Gold traded lower on Friday, moving towards a third straight week of losses on the backdrop of a recovering US economy, which prompted investors to put their money in other vehicles, while India’s plan to double the import duty on gold bullion erased some early gains. On news that Finance Minister Pranab Mukherjee proposed to double the 4% customs duty on gold from April 2012, physical dealers saw some panic buying from India, the world’s largest gold consumer. In January, India raised the gold import duty 90% and doubled the tax on silver as the government is struggling with a growing fiscal deficit and looked to increase revenues. Growing subsidies for fuel and food have left the government struggling to meet its budget target. Indian investors, who are the largest consumer group of gold in the world, rushed to buy gold in advance of the government’s plan to increase the 4% customs tax in April 2012. The resulting gains where then eroded by stronger then expected US economic growth numbers.
- Tapping oil from the SPR may be trickier than ever (Reuters)
- Why Quantitative Easing Is The Only Game in Town: Martin Wolf (FT)
- Lacker Says Fed May Need to Raise Target Interest Rate in 2013 (Bloomberg)
- Japan Debt-Financing Concern Clouds BOJ’s Bond Buying (Bloomberg) No worries - US will just buy Japan's bonds
- IMF Approves €28bn Loan to Greece (FT)
- Banks Want Fed to Iron Out 'Maiden' (WSJ)
- China 'Wealth Exodus' Underestimated (China Daily)
- Geithner Calls For Reforms to Boost Growth (FT)
- China Adds Treasuries For First Time Since July on Europe Woes (Bloomberg)
- Osborne Weighs 50p Tax Rate Cut To 45p (FT)
And so the lunacy hits a crescendo:
- U.S., U.K. AGREE TO EMERGENCY OIL STOCKS RELEASE, REUTERS SAYS
Hi China, this is Barrack, please buy our oil at firesale prices as you in turn build your strategic reserves. I have a reelection to win. Oh and when Iran attacks one of our 3 aircraft carriers parked next to Tehran in a false flag attack, at least oil will soar from a lower price point.
As Whistleblowing Becomes The Most Profitable Financial 'Industry', Many More 'Greg Smiths' Are ComingSubmitted by Tyler Durden on 03/15/2012 09:47 -0400
Minutes ago on CNBC, Jim Cramer announced that Greg Smith will never get a job on Wall Street again as "one never goes to the press. Ever." Naturally, the assumption is that the secrets of Wall Street's dirty clothing are supposed to stay inside the family, or else one may wake up with a horsehead in their bed. There is one small problem with that. Now that compensations on Wall Street have plunged, and terminations are set for the biggest spike since the Lehman collapse, the opportunity cost to defect from the club has also collapsed. And if anything, Greg Smith's NYT OpEd has shown that it is not only ok to go to the press, but is in fact cool. So what happens next? Well, as the following Reuters article reports, 'whistleblowing' over corrupt and criminal practices on Wall Street is suddenly becoming the next growth industry. Yes - people may get 'priced out' of the industry, but since the industry will likely fire you regardless in the "New Normal" where fundamentals don't matter, and where the only thing that does matter is the H.4.1 statement (as Zero Hedge incidentally pointed out back in early 2010), why not expose some of the dirt that has been shovelled deep under the coach, and get paid some serious cash while doing it?
As Goldman's Muppet-Gate moves from the pink sheets to the Today Show, the Fed-ignorer-in-chief has sent down the message to the holier-than-thou throng at JTMarlin JPMorgan that thou shalt not use the word of Greg Smith in vain. While GS once did God's work, Jamie Dimon's message to his people that "I want to be clear that I don't want anyone here to seek advantage from a competitor's alleged issues or hearsay - ever. It's not the way we do business," Reuters is reporting that Dimon's memo has been distributed to a wider audience with JPMorgan after initially being for the global operating committee. Unfortunately, as every sell-side competitor and buy-side client or prospect knows, its sheer hypocrisy since every dealer is just as likely to fall in the eat-what-you-kill, manipulate-the-Muppets, take-em-on-the-exits camp as this (now described as disgruntled) employee from Goldman so bitterly recounts. Keep up the good work and the next time we want to unwind those CDS, please don't stretch the bid-ask too far, pretty please.
South Africa's gold output fell again in January and was down a very large 11.3% in volume terms in January. Annual gold production is set to be close to 220 tonnes which is a level of gold production not seen since 1922 (see chart below). The falls were seen only in the gold market with production of other minerals holding up with total mineral production down only 2.5% compared with the same month last year. South Africa as recently as two decades ago was the world's largest producer of gold by a huge margin. Only 40 years ago South Africa produced more than 1,000 tonnes of gold per annum but will only produce some 220 tonnes in 2012. Production peaked in 1970 and has been falling steadily and sharply since. The nearly 80% fall in South African gold production has led to it being recently overtaken by China, Australia and the U.S. It is now even at risk of being overtaken by Russia. The massive 11.3% decline in South Africa was more than even that seen in December when gold output fell by 8.2%. The continuing output decline is due to many of the country's biggest gold mining operations having reached the ends of their lives and having closed down.
- Obama, Cameron discussed tapping oil reserves (Reuters)
- Greek Bonds Signal $2.6 Billion Payout on Credit-Default Swaps (Bloomberg)
- China leader's ouster roils succession plans (Reuters)
- China’s Foreign Direct Investment Falls for Fourth Month (Bloomberg)
- Greek Restructuring Delay Helps Banks as Risks Shift (Bloomberg)
- Concerns Rise Over Eurozone Fiscal Treaty (FT)
- Home default notices rise in February: RealtyTrac (Reuters)
- China PBOC Drains Net CNY57 Bln (WSJ)
- Euro zone formally approves 2nd Greek bailout: statement (Reuters)
- In a First, Europeans Act to Suspend Aid to Hungary Unless It Cuts Deficit (NYT)
- UK Chancellor Looks at 100-Year Gilt (FT) - What? No Consols?
- Hilsenrath: Fed's Outlook a Tad Sunnier - (WSJ)
- Banks Shored Up By Stress Test Success (FT)
- U.S. dangles secret data for Russia missile shield approval (Reuters)
- Wen Warns of Second China Cultural Revolution Without Reform (Bloomberg)
- Wen Says Yuan May Be Near Equilibrium as Gains Stall (Bloomberg)
- Merkel Says Europe Is ‘Good Way’ Up Mountain, Not Over It (Bloomberg)
The actual numbers were blockbusters.
Mark Fisher Accused By CFTC Of Pulling An MF Global, Depositing Customer Funds Into Non-Segregated AccountSubmitted by Tyler Durden on 03/13/2012 12:49 -0400
Mark Fisher is a staple contributor on CNBC. Or at least was. According to various headlines flashing across both Bloomberg and Reuters, it seems that his MBF Clearing Corp is the first victim of the CFTC expanding its MF Global inquiry, and Fisher's MBF Clearing Corp of performing just the same "vaporization" activity that MF Global engaged in and that boggle regulators' minds.
MBF CLEARING CORP SUED BY CFTC FOR FAILIING TO SEGREGATE FUNDS
CFTC ACCUSES MBF OF DEPOSITING CUSTOMER FUNDS INTO A NON-SEGREGATED ACCOUNT THAT ROUTINELY HELD BETWEEN $30-90 MLN
CFTC ALLEGES CUSTOMER ACCOUNTS WEREN'T PROPERLY SEGREGATED
Oops. In other news, JPM and Jon Corzine are both completely innocent of anything. But at least the CFTC can say it has done its duty of punishing transgressors and all is now well.
Reuters has been kind enough to release the "Second Economic Adjustment Programme for Greece" - a 195 page blueprint that Greece has to follow (unlike the first one, which it kinda, sorta ignored) in order for the money to keep flowing (money to bail out Europe's banks that is). We can save you the reading: below is the only chart of note. This is what the European powers expect Greek GDP to do. It needs no further commentary.
- Tainted Libor Guessing Games Face Replacement by Real Trades (Bloomberg) - so circular, self-reported data is "tainted" - but consumer confidence is great for pumping a stock market?
- Japan Sets up $12 Billion Program for Dollar Loans, Increases Growth Fund (Bloomberg)
- China Hints at Halt to Renminbi Rise (FT)
- Spain Pressed to Cut More From Its Budget (FT)
- Bailout can make Greek debt sustainable, but risks remain: EU/IMF (Reuters)
- Banks to Face Tough Reviews, Details of Mortgage Deal Show (NYT)
- U.S. and Europe Move on China Minerals (WSJ)
- Use of Homeless as Internet Hot Spots Backfires on Marketer (NYT)
- Obama administration seeks to pressure China on exports with new trade case (AP)