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Crude Fireworks
Something is spooking the reflation trade. While both gold and silver have moved decidedly higher in the past hour, little compares to the fireworks in West Texas, where crude has just gapped up a solid dollar, in what briefly appeared to be an offerless market. Furthermore the move seems contained to WTI: the move in Brent is far more cool and collected, although will likely soon follow and pass the $100 barrier. And while the disconnected between the two (north of $5 recently) has been well noted, if not completely understood, the sudden move in WTI does not seem to have an immediate catalyst: the all critical Chinese CPI/GDP/retail data is not due until tomorrow, so either someone is trying to start a HFT algo melt up in various futures markets, or fat fingers (soon to be denied) are far more prevalent than previously expected.
Incidentally the momentary move above has just wiped out another $100 billion of US GDP. While each individual $100 billion is pocket change, put 10 of these together, and soon they start to add up.
Update: the major gap appears to be merely the on the run roll...
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Buy The Pop Bitchez
your graph rolled the future. try graphing the expiration h1 explicitly.
they usually calmly beat down the dollar when chinese political events occur
Yes, reason for optimism:
http://tfmetalsreport.blogspot.com/2011/01/feeling-better.html
All that gold only bought a one week dollar hump. OUCH. Things are worse than I thought.
tyler, go here http://www.zerohedge.com/article/inflation-expectation-60-6-months-%E2%8...
600billion asia bid on the EUR and big USD sales. yeah somthing is up...
check your crosses hft's are now overbidding
Feb to March rollover.
Hot money just sloshing around with reckless abandon.
F******* China! check your wires. major sovereign sells on the USD/plus UST's.
warning shot?
More like desperation trying to prevent collapse of EUR!
Did you see the news that Ireland printed EUR worth around 25% of its GDP? If Portugal, Spain, Italy, and Greece notice this trick then the EUR is finished.
Yep.
http://www.marketwatch.com/investing/index/DXY
THE MARKET TICKER:
Forged..... Commercial Paper?Oh God, please no.....
Today, Qilu Bank is being investigated over a scandal allegedly involving $227m of forged commercial bank bills, used to provide short-term loans to business, and other forged commercial paper.
The lender, which is 20 per cent owned by Australia's Commonwealth Bank, is based in Jinan, the capital of Shandong province, in northeast China
Interesting timing with Hu Jintao on US soil today. Looks like the economic war is picking up.
.
Ireland prints 51 billion euros out of thin air and it's a non story. I think it's the jump the shark moment for the euro. Germany's got to be looking for an exit.
Discussed here first over the weekend
Accelerating Deposit Flight In Ireland Forces Irish Central Bank To Print Money Independent Of ECB
Sorry I didn't clarify. It's a non story in the main stream media. It's a huge story none the less. I'm sure the central bankers around the world are freaking out about Ireland doing this. If the EU and ECB turns a blind eye to this then it won't be long till other EU countries follow. But I kind of expect it. There's no other way to pay off all these debts.
Not really, it's just more of the same central bank monetisation. Whatever garbage the Irish central bank monetises the government explicitly guarantees, which in turn the ECB already explicitly guarantees anyhow. The quality of the ECB's collateral, being Irish government debt, is garbage now so it won't make any difference until it does.....one day.
http://www.thedailybell.com/1690/End-of-Euro-Ireland-Prints-Own-Notes.html
OH, thanks for clarifying for me. I get it now, Ireland created debt free money. All Central Banks worse nightmare. I new that was an important development but until now I didn't quit grasp it. It's starting to look like 2011's going to be one wild year.
Ireland created debt free money
No they didn't (I'm assuming you are not being sarcastic). You cannot 'create' debt free 'money'. Paper money is an obligation of the issuer, there is no way around this.
The Quarter in my pocket says United States of America on it with a material cost of about $.065 spent by our government unencumbered, the dollar bill in my pocket says Federal Reserve Note that was borrowed into existence. Big difference.
Ireland stepped beyond the smoke screen of monetization. They are in unvarnished money printing territory ala Zimbabwe and the Wiemar Republic.
How do you tell the difference from Ireland's created Euro from Germany's Central Bank issued Euro?
identical paper notes...when does the point of recognition occur?
It can run faster than her brother.
/:
lol
If he ever catches her inflation will really widen the spread.
Ireland Has a T with a check sum of 6 (or it could be 666)
it's not EUR support pe se, more like EU bond support via Asian govt buys. but china is acting braindead with japan as all it does is keep the inflation spike on oil which they net import.
Re: Brent vs WTI. A great deal of discussion on this lately in various venues.
It apparently can be attributed to pipeline issues in the US. Enbridge and others. They are making it difficult to get WTI to the customers, making it less in demand. The pipelines were designed to route Texas oil and there simply is less and less of that produced now. Brent, on the other hand, has become the most used type of oil, despite its similar depletion, simply because it can get from point A to point B. And thus, seeing more demand, its price rises disproportionately to WTI.
Oil is all powerful, but not all oil is created equal.
WTI is here in the good ol' US of A.
Brent is out there on the stormy North Sea.
Isn't there a pretty good sized $ differential just to get Brent into a US pipeline?
Yes, it is contract roll. Still... this might help to firm up the crude market:
Shell Shuts Brent North Sea Platorms After Incident, Can't Forecast Return By Eduard Gismatullin and Lananh Nguyen - Jan 18, 2011 6:49 AM CT Royal Dutch Shell Plc, Europe’s largest oil company, said it shut down production from four Brent platforms in the North Sea following an accident.“All non-essential personnel onboard the Shell-operated Brent Bravo platform in the northern North Sea returned to shore on Saturday,” Sally Hepton, a London-based company spokeswoman, said by phone today. “We have taken these actions as a precautionary measure.”
Shell declined to say when operations will resume or whether the company would have to declare force majeure on Brent crude shipments. There were no injuries, Hepton said.
Brent crude futures have advanced relative to U.S. benchmark West Texas Intermediate amid recent outages in the North Sea, such as Statoil ASA’s Jan. 11 closure of its Snorre A platform and Vigdis oil field after a gas leak. Brent crude for March rose as much as 94 cents today before erasing gains.
A 50 metric-ton bar fell from one of the rigs into the sea, Jake Molloy, regional organizer for the National Union of Rail, Maritime and Transport Workers, said by phone from Aberdeen, Scotland. Shell evacuated as many as 100 non-essential staff from the Brent Bravo platform, he said.
“We are aware of the situation and are working with Shell,” said Kevin Hegarty, a Liverpool, U.K.-based spokesman for the Health and Safety Executive.
Brent Output
The Brent field supplies about 4.5 million standard cubic meters of natural gas and 20,000 barrels of crude oil a day, equal to about 2 percent and 1 percent of the U.K.’s respective fuel needs, according to Shell.
Brent is one of the four North Sea crude varieties that compose Dated Brent, used as a benchmark to price cargoes from Europe, Africa and Russia.
Daily exports of North Sea Brent blend crude are scheduled at 135,484 barrels a day in January, according to a monthly loading program. Shipments in February are poised to increase 26.5 percent from this month to 171,429 barrels a day, the plan shows.
WTI futures were $7.14 a barrel cheaper than Brent on Jan. 14, the widest gap between the two grades in almost two years.
20K bpd is noise.
So this is not a big deal, but have a look at overall North Sea production and how it is cratering. That IS a big deal.
Stop it. You are scaring the troll again.
not a spike Ty - contract roll - you're definately losing your edge
you got a roll because Asia just went insane. major spike on oil in the next 24hrs eye 94
USD just got slaughtered, EUR went bid and oil spiked all less than 2hr of each other. why? China/Japan just bought 500billion + of EUR and caused a selling spree on the USD. gold spiked too.
This definitely didn't make it onto the US news, I just found out right now. Don't let these idiots say different, Ireland out and out needed money and couldn't get what it needed either quickly, at all or at the rates it wanted (no rates) and it decided to print up money. Then the ECB said this doesn't matter because it was so small and yada yada yada. What this is, is the signs of desperation behind the scenes. They don't know how much money they truly printed or if they will do it again. Remember, once you start down this path it's very hard to stop. And the insidious part of the trap is it makes the printer/glutton ensare itself into the trap. So Ireland does it, whats to stop the other troubled countries from printing a billion here or a billion their and/or not even reporting they are printing.
Imagine that all 50 states could print the greenback, would you want those 50 states in the union to have the ability to print the same money you have or share with the others. It would be uncontrollable and you would definitley be in hyperinflation. This is the first shot of the EU and the Euro going down. Germany wants out and after hearing about this, they can't be to happy.
Ireland's notes will be just as crisp as germany's. They have the same plates, same paper, same ink
But by Law different Serial Letters and check sums.
Ireland is T with 6 check sum
Question are all Euros created equal ? That is the Question......
The answer is soon to be ........... NO!
Euro chick fight!
Who cares about oil? The iPad2 will fly us wherever we want to go. And it will run on unicorn dust. I heard it on the conference call.
-sent from my iPad
Tyler, I love it when you give more weight to the commodities in your reporting, as I think, they are THE up market and also have a number of (not so nice though) political consequences. Besides, they don't seem to be sooo manipulated as the equities, with the two well known shiny exceptions.
QE will save us all!
The change Obama promised is here!