Hong Kong

The Guardian has released the second part of the Edward Snowden interviews with Glenn Greenwald and Laura Poitras. Snowden contemplates the reaction from the US government to his revelations and gets their play-book eerily correct.

Tonight out of Bloomberg: ": "China’s money-market cash squeeze is likely to reduce credit growth this year by 750 billion yuan ($122 billion), an amount equivalent to the size of Vietnam’s economy, according to a Bloomberg News survey. The number is the median estimate of 15 analysts, whose projections last week ranged from cuts of 20 billion yuan to 3 trillion yuan"... Two weeks ago from Zero Hedge: "The country is about to undergo an unprecedented deleveraging that could amount to over CNY1 trillion in order to force reallocate capital in a more efficient basis. That's right: a massive deleveraging coming dead ahead in China just in time to shock the market still reeling from the threat of the Fed's tapering." And here is the reason why.

Today’s AM fix was USD 1,232.75, EUR 957.40 and GBP 822.55 per ounce.
Yesterday’s AM fix was USD 1,249.50, EUR 961.15 and GBP 819.67 per ounce.

Following the most recent shift 'away' from a USD-centric world (with the China-Australia direct currency convertibility), it seems the possibility of China's Yuan as the next global reserve currency is getting closer. The Brits, Germans, and now the Swiss (who just signed a free-trade-agreement with China) are all actively vying to become Europe's Yuan trading hub as it seems the long line of developments to internationalize the currency over the past two years. As Bundesbank board member Joachim Nagel noted in a speech entitled "Reniminbi as a potential reserve currency" this week, "the Chinese currency is well on its way to becoming one of the future global reserve currencies." He noted that, although the USD is still the most commonly-used currency for settling trade with China; from virtually zero in 2010, the Yuan is used to settle over 12% of trading transactions now - and is likley to increase further.

Yesterday, infamous whistleblower Edward Snowden, stuck nearly two weeks in the transit zone of Moscow's Sheremetyevo airport, finally got some good news: first Nicaragua, then Venezuela (and moments ago Bolivia) broke the rejection letter trend, and in bombastic and very political fashion, offered him asylum (although as with everything in politics nothing is concluded until he is actually on some Latin American beach). However, a question remains: just where is Snowden right now? After all, following his initial public appearance and video with the Guardian and WaPo, there have been virtually no public sightings of him, despite his current location in one of the most public venues in the world: the Moscow airport.

So much for Iceland's bid as the world safe haven from government (and intellectual status quo) persecution. The tiny country that was such a vocal supporter of Julian Assange, and which originally was speculated as being the final destination of Snowden upon his departure from Hong Kong, has just opined on his request for Icelandic citizenship, and the answer is a resounding no, following the country's "parliament voted not to debate it before the summer recess" Reuters reports.

• Egypt Girds for Muslim Brotherhood Protests (WSJ)
• SAC Capital's Steven Cohen Expected to Avoid Criminal Charges (WSJ)
• SAC insider-trading probe could last years (Reuters)
• RBI seen selling dollars around 60.59 levels: dealers (Reuters)
• China signals will cut off credit to rebalance economy (Reuters)
• Egypt army arrests key Muslim Brotherhood figures (BBC)
• Rise in Steel Prices Alarms Buyers (WSJ)
• Draghi-Carney Seek Independence Day Break From Bernanke (BBG)
• Samsung Warns Results Will Miss Forecasts (WSJ)
• Russia Prosecutor Seeks 6 Years in Jail for Putin Critic Navalny (BBG)

Whether or not you believe PMs will serve as the ultimate store of wealth as the global fiat monetary system collapses should have absolutely no bearing on making the intelligent decision to remove your financial assets from under the domain and inevitable confiscation of global bankers and their State-run tyrannies.  Independence Day is a fine day to start the process of taking back our freedoms from the tyrants that rule over us.

Things are turning from bad to worse for the real-life version of The Terminal's Edward Snowden, who a day after applying to 21 countries for political asylum has been flooded with rejection letters near and far, even as he was forced to cancel his application to his current host nation, Russia, after being told he would have to stop leaking secrets as a condition to stay. More from the FT: "The 30-year-old fugitive’s options narrowed further on Tuesday when China reacted coolly to the idea of him moving there, Poland rejected an application and other European nations said asylum requests had to be made in the country."

For many years, the Chinese politburo had a simple solution to accusations that central planning doesn't work: just make up the economic numbers. However, a few months ago China found itself in hot water when it became impossible to pretend its manipulated numbers were even remotely credible, driven by a massive discrepancy between China exports to Hong Kong and HK imports from China. The immediate result by China, and the PBOC, as it attempted to regain some credibility was an drastic and epic move to force capital reallocation, in the process nearly wiping out its banking sector when interbank lending rates exploded to over 25%. For now, China appears to have regained some control even if the ensuing CNY1 trillion deleveraging that is imminent is sure to lead to unprecedented pain for the country that is more addicted to credit creation than any other. But in the meantime, China has once again fallen bank to doing what it does best: manipulating economic data, in this case the recently announced PMI. Only this time there is a twist: instead of goalseeking reported data to comply with some artificial reality that Beijing approves of, now China is simply flat out refusing to report numbers, period!

• Egypt on the edge after Mursi rebuffs army ultimatum (Reuters)
• Inside China's Bank-Rate Missteps (WSJ)
• Obama Urges Morsi to Respond to Protesters' Concerns (WSJ)
• How Fed’s 7% Jobless Avoids Deterring Bondholders Is Mystery (BBG)
• Obama Joins With Political Foe Bush at End of Africa Trip (BBG)
• China may introduce deposit insurance by year-end (China Daily)
• China’s Slowdown Could Slam Hong Kong (BBG)
• Government 'to ask Rothschild to advise on RBS split' (Telegraph)
• Martin Feldstein: The Fed Should Start to 'Taper' Now (WSJ)

In the end the Obama administration is not afraid of whistleblowers like me, Bradley Manning or Thomas Drake. We are stateless, imprisoned, or powerless. No, the Obama administration is afraid of you. It is afraid of an informed, angry public demanding the constitutional government it was promised — and it should be.

I am unbowed in my convictions and impressed at the efforts taken by so many.

While hardly coming as news to anyone who could have read the tea leaves as soon as Snowden boarded the plane from Hong Kong to Moscow, the flashing red headline that the NSA whistleblower has just applied to be Depardieu's neighbor, has just escalated the great US foreign policy snafu that started a month ago with the NSA spying revelations, and has since developed into a huge scandal involving Europe, Russia, China, Hong Kong, and virtually every other country (not to mention US citizens) that the US government is spying on.

• SNOWDEN ASKS FOR RUSSIAN POLITICAL ASYLUM: IMMIGRATION OFFICIAL
• SNOWDEN ASYLUM APPLICATION RECEIVED YESTERDAY: RUSSIAN OFFICIAL

And with Putin saying there is no chance he will return Snowden to the US, in response to Obama's demands, suddenly the balance of power shifts to Russia's favor (which by now it is almost certain, knows everything that Snowden does). Ball is now in Putin's court. Just where he likes it.

While the situation for Edward Snowden remains uncertain, Russian officials report that he has handed them an appeal to 15 nations for political asylum. As the LA Times reports, an official noted, "Snowden reiterated once again that he is not a traitor and explained his actions only by a desire to open the world's eyes on the flagrant violations by US special services." This somewhat desperate act follows what Russian officials describe as "Ecuador disavowing [Snowden's] political protection credentials," though we have seen nothing confirmed by Ecuador (yet) especially in light of last week's strong anti-US rhetoric. Russia's President Putin just proclaimed that "Snowden isn't, has never been a Russian agent," and added that Russia doesn't plan to extradite anyone.