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Bill Holter
A Flock of Black Swans in June?
Very soon we will be entering the month of June. Normally June is the time of year in the northern hemisphere when people think of picnics, parks, water sports and the outdoors. It is a time where plans are made for vacation, rest and relaxation. This year may be a little bit different. I say “different” because there is a plethora of converging events, any single one of them with the ability to take the financial markets down to their knees!
Let’s first list the events (which may not even be all inclusive because I either forgot something or am unaware of). What I see converging in June is as follows; the Austrian mortgage banks and banking sector, Greece, Ukraine, India, Russian sanctions, a Russian/Chinese announcement, the “very secret” TPP, and let’s not forget the second largest gold expiration on COMEX.
Since we know so little about the TPP (Trans Pacific Partnership), let’s start with this one. We know so little about it because it is being negotiated in secrecy. So “secret” in fact, anyone who gets to see what is written so far is threatened with jail time if they divulge anything about it. This harks back to Obamacare when Nancy Pelosi once giggled like a little school girl and said “we have to pass it to see what’s in it!”. Fast forward and yes, we now know what was in it, a healthcare industry in turmoil, higher premiums and a “tax” if you don’t participate… Going all the way back to NAFTA, none of these deals has been “good” for the American worker, one can only imagine how deafening that “giant sucking sound” will be that Ross Perot first heard in 1991? Not even sure how this is possible, our legislative process has been kidnapped with no ransom even requested. If this masterpiece gets unveiled in June, a wonder as to market reaction?
Next there is the Austrian mortgage bank Hypo Alpe Adria, will they make their smallish payment of 500 million euros or will they start a chain reaction? If you recall, this pinch came about when the Swiss de pegged the franc and revalued some 20-30% higher within 10 minutes, in many cases it made the loans in Swiss francs worth more than the underlying properties themselves. The southern province of Carinthia has already backed away from pledges previously made by simply saying “we can’t pay”. An important understanding is how all of these banks …own each other’s debt. In other words, the “cross ownership” of debt means that when one goes down it will act as a hit to many of the other’s portfolios. While this is not a huge trigger, all of Eastern Europe can and will be affected by what originated from the Swiss de pegging the franc from the Euro. With the system as illiquid as it is, there is no telling how far this one could reverberate?
On to Greece, they have already raided pension funds and sequestered local monies, June 5th is the deadline according to their finance minister. They owe 320 billion euros, they do not have the money to pay nor do they have a printing press to create it. The only way out is to borrow more …or default and fall into the open arms of Russia and China. The latter seems most likely to me. Greece is a natural trading partner with Russia and does sit along the “old silk road”, moving away from the U.S. and even the Eurozone seems a natural. Please remember the big “nut” here is not the 320 billion euros, it is the CDS written in multiples on their debt AND the interest rate swaps in existence, these are in the TRILLIONS, not chickenfeed in an already illiquid world!
Logically, the next one to segue into is Russia and the NATO sanctions due to expire …in June. If a vote were to be taken today, would the sanctions be re imposed? Would Germany vote for them? Will Greece vote for them if they are still a member of NATO by June? Please understand the relationship between Mrs. Merkel and Mr. Putin, they “used to” talk on the phone daily …until the NSA spying revelations of last year. Will Mrs. Merkel go for more sanctions? What will she do about further aid to Greece. Greece has the ability to ignite many things, financially and politically all bad for the West.
Moving along, let’s look at Ukraine. The IMF is seeking a restructuring (read haircut) on $10 billion worth of Ukrainian debt with private holders. This, the IMF says is necessary before another aid package of $40 billion is approved. The “haircuts” requested are in the neighborhood of 40-50%, will this one fly? Let’s not forget, Russia lent $3 billion to Ukraine in late 2013, I wouldn’t bet they will be accepting haircuts any time soon. In fact, wouldn’t it behoove Russia to watch Ukraine default …and further pressure the financial system of the West? Interestingly, John Kerry just met over the weekend with Russian minister Lavrov, what exactly did they talk about? If I had to speculate, my guess would be the U.S. has just walked away from this pink elephant. But why? Why would the U.S. walk away now?
Again, further speculation but it seems to me quite odd that Russia would announce “Chinese gold holdings” of 30,000 tons via Pravda. To rehash this, would Pravda have released this article without Moscow’s permission? Would Moscow have given permission without the approval from Beijing? Was Mr. Kerry/Obama informed that China will announce this 30,000 ton hoard of gold shortly? Is it a true story or not? As I wrote a few days ago, “gold” is a financial thermonuclear weapon, able to destroy the fiat of the West. It would not surprise me in the least if Washington was given the “courtesy” of a heads up to some sort of coming announcement even if a smaller sum than 30,000 tons. The point here is this, any announcement by China raises the question of Western holdings which of course brings Western currencies into question. It will be very interesting to see how forceful the U.S. is regarding Ukraine, this gold issue may just be the “softener”? I believe we will see very soon whether or not the U.S. changes tack regarding Ukraine (amongst others) as I suspect the Pravda announcement was no error at all.
Another June deadline is India trying to remonetize gold .They propose to allow the deposit of gold on account and interest paid on it. This would immediately boost the economy with a shot of adrenaline as collateral would be massively boosted and lending could blossom. The only problem is that this is about the 5th or 6th time such a plan has been trial ballooned and even if passed, the citizens of India will probably not go for it in masse anyway. They have a long history of holding their gold in hand with no counterparty risk between them and their gold. It might work to some extent but the number of 25,000 tons being deposited is a pipe dream. It should be said however, when China does finally announce their holdings and increase their ability to “price” global assets, the Indians will sit at the table as there is no doubt they hold massive quantities in total!
Lastly but not least important is the June gold expiration on the planet’s favorite gold “pricing” mechanism, COMEX. As of today, there are 187,500 contracts open for June; this represents 18.75 million ounces of gold or 581 tons. The “registered” for delivery category has been bled down to about 11 tons or about 378,000 ounces of gold. The first notice day is June 1st, only seven trading days away. Does anyone see a potential problem here? A “problem” as in there are 50 ounces of gold contracted for every one ounce COMEX claims to have?
Yes, yes, I know I have gone through this exercise before and each time the open interest just dried up and blew away. In fact, many expiration months have seen accounts FULLY FUNDED with cash to purchase the gold on first notice day, only to “go away” later in the month. This makes no sense whatsoever. Why would anyone fund their account fully in order to pay for purchase and then just walk away? On the other side, why would any short not deliver on the 1st or 2nd day of the month as they must pay storage costs for each day they don’t deliver? The answer of course is very simple, the gold does not exist to make delivery and the shorts do not want to let go of what very little they have …and instead cash settle with a little cherry on top? Before finishing this section, it should be pointed out that the ETF GLD has bled 17 tons over the last few weeks where gold rose $50. How does this make any sense at all? It only makes sense to me if someone needed the metal to deliver elsewhere and immediately. A strange occurrence but a topic for another day.
So there you have it, June could be quite the month as many events all converge over the 30 day timeframe, and none of them good! I have warned and warned, you must have exactly the positions you want should the markets close and not offer you the chance to alter. Please, imagine a world where things actually make sense and logic counts for something when it comes to valuing assets. Let’s call it “Mother Nature world” where values make some sense and are actually related to each other and to reality. How would your portfolio or financial position look like if we woke up one fine Monday morning in June to a brand new world?
BG1 @ 11:23
If that report is accurate and has meaning then I’m toast. Just went with SLW calls on Tues, with $gold down $18. Thought I got great prices.
Buygold @ 11:23
Yikes is right! Those must be veritable tonnes of electronic digits selling all that gold. The shorts have a Fairy devil demon in their corner.
I sure hope the Chinese end up on our side.
COT Report – Yikes
If this thing has any validity, we are in for a massive flush. Commercials add 50K gold shorts. Never seen anything like it.
The top of the SM?
Apple Watch: Epic Dud?
http://www.zerohedge.com/news/2015-05-22/apple-watch-epic-dud
Another back door bill snuck through
Got this new this morning. Go GOP not.
Senate “conservative” GOP just helped Obama become our Trade Dictator.
The bill they passed is huge, they didn’t read it and they REFUSE to tell us everything that is in it. They snuck it through on a holiday weekend. With “conservatives” like yours, who needs liberals anymore?
When will voters TRULY WAKE UP and comprehend that we need to dump both of the corrupt old parties?
http://m.dailykos.com/story/2015/05/22/1386927/-TPP-Remains-Classified-after-Trade-Transparency-Act-is-Blocked-by-Senate-Republicans
Dow futures 7 point rpw down sell execution
today was the close below the low of the high day for the sell execution on Dow futures. This is about a 65% reliable trade and may get stopped out for an 80% second attempt.
rno
GoldMoney
GoldMoney has merged with Bit Gold (XAU) on the Toronto Exchange. Neat thing about this merger is that they are going to issue a plastic debit card where you can use your Gold holdings to make purchases at places where credit/debt cards are now excepted.
Bravo.
Old timer
The baby, just another example of the police overseers inept at policing themselves. The lame excuse for their brain dead irresponsible military type actions on their own citizens is non existent unless you want to compare them to a excuse a criminal thug would give. Maybe the blacks who are also getting shot should take a look at Obama. As well as unemployment of blacks as grown since he had been in office. Until they stop turning a blind eye it will just get worse. Yeah Obama keep telling them it’s someone elses fault while giving them tanks and buying up ammo now wanting the Federlize them and making their jobs more complicated policing everything. Oh and if they need money go take it from the people and they don’t even have to charge them then lands in their pockets not the police half them time. Just making them their sacrificial sheep and where the outrage if all the cops killed by these thugs or even in news half the time. That’s not to mention all the soldiers and christians being killed or maimed over seas.
Ororeef I found through someone else that pic of the army truck convoy was in the Mid East who the prankster was that said Virgina don’t know.
old-timer
That’s a good point about the cop being an ex soldier, I would think he IS going to be quicker to shoot than someone who wasn’t military trained. On the other hand the story I heard was that he was attacked with the skateboard which I guess could be as dangerous as any heavy club. I’m not going to make any judgments until we find out more. This is the kind of situation where a body camera would be invaluable.
PS re: “IT’S THE BABY’S FAULT” Insane!
Cheers
Obama making himself the trade cazar
That’s all we need. I’m really disappointed in Cruz over this. It just shows how they say one thing do another. He’s all behind this.
Silverngold 15:30
Seems like there’s little difference between the so called conservative GOP and democrats anymore, don’t have much hope. Here we got Cruz complaint about what’s not constitutional but is all for this agreement ” as long as it goes through congress.” Well he’s not stupid and he knows since when has Obamanation listened to congress? How strong is congress. We have more republicans in seats now who in-effective has that been able to stop the obamination of traitorous anti judeo- christian and economical hostile acts against this country. More jobs will probably be lost.
@ ipso facto…
RE: The Olympia, WA police ‘action’.
IMO, this is just what we should expect.
The local TV news last night reported that the officer responsible was 3 years into his position, with prior experience in Afghanistan in the military, and with the Border Patrol.
So, where is his police training? Probably nonexistent . He was/is trained as a soldier, and he sees any opponent as an enemy. His is trained to kill enemies.
So, when policing in a non-combatant city, he still shoots first as he was trained to do, no matter that the weapon he saw was a skateboard, and that the crime was the theft of some beer.
The culprits are enemies.
Yes, they shouldn’t be stealing beer, and they shouldn’t have run (skateboarded) away.
But is it worth shooting them down like rabid dogs?
This militarization of our police will continue until the locals put a stop to it.
And, they will, probably with a lot of unrest.
As to more police excess, I offer the link to this story; an infant is determined to be at fault for it’s injuries at the hands of out-of-control cops:
http://www.theburningplatform.com/2015/05/22/its-the-babys-fault/
Things have gone horribly wrong in the USA.
It’s not the America I pledged allegiance to way back when.
silverngold @ 12:06
Re: Stevia … Well that sucks. I had thought up until today that stevia was the only sweetener without a ton of drawbacks. I wonder what the actual mechanism is that limits fertility?
Cheers
Happy Memorial Day?? Hate to break it to you!!
Reprinted from Paul Craig Roberts Website
Memorial Day
Memorial Day commemorates soldiers killed in war. We are told that the war dead died for us and our freedom. US Marine General Smedley Butler challenged this view. He said that our soldiers died for the profits of the bankers, Wall Street, Standard Oil, and the United Fruit Company. Here is an excerpt from a speech that he gave in 1933:
“War is just a racket. A racket is best described, I believe, as something that is not what it seems to the majority of people. Only a small inside group knows what it is about. It is conducted for the benefit of the very few at the expense of the masses.”I believe in adequate defense at the coastline and nothing else. If a nation comes over here to fight, then we’ll fight. The trouble with America is that when the dollar only earns 6 percent over here, then it gets restless and goes overseas to get 100 percent. Then the flag follows the dollar and the soldiers follow the flag.
“I wouldn’t go to war again as I have done to protect some lousy investment of the bankers. There are only two things we should fight for. One is the defense of our homes and the other is the Bill of Rights. War for any other reason is simply a racket.
“There isn’t a trick in the racketeering bag that the military gang is blind to. It has its ‘finger men’ to point out enemies, its ‘muscle men’ to destroy enemies, its ‘brain men’ to plan war preparations, and a ‘Big Boss’ Super-Nationalistic-Capitalism.
“It may seem odd for me, a military man to adopt such a comparison. Truthfulness compels me to. I spent thirty-three years and four months in active military service as a member of this country’s most agile military force, the Marine Corps. I served in all commissioned ranks from Second Lieutenant to Major-General. And during that period, I spent most of my time being a high class muscle-man for Big Business, for Wall Street and for the Bankers. In short, I was a racketeer, a gangster for capitalism.
“I suspected I was just part of a racket at the time. Now I am sure of it. Like all the members of the military profession, I never had a thought of my own until I left the service. My mental faculties remained in suspended animation while I obeyed the orders of higher-ups. This is typical with everyone in the military service.“I helped make Mexico, especially Tampico, safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefits of Wall Street. The record of racketeering is long. I helped purify Nicaragua for the international banking house of Brown Brothers in 1909-1912 (where have I heard that name before?). I brought light to the Dominican Republic for American sugar interests in 1916. In China I helped to see to it that Standard Oil went its way unmolested.
“During those years, I had, as the boys in the back room would say, a swell racket. Looking back on it, I feel that I could have given Al Capone a few hints. The best he could do was to operate his racket in three districts. I operated on three continents.”
Most American soldiers died fighting foes who posed no threat to the United States. Our soldiers died for secret agendas of which they knew nothing. Capitalists hid their self-interests behind the flag, and our boys died for the One Percent’s bottom line.
Jade Helm, an exercise that pits the US military against the US public, is scheduled to run July 15 through September 15. What is the secret agenda behind Jade Helm?
-The Soviet Union was a partial check on capitalist looting in the 1950s, 1960s, 1970s, and 1980s. However, with the Soviet collapse capitalist looting intensified during the Clinton, Bush, and Obama regimes.
Neoliberal Globalization is now looting its own constituent parts and the planet itself. Americans, Greeks, Irish, British, Italians, Ukrainians, Iraqis, Libyans, Argentinians, the Spanish and Portuguese are being looted of their savings, pensions, social services, and job opportunities, and the planet is being turned into a wasteland by capitalists sucking the last penny out of the environment. As Claudia von Werlhof writes, predatory capitalism is consuming the globe.
We need a memorial day to commemorate the victims of neoliberal globalization. All of us are its victims, and in the end the capitalists also.
You Can’t Make This Stuff Up!!
Stevia Hailed by Overpopulation Propagandists as an Anti-Fertility Agent?
https://www.youtube.com/watch?feature=player_embedded&v=_Y_ubswux58
And lots more here. http://truthstreammedia.com