 from 1.3050+, Euro regains sight of 1.0200 level amidst retreat in EGBs pre-ECB minutes.
Yen slips on rate dynamics and digests source reports suggesting BoJ may tweak inflation forecast a fraction above 2% and trim growth projection in quarterly outlook next week, USD/JPY rebounds towards 136.00 from around 135.55.
Forint gets fleeting fillip from 200bp 1-week depo rate hike by NBH, while Zloty awaits 75bp tightening move from NBP; EUR/HUF tops 415.00, while EUR/PLN holds near 4.7850.

Fixed Income

Bonds back under pressure as risk sentiment continues to improve and most Central Banks remain hawkish
Bunds reverse from 151.65 to 150.15 before finding underlying bids, Gilts from 115.60 to 114.66 and the 10 year T-note from 119-05 to 115-15
Curves flatter or more inverted after FOMC minutes flag potential for even more restrictive policy

Commodities

WTI and Brent are modestly bid benefiting from stimulus reports and the relative reprieve in the USD’s recent ascension; benchmarks firmer by USD ~0.80/bbl.
US Private Inventory Data: Crude +3.8mln (exp. -1.0mln), Cushing +0.5mln, Gasoline -1.8mln (exp. -0.5mln), Distillate -0.6mln (exp. +1.1mln)
Dutch Minister says gas storage is 58% full, therefore the 80% winter target is achievable. Groningen gas field could be tapped in a emergency scenario
BofA says copper prices could slip below USD 6,000/tonne in the coming months. Click here for the full list of price forecasts from BofA.
Spot gold is, in a similar vein to crude, modestly supported on the USD breather, and steady between touted resistance/support at USD 1750.70/oz and USD 1735-37/oz respectively.

US Event Calendar

07:30: June Challenger Job Cuts YoY, prior -15.8%
08:30: June Continuing Claims, est. 1.33m, prior 1.33m
08:30: July Initial Jobless Claims, est. 230,000, prior 231,000
08:30: May Trade Balance, est. -$84.7b, prior -$87.1b

Central Banks

13:00: Fed’s Bullard to Discuss US Economy and Monetary Policy
13:00: Fed’s Waller Interviewed During NABE Event

DB’s Jim Reid concludes the overnight wrap

If you’re in any doubt about inflation I must say I was bowled over with shock at how much the tooth fairy left Maisie overnight as the first baby tooth in our household fell out yesterday. My wife told me over dinner that the tooth fairy was going to come tonight and I asked her what the going rate was? I mentioned 20p or maybe a bit more as it’s the first one. My wife replied that the tooth fairy and her had agreed ten pounds. I nearly choked on my dinner and made it quite clear that this was a dangerous precedent to set one tooth into a three child settlement period. Inflation expectations can get ingrained this way. However this is one way of solving the intergenerational wealth divide I suppose.

If you’re looking for positives in a world as wobbly as my daughter’s front teeth, in spite of all the bleak newsflow this week, the S&P 500 (+0.36% last night) has been up for three days in a row. However sentiment is bad enough that you’d be forgiven for not noticing. Indeed fears of a recession continue to abound in markets, with yesterday seeing another round of commodity price declines (outside of Euro Gas and electricity), further inversions of the Treasury yield curve, rising US yields with 2yr yields up an astonishing +24.5bps from the European afternoon lows, and continued concerns about a European energy crisis that left the Euro at its weakest level against the US Dollar since 2002. Some stronger US data was the bright spot that may have helped equities but it’s been a bit of a random walk of late as weaker data has also recently helped equities by reining in Fed expectations. So tough markets to find a consistent narrative in at the moment. Makes calling the market reaction to payrolls tomorrow hard.

Looking at some of these moves and stories in more detail, commodities across the board were one of the biggest losers yesterday (ex EU gas and electricity), with the prospect of a global slowdown or recession sending Brent crude oil prices (-2.02%) beneath $100/bbl intraday for the first time since April, with only a partial recovery to $101.23/bbl this morning. When it came to metals, copper slid another -1.95%, taking the industrial bellwether down to a 19-month low (-29.54% from the peak 16 weeks ago), whilst even the classic safe haven of gold (-1.47%) hit a 9-month low. I mentioned in my chart of the day how the extent of the commodity declines we’re seeing right now have only been rivalled at three other points since the 1930s, which are during the initial Covid shock, the GFC, and the German invasion of France in 1940, which brings home just how infrequent declines of this sort are. As usual however, one exception to that pattern were European natural gas futures, which edged up another +3.59% to a post-March high of €171 per megawatt-hour. Meanwhile German electricity prices have surged, with 1-month forward power baseload prices increasing +7.38% to €371, their highest since the start of Russia’s invasion of Ukraine, which risks hurting the all-important German manufacturing sector.

Treasury yields sold off and the yield curve flattened, driven by strong data and a still resolutely hawkish Fed per the June meeting minutes. 2yr yields climbed +18.3bps (24.5bps off the lows), marking their largest daily increase since the WSJ article hinting the Fed was ‘considering’ a +75bp hike, and bringing 2yr yields back above 3%. Further out the curve, 10yr yields increased +12.3bps to 2.93%, led by real yields gaining +12.6bps. The renewed bout of flattening left 2s10s -7.6bps inverted, the most since early April. So a big day in US bonds. As we go to press, yields on the 10yr USTs (-1.1 bps) have slipped to 2.92% in Asia trading, although the 2s10s has steepened slightly back to a still-inverted -5.0bps.

Looking at the drivers, on the data side the ISM services index for June came in above expectations at 55.3 (vs. 54.0 expected), whilst the final composite PMI for June was revised up to 52.3 (vs. flash 51.2). And the JOLTS data on job openings showed a labour market that was still historically tight in May, albeit a bit less tight than it had been, with the number of openings coming down for a second consecutive month for the first time since the pandemic began, at 11.254m in May (vs. 11.0m expected).

The June Fed Minutes added to the narrative, where policymakers steadfastly communicated their desire to tighten policy to fight inflation. As with any minutes release, the comments are at risk of being stale, but it was illuminating that policymakers appeared to be in agreement that policy needed to get into restrictive territory, and that the risks were tilted toward losing control of inflation and having expectations un-anchor. Indeed, something relevant to recent market pricing that’s become more dovish since the June meeting, it said “many participants judged that a significant risk now facing the Committee was that elevated inflation could become entrenched if the public began to question the resolve of the Committee”. When all was said and done, Fed futures pricing by December 2022 increased +9.7bps to 3.37%.

On that theme of central banks, gilts underperformed their counterparts elsewhere in Europe, with the 10yr yield up +4.4bps after there were further signals that the BoE were considering a 50bps hike at their next meeting. Chief economist Pill said that their vow to “act forcefully” in their June statement “reflects both my willingness to adopt a faster pace of tightening than implemented thus far in this tightening cycle, while simultaneously emphasizing the conditionality of any such change in pace on the flow of new data and analysis”. However, sovereign bonds had a better performance elsewhere in Europe, with yields on 10yr bunds (-1.2bps) and OATs (-2.3bps) both moving lower. This was largely before the bulk of the US bond sell off.

Despite the accumulation of bad news, equities appeared to continue marching to the beat of their own drum. The S&P 500 staged another impressive late-day rally which left the index up +0.36%, after spending the morning in the red. Contrary to Tuesday, where only three sectors were in the green, only three sectors were in the red yesterday, so a much more broad-based rally. Tech names performed about in line, with the NASDAQ up +0.35%. Meanwhile the tails of the market underperformed, with the mega-cap FANG+ flat, and the small-cap Russell 2000 down -0.79%. European equities gained, with the STOXX 600 up +1.66%, although most of the increase came at the open to catch up with Tuesday’s late Wall Street rally. Significantly however, we saw the Euro weaken a further -0.82% against the US dollar to take it to its weakest level since 2002, at just $1.0182. My colleague George Saravelos evaluated how much lower the Euro could depreciate against the US dollar depending on which of four heuristics you believe. As a spoiler, yes, parity is in play, but do check out the full piece, here.

Those modest gains in the US stocks are echoing in majority of the Asian markets in early trade. The Kospi (+1.87%) is outperforming across the region, supported by a rise in Samsung Electronics after the company indicated in its earnings guidance that its operating profit likely rose to 14.1 trillion won ($10.8 billion) in 2Q22, up from 12.57 trillion won a year ago. Meanwhile, the Nikkei (+0.73%), Shanghai Composite (+0.51%), and the CSI (+0.56%) all are trading in positive territory, recovering some of their losses in the previous session. Elsewhere, the S&P/ASX 200 (+0.41%) is moving higher as Australia’s trade surplus hit a record high, although the exception to this positive trend has been the Hang Seng (-0.43%). Outside of Asia, DM stock futures are pointing to a steady start with contracts on the S&P 500 (+0.12%), NASDAQ 100 (+0.15%) and DAX (+0.87%) all rising.

Finally in terms of UK politics, PM Johnson lives to fight another day in the face of an unprecedented pace of resignations from his government and substantial pressure to quit. Since the resignations of Health Secretary Javid and Chancellor Sunak on Tuesday evening, more than 40 MPs have resigned as ministers or aides from the government, with Welsh Secretary Simon Hart becoming the third minister at cabinet level to resign. Otherwise, Attorney General Suella Braverman said publicly that Johnson should step down and that she’d stand in a leadership election, although she remains in post for now, whilst Levelling Up Secretary Michael Gove was sacked from the cabinet last night. In terms of next steps with increasing numbers of MPs calling for his removal, there are elections to the 1922 Committee of Conservative MPs next week, and if enough anti-Johnson MPs are elected to that, they are seeking to change the rules so that another confidence vote in Johnson can be held imminently (rather than waiting for a year since the last challenge as under the existing rules).

To the day ahead now, and data releases include the US trade balance for May and the weekly initial jobless claims, as well as German industrial production for May. Meanwhile from central banks, we’ll get the ECB’s minutes from their June meeting, and hear from the Fed’s Waller and Bullard, the ECB’s Lane, Stournaras, Centeno and Herodotou, and the BoE’s Mann and Pill.

THURSDAY /WEDNESDAY NIGHT

3 a./NORTH KOREA/ SOUTH KOREA

///NORTH KOREA/SOUTH KOREA/

3B JAPAN

end

3c CHINA

CHINA

China now prepares another $220 million stimulus going against the West

(zerohedge)

China Prepares $220 Billion Stimulus With Tsunami Of Bond Sales

THURSDAY, JUL 07, 2022 – 07:27 AM

Just as we predicted over a year ago, China – which remains painfully limited in how it can kickstart its slowing economy – is preparing for a massive fiscal stimulus in the form of a tidal wave of local government bond sales.

With growth in the world’s second-largest economy faltering especially after China’s President Xi Jinping made clear weeks ago that “Covid zero” isn’t going anywhere, there is also “chance zero” that Beijing’s 2022 growth target of 5.5% will be achieved because of the lingering threat of new lockdowns.

China’s slowdown recently forced the People’s Bank of China to cut key interest rates for long-term loans to cushion the property slump and lockdowns. Meanwhile, as doubts rise that China will rebound like prior economic downturns, policymakers are set for round two of stimulation: an infrastructure splurge.

Bloomberg reports that China’s Ministry of Finance is considering to allow local governments to sell a whopping 1.5 trillion yuan ($220 billion) of “special” local bonds in the year’s second half. The people said the bonds would bolster the struggling economy.

“The bond sales would be brought forward from next year’s quota,” according to people who asked not to be named because this has yet to be officially announced.

While the issuance of local bonds – one of the very few places in China’s economy where there is excess debt capacity – is nothing new, this would be the first time “the issuance has been fast-tracked in this way, underscoring growing concerns in Beijing over the dire state of the world’s second-largest economy … previously local governments didn’t start selling the debt until Jan. 1, when the new budget year begins.”

China is desperate to offset downward pressure on the economy by restoring its old playbook to increase infrastructure spending to cushion the economy in times of economic distress. If the country’s legislative body approves the proposal, it would add to the 1.1 trillion yuan ($164 billion) in new support for infrastructure unveiled last month.

Economists surveyed by Bloomberg forecast the economy will grow around 4.1% this year, missing Beijing’s growth target of 5.5%. It appears pulling growth forward is a move by the government to offset the economic slump.

While it is a normal practice for local governments to make proposals for the next year, that process normally kicks off in the last quarter of each year, one of the people said. Some provinces were told to start new projects when feasible even if the construction was originally scheduled to start next year, one of the people said. -Bloomberg

Chinese stocks closed green on Thursday. The benchmark CSI 300 Index closed up about half a percent and has surged nearly 19% since finding a low in late April.

After plunging in recent days, commodities caught a solid bid on expectations China will once again emerges as a major buying force as it prepares to build a whole new batch of ghost cities.

end

4/EUROPEAN AFFAIRS//UK AFFAIRS/

Boris Johnson resigns as Prime Minister//its government collapses!

(zerohedge)

Boris Johnson Resigns As Prime Minister After Government Collapses

THURSDAY, JUL 07, 2022 – 07:07 AM

Update (740am ET): It’s official – Boris Johnson announced his resignation as prime minister but defied pressure to step down immediately, insisting he would remain in office until a new Conservative party leader is chosen. In an address in front of No 10 Downing Street, after days of turmoil and mass resignations from his government, the prime minister said: “It is clearly now the will of the parliamentary Conservative party that there should be a new leader for the Conservative party and therefore a new prime minister.”

Johnson, one the most controversial British leaders in modern times, said the timing of the leadership contest would be announced next week. However many Conservatives, including a number of former ministers, believe Johnson should leave Downing St immediately. “There’s no way I could serve under him in any circumstances,” said one.

BoJo also took a swipe at his own political party which abandoned him in record short time, saying “the herd instinct is powerful, and when it moves, it moves.”

“Them’s the breaks”, Johnson summarized his exit. His departure will end a tumultuous three years in office marked by Britain’s exit from the EU, the ravages of Covid-19, the war in Ukraine and a cost of living crisis, as well as his 2019 election win — the Tories’ biggest victory for over four decades.

Before his speech Johnson had already started to fill some ministerial vacancies, with Greg Clark set to come in — temporarily — as levelling-up secretary. James Cleverly becomes the third education secretary in as many days.

Johnson intends to convene his hastily assembled interim cabinet for a meeting on Thursday afternoon, in an attempt to convey a sense that he wants to maintain national stability.

Johnson’s announcement has fired the starting gun on the race to succeed him, with a wide array of candidates expected to confirm they are running in the coming days. There is no clear frontrunner.

* * *

Watch Live as BoJo announces his resignation:

In the end, PredictIt was right…

… and the straw that finally broke the camel’s back was the announcement by Boris Johnson’s newly appointed chancellor Nadhim Zahawi who also called on BoJo to quit just one day after his appointment, saying “Prime minister, you know in your heart what the right thing to do is, and go now,” Zahawi wrote. “The country deserves a government that is not only stable, but which acts with integrity.”

Michelle Donelan, who replaced Zahawi as education secretary on Tuesday night, also resigned. “I see no way that you can continue in post, but without a formal mechanism to remove you it seems that the only way this is only possible is for those of us who remain in Cabinet to force your hand,” she wrote.

That was the tipping point, and just minutes later news broke that the scandal-plagued and extremely unpopular prime minister Boris Johnson plans to resign bringing the curtain down on a tempestuous three years in office marred by a succession of scandals that culminated in the rebellion of his own cabinet and parliamentary group, including a record number of cabinet resignations in a single day.

Johnson, 58, bowed to the inevitable after the mass resignation of members of his government, including Chancellor of the Exchequer Rishi Sunak, as a mounting number of Conservative MPs launched excoriating public attacks on his judgment, leadership and allegiance to the truth.

According to the FT, Johnson spoke to Sir Graham Brady, chair of the 1922 committee of Conservative backbench MPs, at an 8.30am meeting in which the prime minister said he had concluded that he should resign in the interests of the party and the country.

BoJo will leave a nation mired in political and economic uncertainty, rocked by scandal after scandal, and still showing the strains of his singular triumph, the UK’s exit from the European Union, as it confronts surging inflation, potential recession and the threat of widespread industrial action. The Conservatives trail the main opposition Labour Party in the polls, their past reputation for sleaze revived on Johnson’s watch.

As Bloomberg notes, Johnson wants stay on as caretaker premier until October while the Tories elect a new leader. Whether or not his party allows him to remain in office for that long, possible successors are already lining up. They include Foreign Secretary Liz Truss, Trade Minister Penny Mordaunt, Defence Secretary Ben Wallace and the newly installed chancellor, Nadhim Zahawi, as well as Sunak and ex-Health Minister Sajid Javid, who both quit the cabinet on Tuesday. The field is likely to swell.

Johnson is expected to make a statement shortly after midday, when he will announce plans to remain as a caretaker prime minister until the Conservative party conference in October, according to FT reports. He has already started to fill some ministerial vacancies, with Greg Clark set to come in temporarily as “levelling-up secretary”. But a significant number of Conservative MPs do not think Johnson’s position is sustainable and want him to depart Downing Street sooner.

Baroness Ruth Davidson, the former leader of the Scottish Tory party, said: “There’s no way he can stay on until October. It’s arrant nonsense to think he can. Someone needs to grip this.”

Johnson initially responded that he had “a mandate” from the British people and refused to quit. He sacked Michael Gove, one of the senior ministers who had advised him to step down, with a Number 10 aide calling Gove “a snake”.

In response to the news, the pound jumped 0.5% against the dollar, from $1.193 to a high of $1.199 in a modest relief rally, as investors reacted positively to Johnson’s expected resignation.

Finally, those curious who will be the next UK PM, betting service Ladbrokes has Ben Wallace at the head of the betting to replace Johnson. Rishi Sunak and Penny Mordaunt are second and third favorite.

end

A must read..

Europe/China/USA

Luongo: China Queues Up To Join The Davos Beatdown

WEDNESDAY, JUL 06, 2022 – 09:25 PM

Authored by Tom Luongo via Gold, Goats, ‘n Guns blog,

A must read..

(Tom Luongo)

The headlines are full of abject terror that Germany’s vaunted industrial base can collapse, and with it the banking sector, if Russia pulls all natural gas supplies.

Of course, this is exactly what the EU said they wanted, and the question now is will they get it, to quote H.L. Mencken, “good and hard.”

So, finally, after destroying their own economy, the politicians in Europe are considering the right question, “Did we do this to ourselves?”

The Euro’s collapse yesterday morning to a new twenty-year low below $1.03 is answering a resounding, “Yes. Yes you did.” I’m sure the board at Uniper, now staring at a $9+ billion bailout after Vice-Chancellor Robert Haebeck and the rest of his Green/Neocon zealots destroyed their investment in the Nordstream 2 pipeline, would agree with the market.

And so much of this is because now the markets are fully handicapping a global recession based on a spate of terrible economic news, including Germany running a trade deficit in May for the first time in 30 years.

So much for that argument that Europe has a positive cash flow statement and can’t/won’t break down because of it, c.f. my podcast from February with Peter Boockvar.

But to understand why things are accelerating this quickly, beyond the Fed’s hawkishness, I think it’s high time we look at what China’s role in this is and will be.

There’s been a lot of discussion about China’s lockdown policy since the beginning of the War in Ukraine.

What did it mean? Are they seriously paranoid or was this their very Chinese way of supporting Russia’s efforts in Ukraine by exacerbating the massive supply chain breakdown created by Davos’ Coronapocalypse? You know I side with the latter position.

So, after a successful BRICS Summit which saw both Iran and Argentina apply for member status (and China inviting Saudi Arabia to join it and the SCO), China announced a week ago they are loosening the COVID restrictions on foreign travelers into the country.

China unexpectedly slashed quarantine times for international travelers, to just one week, which suggests Beijing is easing COVID zero policies. The nationwide relaxation of pandemic restrictions led investors to buy Chinese stocks.

Inbound travelers will only quarantine for ten days, down from three weeks, which shows local authorities are easing draconian curbs on travel and economic activity as they worry about slumping economic growth sparked by restrictive COVID zero policies earlier this year that locked down Beijing and Shanghai for months (Shanghai finally lifted its lockdown measures on May 31).

The result is, as Zerohedge pointed out at the time, the return of capital inflow to China’s equity markets on the announcement. But the markets had been forecasting capital flight into China for weeks since bottoming in April.

That said, this is a perfect example of what I talk about all the time with respect to potential changes in the US political situation. Markets are always looking for changes in intentions by the political class.

These little changes are seen by traders and investors as edges to be played. They may not pan out, but are bets based on a probability calculation of a state change in public policy.

To this end, Fungal Joe is going to lift the Trump tariffs on Chinese imports this week to buy votes by hoping inflation moderates. I’m okay with him doing this trying to right the ship. Tariffs are never the answer, just like sanctions. Notice also this has zero to do with monetary policy and everything to do with supply disruptions caused by government diktat.

This change by China signals an intention by the CCP to open China back up to tourism and business development that isn’t likely to be reversed. I expect this to be real and for China to make even more little moves like this as the summer drags on and markets churn in the West.

With that change, capital inflow lessens the pressure on both the Hong Kong dollar (HKD) and the Hang Seng while giving China more cover to loosen monetary policy without necessarily raising rates and creates another place for capital to flow now that the ECB has capitulated.

Christine Lagarde’s recent statements about fighting inflation being “more art than science” is just saying the quiet parts out loud. But it was what came out of the ECB’s emergency meeting a couple of weeks ago that finally signaled the end for the euro in the minds of investors.

Not only is Germany’s industrial base being literally destroyed gleefully by its government, now the ECB is going to sell German debt to buy Italian and Spanish debt to keep from drowning. This is akin to bailing water out of one end of the boat only to throw it in the other end.

Couple these things with the frankly, disastrous G-7 Summit where the biggest collection of unserious buffoons gathered to ban the sale of Russian gold and contemplate a global price cap on oil.

… words fail me.

Honestly, after this G-7 the rush into the BRICS Alliance as well the Eurasian Economic Union (EAEU) will be unstoppable. What serious investor with real capital appreciation goals is going to look at this group of committed (and committable) lunatics and think, “Yes! I can trust my money with Boris Johnson, Joe Biden and Ursula Von der Leyen!”

No, they are looking at this crap and opening up Tradestation.

The fact that Justin Trudeau was even invited should have been your sell signal.

While the BRICS were talking about a new trade settlement currency and adding members, the G-7 was talking World War III while getting caught spending more time on photo ops than substantive dialogue.

Unserious people with sophomoric ideas and an antiquated sense of their global importance (especially true of the UK and Germany) is not a recipe for global capital inflow over the long term.

When you look at the fragility of the EU, the UK, and Canada you realize that the only thing propping up global markets at this point is the hope that the U.S. mid-terms are a complete refutation of the Davos agenda.

If that doesn’t happen, if somehow Soros and Davos steal enough seats and put a bunch of RINOs back into Congress and the Senate to freeze any reform of Washington D.C. the collapse of the West will accelerate very quickly.

Again, go back to what I said at the outset, the markets are looking for early indicators, edges, they can play to front run a big change in a country’s domestic/foreign policy.

If the US has an honest political revolution in November replete with the stirrings of entitlement reform and fiscal sanity while the Fed continues raising rates, then that would be a massive buy signal for not only the US but also China.

If not the US begins its collapse and happens for multiple reasons.

The first is obvious. Insane Progressives and Commies will be emboldened to destroy what’s left of the Rule of Law in the US.: pack the SCOTUS, ban guns, etc.

That will send capital fleeing to relatively safe places like Pakistan.

The second is almost as obvious. It will confirm and solidify for a critical mass of people that the government is irredeemable and it’s time for either a new convention of States, per my recent conversation with Bill Fawell, or secession as the only real options left.

Because when all peaceful means of revolt are taken away from people, violence ensues.

While these evil people think they are unassailable, the reality is that they are not. If you doubt me, go look at video of the Dutch Farmer’s Revolution for confirmation of just how angry people truly are.

None of the issues surrounding the Dems have worked at this point.

No amount of SSRI-addled, known-to-law-enforcement-enabled shootings will roll out gun control in the US.

No amount of screeching from unfuckable purple-hairs will bring back Roe v. Wade.

No amount of sexual deviance at the public schools will usher in legalized pedophilia.

These are the positions Democrats have staked their future as a party on and most of America is sincerely fed up with it while their businesses are looted, their bank accounts are emptied and their kids sexually-assaulted at school by strippers.

This is why I fully expect voter fraud costs to soar this November and for the 2000(00) Mules strategy to fail as a result. Proud Boys and Oathkeepers will gladly stand outside drop boxes looking for some douchebag with a handful of fake ballots to “question.”

This means they will just print votes out of thin air, but they can only really do that in places like California.

China opening back up for business is good news. Ending COVID restrictions are necessary to shifting the flow of capital from mattresses back into the global economy. But it won’t happen fast enough without a political revolution in the US to stave off a year or two of messy activity as supply chains reroute.

If China opens up more and the mid-terms are a blowout for normal people there is ample room for the Fed to keep going higher with rates from a US gov’t budget perspective. A good article recently from Wolf Street reminds us (and me) that only new debt is subject to the higher rates the Fed is now charging.

We have historically low debt servicing costs.

The budget is still a mess and it’s why entitlement reform is the key political issue going forward. So, if Soros wins this fall and Davos remains firmly in control of Washington, then there is no hope for America’s future as a 50-state compact. They will burn the rest of this country to the ground before giving up control of it.

Even if the mid-terms go well, the transition period before the new Congress is sat will be horrific.

Between now and then expect them to push a NATO casus belli in Ukraine on us to try and save Biden’s Depends budget, Johnson’s terrible hair and Scholz’s saggy man boobs.

This is how they will counter China moving to attract capital, by starting another war.

The problem for all of them is that China ultimately wins either way. All they will do is delay the inevitable because as I pointed out the other day, there isn’t the productive capacity TODAY to fight a two-front war in Europe and the Pacific.

If NATO moves on Russia, China will move on Taiwan. The Russians are salivating at the prospect of the Brits coming in to fight them in Ukraine to free up the US to take on China.

And the West will lose both wars simultaneously, on the off-chance the whole thing doesn’t go nuclear. I do believe pushing the US into political crisis is the ultimate Davos play here. The problem is, since Putin moved on Ukraine the way he did, there is no pulling that off without atomizing Europe in the process.

So, for once, Davos is staring at a Hobson’s Choice rather than their victims. That Vlad, what a card!

China doesn’t want war with the US anymore than Russia does. So opening up China’s economy and Biden lifting tariffs here are the right capital-attracting moves to force even more instability on Europe.

If we avoid WWIII, along with the Fed putting Congress in a fiscal straightjacket, then we can effect real political change in the US

Everyone wins.

I do believe this is the single most important point every other analyst has missed over the past couple of years. The point of beating Davos is to stop WWIII, stop the messy dissolution of the US which would be a catastrophe for everyone, and end the cycle of violence which has emanated from the European colonial powers for centuries.

The US can survive this fiscally and politically. The SCOTUS just flipped off the commies. The people are rejecting woke anti-storytelling like Lightyear and nearly everything Netflix and Amazon produce.

Seen recently in the Financial Times, even Blackrock is seeing the light.

This tells me that Blackrock’s balance sheet is in serious trouble. It tells me their AUM is falling and their ESG/DEI strategy is gutting the company from within. I wouldn’t doubt for a second that Larry Fink bet the farm on Obama/Schwab getting rid of Powell and now they are staring at a collapse as Powell says, “My turn.”

For all of their power, this is still a company with just $36 billion in shareholder equity. Apple sells that many iPhones in 2 months.

I’d love nothing more than to see Blackrock become the next Lehman Moment. I’m sure most of Wall St. wouldn’t either. There is blood in the water folks and the sharks are circling Europe. Maybe Jamie Dimon will change his middle name to Bruce just to make the point clear to everyone.

I’m sad I gave up popcorn.

* * *

Join my Patreon if you like Popcorn

END

British Airways cuts 10,3000 more flights through the summer

(zerohedge)

British Airways Cuts 10,300 More Flights Through Summer

THURSDAY, JUL 07, 2022 – 04:15 AM

It will be a messy time for flying around Europe as British Airways announced it would cut another 10,300 short-haul flights through the end of the summer. The latest round of cuts means the airline has slashed 27,900 flights due to post-pandemic staff shortages.

The Independent broke the story on Wednesday afternoon and added to the 17,600 cancellations the flagship airline carrier of the UK made at the end of June.

“British Airways has now taken 4.5 million seats out of the market. The latest round was announced ahead of a Friday deadline for airlines to cancel flights this season without losing slots next summer,” the British online newspaper noted.

Most of the flight cancellations will be centered around Heathrow Airport, a major international airport in London, England. But also expect cancellations at Gatwick and London City airport.

A British Airways spokesperson told The Independent that trimming thousand of flights from its schedule will mean the airline will be more flexible and minimize delays and cancelations this summer.

“The whole aviation industry continues to face into significant challenges and we’re completely focussed on building resilience into our operation to give customers the certainty they deserve.
“The government recently decided to give the whole industry slot alleviation to minimize potential disruption this summer. While taking further action is not where we wanted to be, it’s the right thing to do for our customers and our colleagues.
“This new flexibility means that we can further reduce our schedule and consolidate some of our quieter services so that we can protect as many of our holiday flights as possible.
“While most of our flights are unaffected and the majority of customers will get away as planned, we don’t underestimate the impact this will have and we’re doing everything we can to get their travel plans back on track.
“We’re in touch to apologize and offer rebooking options for new flights with us or another airline as soon as possible or issue a full refund.”

Air travel across Europe is fraught with long delays and mass cancelations — similar to the flight chaos in the US. Airlines on both sides of the Atlantic have made a move to reduce flights in their attempt to minimize future flight disruptions.

END

HOLLAND

WATCH: Dutch farmers spray manure, flood streets, blockade police, RISE UP against insane “green” policies – The Right Scoop

Inbox

The Dutch have learnt from the French!
The Farmers of Europe will fight to keep going even if city folk do not understand the efforts of the WEF to strip them of food supply.
Perhaps such learned behavior will spread to North America.

WATCH: Dutch farmers spray manure, flood streets, blockade police, RISE UP against insane “green” policies

5. RUSSIAN AND MIDDLE EASTERN AFFAIRS/

BELARUS/POLAND

Belarus is becoming more belligerent with its neighbour Poland

(zerohedge)

Belarus Threatens To Strike Poland If Cross-Border “Provocations” Launched

THURSDAY, JUL 07, 2022 – 02:45 AM

On Wednesday the Belarusian military issued a stern warning and statement threatening that it’s ready to strike Polish military infrastructures if “provocations” are launched from Poland, however no specifics were given on the type of aggression Belarus is alleging could happen.

The vague warning comes as tensions are already soaring between close Putin-ally Alexander Lukashenko’s Belarus and outspoken NATO member Poland. For starters, Warsaw has long accused Lukashenko of weaponizing migrants, and days ago completed construction on a controversial new section of border wall spanning 186 kilometers.

Poland is likening the border wall as part of the country’s “fight against Russia”. Last Thursday Polish Prime Minister Mateusz Morawiecki while speaking of the wall said, “The first sign of the war in Ukraine was [Belarus President] Alexander Lukashenko’s attack on the Polish border.”

And now, late in the day Wednesday, the Polish prime minister is alleging that Russian agencies have conducted a major hack of Polish government devices, per news wires. The accusation comes a week after several Lithuanian public and private websites went down in what was described as a cyberattack carried out by a Russian-backed hacker group.

Meanwhile, Ukraine has said that Russia is attempting to draw its large ally Belarus into the Ukraine conflict. So far, Belarus’ logistics and staging support to Russian troops has been well-known, but Minsk has refrained from sending in active military forces.

Additionally, late last month Russian President Vladimir Putin confirmed that Russia will supply Belarus with Iskander-M mobile guided missile systems. Though conventional weapons, they they are capable of carrying nuclear warheads – thus the action earned the condemnation of the Pentagon after Putin said, “we will transfer to Belarus Iskander-M tactical missile systems, which can use ballistic or cruise missiles, in their conventional and nuclear versions.”

Iskander missiles are known to have a range of up to 500km and will be handed over to Belarus “within months,” according to Putin’s prior statement.

At the time of that announcement, Lukashenko informed Putin that Belarus remains alarmed “aggressive” and “confrontational” policies of its NATO neighbors Lithuania and Poland.Via BBC

This has fueled concern that should the Ukraine war spill across borders, the fault line would be precisely along Russia’s ally Belarus and its Baltic and East European neighbors to the West. Belarus has already come under US and EU sanctions for its open support given to Putin’s war efforts against Ukraine, allowing Russia to launch the Feb.24 invasion from its territory.

end

This ought to scare a lot of people

(zerohedge)

Top Russian Official Calls For “Return” Of Alaska In Bizarre Threat

THURSDAY, JUL 07, 2022 – 02:05 PM

Threats invoking nuclear rhetoric out of Russia appear to be picking up again, at a moment Washington continues to ramp up weapons shipments to Ukraine’s military, and as the Biden administration is pledging to back efforts to charge Russian officials before an international criminal court.

As we detailed earlier, former Russian President Dmitry Medvedev and current deputy secretary of Russia’s Security Council warned of the “wrath of God” if the US leads efforts to establish an international tribunal for investigating Russian war crimes in Ukraine. “The idea of punishing a country that has one of the largest nuclear potentials is absurd. And potentially poses a threat to the existence of humanity,” he stated Wednesday.

But another top official’s threatening words are also grabbing headlines, given how unusual the statement is. Russia’s lower house speaker, Vyacheslav Volodin, suggested that Alaska could be targeted by Russia next in a scenario of continued US provocations. He essentially said that Russia could take it back as “Alaska previously belonged to Russia.”Russian Orthodox Church, Dutch Harbor, Alaska

Specifically he was responding to reports that the Biden administration is seeking to seize Russian assets abroad, also in conjunction with European authorities. According to a translation, Volodin warned the US that it “instead ought to remember that Alaska previously belonged to Russia,” in statements carried in Russian media on Wednesday.

“Let America always remember, there is a part of [Russian] territory: Alaska,” he said, according to Hromadske, subsequently translated in The Daily Beast. “So when they start trying to dispose of our resources abroad, before they do it, let them think: we also have something to return.”

Another official threw his support behind the theat. State Duma Vice Speaker Pyotr Tolstoy went so far as to propose holding a referendum on Alaska – akin to the Crimea referendum of 2014.

As for the idea of “returning” Alaska, this is in reference to the huge northern land mass abutting Canada and what eventually became the 49th US state as having been colonized by the Russian Empire starting in the early 18th century. Additionally, the earliest form of Christianity to reach the local Aleut natives was Russian Orthodoxy – which is still prominent in Alaska – brought by Russian missionaries during that period. Russian culture’s imprint on the local natives has continued to this day.

Russia sold the vast territory to the United States in 1867 for $7.2 million – which in today’s terms would be equivalent to somewhere north of $140 million. The territory was formally admitted as a US state in 1959.Archived 1860 map, Russian America (Alaska) was to the west of British America (Canada). Via Wiki Commons

While this talk of ‘returning Alaska’ appears tongue-in-cheek, there has been past public discussion in Russian media over whether Moscow could one day gain Alaska back. For example, related to the Crimea crisis, NPR noted back in 2014:

President Vladimir Putin’s annexation of Crimea is reigniting talk in Russia of taking back Alaska from the United States, which purchased the territory from a czar for $7.2 million nearly a century and a half ago.
…A recent petition written in clunky English on the official White House website seeks Alaska’s secession and return to Russia.
So far, it has generated more than 37,000 signatures — or more than a third of the 100,000 needed to get the Obama administration to formally respond.

Over the past years, airspace off Alaska and the Bering Sea has been scene of Russian and US air force encounters and intercepts, which has included Russia sending long-range bombers to fly miles off the coast, typically just within international airspace.

end

Russia’s Medvedev Warns US Trying To Punish A Nuclear Power ‘Risks Existence Of Humanity’

THURSDAY, JUL 07, 2022 – 11:15 AM

Authored by Dave DeCamp via AntiWar.com,

Former Russian President Dmitry Medvedev on Wednesday warned the US against trying to punish Russia for its war in Ukraine, saying that doing so would risk humanity since Moscow has the world’s largest nuclear arsenal.

“The idea of punishing a country that has one of the largest nuclear potentials is absurd. And potentially poses a threat to the existence of humanity,” Medvedev wrote on Telegram.Getty Images

Medvedev, who currently serves as the deputy of Russia’s Security Council, had warned earlier in the war that if the US destabilizes Russia like it did Iraq and other countries, it could lead to a nuclear “dystopia.” As of 2020, Russia was estimated to have 6,375 nuclear warheads, and the US said it possessed 5,750 warheads.

Even though it’s widely believed that a direct conflict between the US and Russia could quickly turn nuclear, it doesn’t appear to be a factor in the Biden administration’s response to the war in Ukraine. Instead, the US is pouring billions of dollars in weapons into the country and continues to escalate its involvement in the war.

In his Telegram post, Medvedev also called out the US for hypocrisy for trying to put Russia on trial for war crimes, citing the millions killed by the US since World War II in countries like Korea, Vietnam, Iraq, Afghanistan, and many others.

“So who’s going to give us a show trial? Those who kill people and commit war crimes with impunity, but do not meet real condemnation in the international structures financed by them?” Medvedev said, according to a Google translation of his Telegram post.

US Attorney General Merrick Garland recently visited Ukraine and pledged support for international efforts to investigate alleged Russian war crimes. The International Criminal Court (ICC) has opened an investigation in Ukraine, but the US is not a party to the court and has impeded its effort to investigate alleged war crimes committed by the US and Israel.

Dumb gets dumber

Inbox

Perhaps the Russians will simply cut electrical power and let them discover life without electricity, or raise the cost of power, payable in Rubles. Just dumb to play such childish games without alternatives.

Not withstanding everything needed can be supplied by boat so childish behavior means nothing.

7/7/22
By Avia.Pro News
translated from Russian

Lithuania refused to provide Russia with “green corridors” to the Kaliningrad region.

Despite the fact that European countries called for the transit of Russian cargo to the Kaliningrad region, stating that it was only about transit “from Russia to Russia”, the Lithuanian authorities officially announced that the country does not intend to provide an opportunity for transit of Russian goods through its territory. This was stated by Advisor to the President of Lithuania.

“Therefore, when someone talks about green corridors in public space, we emphasize: there can be no thought that Lithuania does not control what is happening on its territory ,” adviser to the President of Lithuania Asta Skaisgirytė.

Thus, Lithuania decided to go for further escalation with Russia, which will likely lead to the fact that the Russian side will take serious measures against Vilnius, since in fact the Lithuanian authorities are conducting an open blockade of the Kaliningrad region, using the sanctions imposed by Western countries against Russia only as argument, while pursuing their own goals.

Experts do not rule out that the EU may increase pressure on Lithuania, leaving it without a number of subsidies, however, in the near future, unblocking the transit of Russian cargo to the Kaliningrad region should not be expected.

source:
https://avia.pro/news/litva-oficialno-otkazalas-predostavlyat-rossii-zelyonye-koridory-v-kaliningradskuyu-oblast

GLOBAL ISSUES AND COVID COMMENTARIES

Dr Paul Alexander..

Open in browser Boris Johnson is OUT!!!! Did I not tell you that 2 days ago; Trudeau is next, Doug Ford is next, we the people must get the MPs & MPPs to vote internally; & get them out, what Trudeau did lockdowns

What these leaders did was monstrous, we removed Kenny Alberta, these people harmed & killed populations with their fraud COVID pandemic & the fraud vaccine mandates
Dr. Paul Alexander
July 7

We must pressure the MPs and MPPs, we cannot wait for next elections, we get them out now via internal moves; we are good governance and we use that route; get to phuck out Boris, you and your COVID policies killed people and what we need to do is public inquiry of him and all of them and find out where each dollar$ in the COVID PPE has gone. Who, which MP, with MPP, which congressperson, which senator got money, their families, their buddies, for as sure as the sun shines, these people stole money…we need to find out who and jail them!We start investigating Fauci, Bourla of Pfizer, Bancel of Moderna, Francis Collins, Birx, Walensky…all of them…proper legal public inquiries, public, proper, no kangaroo but we examine each policy. We examine Tam in Canada, proper inquiries, any ties to WHO and which person got illicit money, any $, we examine all, Trump administration, Biden administration, Trudeau administration, Boris…all…. COVID was a money train, a corrupted fraud and we need accountability, for our good police and military and good people forced mandated these fraud injections and now many are COVID vaccine injured and do not know it; yet; we predict harms and deaths coming massively on them. I pray daily for my police and military.What Trudeau did to the truckers in January in Canada was monstrous. He brutalized them and beat protestors and truckers. The Supreme Court of Canada said it was. The RCMP alluded to this too. We need this addressed with proper inquiry.Every single COVID policy must be examined and any official who caused the death of people must be financially penalized and many must be jailed for what they did!

end

Special thanks to Milan for sending this to us:

Over 100 Employees Sue WestJet Over COVID-19 Vaccine Mandate

Inbox

Over 100 Employees Sue WestJet Over COVID-19 Vaccine Mandate
https://link.theepochtimes.com/mkt_app/over-100-employees-sue-westjet-over-covid-19-vaccine-mandate_4580356.html

end

Authors Correct Study That Inflated Child COVID-19 Deaths After CDC Officials Promoted It

Inbox

Authors Correct Study That Inflated Child COVID-19 Deaths After CDC Officials Promoted It
https://link.theepochtimes.com/mkt_app/authors-correct-study-that-inflated-child-covid-19-deaths-after-cdc-officials-promoted-it_4578012.html

GLOBAL INFLATION/SUPPLY ISSUES

Russell Clark (4 horsemen fame) is one smart individual.

He is saying that global inflation will rule over deflation

(Russell Clark)

Russell Clark: Inflation Or Deflation?

THURSDAY, JUL 07, 2022 – 09:29 AM

By Russell Clark of Capital Flows and Asset Markets substack

For the past year or so, inflation trades have worked. Long commodities and short bonds. In the last month or so, commodities have seen a sizable sell off. Is the deflation trade back on?

For me the biggest surprise for me in this sell off of in commodities is that it been driven by the commodities that should be most affected by the Russian/Ukrainian War. Russia and Ukraine are sizable wheat exporters, but the wheat price has fully reversed the spike that was first seen on the invasion. I have included corn (maize) where Ukraine is a smaller exporter for comparison.

Even more surprising to me has been the oilseed market. Ukraine is a dominant exporter of sunflower oil, which has seen exports collapse. This should tighten up the export market for vegetable oil, which is dominated by palm oil. Palm oil did spike on the invasion, but has dropped by nearly half since its peak.

This would be suggestive that market was looking through Russian and Ukrainian supply issues, but the market for European gas shows no such look through. That is European gas prices are still at very high prices.

Old school macro analysis (or muscle memory) would suggest that commodities are done. Historically speaking the relationship between Asian currencies and commodities has been strong, until this year, implying considerable downside to commodities.

The problem I have with this analysis is that assumes that both the US and China are willing to either let unemployment rise, or real wages fall. Both politically and economically I see this as a non-starter. In fact, falling commodity prices are likely to allow governments to increase spending again, as demand management becomes more important.

One risk is that I am too early, and we have one more deflationary cycle. There are two market indicators I am looking at that signal inflation rather than deflation to me. First, Japanese 30 year JGBs. Most people will think this is meaningless – but JGB investors understood the deflationary political arrangement of the world 30 years before the rest of the world. If they are not buying into deflation, then I am not either.

Why are the Japanese not buying into deflation? Probably because we are not really seeing much commodity deflation in China (although plenty of asset deflation). LNG prices in Asia are following European gas prices higher. Chinese corn prices (and China remains the world’s largest importer of corn) still remain well above US prices.

My base case remains that China has an explicit policy of reducing income inequality through raising wages, and reducing asset prices. This will continue to put upward pressure on commodity prices, which is now leading to strong pressure on governments to raise wages for workers. However I cut it, the world needs higher wages to deal with the extreme debt loads of governments, as well as the extreme valuations of housing to wages. Rising wages will actually drive very significant growth in GDP, and should continue to be bearish bonds, and bullish commodities.

The risk is a policy change out of China, but given that a Chinese devaluation would likely be met with tariff increases, all roads lead to inflation for me.

GLOBE//SUPPLY PROBLEMS

Interesting: 2% of all global freight is at a standstill due to North Sea congestion

(zerohedge)

“Very Unusual Situation”: 2% Of All Global Freight Is At A Standstill In North Sea Due To Historic Congestion

WEDNESDAY, JUL 06, 2022 – 05:05 PM

Yesterday, when writing the congratulatory note to coal which has emerged victorious – and with a record high price – over the rotting, humiliated corpses of millions of virtue signaling fake muppets, we said that as a result of the unprecedented surge in imports by desperate European nations, “the flood of imports is contributing to major congestion at the ports.”

Today, Reuters picks up on this latest troubling side-effect of fanatic environmentalist idiocy, and writes that according to an expert from Germany’s IfW economic institute, more than 2% of global freight capacity is at a standstill in the North Sea, a “very unusual” situation for the ports there.

“There is currently no end in sight to the congestion in container shipping,” said IfW’s Vincent Stamer, adding that traffic jams were also growing outside Chinese ports, a troubling reminder that supply chains remain painfully clogged up despite covid lockdowns becoming a distant memory.

“For Germany and the EU, this affects overseas trade in particular, especially with Asia, where consumer electronics, furniture and textiles, for example, are shipped from.”

Logistics companies have been struggling for months with shipping container schedules, which have been thrown into disarray due to the war in Ukraine and lockdowns in China. The latest snag emerged when the burst in coal and LNG imports by European countries revealed that port infrastructure is woefully unprepared for the jump in traffic.

German logistics firm HHLA last month appealed to every link in the supply chain, from clients to railroads, to coordinate better in the face of war-induced disruptions.

“Just-in-time production carries risks. And volatility requires flexibility from everyone,” said CEO Angela Titzrath.

“German foreign trade continues to hold its own in the crisis, but the outlook is gloomy,” Dirk Jandura, president of the German Federation of Wholesale, Foreign Trade and Services (BGA), said earlier this week.

Exports and imports in the European Union are forecasted to remain relatively stable in June, according to the IfW Kiel trade indicator.

Further complicating matters, there are also roughly 20% fewer container ships in the Red Sea – the most important trade route between Europe and Asia – than expected under normal circumstances, said the IfW.

The last time the gap was this large was after the outbreak of the coronavirus pandemic two years ago, according to Stamer.

END

VACCINE INJURY/

Vaccine Impact

75,322 Dead 5,938,318 Injured Recorded in Europe and USA Following COVID Vaccines – Babies and Toddlers Hallucinating and Having Seizures After Shots

July 6, 2022 4:45 pm

The European Medicines Agency (EMA) database of adverse drug reactions is now reporting 46,160 deaths and 4,623,724 injuries following COVID-19 vaccines, while the United States’ Vaccine Adverse Events Recording System (VAERS) is now reporting 29,162 deaths and 1,314,594 injuries following COVID-19 vaccines. We know that as huge as these numbers are which are official government statistics, that they only represent a very small fraction of the total number of deaths and injuries suffered by those who chose to receive COVID-19 vaccines during the past 18 months. And now that the shots have been approved for emergency use in babies and toddlers under the age of 5, reports are coming in of these babies suffering hallucinations and seizures.

MICHAEL EVERY and BILL BLAIN

Michael Every on the day’s most important topics

And now Michael Every…(Bas Geffen))

Rabo: The Fed Hopes To Squeeze The Life Out Of The US Economy

THURSDAY, JUL 07, 2022 – 10:19 AM

By Bas van Geffen, senior macro strategist at Rabobank

The shift from inflation to recession fears continues to dictate the pace of trading. As an indicator of US recession risks, the Treasury curve is inverted again, with the 2s10s spread at -5.7bp.

And European money markets continue to lower their expectations of the ECB’s hiking cycle. Although the day-on-day change doesn’t show it due to a late-afternoon recovery, almost a full 25bp rate hike had evaporated from the 8th ECB-dated €STR forward swap that corresponds to policy one year ahead.

Worse, as our Rates Strategists noted yesterday, the corresponding slide in short-dated Bund yields is not reflected in break-even rates nor in EUR inflation swaps. In other words, the concerns are fully recession driven, while inflation concerns aren’t abating either – a true headache for central banks, as we have been warning.

European data did little to soothe these worries. Eurozone retail sales continue to hold up better than consumer surveys suggest. Although sentiment has been near the pandemic lows, indicating that consumers are already feeling the pain, actual spending continues at a modest pace so far. Nonetheless, momentum is slowing, as German factory orders indicated once again yesterday. This Bloomberg article on the aluminium market is perhaps the best illustration we’ve seen of the European cycle post-Covid: from supply chain disruptions that led to over-ordering and therefore rampant prices, to slowing orders currently as factories have either restocked their raw materials and/or are expecting less consumer demand – making them hesitant to add to inventories.

Whereas markets and businesses continue to shift their focus from inflation to recession risks, the minutes of the June FOMC meeting revealed that the US central bank is mostly worried that inflation could become entrenched. To avoid this, the FOMC will prioritize its price stability mandate over its goal of full employment. In practise, this means continued hikes, and participants concluded that an even more restrictive stance could be appropriate if elevated inflationary pressures were to persist. As our US strategist summarises once again, we believe that a recession is basically collateral damage in the Fed’s mission to stamp out inflation. Additionally, this time the Fed will probably not succumb to the pressure to slash rates back to zero as soon as the economy falters. That realization should only amplify the market’s concerns about the economic outlook.

While the Fed’s experience –how did we ever get from ‘transitory’ to ‘entrenched’?– serves as a warning for its peers, the bright spot of a more aggressive FOMC is that the ECB might just manage to get away with less tightening, possibly allowing European policymakers to take a little more care of the economy. If the Fed squeezes the life out of the US economy, that will undoubtedly have a global impact. It may therefore cool global aggregate demand just enough to take the biggest sting out of inflation. Yet, as the decline in the euro over the last week highlights, the ECB will obviously understand that a free ride does not exist.

AND now Bill Blain…

Blain: There’s A “Major Market Shift” Going On Over What Will Trigger The End Of The World

THURSDAY, JUL 07, 2022 – 08:22 AM

Authored by Bill Blain via MorningPorridge.com,

“ The world is a concept that requires constant juggling…”

Don’t be distracted by the antics in Westminster – there is a major market shift going on between the End of the World being triggered by Inflation, or Recession destroying everything. Relax. European Energy policy will probably kill us!

It’s difficult to not be distracted by The Very British Revolution gently shaking the lace curtains of the English establishment this week. The powers that be in this land are absolutely shocked to discover our unwritten constitution – which works on the guiding principle “a gentleman should do the right thing” – doesn’t actually work when the prime minister is a spoilt toddler, and most certainly not a gentleman.

The one thing we do know is when Boris eventually falls – and he surely shall – there will be a sterling relief rally, and a run on cream teas in the Members’ Terrace Tea Rooms. There is even talk the Queen might have to get involved. Perish the thought. It’s just a Prime Minister and she’s dealt with plenty of them. Its not like’s its anything serious like an Alien Invasion or the Strictly Final.

All political lives end in failure. (Proving there is a God after all..)

Meanwhile.. back in the real world…

Last week the markets were steeling themselves for a monumental Central Banks vs Inflation battle. How high would interest rates have to rise to stem inflation? How much would rate hikes crush markets? If a week is a long-time in politics, then it’s a lifetime in markets.

The game has now switched – just how damaging will recession be to the global economy? And what are the implications?

And suddenly the thinking of the market’s groupthink hive mind is… Recession? … The pace of interest rate rises will slow. … Central banks will ease liquidity to address recessionary risks. … Liquidity means cheaper rates. … Cheaper rates mean stocks look relatively cheap…. (lightbulb moment) .. Buy stocks! Buy Tech Stocks!

Oh dear. The market is not a rational being. It is just a voting machine reflecting the views of participants – who are often wrong and tend to jump to all kinds of silly conclusions.

But it is clear a new market theme is developing – recession is visible from cheaper energy and cheaper oil. Meanwhile, the overly strong dollar is beginning to damage US firms, likely to trigger weaker corporate earnings, thus a further market slide in Q3 – again likely to make Central Banks act to address economic and market weakness, and to weaken the dollar by slowing the tightening. In short, markets are talking themselves into an expectation of further monetary distortion and Central Banks bailing them out.

I suspect that’s how this summer is going to play out – a series of up, down, market shifts, from inflation, growth, recession, each leading to the volatile up 8%, down 9% price ructions we’ve been seeing in prices over recent weeks. There isn’t a single dominant theme – although one will eventually emerge. Part of the problem is central banks and their credibility.

I no longer have a clue what central banks are really thinking – if at all.

I suspect they are desperately trying to learn how to juggle. The beauty of juggling is making something difficult look easy. Back in the glory days of Central Banks they communicated by not telling us anything – if you understood, then they’d misspoke! The best central bankers were consummate juggles, able to look tough on inflation and the consequences of recession without missing a catch.

Juggling is an instinctive skill. The trick is learning to actually throw the balls rather than try to pass them. It requires a certain suspension of the natural way to do things – and it’s a light bulb moment when you learn how. It’s not something central bankers are likely to successfully learn overnight. (I reckon I teach anyone to juggle over the course of 3 hours! Yet another useless Blain skill.)

The failure of central banks to juggle, and the market jumping between narratives on growth, inflation, recession, stagflation and recovery is why markets will remain unclear through the summer as Central Banks try to figure out what their message is supposed to be. And if Energy Prices are low today, they might be back up there tomorrow.

The big, big No-See-Um is European Energy.

German energy policy in particular is a potential unravel moment. Germany is struggling to adjust to its over reliance on Soviet Energy, and Green Politics which are proving unyielding to the crisis. Germany was importing 55% of its gas from Russia pre-war. That has fallen to 35%, but it will take a difficult 2 years (at least) to build the infrastructure to end Germany’s reliance on Russian gas:

it if happens, the Russia is the ultimate loser, its hold over Europe diminished.
If it doesn’t happen Russia wins, and the European economy will remain beholden to Moscow for power.

The pressures on German industry will become progressively apparent in coming months, putting more and more pressure for an accommodation with Russia, such as forcing Ukraine to accept a peace and state dismemberment – giving away conquered territories. The pressure will be ratcheted up with Russian Kompromat over European politicians. If Europe does cave to energy pressure, the consequences will be enormous, in terms of markets, geopolitics, and especially the future relationship between the US and Europe.

7. OIL//OIL ISSUES//NATURAL GAS//ELECTRICITY ISSUES/USA//GLOBE

Oil Spikes Amid Rumor Of Texas Power Shock

THURSDAY, JUL 07, 2022 – 09:52 AM

With oil slumping into a deep bear market, tumbling (briefly) below $100 yesterday and just shy of where it traded before the Ukraine war, the Biden administration is preemptively declaring victory: after all, between sliding oil prices, refineries finally working in lockstep and spreads collapsing, it’s no surprise we have seen gasoline prices drop for the past 22 days, the longest stretch since the covid depression.

Sadly for Biden, this steep drop in both oil and gasoline prices is unlikely to stick, and not just because the fund liquidation that sent oil so sharply lower is in wild contrast with the wildly bullish dynamics in the physical market where the prompt WTI spread surged higher on Wednesday, climbing by the most in four months excluding expiry anomalies. Nor because if reports of a $220BN Chinese stimulus are true, it means that Beijing is about to order every barrell of oil it can find. The real reason why oil may be about to spike sharply higher comes out of Texas where an imminent power shock may lead to widespread oil infrastructure shutdowns.

Here is what a dealer for one of the larger institutional crude and products books writes in:

… looking like Texas may be short power for the next week or so. Wild rumors floating around that the Governor may call on industrials (ie refineries) to idle or significantly de-rate plants for up to a week to keep from having to black out residential consumers (Mom&Pop) in a heat wave. Don’t want to make folks sweat at home in the dark during an election year.
Key takeaway? Cracks may just be getting started and could go parabolic here.

And if cracks soar, underlying prices won’t be far behind. And yes, gasoline prices are about to reverse all recent losses with a vengeance. As for oil, well the reversal is already starting.

END

How idiotic!

(zerohedge)

Millions Of Barrels From US Emergency Oil Reserve Sent Abroad, Including To China

THURSDAY, JUL 07, 2022 – 10:37 AM

With a growing number of people realizing that the Biden administration has drained more oil from the US strategic petroleum reserve, which is meant to be used during real emergencies not fake, made up ones such as Democrats facing a catastrophic failure at the midterm elections…

… more people are starting to ask the next big question: where is this furious liquidation of US black gold going?

Courtesy of Reuters we know: more than 5 million barrels of oil that were part of the historic U.S. SPR release were exported to Europe and Asia last month, including top US geopolitical nemesis in the global arena, China, even as U.S. gasoline and diesel prices hit record highs.

The export of crude and fuel is blunting the impact of the moves by U.S. President Joe Biden to lower record pump prices. In a widely mocked call, Biden on Saturday renewed a call for gasoline suppliers to cut their prices, drawing rightful criticism from Amazon founder Jeff Bezos, because going after mom and pop gas stores merely demonstrates just how clueless the handlers of the senile presidential puppet truly are.

About 1 million barrels per day have been drained from the Strategic Petroleum Reserve through October, an unprecedented pace. The drain means SPR inventories fell to the lowest since 1986. US crude futures are above $100 per barrel and gasoline and diesel prices above $5 a gallon in one-fifth of the nation. US officials have said oil prices could be higher if the SPR had not been tapped, and for once they are right. Still, the question looms of what happens to oil prices when the US can no longer sell the SPR amid concerns of a real emergency: we know the answer and the Biden admin won’t like it.

“The SPR remains a critical energy security tool to address global crude oil supply disruptions,” a Department of Energy spokesperson said, adding that the emergency releases helped ensure stable supply of crude oil.

Citing customs data, Reuters traced that the fourth-largest U.S. oil refiner, Phillips 66 shipped about 470,000 barrels of sour crude from the Big Hill SPR storage site in Texas to Trieste, Italy. Trieste is home to a pipeline that sends oil to refineries in central Europe. Meanwhile, Atlantic Trading & Marketing (ATMI), an arm of French oil major TotalEnergies, exported 2 cargoes of 560,000 barrels each. Cargoes of SPR crude were also headed to the Netherlands and to a Reliance refinery in India, an industry source said.

What is most notable is that a third cargo headed to US arch-enemy, China, which is now directly benefiting at the expense of US consumers as a result of Biden’s escalating panic to undo the consequences of his catastrophic green policies by selling the most valuable US assets directly to Beijing!

But what is even more scary is the following exchange, in which the White House simply had no response when asked if the US is selling its emergency reserve oil to China.

Pointing out the obvious, Matt Smith, lead oil analyst at Kpler. said that “crude and fuel prices would likely be higher if (the SPR releases) hadn’t happened, but at the same time, it isn’t really having the effect that was assumed.”

And while the midterms will come and go, and Democrats will suffer a historic loss, the U.S. energy picture is getting more dire by the minute thanks to the sheer incompetence and/or corruption of the executive branch: crude inventories are the lowest since 2004 as refineries run near peak levels. Refineries in the U.S. Gulf coast were at 97.9% utilization, the most in three and a half years. This means even the smallest accident can and will sell oil prices to the moon.

8 EMERGING MARKET& AUSTRALIA ISSUES

Australia//// NEW ZEALAND/ SOUTH AFRICA/BRAZIL/ARGENTINA/INDIA/PAKISTAN

Your early currency/gold and silver pricing/Asian and European bourse movements/ and interest rate settings THURSDAY morning 7:30 AM

Euro/USA 1.0192 UP 0.0007 /EUROPE BOURSES //ALL GREEN

USA/ YEN 135.76 DOWN .186 /NOW TARGETS INTEREST RATE AT .11% AS IT WILL BUY UNLIMITED BONDS TO GETS TO THAT LEVEL…

GBP/USA 1.1981 UP 0.0058

Last night Shanghai COMPOSITE CLOSED UP 9.05 POINTS UP 0.27%

Hang Sang CLOSED UP 56.92 PTS OR 0.26%

AUSTRALIA CLOSED UP 0.31% // EUROPEAN BOURSES ALL GREEN

Trading from Europe and ASIA

I) EUROPEAN BOURSES ALL GREEN

2/ CHINESE BOURSES / :Hang SANG CLOSED UP 56.92 PTS OR .26%

/SHANGHAI CLOSED UP 9.05 PTS UP 0.27%

Australia BOURSE CLOSED UP .78%

(Nikkei (Japan) CLOSED UP 382.88 OR 1.47%

INDIA’S SENSEX IN THE GREEN

Gold very early morning trading: 1744.45

silver:$19.44

USA dollar index early THURSDAY morning: 106.72 DOWN 0.18 CENT(S) from WEDNESDAY’s close.

THURSDAY MORNING NUMBERS ENDS

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And now your closing THURSDAY NUMBERS 1: 00 PM

Portuguese 10 year bond yield: 2.39% UP 11 in basis point(s) yield

JAPANESE BOND YIELD: +0.252% UP 0 AND 5/10 BASIS POINTS /JAPAN losing control of its yield curve/

SPANISH 10 YR BOND YIELD: 2.39%// UP 15 in basis points yield

ITALIAN 10 YR BOND YIELD 3.39 UP 15 points in basis points yield ./

GERMAN 10 YR BOND YIELD: RISES TO +1.295%

END

IMPORTANT CURRENCY CLOSES FOR THURSDAY

Closing currency crosses for day /USA DOLLAR INDEX/USA 10 YR BOND YIELD/1:00 PM

Euro/USA 1.0157 DOWN 0.0027 or 27 basis points

USA/Japan: 135.88 DOWN .07 OR YEN UP .7 basis points/

Great Britain/USA 1.2001 UP 0.0080 OR 80 BASIS POINTS

Canadian dollar UP .0056 OR 32 BASIS pts to 1.2981

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

The USA/Yuan, CNY: closed ON SHORE (CLOSED ..UP 6.7030

THE USA/YUAN OFFSHORE: (YUAN CLOSED (UP)..6.7027

TURKISH LIRA: 17.26 EXTREMELY DANGEROUS LEVEL/DEATH WISH/HYPERINFLATION TO BEGIN.

the 10 yr Japanese bond yield at +0.252

Your closing 10 yr US bond yield UP 8 IN basis points from WEDNESDAY at 2.989% //trading well ABOVE the resistance level of 2.27-2.32%) very problematic

USA 30 yr bond yield 3.168 UP 5 in basis points

Your closing USA dollar index, 106.91 UP 1 CENT(S) ON THE DAY/1.00 PM/

Your closing bourses for Europe and the Dow along with the USA dollar index closing and interest rates THURSDAY: 12:00 PM

London: CLOSED UP 87.65 PTS OR 1.23%

German Dax : CLOSED UP 249.66 POINTS OR 1.98%

Paris CAC CLOSED UP 99.25 PTS OR 1.68%

Spain IBEX CLOSED UP 177.40 OR 2.18%

Italian MIB: CLOSED UP 629.90PTS OR 3.01%

WTI Oil price 103.76 12: EST

Brent Oil: 106/09 12:00 EST

USA /RUSSIAN /// RUBLE RISES TO: 61.99 UP 1 & 35/100 RUBLES/DOLLAR

GERMAN 10 YR BOND YIELD; +1.295

CLOSING NUMBERS: 4 PM

Euro vs USA: 1.0159 down .0026 OR 26 BASIS POINTS

British Pound: 1.2021 UP .0099 or 99 basis pts

USA dollar vs Japanese Yen: 136.01 UP 0.06//YEN DOWN 6 BASIS PTS

USA dollar vs Canadian dollar: 1.2979 up 0058 (CDN dollar U[ 58 basis pts)

West Texas intermediate oil: 102.72

Brent OIL: 104.58

USA 10 yr bond yield: 23.006 UP 10 points

USA 30 yr bond yield: 3.196 UP 8 pts

USA DOLLAR VS TURKISH LIRA: 17.25

USA DOLLAR VS RUSSIA//// ROUBLE: 61.950 UP 1 AND 40/100 ROUBLES

DOW JONES INDUSTRIAL AVERAGE: UP 347.07 PTS OR 1.12 %

NASDAQ 100 UP 256.47 PTS OR 2.16%

VOLATILITY INDEX: 25.80 DOWN 0.93 PTS (3.48)%

GLD: 162.23 UP 0.09 PTS OR 0.06%

SLV/ 17.69 UP .06 CENTS OR 0.34%

end)

USA trading day in Graph Form

Bitcoin, Big-Tech, & Black Gold Bid As Hawkish FedSpeak Batters Bonds

BY TYLER DURDEN

THURSDAY, JUL 07, 2022 – 04:00 PM

A weak claims print and a double-whammy of hawkish FedSpeak (from Bullard and Waller) prompted stocks and bond yields to surge higher…

*BULLARD: URGENCY TO TAKE CARE OF INFLATION AS SOON AS POSSIBLE
*BULLARD: US MACRO SITUATION STRAINING FED CREDIBILITY ON TARGET
*WALLER: MARKETS ARE EXPECTING A RECESSION, LET’S GET IT DONE
*WALLER: DON’T SEE FED MAKING THE `STOP-AND-GO’ MISTAKE OF 1970S
*WALLER SAYS CLIMB IN HOUSE PRICES OF LAST TWO YEARS `INSANE’

The Fed’s rate-trajectory ticked up hawkishly…

Source: Bloomberg

Which presumably means a recession will come sooner and therefore a Fed response sooner and therefore BTFD in the crappiest most-beaten-down stocks to front-run that reaction-function.

The US equity market open was massively bullish (apparently) with Small Caps and Nasdaq outperforming and that ramp extended on the back of another huge short squeeze all day…

This is the 4th straight winning day for stocks – equaling 2022’s best-win-streak.

After yesterday’s brief pause, the short squeeze continued today. “Most Shorted” stocks are up a stunning 13.5% from Tuesday’s opening lows…

Source: Bloomberg

Growth outperformed Value…

Source: Bloomberg

So-called “Smart” money is buying this dip for now…

Source: Bloomberg

Notably, 6 of the last 7 payrolls days have ended lower 6 hours after the print (whether it was a beat or a miss)…

Source: Bloomberg

Bonds were dumped again today, extending yesterday’s surge in yields, with the belly the pivot point again as 5Y rose 7bps and 2Y rose 3bps…

Source: Bloomberg

10Y Yields rose back above 3.00%…

Source: Bloomberg

Notably, USTs are significantly unattractive relative to domestic sovereign bonds for Europeans and Japanese…

Source: Bloomberg

On a side note, mortgage rates crashed in the last week – the 40bp drop is the biggest weekly drop since Lehman…

Source: Bloomberg

The dollar leaked lower on the day after 2 big ‘up’ days…

Source: Bloomberg

Cryptos rallied notably today with ETH back above $1200 and BTC surging back near $21,500…

Source: Bloomberg

Massive surge in NatGas after a smaller than expected storage build…

Oil prices surged on the day on supply anxiety in Texas and Kazakhstan…

For some context, the following chart adjusts EU and US NatGas to an oil barrel equivalent – European Nattie is currently trading at triple the cost of US NatGas (which is trading in line with WTI)…

Source: Bloomberg

Gold managed very modest gains on the day…

And finally, we note that Bonds remain (relatively) the most ‘risky’ assets, followed by FX with oil rather surprisingly calm…

Source: Bloomberg

But bonds remain ‘cheapest’ relative to stocks in 11 years…

Source: Bloomberg

What will change after tomorrow’s payrolls print?

I) / EARLY MORNING TRADING//

ii) USA DATA

Layoffs soar causing initial and continuing claims to accelerate

(zerohedge)

Initial & Continuing Jobless Claims Accelerate As Layoffs Soar

THURSDAY, JUL 07, 2022 – 08:34 AM

The number of Americans who filed for unemployment claims for the first time rose to 235k last week, up from the 231k the prior week. The 4-week average is now at 232.5k – the highest since the first week of December…

Source: Bloomberg

Additionally as the chart above shows, continuing claims – some have said the most important recession indicator – has started to accelerate higher (from 1.324mm to 1.375mm last week – well above the 1.328mm expected)

New York, Michigan, and California saw the largest rise in claims while Illinois and Kentucky saw the largest drops last week…

Something snapped in the labor market last month, as Challenger’s data shows US Job Cuts rose a stunning 58.8% YoY…

Source: Bloomberg

And if the ISM surveys (from both the Services and Manufacturing sides of the economy) are to be believed, things are about to get rather ugly for claims data… and the labor market overall…

Source: Bloomberg

And yet tomorrow’s payroll print is still expected to be +250k?

.

END

IIB) USA COVID/VACCINE MANDATES

end

iii)a. USA economic stories

David Stockman on USA inflation with an emphasis on the PPI

a must read..

David Stockman On Why The Great Reckoning Has Begun

THURSDAY, JUL 07, 2022 – 08:45 AM

Authored by David Stockman via InternationalMan.com,

Well, that should have been a wake-up call. The 30-year mortgage rate soared by 24 basis points recently to 6.18%. So the latter now stands at well more than double the 2.65% rate which prevailed just 18 months ago in January 2021, and at the highest level since the tail end of the Great Financial Crisis in 2009.

In a word, the Fed’s fake economy based on ridiculously unsustainable ultra-low interest rates is coming to a thundering end. And far more abruptly and violently than the Fed and its Wall Street megaphones ever remotely imagined.

Not surprisingly, the eruption of the mortgage rate depicted above has sent housing “affordability” into the drink. In fact, housing affordability is now at the lowest point on record going back to the late 1980s.

Needless to say, household budgets are about to get hammered and the housing market is fixing to experience another great implosion. It would actually take a 30% drop in average home prices to reverse the affordability plunge just since the pre-Covid levels.

Homebuyer Affordability Index, 1988-2022

Alas, the surge in homeowners’ carry cost especially during the last six months is truly startling. A simple back of the envelope calculation reveals that the jump in mortgage rates from 3.25% to 6.13% during that brief period means that new homebuyers face an average monthly payment on a typical new $350,000 mortgage (at the median price) that has gone up from $1,523 to $2,128. That’s a 40% increase in 6 months!

So whether it was intended or not, the Fed is about to unleash the biggest housing crisis since the bursting of the 2007 bubble. And there should be no doubt: The housing price bubble this time is even more egregious than back in 2005-2007.

House Price Index, 2000-2022

Likewise, junk bond yields have gone from 4% at the end of Dec (i.e. just 6 months ago) to 8.4% today. That’s another lightening fast doubling of rates.

So with junk bond yields at their highest level since 2015, the myth of low defaults is about to be monkey-hammered. That’s because the “refi” game which papered over bad credits is now over: When you rollover your leveraged debt to a 2X higher interest rate, rather than to a lower one compliments of the Fed money printers as per the last decade, the jig is up.

As the excellent bond maven, Stephanie Pomboy, tweeted recently:

Prepare to see an absolute ONSLAUGHT of corp defaults and downgrades. The myth of corp B/S strength is about to be shattered spectacularly.

She got that right. And that’s also the true economic evil of the Fed’s financial repression policies. It causes the financial signalling system to go wildly askew, thereby generating massively falsified financial values.

For instance, the market cap of the FANG stocks went from $3.0 trillion to $5.1 trillion and then back to $3.0 trillion, all in the space of hardly two years. But that’s not honest price discovery in any sense of the word; it’s just the consequence of liquidity fueled bubbles being inflated and then deflated by speculative forces.

Indeed, at the individual company level, the bubble dynamics as between the Covid-19 stock rally from March 23, 2020 to January 3, 2022 and then what is now being labelled the subsequent “bear market” is truly astounding.

Covid-19 Bull Market Versus Plunge Since January 3, 2022 Peak:

Nividia: Up 466%, Down 48%;
Apple: Up 224%, down 28%;
Google: Up 175%, Down 27%;
Microsoft: Up 145%, Down 28%;
Facebook/Meta: Up 129%, Down 51%.

There is one constant, of course, which was ever cheaper overnight money (red line) supplied by the Fed that provided the carry traders with the wherewithal for massive, sustained momentum driven speculation.

Indeed, as indicated by the chart, the Fed’s mistakes were systemic: As rates peaked lower and lower with each cycle, the financial bubbles got larger and larger.

At the same time that the bejesus was being inflated out of Wall Street, the planking was being laid for a new bout of goods and services inflation on main street. And this gets us to the May PPI index released this AM.

There are various measures of producer prices, but the index that requires special attention at the moment is the All Commodities PPI. It was up a red hot 21.5% versus prior year.

More importantly, the 20%+ Y/Y readings of the last few months exceed almost all prior inflation peaks since 1950. For instance, the July 2008 peak posted at 17.4% versus prior year, and even at the top of the inflation blow-off in November 1974, the Y/Y gain came in only slightly higher at 23.4%. Even the Korean War induced inflation-surge in 1951 peaked at just 18.4% on a Y/Y basis.

In other words, producer inflation is roaring down the pipeline at rates seen less than 0.01% of the time during the past three-quarters of a century. The Fed belated attempt to cope with it, therefore, will not end well or soon.

Y/Y Change In All Commodities PPI, 1950-2022

Even if we look at May’s readings for PPI finished goods as opposed to commodities, there is no evident relief in sight. The Y/Y gain was 16.4%, the largest advance since December 1974 when the finished goods PPI posted at 18.5%.

That was 48 years ago, of course, but the mechanics of inflation transmission do not change. That is, producer prices fuel the costs of production of goods and services in the business sector, which, in turn, work their way into the retail price level with a lag.

Accordingly, we are not yet even close to “peak inflation”. The only scenario in which these soaring producer level price increases do not show-up in the CPI is in the event of a thundering recessionary collapse in which producer profit margins are crushed on the way down.

The latter is always a possibility, but the issue is timing and sequence: What buckles first—output and employment or producer profits margins?

Currently, we are in such uncharted waters that it is difficult to know. But no matter: Both outcomes are on the way, and in the not too distant future, too.

Y/Y Change In Producer Price Index For Finished Goods, 1974-2022

In the case of the final demand for consumer foods, the index was up nearly 14%, and that was the seventh straight month of double-digit gains. We have a hard time seeing how household budgets will survive the grocery bill assault coming down the inflation pipeline or how the idea that inflation has peaked has any basis in the facts conveyed by the May PPI release.

Indeed, the chart below conveys quite pointedly that we are in a wholly new inflation ball game. After the Fed adopted inflation targeting in January 2012 it took to lamenting that it was missing its 2.00% target from below, thereby justifying its madcap money-printing.

One of the reasons, however, was that the global foods market was in temporary surplus, causing food inflation to oscillate between +2.5% and -2.5%. That had nothing to do with the monetary policies being cranked out in the Eccles Building, save for the license it provided other central banks to flood their economies with cheap capital and thereby generating a temporary abundance of agricultural investment.

But that era was never sustainable, and was always at risk for exogenous disruptions like the Ukraine based global Sanctions War now roiling the global commodities and food markets. Accordingly, the idea that the Fed had license to print money with reckless abandon because headline inflation was being temporarily pulled lower by deflation in foods, energy and manufactured goods will surely rank as one of the great follies of all time.

Y/Y Change In PPI For Finished Consumer Foods, 2012-2022

Another sign that inflation has a growing head of steam was the 21.0% Y/Y rise in the PPI for transportation and warehousing. As shown below, that’s off-the-charts of recent history, and more than double the surge that occurred during the inflationary blow-off top in mid-2008.

Needless to say, these are services industries that are being hit by the double whammy of rising energy and wage costs, neither of which is likely to be abating any time soon. Nor would resolution of current global supply chain dislocations make much difference—the problem in this instance is shortages of capacity across a broad spectrum of modalities, from railroads to trucking and the ocean ports.

Y/Y Change In PPI For Transportation And Warehousing Industries, 2008-2022

For want of doubt, here are the PPI indices for energy and for transportation and warehouse wages. In the latter case the wage gain (purple line) was 7.8% on a Y/Y basis, a figure more than triple the 2.5% per annum trend that prevailed prior to February 2020.

Similarly, the gain in the PPI for energy during May was 45%, a Y/Y level which has prevailed since the spring of 2021. That is, there is nothing in the black line below that says the worst is over.

Y/Y Change, Transportation And Warehousing Costs And Energy, 2016-2022

In short, the central banks have unleashed an inflationary whirlwind that has left the false pricing of the stock and bond markets high and dry. That’s why the very benchmark security of the global financial system has nearly gone parabolic in recent weeks.

At today’s 3.48% closing yield, the 10-year US Treasury yield was up 50 basis points from 5 days ago, 130 basis points from mid-March, and is in a totally different universe than prevailed when the Fed went berserk buying government bonds after March 2020.

But here’s the thing. Out of anti-inflation desperation, the Fed has pivoted to QT, but the impact of Fed held-bonds flooding into the trading pits has barely begun. And that’s to say nothing of the $95 billion per month bond shrinkage rate which will commence in September.

10-Year Treasury Yield, February 2020-June 2022

So the Great Reckoning has now commenced. The soaring red line below tells you all you need to know. It means that the artificially low cap rates of the last decade or more have reached their sell-by date and that the great money bubble the fostered is now heading for the wall.

* * *

The Fed has already pumped enormous distortions into the economy and inflated an “everything bubble.” The next round of money printing is likely to bring the situation to a breaking point. If you want to navigate the complicated economic and political situation that is unfolding, then you need to see this newly released video from Doug Casey and his team. In it, Doug reveals what you need to know, and how these dangerous times could impact your wealth. Click here to watch it now.

END

Manhattan housing market quickly cooling

(zerohedge)

Real-Time Indicator Shows Manhattan Housing Market Quickly Cooling

WEDNESDAY, JUL 06, 2022 – 07:05 PM

Appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate wrote in a new report that Manhattan’s residential market showed signs of cooling after a post-lockdown buying surge.

Jonathan Miller, president of Miller Samuel, said a “spike in interest rates, inflation, economic uncertainty, and the war in Ukraine” has resulted in a plunge in newly signed contracts between April and June. Newly signed contracts jumped to 1.4k in March as the 30Y mortgage began to soar. Shortly after, costlier mortgages curtailed buyers, and new contracts tumbled to as low as 923 in June. Source: Bloomberg

“This is a quick pivot from an overachieving market to a market that’s being challenged by an unprecedented amount of uncertainty,” Miller said. The sharp downturn in newly signed contracts is part of prospective homebuyers heading to the sidelines because of turmoil in stocks, bonds, and crypto, interest rate increases, and mounting fears of an imminent recession.

This uncertainty has translated into fewer bidding wars, slumping signed contracts, and price reductions on listings as inventory gradually builds.

Manhattan’s decline in newly signed contracts comes as the median sales price for the second quarter increased to a record $1.25 million.

“Contracts are the best real-time indicator of market performance,” Garrett Derderian, director of market intelligence at brokerage Serhant, told Bloomberg. He believes third-quarter contract figures “will be bleaker.”

It appears that the slowdown in Manhattan’s residential market accelerated into June and could easily lead to slowing sales in all boroughs.

McKenzie Ryan, a top New York broker with Douglas Elliman, told CNBC the number of buyers showing up for open houses has fallen off a cliff. She said an April listing attracted 31 people to the house. A similar listing she held last month only brought in four people.

“My clients in tech are just bracing right now for whatever happens … Some people have seen a steep loss in wealth since the start of the year,” Ryan said.

The signs of a shift are still early, though it could soon indicate Manhattan’s residential market is set to peak, then reverse.

END

Mortgage Rates Crash Most ‘Since Lehman’ As Loan Demand Collapses

THURSDAY, JUL 07, 2022 – 11:30 AM

It appears the laws of supply and demand have once again miraculously re-appeared – this time in the home mortgage market.

The average rate for a 30-year loan plunged to 5.3%, the lowest in a month and down from 5.7% last week. That is the largest weekly drop (40bps) since the Lehman collapse in 2008…

Judging by the total collapse in mortgage applications, it is clear that as the ‘price’ of loans rose (rates) then the ‘demand’ for loans evaporated. Simply put, if you were writing mortgages at such high rates (amid near record low levels of affordability) you are doing no business at all…

So you lower the price of the loan (rates) to encourage demand. With the 40bps crash in rates this week, it appears the fecal matter really hit the rotating object in the mortgage providers.

“Because of falling mortgage rates, homes may be more affordable than they were three weeks ago,” Holden Lewis, home and mortgage spokesperson at NerdWallet said in a statement. “There were few, if any, times you could have said that in the first half of 2022.”

Good luck with that idea. Rates are still up massively from levels a year ago – and home prices are at ever higher levels too.

At the current 30-year average, a borrower with a $300,000 mortgage would pay roughly $1,665 a month, about $383 more than at the end of last year, when rates hovered around 3.11%.

“While the drop provides minor relief to buyers, the housing market will continue to normalize if home-price growth materially slows due to the combination of low housing affordability and an expected economic slowdown,” said Sam Khater, Freddie Mac’s chief economist.

Of course, the big question is – Will Powell be pleased? Because prices are not really coming down much on the homes themselves (yet). This market-driven rate-cut stimulting demand is not what the inflation-battling folks in the Marriner-Eccles building are hoping for.

END

This is becoming quite serious!! auto loans in value are exceeding rents

(zerohedge)

Are We Headed For An “Auto Loan Crisis” As Delinquencies Begin To Rise?

THURSDAY, JUL 07, 2022 – 12:05 PM

Automobile affordability worsens as Americans are saddled up with monthly payments topping $1,000, and loan delinquencies are creeping higher thanks to increasing economic pressures thanks to the Federal Reserve’s aggressive monetary tightening regime to rein in the highest inflation in 40 years. A Fed-induced downturn in the economy could end up bursting the auto bubble.

“We are seeing delinquencies start to increase,” Ford Chief Financial Officer John Lawler told the Deutsche Bank 2022 Global Automotive Conference last month.
“We’re looking for every indication and every data point we can to get a read on where the consumer is, where they’re headed given everything that we see out there, the inflationary pressures, the economic issues, et cetera,” Lawler said.
He continued: “So we are seeing some headwinds there a little bit when it comes to delinquencies as maybe a leading indicator.”

Edmunds’ executive director of insights Jessica Caldwell also noted, “auto loan delinquencies are expected to rise,” adding consumers must “understand the risks associated with financing more than what they can afford.”

Meanwhile, June data from Edmunds shows monthly auto payments topped $1,000. Cox Automotive showed the average monthly car payment reached $712 in May. These auto payments are higher than rent for one-bedroom apartments in Wichita, Kansas, and Akron, Ohio.

Combine auto, shelter, energy, and food costs that are soaring, and no wonder consumers have maxed out their credit cards and drained savings as they struggle to survive the worst inflationary storm in 40 years. This situation is expected to worsen as the Fed is determined to hike into a downturn and may trigger a recession in the middle of the second half of 2022, according to a note from Nomura.

What’s surprising to Jack Liebersohn, an economics professor at the University of California, Irvine, is that auto payments are topping shelter costs for some consumers.

“Normally housing is the thing people struggle to pay — autos are typically an optional expense you can delay, so the phenomenon of car payments exceeding rent is surprising to me,” Liebersohn told Bloomberg.

Given the souring macro economic backdrop, auto delinquencies are beginning to trend higher following a plunge in early 2020 and another in early 2021, thanks to auto loan deferment programs and stimulus checks. Now the safety nets are gone as consumers with insurmountable debts, paying the highest ever monthly payments, become financially paralyzed by the high inflation. This won’t end well and could trigger a tsunami of delinquencies.

Banks have begun modeling possible scenarios in the event of an economic downturn and increasing delinquencies, leading to an increasing rejection of credit applications (this is broad, not just autos).

What’s even more concerning are Google search trends for “voluntary repossession of car” have surged to the highest level since the summer of 2008. This can only suggest consumers with high monthly payments contemplate surrendering their vehicle to the bank to avoid falling behind on payments.

The last time search trends for “voluntary repossession of car” were this high, the stock market was halved in the second half of 2008 and didn’t find a bottom until March of 2009.

The “strong consumer” narrative that President Biden and Fed Chair Jerome Powell pedal could be ‘smoke and mirrors’ as a wave of auto loan delinquencies could be nearing as recession risks soar.

For more color on what could happen next. Auto expert Lucky Lopez warns an “auto loan crisis” is about to unfold.

Besides an auto loan crisis, eight million Americans are behind on rent payments and face eviction.

Storm clouds are gathering.

end

A good one!!

Mish Shedlock/Mish talk

Artificial Wealth Vs GDP: Why Earnings & The Stock Market Will Get Crushed

THURSDAY, JUL 07, 2022 – 12:27 PM

Authored by Mike Shedlock via MishTalk.com,

Here’s the case for an earnings smash accompanied by a continuation of the stock market crash.

Imaginary Wealth and Hyper-Financialization

Ben Hunt: “In late 1990s, the Fed began to use monetary policy as a political tool to make us richer than our economy could grow, inflating home prices and financial asset prices without (they thought) ever triggering wage/price inflation in the broader economy.”

Change “richer” to “feel richer” and the idea is perfect.

Earnings Forecast

Which Earnings Estimate Do You Believe?

Wall Street predicts +10% S&P earnings growth. T
The Belkin Report forecasts -48% S&P earnings slump, like 2009.

Actual earnings could be even more extreme or somewhere in the middle, but I expect Belkin to be in the ballpark.

Case for an Earnings Crash

Recession
De-globalization costs
Retirement of 22 million boomers will lower productivity and slow spending
De-carbonization is very expensive, do we even have the natural resources?
End of a 40-year bull market in interests rates
Potential for protracted war in Ukraine
Central bank concern over reigniting inflation
Renewed union push
Wealth impact of stock market decline will itself slow spending
Various bubbles have just begin to pop

Feedback Loops

Some of the above points are circular, feeding on themselves. But I do expect a reinforcing feedback loop. There is a wealth impact of a stock market and crypto plunge that feeds on itself.

De-Globalization

De-globalization is huge. We went from just-in-time inventory management to inventory and supply chain chaos. That point alone is sufficient reason to suspect current earnings estimates.

For discussion, please see De-Globalization: New Supply Chains Are Inefficient and Will Drive Up Inflation

Protracted War in Ukraine

Things will improve once the war in Ukraine ends, but when is that?

Neither side can win outright until at least one side changes its definition of win. Ukraine wants all of its territory back. Forget it. That won’t happen. And as long as the US keeps supplying weapons, the war will go on.

Meanwhile, How Long Before Putin Shuts Off Natural Gas Delivery to Europe?

Assume the war ends early. Things will not return to the previous normal of outsourcing everything to Asia confident that supplies will be readily at hand when needed.

Climate Change

A climate change push is everywhere. But where do we get the lithium, platinum, nickel, rare earth minerals? What about fertilizer?

What about building the infrastructure? The latter will take still more government spending on top of the declared war on fossil fuels driving up costs.

Unionization

There is a renewed push for unionization in many states. Amazon just lost a key battle.

In California, and AB5 Ruling May Disrupt All West Coast Truck Shipments

California ruled that independent drivers are employees not contractors. The US Supreme Court refused the case. The ruling creates a huge potential for a massive truck shipping logjam.

Even when the logjam ends, there will be a permanent increase in price.

22 Million Boomers Head for Retirement

Employment levels from the BLS, chart by Mish

Millions of those workers will soon retire. Who is there to replace them but unskilled Zoomers?

Expect a productivity hit.

For more discussion, please see Expect a Long But Shallow Recession With Minimal Job Losses

Central Bank Concern Over Reigniting Inflation

We have had a 14 years of near-endless QE. We now have Quantitative Tightening scheduled to last for years.

Color me very skeptical of that idea. Regardless, QT will go on for a while.

Powell looks like a fool on inflation, primarily because he was a fool. He will not want to risk more inflation. This point is clear.

On June 29, 2022, Powell admitted “We understand better how little we understand about inflation”

Powell: “We understand better how little we understand about inflation.”
Powell: “There’s a clock running here. The risk is that because of the multiplicity of shocks, you start to transition into a higher-inflation regime. Our job is literally to prevent that from happening, and we will prevent that from happening.”
Powell: “The process is highly likely to involve some pain, but the worse pain would be in failing to address this high inflation and allowing it to become persistent.”
Powell: “Is there a risk we would go too far? Certainly there’s a risk. The bigger mistake to make, let’s put it that way, would be to fail to restore price stability.”

That translates to “Damn the recession, we are hiking.”

End of a 40-Year Bond Bull Market

Instead of financial pumping, ponder the End of the 40-Year Bull in Debt and a “Global Depression” Threat

Francis Hunt interviews Danielle DiMartino Booth in a must watch video, her most economically comprehensive yet.

Risks Strongly Skewed to the Downside

Point-by-point there is simply no reason to believe fantasyland earnings estimates. My estimate of 2,000+- on the S&P 500 just might be overly optimistic.

* * *

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3b/INFLATION COMMENTARIES/LOG JAMS ETC

END

SWAMP STORIES

King Report

The King Report July 7, 2022 Issue 6795

Independent View of the News

Copper Crash Deepens as Recession Fears Dominate Metals Trading
Copper plunged below $7,500 a ton as fears of a global economic slowdown piled pressure on industrial metals and deepened their retreat from record highs just months ago. Investors are fretting over a range of threats to demand, from Europe’s gas crisis to a US slowdown and renewed virus flare-ups in China. After a 4.2% slump on Tuesday to its lowest close in 19 months, copper fell almost 5% on Wednesday, before paring some losses. Aluminum, nickel and tin also tumbled…
https://www.bloomberg.com/news/articles/2022-07-06/copper-crash-deepens-as-recession-fears-dominate-metals-trading

China’s Debt to Climb to Record in 2022, Government Adviser SaysTemporary increase in debt ratio not too risky: NIFD’s Zhang‘Little possibility’ of household leverage decline, Zhang saysChina’s debt will likely hit a record this year as the central bank tries to boost credit and shore up the struggling economy, according to a government-backed think tank. The overall leverage ratio — total debt as a percentage of gross domestic product — is projected to increase by 11.3 percentage points to around 275% this year, according to Zhang Xiaojing…
https://www.bloomberg.com/news/articles/2022-07-06/china-s-debt-to-climb-to-record-in-2022-government-adviser-says

@SPGlobalPMI: The S&P Global US Services PMI registered 52.7 in June (May: 53.4), as rising inflationary pressures and economic uncertainty resulted in a first contraction in new business for nearly two years. Read more: http://ow.ly/oYI550JPBl3

US Services Gauge Slips to Lowest Level in More Than Two Years
The Institute for Supply Management’s gauge of services slipped to 55.3 from May’s 55.9, according to data released Wednesday. Despite the softening, the index exceeded the median estimate of 54…
https://www.bloomberg.com/news/articles/2022-07-06/us-services-gauge-slips-to-lowest-level-in-more-than-two-years

The Truth Is Recession Feels Like It’s Already Here – The recession calls are getting louder on Wall Street, but for households and businesses ⁠— the downturn is already here…
https://www.bloomberg.com/news/newsletters/2022-07-06/bloomberg-big-take-consumers-say-it-feels-like-a-recession-is-here

Fed Sees ‘More Restrictive’ Rates Possible If Inflation Persists
    Raising rates could slow GDP growth over time, minutes show
    Return to 2% inflation ‘critical’ for employment mandate
Policy makers backed raising rates at their next meeting in July by either 50 or 75 basis points, according to minutes of the Federal Open Market Committee’s June 14-15 policy meeting released Wednesday in Washington. They viewed maintaining the central bank’s credibility to control inflation as crucial…
https://finance.yahoo.com/news/fed-sees-more-restrictive-rates-180001619.html

Joe Biden reportedly exports 5 million oil barrels despite US gas prices (1 cargo went to China!)
https://nypost.com/2022/07/06/joe-biden-exports-oil-barrels-despite-us-gas-prices-report/

ESUs traded in a range for the entire day until they broke higher at 14:32 ET. During its range trading, ESUs vacillated between loses and gains. ESUs hit a daily low of 3808.75 at 2:10 ET, ten minutes after Chinese trading ended. The usual rally for the NYSE open appeared; but ESUs peaked at 9:31 ET. Methodical selling pushed ESUs 40 handles lower (from the opening high) by the European close.

We all know what happens next. Someone pushed ESUs and stocks higher after the early tumble in the US. ESUs hit the daily high of 3875.00 (+63.50 from NYSE session low) at 15:36 ET.

Part of the afternoon equity surge might have been traders playing the pattern of buying for a presidential speech on the economy. Lonesome Joe was in Ohio to tout his economic prowess in the afternoon.

‘Scheduling Conflicts’: Ohio Democrats Shun Biden’s Visit
U.S. Rep. Tim Ryan of Ohio’s 13th Congressional District — the Democrat running for U.S. Senate against Republican nominee J.D. Vance — won’t be appearing with Biden on Wednesday. Nor will Nan Whaley, the Democrat candidate for Ohio governor challenging incumbent GOP Governor Mike DeWine.
https://townhall.com/tipsheet/spencerbrown/2022/07/06/ohio-democrats-shun-bidens-visit-n2609815

When The Big Guy’s economic address began, ESUs tumbled 34 handles in 17 minutes. Someone then juiced ESUs ten handles during the final 7 minutes of NYSE trading. Joe blamed Putin for inflation, and the GOP for economic ills. He said DJT “lost more jobs than any other administration.” Everyone, except Biden Kool-Aid drinkers, knows The Big Guy is pathetically trying to deflect attention from his woeful economic performance and pitiful presidency.

@greg_price11: Biden: “Republicans do nothing but obstruct our effort to lower your gas taxes, lower your food prices, lower your healthcare costs, lower your prescription drug costs.”
https://twitter.com/greg_price11/status/1544770421169557505

Biden praises American Rescue Plan for restoring ‘dignified retirement’
Biden spoke about the Special Financial Assistance program, which will safeguard retirees who have faced cuts to their pensions due to investment losses. The program will allow them to receive the benefits they were originally supposed to see upon retirement… (Heads I win; tails get government bailout!)
https://www.upi.com/Top_News/US/2022/07/06/joe-biden-cleveland-economy-inflation-pensions/6601657112131/

USUs traded sideways in negative territory during Asian trading. They broke out to the upside at 7:39 ET. USUs then surged to 142 6/32 at 8:38 ET. After a slow rollover, USUs tumbled to the daily low of 139 16/32 at 14:14 ET. They then traded sideways, in a modest range, until they broke down at 15:20 ET. USUs hit a session low of 139 12/32, -1 25/32 for the day, at 15:56 ET.

It appeared that an offensive asset allocation occurred: Someone relentlessly bought ESUs and sold USUs. This was probably the unwinding of an extremely profitable defensive asset allocation.

The dollar rallied sharply again. The Dollar Index hit 107.264 at 10:15 ET. The euro fell to a daily low of 1.0162 at 10:20 ET. Forex jockeys expected the dollar to hit parity with the euro. What happens if the euro decisively broke below parity with the buck?

The yen fell to a low of 136.01/dollar at 10:08 ET, its lowest dollar level since September 1998.

Morgan Stanley’s Asian Dollar Index (ADXY) fell to 101.98. The index plunged to 99.96 in March 2020 on the Covid Panic. If the index breaches 100 in coming weeks, it could be bad for Asian nations.

Positive aspects of previous session
Once again, someone drove ESUs and stocks higher in the US after an early tumble

Negative aspects of previous session
Bonds declined sharply, as much as 1 24/32, after a rally during Asian trading
The dollar continues to march higher

Ambiguous aspects of previous session
How much of a US recession is baked into US stocks?

First Hour/Last Hour Action [S&P 500 Index]: 1st Hour from NYSE open: Down; Last Hour: Down

Pivot Point for S&P 500 Index [above/below indicates daily trend to traders]: 3841.79
Previous session High/Low: 3870.91; 3809.37

Pfizer Asks Court to Dismiss Whistleblower Lawsuit Because Government Was Aware of Fraud
A lawsuit filed by whistleblower Brook Jackson alleging Pfizer and two of its contractors manipulated data and committed other acts of fraud during Pfizer’s COVID-19 clinical trials is paused following a motion by the defendants to dismiss the case. (This looks like a big deal that the MSM is ignoring.)
    Jackson’s lawyer said Pfizer argued the lawsuit, which was filed under the False Claims Act, should be dismissed because the U.S. government knew of the wrongdoings in the clinical trials but continued to do business with the vaccine maker… https://childrenshealthdefense.org/defender/pfizer-whistleblower-lawsuit-fraud/

@Cavalewis: Crime continues to surge across America (YTD 22 compared to 21): NY Crime:⬆️ 37% (as of 7/3); Chicago Crime: ⬆️ 34% (7/3); Newark NJ Crime: ⬆️ 11% (7/3); DC Violent Crime:⬆️ 9% (7/6); San Francisco Crime: ⬆️ 7% (7/3); Philly Homicides: ⬆️ 6% (7/5)… Baltimore crime data suggest the first 6 months of 2022 were the deadliest in Baltimore history…It’s hard to understate the negative impacts divisive rhetoric has had on America’s law enforcement, and our communities. Last year, 73 law enforcement officers were killed — the highest number since 9/11. Meanwhile, police resignations surged by 40% from 2020 to 2021.   https://twitter.com/Cavalewis/status/1544700483796959232

Biden stuck in no-man’s-land on Ukraine – The risk that the president is caught in no-man’s-land, doing enough to pay a real price in energy prices while not doing enough to help Ukraine halt Russian advances… there is an unsettling feeling that Biden, having settled into a position of solid support for Kyiv, has no real plan as to how to help bring about an end to this war that serves US interests…  https://spectatorworld.com/newsletter/biden-stuck-no-mans-land-ukraine-07-05-22/

How will Americans react if Russia prevails and the $60B+ that the US gave to Ukraine is for naught. Now add US consumer ire due to a recession to the equation.

Today – From yesterday’s King Report: Part of the impetus to Tuesday’s afternoon rally could be that traders see the window for a rally early this week before anxiety ahead of Friday’s June Employment appears on Thursday afternoon.

Despite equity tumbles during early NYSE trading in the previous two sessions, someone pushed ESUs and stocks higher after Europe closed. We opined traders would see a window for an equity rally early in the week, and June Employment Report anxiety could appear by Thursday afternoon. We will stick to this story until the market deviates from it.

If stocks rally during the morning or at midday in the US, the odds of an afternoon decline increase. ESUs are -6.75 and USUs are + 4/32 at 21:05 ET. ESUs are very ripe for a pump & dump!

Expected econ data: May Trade Balance -$84.7B; Initial Jobless Claims 230k, Continuing Claims 1.33m; Fed Gov Waller at NABE event, & St. Louis Fed Pres Bullard on Economy & Monetary Policy 13:00 ET

S&P 500 Index 50-day MA: 3986; 100-day MA: 4196; 150-day MA: 4335; 200-day MA: 4384
DJIA 50-day MA: 32,019; 100-day MA: 33,132; 150-day MA: 33,923; 200-day MA: 34,260

S&P 500 Index – Trender trading model and MACD for key time frames
Monthly: Trender and MACD are negative – a close above 4928.42 triggers a buy signal
Weekly: Trender and MACD are negative – a close above 4204.42 triggers a buy signal
Daily: Trender and MACD are positive – a close below 3708.13 triggers a sell signal
Hourly: Trender and MACD are positive – a close below 3781.54 triggers a sell signal

@CBS_Herridge: @JamesComer says Treasury “…will not provide (Suspicious Activity Reports) to Committee Republicans unless Democrats join the request.” @CBSNews reports +150 transactions involving Hunter, James Biden’s global biz affairs were flagged by US banks for further review.
    Previously, a Treasury spokesperson said the department provides SARs “in a manner that enables robust oversight.” @CBS_News asked Treasury to respond to republican allegations it is continuing to “thwart congressional oversight.”  https://twitter.com/CBS_Herridge/status/1544688423511986177

@realJoelFischer: You can’t make this up!!  Joe Biden placed a medal to a Vietnam veteran wrong way around his back.   https://twitter.com/realJoelFischer/status/1544817718553190402

Biden communications director Kate Bedingfield to step down
https://justthenews.com/government/white-house/biden-communications-director-kate-bedingfield-step-down

White House Replaces Classic Norman Rockwell Paintings With ‘Jumbo Photos’ of… Joe Biden
https://pjmedia.com/news-and-politics/robert-spencer/2022/07/06/white-house-replaces-classic-norman-rockwell-paintings-with-jumbo-photos-of-joe-biden-n1610861

Potential Richmond July 4 mass shooters charged as noncitizens in possession of firearm, police say
Two illegal immigrants, 52-year-old Julio Alvarado-Dubon and 38-year-old Rolman Balacarcel, were arrested and charged with being a non-U.S. citizens in possession of a gun after police uncovered a plot that the duo planned a mass shooting at Richmond’s July 4 celebration Monday…police investigated Alvarado-Dubon based on a tip to police by someone he would only refer to as a “hero citizen.”…
https://www.foxnews.com/us/potential-richmond-july-4-mass-shooters-charged-noncitizens-possession-firearm-police-say

After speaking in Chicago on Tuesday, VP Kamala Harris went to Highland Park, Illinois to speak about the July 4^th parade attack. The result is comedy gold, Jerry.

@bennyjohnson: Kamala Harris has such a way with words: “We got to take this stuff seriously, as seriously as you are because you have been forced to have take this seriously…”
https://twitter.com/bennyjohnson/status/1544483574459650048

Highland Park shooting: Kamala Harris goes viral with ‘seriously’ word salad during visit to Chicago suburb  https://t.co/gEefI78fpu

Kamala Harris delivers interview in front of official sign with Louisiana misspelled
Vice President Kamala Harris did not address the typo during a 30-minute interview
https://www.foxnews.com/politics/kamala-harris-delivers-interview-front-official-sign-louisiana-misspelled

AP: Prosecutor: July 4 parade shooter confessed to police
The state has a so-called red flag law designed to stop dangerous people before they kill, but it requires family members, relatives, roommates or police to ask a judge to order guns seized…
https://apnews.com/article/gun-violence-chicago-shootings-lake-michigan-9fd3e23a6396aa5e008943fbb260551b

@DailyMail: Shooter says he used $800 Smith & Wesson rifle to kill EIGHT in parade massacre
After the shooting, he used his mom’s car to drive to Madison, Wisconsin
He contemplated a second shooting in Wisconsin at a different parade because he had 60 rounds left
    His parents’ attorney has spoken out in their defense to insist there were ‘no red flags’ for them to report to police… (Suicide attempt, threat to family to kill everyone, and much more are not red flags?)
https://www.dailymail.co.uk/news/article-10987379/Lawyer-Highland-Park-shooters-parents-claims-no-red-flags.html

Axios Chicago’s @monicaeng: The Illinois State Police just told @axios Chicago that Crimo’s father co-signed for his FOID card that he received even after threatening to kill his family and having his weapons confiscated. @pksmid all of which was reported to the ISP. Per Illinois State Police: Crimo’s death threats and weapon confiscation happened in Sept 2019. Crimo (19 at the time) then applied for his FOID card in December 2019 sponsored by his father, and it was reviewed in Jan 2020.
    Because the family did not press charges at the time of the Sept 2019 death threats, ISP says that when they were reviewing Crimo III’s FOID card application in Jan 2020, “there was insufficient basis to establish a clear and present danger and deny the FOID application.

Highland Park shooter was facing life on the streets as his home was set for foreclosure…
Highland Park shooter Bobby Crimo was about to be thrown out of the apartment where he lived behind his father’s home, DailyMail.com can reveal exclusively…
    A former coach of Crimo’s said the alleged killer stood out to him as he and his younger brother were often left behind at their afterschool program because their ‘flighty’ mom forgot to pick them up or their dad was at work…It’s unclear when the shooter’s parents separated but they no longer live together…His mother Denise Pesina is an ‘alternative healer’… https://t.co/zzTy1IlO6f

Robert Crimo Raises a Red Flag About America
Why do some people insist on ignoring the warning signs?
Five-foot-eleven, 120 pounds raises a red flag…Is not a face tattoo a red flag? Mr. Crimo’s facial ink includes five notches under his eye of the type one makes on a belt or bedpost and the number 47, which some speculate pertains to the character Agent 47 in a video game called Hitman, on his temple. The word “Awake” appears in cursive above an eyebrow…His videos, since removed by YouTube, depict a shootout with the cops and include a poster of Lee Harvey Oswald…
   Primo drove a car with the word “p@$$ymobile” written on its rear. He allegedly posted pictures of himself with a sex doll that a fellow redditor wrote looked “12” but Crimo insisted in defense of himself was “15.” His discord channel reportedly included Faces of Death–style videos showing a suicide and a beheading. He neither worked a job nor attended school. He did not graduate from a traditional high school but instead, after intervention from a school counselor, received his education through homeschooling. Red flag. Red flag. Red flag. Red flag.
    He attempted suicide in 2019 and later that year threatened to “kill everyone” where he lived…
    Americans blame their laws because blaming our society requires more soul-searching and less scapegoating. We celebrate deviancy and judge only those who dares to judge a book by its cover. We prefix antisocial online activity with the word “social” and find nothing amiss with music that celebrates school shootings. Parental neglect shocks nobody…
https://spectator.org/robert-crimo-raises-red-flag-about-america/?s=02

Highland Park gunman Robert Crimo contemplated second shooting: authorities
“He seriously contemplated using the firearm in his vehicle to commit another shooting in Madison (WI),” Lake County Major Crime Task Force spokesman Christopher Covelli said… https://trib.al/pnOlGzT

@JerryDunleavy: Illinois State Police on the Highland Park shooter: (Father claimed knives were his; ISP did 4 background checks in 2020/2021) https://twitter.com/JerryDunleavy/status/1544715487963127808

Highland Park gunman Robert Crimo posted Call of Duty clips showing characters shooting from rooftops https://trib.al/u8YDZDv

Illinois Has All the Gun Laws Republican Senators Caved to Push States Into, and That Didn’t Stop the Highland Park Killer  https://thefederalist.com/2022/07/06/illinois-has-all-the-gun-laws-republican-senators-caved-to-push-states-into-and-that-didnt-stop-the-highland-park-killer/

Severe, even 2^nd Amendment violating laws cannot redress not enforcing exiting laws, not prosecuting criminals, egregiously lenient judges, a depraved culture, debased societal norms, and parental neglect.

@a_centrism: In the 1960s, the average IQ of an American with an undergraduate degree was 111. By the 2010s, it was 100. As academic rigor and grading standards have declined, and DIE pressures increased, across all levels of education, the average IQ of graduates has declined.
https://twitter.com/a_centrism/status/1544359874183811074

Tucker Carlson anoints the next star of the Democratic Party: State Senator of RI, Tiara Mack
https://twitter.com/a_centrism/status/1544359874183811074

@CWBChicago: Anthony Heredia is on parole for firing a gun at a car. Last month, Chicago cops said they found him riding in a van with a gun. Prosecutors refused to file felony charges. Last week, he allegedly shot and killed a 17-year-old girl at McDonald’s.  https://t.co/0057sZHcBo

Police officers from coast to coast come under attack over 4th of July weekend
https://www.foxnews.com/us/police-officers-coast-to-coast-come-under-attack-4th-of-july-weekend

@mrddmia: The Biden Justice Department just sued Arizona over a new state law requiring voters to prove they’re citizens.  Attorney Emily R Brailey signed the DOJ’s complaint, where she started 9 months ago. She previously worked as a Democrat election attorney, including for @marceelias.
https://twitter.com/mrddmia/status/1544474413038460928

@alexbruesewitz: Biden wants you to believe that absolutely no illegal aliens voted in the 2020 election but is now suing Arizona in attempt to overturn a law that requires proof of citizenship to vote…

North Carolina voters abandoning Democrats, switching to GOP as part of a national trend
Democrats lost nearly 20,000 voters since January.
https://justthenews.com/nation/states/center-square/north-carolina-voters-switching-republican-party-part-national-trend

A new Harvard-Harris Poll shows (P. 41) only 10% of registered voters support abortion up to birth.  72% support abortion bans after 15 weeks (75% of women and 69% of men). “The Roe Decision has a net neutral impact on midterm voting.” (p. 44)
https://harvardharrispoll.com/wp-content/uploads/2022/07/HHP_June2022_KeyResults.pdf

Registered Voter Polls Will (Usually) Overrate Democrats
https://fivethirtyeight.com/features/registered-voter-polls-will-usually-overrate-democrats/

@seanspicer: Since 1897 @nytimes has printed a copy of the Declaration of Independence on the 4th of July – this year the folks at the Gray Lady claim they “forgot” As the leftists at the @washingtonpost say democracy dies in darkness

@GlynisPayne17: Undercover police tried to infiltrate the Dutch farmers protest, but they got caught
https://twitter.com/GlynisPayne17/status/1544272468940136448

Greg Hunter: interviewing

See you tomorrow

One comment

USA DATA: HUGE INCREASES IN INITIAL AND CONTINUAL CLAIMS ON THE JOBLESS REPORT – altnews.org · July 8, 2022 - 9:05 am · Reply→

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