Approximately 50 tonnes of BCV gold has been exported from Venezuela to Switzerland within the first 10 weeks of 2016. How much longer can this outflow continue? This gold is being exported by the BCV in order to participate in swaps (or maybe even outright sales) in order to provide external financing to the Venezuelan Government. The fact that the gold is being picked up by Brinks Switzerland suggests it is being brought to a Swiss gold refinery. The main reason gold is sent to Switzerland is so that it can be refined or recast.
But don't be alarmed. Deutsche Bank says you have nothing to be concerned about...
If it looks like a crash, smells like a crash, acts like a crash, is it a recovery? Here's the hard hitting evidence that you just won't find anywhere else. Just don't shoot the messenger! BoomBustBlog style research is back with a vengence.
"We're in a bear market — we can't get away from it," warned CNBC's Jim Cramer on February 5th, exclaiming that "the stock market is not working." A month later - following a 13%, almost irrepressible ramp in stocks - Cramer has changed his tune, explaining last night that "signs of a massive rally could be coming." We wonder, with contrarianism like this (combined with his confidence that "Deutsche Bank is not systemic"), is Cramer the new Gartman?
- Dow's Freakish Bounce Makes Investors Whole, Can't Erase Doubts (BBG)
- R.I.P. Dollar Rally as Dovish Fed Spurs Worst Slump Since 2011 (BBG)
- Global Currencies Soar, Defying Central Bankers (WSJ)
- Oil hits 2016 high above $42 on production and demand outlook (Reuters)
- The U.S. Is Exporting Its Oil Everywhere (BBG)
- Hillary Clinton’s Allies Launch Plan to Undercut Donald Trump Now (WSJ)
When it comes to the "here and now", which in the Fed's centrally-planned market is driven almost excusively by momentum ignition algos, complacency indeed rules (VIX 13). But even the merest glimpse into the near future, or rather how the present environment may disconnect with what may happen tomorrow, or next week, or, as the case may be, in three months, institutional investors are more concerned than ever before. But is this a confirmation that the US stock market is about to have a new "Deutsche Bank" moment?
"The jump in basis swaps is an extremely serious problem,” said Hidetoshi Ohashi, the chief credit strategist in Tokyo at Mizuho. "If it continues widening, financial firms will need to reduce their overseas holdings or diversify their investments into other regions."
German reinsurer Munich Re is boosting its gold and cash reserves in the face of the punishing negative interest rates from the European Central Bank, it said on Wednesday. Munich Re has held gold in its coffers for some time and recently added a cash sum in in the two-digit million euros, Chief Executive Nikolaus von Bomhard told a news conference. "We are just trying it out, but you can see how serious the situation is," von Bomhard said.
Former Fed Employee Avoids Jail, Gets $2,000 Fine For Stealing Fed Secrets On Behalf Of Goldman SachsSubmitted by Tyler Durden on 03/16/2016 15:20 -0400
Jason Gross was the latest former banker to make a mockery of the US judicial system when he was spared prison on Wednesday, for stealing NY Fed secrets on behalf of Goldman Sachs. Instead Gross, 37, was fined $2,000 by U.S. Magistrate Judge Gabriel Gorenstein in Manhattan and sentenced to a year of probation with 200 hours of community service after pleading guilty to a misdemeanor charge of theft of government property.
With the market already pricing in dramatically fewer rate-hikes that the "cheerleading" Fed, Deutsche Bank expects the USD to respond favorably to the FOMC’s signals on Wednesday, contrary to the pattern seen after the last four FOMC meetings with press conferences. While 'bankers' are clamoring for rate-hikes (warning of "consequences" should The Fed fail to deliver), Citi sees 5 of the 6 main drivers of Fed decision-making pointing to a hike... and an echo of Oct 2015's dip-and-rip.
"We expect the Fed to signal that it wants to continue normalizing policy, which means three hikes this year and four in 2017, with the statement referring to the risks as “nearly balanced,” reverting to phraseology used in October, just before December lift-off. Overall, our sense is that the outcome will be more hawkish than market pricing."
We suppose this shouldn't come as a surprise to anyone since it emanates from the CEO of what could turn out to be the next Lehman, but the market isn't so pleased with Deutsche Bank's John Cryan, who on Wednesday delivered the latest bad news for the German behemoth when the CEO said the bank likely would not be profitable in 2016.
Today Janet Yellen and the FOMC will go back to square one and try to reset global expectations unleashed by the ill-fated December rate "policy mistake" hike, when at 2pm the Fed will announce assessment of the economy, even if not rate hike is expected today. Just like in December the Fed will be forced to telegraph that it is hiking rates as a signal of a strengthening US, and global, economy where "risks are balanced" and hope that the subsequent global reaction will not be a rerun of what happened in January and February when confusion about the Fed's intentions led to a global market rout.
Was that it for the great February/March bear market rally?
Be careful, Deutsche Bank warns, in a reiteration of Goldman's call from Sunday: if the Fed leans hawkish causing the USD to jump and commodities to fall anew, equities won't like what they see and we could be headed back to the turmoil that kicked off the year - Draghi or no Draghi.