$ES_F MOC SELL $650mil $$
$ES_F SPX moc implied imbal $1.3B for SALE $$
$ES_F 02:34:26 TRADINGDATA2: (bshepard) ESM moving the the favored direction of the imbalalce meter ... down $$
$ES_F 81% sell side $$
John_Monaco (13:41:50): 75% sell side on the close
"He who holds the gold makes the rules?" notes SHTFPlan.com's Mac Slavo...
Fresh attempts at containing Russia and continuing the empire have been met with countermoves. Russia appears to be building strength in every way. Putin and his country have no intention of being under the American thumb, and are developing rapid resistance as the U.S. petrodollar loses its grip and China, Russia and the East shift into new currencies and shifting world order.
What lies ahead? It will be a strong hand for the countries that have the most significant backing in gold and hard assets; and China and Russia have positioned themselves very well. Prepare for a changing economic landscape, and one in which self-reliance might be all we have.
As The Free Thought Project's Jay Syrmopoulos warns, Russia is Hoarding Gold at an Alarming Rate — The Next World War Will Be Fought with Currencies
With all eyes on Russia’s unveiling their latest nuclear intercontinental ballistic missile (ICBM), which NATO has dubbed the “SATAN” missile, as tensions with the U.S. increase, Moscow’s most potent “weapon” may be something drastically different.
The rapidly evolving geopolitical “weapon” brandished by Russia is an ever increasing stockpile of gold, as well as Russia’s native currency, the ruble.
Take a look at the symbol below, as it could soon come to change the entire hierarchy of the international order – potentially ushering in a complete international paradigm shift – and much sooner than you might think.
The symbol is the new designation of the Russian ruble, Russia’s national currency.
Similar to how the U.S. uses the dollar sign ($), the U.K. uses the pound sign (£), and the European Union uses the euro symbol (€), Russia is about to begin exporting its symbol internationally.
After the failed “reset” in U.S./Russian relations by the Obama administration, and the continued deterioration of the countries relationship, Washington began targeting entire sectors of the Russian economy, as well as specific individuals, meant to impose an economic burden so severe that it would force Moscow into compliance.
Instead of decimating Russia, what it precipitated was a Russian response of gradually weaning themselves off of the hegemony of the U.S. petrodollar, and working with China to create an alternative to the SWIFT payment system that isn’t solely controlled by Western interests (see Asian Infrastructure Investment Bank, New Development Bank).
According to the Corbett Report:
New reports indicate that China is ready to launch its SWIFT alternative, and for those who have their ear to the ground this is the most significant move yet in the unfolding process of de-dollarization that is seeing the BRICS-led “resistance bloc” breaking away from the financial stranglehold of the US-led “Washington Consensus.”
For those who don’t know, SWIFT stands for the Society for Worldwide Interbank Financial Telecommunication and is shorthand for the SWIFTNet Network that is used by over 10,500 financial institutions in 215 countries and territories to transmit financial transaction data around the world. SWIFT does not do any of the clearing or processing for these transactions itself, but instead sends the payment orders that are then settled by correspondent banks of the member institutions. Still, given the system’s near universality in the financial system, it means that virtually every international transaction between banking institutions goes through the SWIFT network.
This is why de-listing from the SWIFT network remains one of the primary financial weapons wielded by the US and its allies in their increasingly important financial warfare campaigns.
Recently, financial guru Jim Rickards, author of the book “Currency Wars,” wrote that “Russia is poised for a major comeback in its economy. Russian bonds and stocks and the Russian currency, the ruble, will all benefit.” Rickards believes a “strong turnaround” is coming within Russia, and that this comeback will benefit the ruble.
While still suffering from the economic warfare being waged by the U.S., Russia has realized that as long they are subservient to the petrodollar, there remains a clear and present danger of the Russian economy being devastated by the whims of Washington.
The Bank of Russia, that nation’s central bank, is extremely clear about its mission, and monetary policy declaring on its website:
Monetary policy constitutes an integral part of the state policy and is aimed at enhancing well-being of Russian citizens. The Bank of Russia implements monetary policy in the framework of inflation-targeting regime, and sees price stability, albeit sustainably low inflation, as its priority. Given structural peculiarities of the Russian economy, the target is to reduce inflation to 4% by 2017 and maintain it within that range in the medium run.
In layman’s terms, that means that monetary policy, similar to nuclear weapons and the military, are “an integral part of the state policy” in Russia. While many analysts have noted the increased build-up in Russia’s military arsenal, seemingly few have highlighted the massive build-up of Russian gold reserves over the past decade.
Below is a chart showing Russian gold reserves between 1994 and last year, 2015:
Since 2006, there has been a year-on-year increase that reveals a significant upward trend. The chart clearly reveals that Russia’s state policy of increasing state monetary assets, in the form of gold. Additionally, the Russian government has been converting state rubles into gold assets. From 2006 to 2015, Russia’s state holdings of gold tripled.
Within just the past year Russia has substantially increased its gold holdings
According to the Business Insider:
In July of this year, the central bank of Russia added 200,000 ounces of gold to its reserves. The one-month uptick in Russian gold reserves — 200,000 ounces — is approximately equal to the entire annual output of Barrick Gold’s Turquoise Ridge gold mine in Nevada.
At that same rate — 200,000 ounces per month — in a mere five months, Russia would add to state gold reserves the equivalent of the entire annual output of Barrick’s massive Goldstrike mine in Nevada.
Currently, Russian gold reserves rank seventh in the world. It’s clear that there is a concerted effort by Russian authorities to build up the country’s gold reserves as part of a national strategy to negate the effects of economic warfare waged by the United States.
Rickards, in his 2011 book “Currency Wars,” theorized that Russia and China could combine their gold reserves to form a global gold-backed currency to compete against the U.S. dollar. Currently, Russian reserves stand at roughly 1,500 tonnes, with Chinese reserves totaling over 1,800 tonnes (according to China — it’s likely more), which would amount to a combined total of roughly 3,300 tonnes of gold.
The U.S. is about to lose overarching control of policymaking within the International Monetary Fund (IMF), thus the U.S. lockup on global gold is about to vanish, according to Business Insider.
Imagine for a moment the distinctly real possibility that Russian-Chinese alliance could exercise indirect (or even direct) control over the IMF’s gold reserve of over 2,800 tonnes. Russian, Chinese and IMF gold combined would equal roughly 6,100 tonnes, and would allow for direct competition with the U.S. gold reserves, estimated at 8,100 tonnes.
Russia and China have realized that the petrodollar is wielded by Washington as it’s weapon of choice when opposing a well-armed state, and clearly see the writing on the wall – thus working together to create a new global financial paradigm.
The reality is that the United States is $20 trillion dollars in debt, and eventually the time will come when the U.S. economy begins to implode — and all the fiat currency people are stuck holding will essentially be worth nothing more than the paper it’s printed on. Hard assets, such as gold and silver, should be bought and taken custody of while there is still an opportunity to do so, as a means of hedging against the potentially disastrous results of the U.S. using the petrodollar as a “weapon.”
Ultimately, the United States, Russia and China are all controlled by centralized power-hungry tyrants attempting to command powerful global bureaucracies like the IMF, the World Bank, SWIFT, New Development Bank and the Asian Infrastructure Investment Bank.
It’s not Russian nuclear weapons that people should fear, as the policy of mutually assured destruction essentially voids any benefit of a state launching a first-strike nuclear attack. The true threat to America is our economic house of cards, built upon the back of a neoliberal trade policy that puts the “rights” of corporations over that of people.
Presented with no comment...
Clinton State Dept Spent 5.4 Million Taxpayer Dollars On 'Crystal Stemware', $630k On Facebook 'Likes'
The Republican National Committee revealed Thursday in a 21-page memo that Hillary Clinton’s State Department spent millions of dollars on lavish goods and initiatives on the taxpayers’ dime.
The State Department spent $5.4 million on a “no-bid contract for crystal stemware” and $630,000 to “increase Facebook likes on four State Department pages.”
The memo also highlighted that the State Department spent more than $600 million on failed projects in Iraq and Afghanistan, the Washington Examiner reported.
The projects included a $3.6 million fleet of “unused broadcast TV trucks” in Afghanistan and $167.5 million on “preventable cost overruns while expanding embassy Kabul.”
The State Department spent an additional $9.8 million on purchases the GOP characterized as “frivolous,” such as the $79,000 in taxpayer funds Clinton’s agency used to buy up copies of President Obama’s book or the $53,004 her agency spent on “marble polishing services” at the U.S. embassy in Brasilia “during the summer of 2010.”
Republican presidential nominee Donald Trump has previously seized on the State Department’s questionable bookkeeping methods under Clinton when she was secretary of state. In the third presidential debate, Trump said that $6 billion went missing during Clinton’s tenure at the State Department, the Examiner noted.
His comments were likely based on a March 2014 memo from the State Department inspector general in which the watchdog noted contract files for projects worth up to $6 billion had disappeared since 2008. With no paper trail to document the progress of those projects, there was no way for the inspector general to verify that the money ended up in the proper place, the watchdog argued.
This memo plays into Trump’s latest push to “Drain the Swamp” as his campaign seeks to shed light on waste, fraud, and abuse among federal agencies.
In David Einhorn's latest letter, in which we find that Greenlight had a solid quarter in Q3, generating a 3.4% return which boosted the hedge fund's YTD return to 3.8%, we also learn that the poker playing-head of Greenlight is not a fan of Elon Musk; Einhorn also lashes out at the Fed although since Greenlight's antipathy toward the Federal Reserve has been well known for years, this is not exactly new.
Einhorn starts off by quoting from Dave Pell: “It’s pretty amazing that we live in an age when a CEO of two public companies can give a talk about colonizing Mars and shareholders don’t see that as a warning signal”, and added that "It’s not so amazing when one considers that those same complacent shareholders have been willing to look past years of over-promising and under-delivering from a promotional CEO. Elon Musk’s ability to spin a yarn and keep a story going seems to mesmerize his investors, blinding them to the challenges the company is facing."
Something tells us TSLA is one of Einhorn's more prominent shorts. And speaking of shorts, in the next part of the letter Einhorn then lashes out at central bankers, in typical fashion:
In contrast, we have central bankers who are determined to see flashing lights that aren’t there. We are more than seven years into an economic recovery, yet central bankers behave as if we’re still in crisis. Not only are experimental emergency policies being maintained, they are being expanded despite little evidence that they are needed or helpful. The newest manifestation comes from Japan, where the central bank has committed to monetize the entire government bond market if needed to keep the ten-year rate at zero. Leading economists are currently destigmatizing the idea of fiscal policy stimulus financed by direct money printing, so that goes into the coming attractions queue.
Einhorn next engages in everyone's favorite exercise: just what "data" is the "data-dependent" Fed reacting to:
With U.S. unemployment at 5% and the core CPI rising 2.2% over the last year, it is difficult for the “data dependent” Fed to further rationalize emergency rates based on its official dual mandate. It appears that the real criteria for raising rates are:
- Market forecasters fully expect a rate increase.
- The most recent move in the S&P 500 was positive.
- There is no trouble in foreign economies or financial markets.
- There are no potentially destabilizing geopolitical events, including foreign elections.
- The Cubs win the World Series.
At the most recent Federal Reserve meeting, Chairwoman Janet Yellen indicated that the case for raising rates had strengthened, and three governors voted to do so, yet the Fed decided to wait.
Einhorn's conclusion is spot on:
"Clearly there is little appetite for normalizing policy, even under normal conditions. Instead of defending the continued easy money policy, Chairwoman Yellen recharacterized it as only “modestly accommodative.” She also denied that the U.S. election drove the decision, which makes her politically neutral enough to moderate a presidential debate."
In light of today's FBI developments, and should Hillary lose the election, perhaps the next Fed move will be a rate cut should the market proceed to tumble having priced in a Clinton election.
His full letter is below.
I have written previously about being stuck in a trading range.
“Over the past couple of months, we have continued to drift from one economic report, or Central Bank meeting, to the next. Each report and meeting have continued to leave market participants confused as to what is going to happen next.
Is the economy improving? Or not?
Will the Fed hike rates? Not?
The bulls and the bears have met at the crossroad. However, neither is ready to commit capital towards their inherent convictions. So, for 43-days, and counting, we remain range bound waiting for what is going to happen next.”
Chart updated to present:
The problem with going nowhere is that it makes managing money much more difficult. With the market having broken the bullish trend line from the February lows, as shown below, along with remaining overbought with a sell signal in place, the risk to the downside outweighs the potential for a further advance currently. With downtrend resistance from the previous highs pushing prices lower, the risk of a break below 2125 is elevated. Being a bit more cautious given the current technical backdrop will likely be prudent.
While there are many simply suggesting just to buy into passive indexes and hold them, the brutal reality to such strategies have destroyed the ability for many to ever actually reach their investment goals.
However, despite the weight of evidence suggesting the markets are currently in a third bubble since the turn of the century, the commentary to ignore the outcomes related to such asset inflations is actually quite astonishing. Such is the result of a market seemingly immune to declines due to continued support, or at least belief thereof, from Central Banks.
But, just as was witnessed following “The Great Depression,” the bursting of the next asset bubble will likely once again drive participants away from the market for an entire generation, or longer. The problem for individual investors is the “trap” that is currently being laid between the appearance of strong market dynamics against the backdrop of weak economic and market fundamentals. Ignoring the last two to chase the former has historically not worked out well.
Alas, that is a story for another day, for now, we remain “stuck in the middle” waiting on an election outcome.
In the meantime, here is what I am reading this weekend.
Fed / Economy
- 5 Biggest Global Economic Challenges by Anthony Fensom via National Interest
- One Thing The Next Pres. Needs To Know by Joseph Stiglitz via Vanity Fair
- World In A Major Cyclical Upturn by Eric Bush via GaveKal
- American Job Recovery Is A Global Laggard by Narayana Kocherlakota via Bloomberg
- The Blind Ally Of Monetary Populism by Jeffrey Frankel via Project Syndicate
- What Could Go Wrong In America by Martin Feldstein via Project Syndicate
- For The Fed, The Dollar May Be A Problem by Jeffrey Snider via Alhambra Partners
- The Fed Could Pull A November Surprise by Patti Domm via CNBC
- Fed Is On A Collision Course by Financial Sense
- Recession Risk Is Rising by Tyler Durden via ZeroHedge
- Many Americans Balancing 2 or 3 Jobs by Paul Davidson via USA Today
- Yellen Has Many Questions, Few Answers by Dr. Ed Yardeni via Yardeni Research
- Globalization Fading To Black by Danielle DiMartino-Booth via Money Strong
- Time To Move Past The Election by John Tobey via Forbes
- Next Year’s Ticking Time Bomb by Ambrose Evans-Pritchard via The Telegraph
- Stock Market Stuck In Danger Zone by Michael Sincere via MarketWatch
- Chasing Yield Is Not A Good Plan Now by Michael Kahn via Barron’s
- A Chart To Help You Find Market Direction by Adam Koos via MarketWatch
- Next 10-Years Will Be Ugly For Your 401k by Suzanne Woolley via Bloomberg
- All Signs Are Flashing Market Is At Risk by David Rosenberg via Financial Post
- Most Of What You Think About Investing Is Wrong by L. Hamtil via Fortune Financial
- Charts That Scare WallStreet by Kawa, Verma, Verhage and Kim via Bloomberg
- September New Home Sales: Let Revisions Begin by Aaron Layman via AaronLayman.com
- Are Our Magazine Covers A Contrarian Indicator by Buttonwood via The Economist
- Who Will Pay For Clinton’s Tax Code Social Engineering by Alex Brill via RCM
- When You Should Claim Social Security Early by Sharon Epperson via CNBC
- Is US QE More Toxic Than Japan’s QE by Paul Murphy via FT
- Corporate America’s Bogus Election Excuse by Paul La Monica via CNN Money
- The Story Behind The Story Of Home Resales by Jeffrey Snider via Alhambra Partners
- Our Deplorable Ruling Class by John Stossel via Reason
- Failure Likely Regardless Of Who Wins by Mike “Mish” Shedlock via MishTalk.com
- Losses Hurt More Than Gains by Adam Taggart via Peak Prosperity
- The End Of Stock Buybacks by Bryan Borzykowski via Morningstar
- Future Of Investment Management via The Thought Factory
- Chasing Stocks At Levels To Beget Lousy Returns by John Hussman via Hussman Funds
- Small Stocks Threaten Breakdown by Dana Lyons via Tumblr
- A Real Conversation About The Markets by Jesse Felder via The Felder Report
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