http://www.zerohedge.com/fullrss2.xml/wp-content/plugins/uBillboard/capitalistexploits.at/2012/01/japan-official-media-announcement en Global Debt Bubble Understated By $13 Trillion Warn BIS http://www.zerohedge.com/news/2017-09-19/global-debt-bubble-understated-13-trillion-warn-bis <p><span style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif;"><span style="font-size: 16px;"><strong><a href="http://www.goldcore.com/us/gold-blog/global-debt-bubble-understated-13-trillion-warn-bis/">Global Debt &nbsp;Bubble Understated By $13 Trillion Warn BIS</a></strong></span></span></p> <p><span style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif;"><span style="font-size: 16px;"><strong>&nbsp;</strong></span></span><strong style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">- Global debt bubble may be understated by $13 trillion: BIS</strong><strong style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><br />- 'Central banks central bank' warns&nbsp;enormous liabilities have accrued in FX swaps, currency swaps &amp; ‘forwards’<br />- Risk of new&nbsp;liquidity crunch and global debt crisis<br />-&nbsp;<em>“The debt remains obscured from view...”</em>&nbsp;warn BIS</strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/06/29/iif%20total%20debt%201_0.png" width="500" height="334" style="height: auto; max-width: 100%;" class="alignnone size-large" /></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">Global debt may be under-reported by around $13 trillion because traditional accounting practices exclude foreign exchange derivatives used to hedge international trade and foreign currency bonds, the BIS said on Sunday.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">Bank for International Settlements researchers said it was hard to assess the risk this “missing” debt poses, but that the main worry was a liquidity crunch like the one that seized FX swap and forwards markets during the financial crisis.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">The $13 trillion unaccounted-for exposure exceeds the on-balance-sheet debt of $10.7 trillion that data shows was owed by firms and governments outside the United States at end-March.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">The fact these FX derivatives do not appear on financial and non-financial institutions’ balance sheets under current accounting rules means little is known about where the debt lies.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">“The debt remains obscured from view,” Claudio Borio, head of the BIS’s monetary and economic department, and two colleagues, Robert McCauley and Patrick McGuire, said in its latest quarterly report.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">“Accounting conventions leave it mostly off-balance sheet, as a derivative, even though it is in effect a secured loan with principal to be repaid in full at maturity,” BIS said.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">Explaining the risk they added: “In particular, the short maturity of most FX swaps and forwards can create big maturity mismatches and hence generate large liquidity demands, especially during times of stress.”</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">When buying a foreign asset, a domestic investor has three choices: buy a currency forward, undertake an FX swap or do a repurchase transaction.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">But while the first two are recorded on balance sheets on a net basis without taking the notional amount into consideration, a repo transaction is recorded on a gross basis, when all these three types of trades are essentially similar - secured debt.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">All these trades are used to remove the foreign exchange risk in a purchase of foreign securities.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">In a swap, two parties exchange currencies and agree to reverse the swap later. In a forward contract the parties agree to exchange currencies at a fixed date and price in the future.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">Swaps and forwards amounted to more than $3 trillion a day last year, equivalent to more than 60 percent of total FX turnover, the BIS said. More than 90 percent of the market was in dollars and FX swaps accounted for 75 percent of the total.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">They are also overwhelmingly short-term. Three-quarters of positions had a maturity of less than a year at the end of 2016.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">Though the outstanding amount of FX swaps and forward contracts has quadrupled since the early 2000s to $58 trillion - almost three times the $21 trillion value of world trade - it dropped after the financial crisis, reflecting a drop in hedging needs as both trade and investments collapsed.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">The BIS said non-financial users employ FX forwards and currency swaps for speculation and to hedge international trade and foreign currency bonds.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">Institutional investors, asset managers and hedge funds used forwards to hedge their holdings and take positions while financial firms used swaps to hedge international bonds.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">While this debt is mostly secured as counterparties usually enter into forward transactions to reduce currency exposure, the make-up of these largely short-term transactions means they are often the most vulnerable to strains in the financial system.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">For example, European banks increased their reliance on these money market instruments during the global financial crisis to secure their dollar funding while the collapse of the structured products markets during the crisis sent shockwaves rippling through the system.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">“Markets calmed only after coordinated central bank swap lines to supply dollars to non-U.S. banks became unlimited in October 2008,” the BIS report said.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">As for who is lending the dollars to non-U.S. banks, the BIS said the funding came from U.S. banks, central banks European agencies, supranational organizations and private non-banks.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">“All of these appear to provide some funding, with U.S. banks and central banks together closing about half the gap,” it said.</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://www.reuters.com/article/us-bis-debt-currencies/global-debt-may-be-understated-by-13-trillion-bis-idUSKCN1BS0OG?il=0" target="_blank">Source: Global debt may be understated by $13 trillion: BIS - Reuters</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">Related Content</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><a href="http://www.goldcore.com/us/gold-blog/gold-good-store-value-protect-217-trillion-global-debt-bubble/" target="_blank">Gold Protect From $217 Trillion Global Debt Bubble</a></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://www.goldcore.com/us/gold-blog/debt-bubble-ireland-globally-sees-wealthy-diversify-gold/" target="_blank">Global Debt&nbsp;Bubble Sees Wealthy Diversify Into Gold</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://www.goldcore.com/ie/gold-blog/world-is-now-199-trillion-in-debt/">World Is Now $199 Trillion In Debt</a><a href="http://www.goldcore.com/us/gold-blog/debt-bubble-ireland-globally-sees-wealthy-diversify-gold/" target="_blank"><br /></a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">&nbsp;</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong>News and&nbsp;Commentary</strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://uk.reuters.com/article/global-precious/precious-gold-edges-up-as-dollar-eases-markets-brace-for-fed-meeting-idUKL4N1M007L">Gold edges up as dollar eases; markets brace for Fed meeting (Reuters.com)</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://www.marketwatch.com/story/gold-struggles-at-multiweek-lows-as-stocks-march-yet-higher-2017-09-18">Gold ends at 3-week low as U.S. stock indexes tap record highs (MarketWatch.com)</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="https://www.bloomberg.com/news/articles/2017-09-18/yen-steady-after-two-day-loss-stock-futures-rise-markets-wrap">Stocks in Asia Rise; Yen Steady After Two-Day Loss (Bloomberg.com)</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://www.reuters.com/article/us-global-markets/world-stocks-reach-new-peak-as-fed-focused-week-begins-idUSKCN1BT010">World stocks reach new peak as Fed-focused week begins (Reuters.com)</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://www.marketwatch.com/story/builder-confidence-slips-in-september-on-worries-about-labor-materials-availability-2017-09-18?mod=MW_story_latest_news">Builder confidence slips in September on worries about labor, materials availability (MarketWatch.com)</a></strong></p> <div class="mceTemp" style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"> <dl class="wp-caption alignnone" style="margin-bottom: 0px; max-width: 100%; width: 1484px;"> <dt class="wp-caption-dt"><a href="http://www.goldcore.com/ie/wp-content/uploads/sites/19/2017/09/put-to-call-advances-gold-etf.png" target="_blank"><img src="http://www.goldcore.com/ie/wp-content/uploads/sites/19/2017/09/put-to-call-advances-gold-etf.png" width="1474" height="906" style="height: auto; max-width: 100%; display: block;" /></a></dt> <dd class="wp-caption-dd" style="font-size: 14px; padding-top: 0.5em; margin-bottom: 0px; margin-left: 0px;">Source: Bloomberg</dd> </dl> </div> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://www.reuters.com/article/us-bis-debt-currencies/global-debt-may-be-understated-by-13-trillion-bis-idUSKCN1BS0OG?il=0">Global debt may be underestimated by $13 trillion, BIS warns (Reuters.com)</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="https://www.bloomberg.com/news/articles/2017-09-18/spdr-gold-etf-highlights-market-confusion-as-traders-await-fed">Largest Gold ETF Highlights Bullion Traders’ Confusion (Bloomberg.com)</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://www.zerohedge.com/news/2017-09-18/us-f-35s-b-1bs-and-korean-f-15ks-hold-mock-bombing-drills">In "Warning To Pyongyang", B-1B Bombers, F-35s Hold Mock Bombing Drills (ZeroHedge.com)</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="https://news.bitcoin.com/india-bitcoin-cryptocurrency-legal-tender/">India Considers Issuing Its Own Bitcoin-Like Cryptocurrency as Legal Tender (Bitcoin.com)</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://www.plata.com.mx/Mplata/articulos/articlesFilt.asp?fiidarticulo=322">Mexican Congress Debates the Monetization of the ‘Libertad’ Silver Ounce (Plata.com.mx)</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong>Gold Prices (LBMA AM)</strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">19 Sep: USD 1,308.45, GBP 969.30 &amp; EUR 1,091.25 per ounce<br />18 Sep: USD 1,314.40, GBP 970.16 &amp; EUR 1,100.68 per ounce<br />15 Sep: USD 1,325.00, GBP 977.32 &amp; EUR 1,109.16 per ounce<br />14 Sep: USD 1,323.00, GBP 1,002.44 &amp; EUR 1,111.58 per ounce<br />13 Sep: USD 1,332.25, GBP 1,003.85 &amp; EUR 1,112.43 per ounce<br />12 Sep: USD 1,326.25, GBP 1,000.66 &amp; EUR 1,109.41 per ounce<br />11 Sep: USD 1,338.75, GBP 1,015.31 &amp; EUR 1,114.24 per ounce</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong>Silver Prices (LBMA)</strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">19 Sep: USD 17.15, GBP 12.70 &amp; EUR 14.31 per ounce<br />18 Sep: USD 17.53, GBP 12.94 &amp; EUR 14.66 per ounce<br />15 Sep: USD 17.70, GBP 13.03 &amp; EUR 14.81 per ounce<br />14 Sep: USD 17.75, GBP 13.40 &amp; EUR 14.91 per ounce<br />13 Sep: USD 17.91, GBP 13.50 &amp; EUR 14.94 per ounce<br />12 Sep: USD 17.75, GBP 13.37 &amp; EUR 14.87 per ounce<br />11 Sep: USD 17.85, GBP 13.51 &amp; EUR 14.86 per ounce</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><br />Recent Market Updates</strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://www.goldcore.com/us/gold-blog/bitcoin-price-falls-40-3-days-underlining-golds-safe-haven-credentials/">-&nbsp;Bitcoin Price Falls 40% In 3 Days Underlining Gold’s Safe Haven Credentials</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/gold-markets-fatigued-war-talk-boils/">-&nbsp;Gold Up, Markets Fatigued As War Talk Boils Over</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/oil-rich-venezuela-stops-accepting-dollars/">-&nbsp;Oil Rich Venezuela Stops Accepting Dollars</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/massive-equifax-hack-shows-cyber-risk-deposits-investments-today/">-&nbsp;Massive Equifax Hack Shows Cyber Risk to Deposits and Investments Today</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/british-people-suddenly-stopped-buying-cars/">-&nbsp;British People Suddenly Stopped Buying Cars</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/buy-gold-long-term-fiat-money-doomed/">-&nbsp;Buy Gold for Long Term as “Fiat Money Is Doomed”</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/conor-mcgregor-worth-weight-gold/">-&nbsp;Conor McGregor – Worth His Weight In Gold?</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/gold-2-weekly-gain18-higher-ytd-trumps-debt-ceiling-deal-hurts-dollar/">-&nbsp;Gold Has 2% Weekly Gain,18% Higher YTD – Trump’s Debt Ceiling Deal Hurts Dollar</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/things-going-long-goldman-ceo/">-&nbsp;‘Things Have Been Going Up For Too Long’ – Goldman CEO</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/physical-gold-in-vault-is-true-hedge-of-last-resort-goldman-sachs/">-&nbsp;Physical Gold In Vault Is “True Hedge of Last Resort” – Goldman Sachs</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/bitcoin-falls-20-mobius-chinese-regulators-warn/">-&nbsp;Bitcoin Falls 20% as Mobius and Chinese Regulators Warn</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/precious-metals-outperform-markets-in-august-gold-4-silver-5/">-&nbsp;Gold Surges To $1338 as U.S. Warns of ‘Massive’ Military Response</a></strong><br /><strong><a href="http://www.goldcore.com/us/gold-blog/precious-metals-outperform-markets-august-gold-4-silver-5/">-&nbsp;Precious Metals Outperform Markets In August – Gold +4%, Silver +5%</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong>Important&nbsp;<span class="m_-928942620346942956il">Guides</span></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">For your perusal, below are our&nbsp;<span class="m_-928942620346942956m_5033479916755799273m_2111833215933341997il">most</span>&nbsp;<span class="m_-928942620346942956m_5033479916755799273m_2111833215933341997il">popular</span>&nbsp;<span class="m_-928942620346942956m_5033479916755799273m_2111833215933341997il">guides</span>&nbsp;in 2017:</p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://t.hsms10.com/e1t/c/*W1sFhNs6QLBySW4Rr0Hl90CHT-0/*N5MhbFRBkTqXW95dlRy194d-P0/5/f18dQhb0S5ft8X-f1rW8cCGTT51FcdHN5s9DSvWrM1ZW3MpzC43frry_W8r4Kht63lH28W1lQSSc8y_DL1W8z_p0c67hcl-W1qMTKP5xLd3bN8zTG51RBdNtW3L39B54P7Fz2W8rCHmp3PnStQVS9p0b63dhWbW8mp0Tc5x5KNkW7-XB_567h1CPW8r5PXz49z-4PN2MV0Xm5w8jDW1mw3yc59SFsZN4H-tjrQC5z2VPC2cV7gvpc4W4XYhBl2y9PQJW4sxqtN7h5hQFW28TbSB2Cg_LLW96LzRy5DkRJDW5BRXXj2y4Lc7N3Kd2SV_-Nf6W3brNsz66rKFTW2xH0xz1lcG1VVQBGcH5DQdGhN22JjmzdPgQwW9464-Y5GFs9DW4Rj6Nh6BzJrnN45Ly2MkwRN4W8qYMH51FnsVDW2X9_p02MVHnbN2GZdYq215_BW1J7MZd3mgJK7W4F32xR1JjtM5W4Bn5JG3ZzLH2W5jL56q7dkHC7W3VtW1b1MWhN-W1MKd944yqBfl111" target="_blank">Essential&nbsp;<span class="m_6690301754972839650m_5033479916755799273m_2111833215933341997il"><span class="m_6690301754972839650il">Guide</span></span>&nbsp;To Storing Gold In Switzerland</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://t.hsms10.com/e1t/c/*W1sFhNs6QLBySW4Rr0Hl90CHT-0/*W5Hh19S2J1j6jW1gxPj45yTRLt0/5/f18dQhb0S5fw8X-fbXW8cCGTT51FcdHN5s9DSvWrM1YW3MpzC43frry_W8r4Kht63lH28W1lQSSc8y_DL1W8z_p0c67hcl-W1qMTKP5xLd3bN8zTG51RBdNtW3L39B54P7Fz2W8rCHjG25x99KVwyMQc6PVJWyW625bx16Gj8TSW6bVy-525hjVhW83KHrF7J39qHN2m8DqKmmF0wW1jsTjn5VDnrHVbq5fx4TKc2lW6Rjg6t5Pk17jW2xZzRk8LpcPpW36k5sF4FnHNZW1mvfQB2BpzSjN1mT8mr2g4dYW5VZ-P_37vq3BW2--Tfh1w3GzfW5CkFpW6ZccdyW5vvKY_3N2S6fW3KRSNH8yxr7CW7YJp821cQlwRW63x06S1bBvW3W408wWR11rnNbV4Vjkz6NjfdLW55Fr2P5nn1d6W301cwV4GX00sW5hfR428jJDdkW4Cy2w54wj2JxVMFy4w4hyJQMV6N2-D1mPRd4N6YRN0Y4ZDMLD2LMBk7BT1f5Fq5PC03" target="_blank">Essential&nbsp;<span class="m_6690301754972839650m_5033479916755799273m_2111833215933341997il"><span class="m_6690301754972839650il">Guide</span></span>&nbsp;To Storing Gold In Singapore</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;"><strong><a href="http://t.hsms10.com/e1t/c/*W1sFhNs6QLBySW4Rr0Hl90CHT-0/*W7dc5x_8dXcz0W57pb-W8yRfPY0/5/f18dQhb0Sjv98X-fhGW8cCGTT51FcdHN5s9DSvWrBCVW3MpzC43frry_W8r4Kht63lH28W1lQSSc8y_DL1W8z0sTg7mCbb0W57V1HT7tVHF9W8Z32tg35s628W859LV685kgn-W5mG2963qCNtmW8hTG4j5Zh496W2d551v3pNnKLVLrb9R83_Pn-W7JCxGl81bhDKW7N_KqM11GBXTW41TlcR3TwTqzW19BjML1ks0KjW7RPZVs5-2sjBW7ZzDyK7GLjPjW2KH_vB6SdpRZW1hx1p11Gg3W9W6rwy5K1YZKs5W2gFslL6NqPjwW1tbMwf7n90PHW67SS1j224DVBW6SdFBY1S1FW8W1Th1-Q1X2dwGW1swLvy81myPRW1B9M4Q6SdHPtW7C3gqS89xKZ9W1Ms6WG19gjwJN42ktpLPs031VgkKmy5qqk_FW41Q13s3srYmmW2-yGlm4v9PYhVmLW2J4r5l5jW7fnqv3187HWVW794lJw3T7yBDW1Zq0mT90vVQHW7SNfQy7BfhjRN3QzSrFQN_TjVcGblm3cFvNY0" target="_blank">Essential&nbsp;<span class="m_6690301754972839650m_5033479916755799273m_2111833215933341997il"><span class="m_6690301754972839650il">Guide</span></span>&nbsp;to Tax Free Gold Sovereigns (UK)</a></strong></p> <p style="color: #333333; font-family: Georgia, &quot;Times New Roman&quot;, &quot;Bitstream Charter&quot;, Times, serif; font-size: 16px;">Please share our research with family, friends and colleagues who you think would benefit from being informed by it.</p> http://www.zerohedge.com/news/2017-09-19/global-debt-bubble-understated-13-trillion-warn-bis#comments BIS Bitcoin Business Central Banks Counterparties Currency swap Debt Ceiling Derivative Economy Finance Financial crisis of 2007–2008 fixed Foreign exchange market Foreign exchange option Foreign exchange swap goldman sachs Goldman Sachs Hedge India Institutional Investors Mexican Congress Monetization Money Precious Metals Reuters Secured Debt Sovereigns Swap Switzerland Systemic risk US Federal Reserve World Trade Yen Tue, 19 Sep 2017 11:44:43 +0000 GoldCore 603756 at http://www.zerohedge.com Euro Tumbles On Report ECB Is "Concerned And Divided" Over End To QE http://www.zerohedge.com/news/2017-09-19/euro-tumbles-report-ecb-council-disagrees-over-end-qe <p>Talk 'em up, then slam 'em down. </p> <p>The familiar pattern of "clear and transparent" central bank communication was on full display moments ago, when following months of build up to an ECB taper announcement, the ECB used its favorite mouthpiece, Reuters, to "trial balloon" that an ECB decision over whether to announce a firm end-date to the central bank's bond buying could be "put off until December" as a result of disagreement among the ECB council stemming from "concern over Euro strength" which is leading to "uncertainty and divide within the council." </p> <p>As a result, some within the ECB want to be able to "extend or expand" buys if needed, in other words if the EURUSD rises too far above 1.20. </p> <p>The highlights from Reuters:</p> <ul> <li>CONCERN OVER EURO STRENGTH IS LEADING TO UNCERTAINTY AND DIVIDE WITHIN ECB COUNCIL - SOURCES</li> <li>ECB POLICYMAKERS DISAGREE ON WHETHER TO SET FIRM END-DATE FOR BOND-BUYING PROGRAMME IN OCT - SOURCES</li> <li>SOME ECB RATE SETTERS WANT TO BE ABLE TO EXTEND OR EXPAND BUYS IF NEEDED - SOURCES</li> <li>SOME ELEMENTS OF ECB DECISION COULD BE PUT OFF UNTIL DEC - SOURCES</li> </ul> <p>And the <a href="https://uk.reuters.com/article/uk-ecb-policy-bonds/ecb-may-keep-open-option-to-prolong-bond-buying-again-in-2018-sources-idUKKCN1BU1G6?il=0">full report</a>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>European Central Bank policymakers disagree on whether to set a definitive end-date for their money-printing programme when they meet in October, raising the chance that they will keep open at least the option of prolonging it again, six sources told Reuters. <strong>A stubbornly strong euro, with its dampening effect on inflation, is driving a rift among ECB policymakers, </strong>the sources on the ECB’s Governing Council with direct knowledge of its thinking said. </p> <p>&nbsp;</p> <p><strong>The split is between ‘hawks’ -- led by richer, northern countries such as Germany -- who are ready to wind down the 2.3 trillion euros bond-purchase programme and ‘doves’ who simply want to reduce its monthly pace, the sources said. </strong></p> <p>&nbsp;</p> <p><strong>This is raising the likelihood that they will seek a compromise solution on Oct. 26, whereby any end-date for purchases would not be set in stone, or that they will put off part of the decision until December, </strong>the sources added. </p> <p>&nbsp;</p> <p>The main point of contention is <strong>the euro’s continued appreciation against major currencies, which is threatening to curb inflation in the euro zone by making its imports cheaper and exports dearer</strong></p> </blockquote> <p>In immediate kneejerk reaction, the EURUSD tumbled from 1.1990 to as low as 1.1960 as traders scratch their heads just how will the ECB extend QE indefinitely when it is running out of bonds to buy, and wondering if the ECB will pull a BOJ and buy ETFs next as Reuters also "trial ballooned" back in 2016.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/EURUSD%20tumbles_1.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/EURUSD%20tumbles_0.jpg" width="500" height="229" /></a></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="654" height="300" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/EURUSD%20tumbles.jpg?1505820921" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-19/euro-tumbles-report-ecb-council-disagrees-over-end-qe#comments Bank of Japan Benoît Cœuré Bond Central bankers Currency ECB council ECB’s Governing Council Economy of Europe Economy of the European Union Euro European Central Bank European Central Bank European Central Bank European System of Central Banks European Union Eurozone Germany Reuters Tue, 19 Sep 2017 11:37:18 +0000 Tyler Durden 603755 at http://www.zerohedge.com Norway's Sovereign Wealth Fund Hits $1 Trillion For First Time Ever http://www.zerohedge.com/news/2017-09-19/norways-sovereign-wealth-fund-hits-1-trillion-first-time-ever <p><em>Content originally published at <a href="http://ibankcoin.com/">iBankCoin.com</a></em></p> <p>For the first time ever, Norway's sovereign wealth fund, which was launched 20 years ago to invest their oil money, has surpassed $1 trillion.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>"I don't think anyone expected the fund to ever reach 1 trillion dollars when the first transfer of oil revenue was made in May 1996. Reaching 1 trillion dollars is a milestone, and the growth in the fund's market value has been stunning", said Yngve Slyngstad, chief executive officer at Norges Bank Investment Management.<br /> &nbsp;<br /> The fund's administrators said that on Tuesday 19 September 2017 at 2:01 a.m. local time, the fund value hit $1,000,000,000,000, or $1 trillion, for the first time.<br /> &nbsp;<br /> The bank said a strengthening of the world's major currencies against the U.S. dollar combined with strong equity markets during 2017 had rapidly increased the U.S. dollar value of the pooled capital.</p></blockquote> <p>&nbsp;<br /> The fund is broadly diversified and is very open about how the money is invested. If you're interested in the details, check <a href="https://www.nbim.no/en/the-fund/holdings/?fullsize=true">here</a>.<br /> &nbsp;<br /> The fund is ~65% long equities, upwards of 30% fixed income and a little real estate.<br /> <a href="https://ibankcoin.com/flyblog/files/2017/09/norges.png"><img src="https://ibankcoin.com/flyblog/files/2017/09/norges.png" alt="" width="600" height="440" class="alignnone size-full wp-image-72402" /></a></p> <p>Norway's GDP for 2016 was $370 billion, or $70k per capita.</p> <p>Here's the top countries, sorted by highest GDP per capita.</p> <p><a href="https://ibankcoin.com/flyblog/files/2017/09/per.png"><img src="https://ibankcoin.com/flyblog/files/2017/09/per.png" alt="" width="600" height="568" class="alignnone size-full wp-image-72403" /></a></p> http://www.zerohedge.com/news/2017-09-19/norways-sovereign-wealth-fund-hits-1-trillion-first-time-ever#comments Business Equity Markets fixed Government Pension Fund of Norway Investment Management Norges Bank Norges Bank Norway Real estate Yngve Slyngstad Tue, 19 Sep 2017 11:34:59 +0000 The_Real_Fly 603754 at http://www.zerohedge.com Toys "R" Us Files Chapter 11: Second Largest US Retail Bankruptcy In History http://www.zerohedge.com/news/2017-09-19/toys-r-us-files-chapter-11-second-largest-us-retail-bankruptcy-history <p>Toys “R” Us Inc., the largest US "brick and mortar" toys retailer, filed for bankruptcy late on Monday night, as a result of a crushing post-LBO debt load and relentless competition from warehouse and online retailers, the "latest blow to a retail industry reeling from store closures, sluggish mall traffic and the gravitational pull of Amazon.com" according to <a href="https://www.bloomberg.com/news/articles/2017-09-19/toys-r-us-files-for-bankruptcy-crushed-by-online-competition">Bloomberg</a>.&nbsp; The Chapter 11 filing is among the largest ever by a specialty retailer and <strong>casts doubt over the future of its about 1,600 stores and 64,000 employees</strong>. It comes just as Toys ‘R’ Us is gearing up for the holiday shopping season, which accounts for the bulk of its sales, and as vendors halt shipments to the now insolvent retailer.</p> <p>With assets of $6.9 billion, <strong>it’s the second-largest retail bankruptcy, trailing the filing in 2002 by Kmart, which had $14.6 billion in assets.</strong></p> <p>The company was saddled with debt from a $6.6 billion buyout in 2005 led by KKR, Bain Capital and Vornado Realty Trust. Toys ‘R’ Us has bonds coming due over the next few years that lost most of their value this month. </p> <p>&nbsp;</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/2017-09-18%20%282%29.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/2017-09-18%20%282%29_0.jpg" width="500" height="262" /></a></p> <p>“While today’s decision does not necessarily mean it is game over for Toys ‘R’ Us, it brings to a close a turbulent chapter in the iconic company’s history,” said Neil Saunders, managing director of GlobalData Retail. </p> <p>“What they have going for them is they are the last major player in their market,” said David Berliner, a partner and restructuring specialist with BDO Consulting. “The vendors don’t want to see them fail, so I think they have a good opportunity to survive.” </p> <p>The company listed debt and assets of more than $1 billion in its Chapter 11 filing submitted Monday at the U.S. Bankruptcy Court in Richmond, Virginia (an odd place for such a major bankruptcy filing). Prior to filing, the company said that it had secured more than $3 billion in financing from lenders including a JPMorgan Chase &amp; Co.-led bank syndicate and certain existing lenders to fund operations while it restructures. The money will be critical to provide comfort to Toys "R" Us vendors that they will be paid on time. Yesterday the stocks of some key suppliers such as Hasbro and Mattel were hit in advance of the filing.</p> <p>When reports surfaced recently that Toys “R” Us was weighing a bankruptcy filing, Chinese toy scooter maker Pinghu Mijia Child Product Co. put all of the retailer’s orders on hold, fearing it wouldn’t get paid, according to sales manager Justin Yu, Bloomberg reported. The toy retailer represents about 10 to 20 percent of the Chinese supplier’s sales. “We were shocked to hear the news last week because their orders to us have been rising every year, so we did not know they were in trouble,” Yu said. “They’re a major buyer and I would say that the majority of toy makers in China would have some contracts with them.”</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>The bankruptcy filing by the company also may have global implications, especially for Chinese toy manufacturers. <strong>Some 38 percent of the company’s revenue came from overseas markets in the latest fiscal year</strong>. “It’s a loss for the long-term benefit of the entire industry,” said Lun Leung, chairman of Hong Kong-based Lung Cheong Group, a toy supplier for Hasbro Inc. He said Toys “R” Us accounted for less than 5 percent of the group’s sales.</p> </blockquote> <p>“We expect that the financial constraints that have held us back will be addressed in a lasting and effective way,” Chief Executive Dave Brandon said. “Together with our investors, our objective is to work with our debtholders and other creditors to restructure the $5 billion of long-term debt on our balance sheet.” </p> <p>The company's Canadian unit intends to seek protection in parallel proceedings under the Companies’ Creditors Arrangement Act (CCAA) in the Ontario Superior Court of Justice, Toys ‘R’ Us said in a statement. Operations outside of the United States and Canada, including about 255 licensed stores and joint venture partnerships in Asia, which are separate entities, are not part of the bankruptcy proceedings, Toys ‘R’ Us said. </p> <p>As an indication of the challenges faced by the struggling retailer, the company opened a temporary store in New York City’s Times Square this year to capture more holiday shoppers, almost two years after it closed its flagship store barely a block away, driven out by high rents. </p> <p>More than a dozen significant retail chains have filed for bankruptcy this year. Among them were Perfumania Inc, apparel chains rue21 Inc and Gymboree Corp, discount shoe chain Payless Holdings LLC and designer clothing chain BCBG Max Azria Global Holdings LLC. </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/reorg%20first%20day%20ytd.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/reorg%20first%20day%20ytd_0.jpg" width="500" height="472" /></a></p> <p>The shakeout is also reverberating across American malls and shopping districts. More than 10 percent of U.S. retail space, or nearly 1 billion square feet, may need to be closed, converted to other uses or renegotiated for lower rent in coming years, according to data provided to Bloomberg by CoStar Group.</p> <p>Major retailers including Macy’s and Sears Holding have closed hundreds of locations as they struggle to compete discounters such as Wal-Mart and Amazon.com. Amazon’s recent acquisition of high-end grocer Whole Foods Markets Inc stirred speculation that the online giant will use its pricing power and huge reach among U.S. consumers to go after market share of traditional brick-and-mortar grocers. </p> <p><em>The company's full bankrtupcy filing is below:</em></p> <p><iframe src="https://www.scribd.com/embeds/359309842/content?start_page=1&amp;view_mode=scroll&amp;access_key=key-lNMmSOdX72pEcLjRrWSv&amp;show_recommendations=true" width="100%" height="600" frameborder="0" scrolling="no"></iframe></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="1024" height="587" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/toys%20r%20us%20closing_1.jpg?1505819859" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-19/toys-r-us-files-chapter-11-second-largest-us-retail-bankruptcy-history#comments Babycare Bain Bain Capital Bankruptcy Bankruptcy in the United States BCBG Max Azria Business Chapter 11, Title 11, United States Code China Creditors Economy of the United States Fail Finance Gymboree JPMorgan Chase KKR Li & Fung Market Share Ontario Superior Court of Justice Private equity Sears Toys "R" Us U.S. Bankruptcy Court Wayne, New Jersey Tue, 19 Sep 2017 11:22:22 +0000 Tyler Durden 603753 at http://www.zerohedge.com Global Equities Hit New All Time High Ahead Of The Fed; VIX < 10; Japan Stocks Surge http://www.zerohedge.com/news/2017-09-19/global-equities-hit-new-all-time-high-ahead-fed-vix-10-japan-stocks-surge <p>S&amp;P futures are little changed as the Fed begins its two-day FOMC meeting pushing the VIX below 10, down 1.3% and falling for the 7th day; European shares are lower as is the dollar while Japanese stocks soar on the back of a tumbling yen as a snap election in Japan now appears imminent. Despite the cautious action ahead of the Fed, the The MSCI All-Country World Index rose 0.1% to a new record high. </p> <p>Among the notable overnight moves, the USDCNH climbed to highest since late August ahead of this week’s FOMC decision. Ten-year Treasury yields fell 1 bp; Australia’s 10-year gained 1 bp. Japanese equities rose 1.5% ahead of an expected snap election to be called by PM Abe this week; China and Hong Kong shares declined. WTI crude holds just below $50; Dalian iron ore contract dropped. The Bloomberg Dollar Spot Index was little changed before tomorrow’s Fed’s policy decision, when interest-rate projections are seen drawing more attention than any balance-sheet announcement as tapering is seen as a given. The euro was supported by unwinding of shorts against the pound and by yen selling amid improved risk appetite and reports of Japan PM Abe calling for snap elections. Treasuries were underpinned in Asian hours as Japanese investors returned after Monday’s holiday, while price action was muted in London trading.</p> <p>Meanwhile, nobody appeared concerned about tomorrow's Fed announcement, where the balance sheet unwind is expected while attention will focus on any revision to the Fed's dots. “We are not overly concerned about” the Fed’s quantitative-tightening plans, Merrill Lynch and U.S. Trust head of fixed-income strategy Matthew Diczok told Bloomberg TV. “If you model it out, over about the next three years they’ll take out about $1.3 trillion or so. That’s only a third of what they put into the market. So it’s going to be very slow, very gradual, very deliberate and it shouldn’t lead to any near-term fireworks into the market at all.”</p> <p>Following the recent improvement in data, December rate hike odds once again rose back to 50%, suggesting another rate hike may be possible this year.</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/dec%20possible.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/dec%20possible_0.jpg" width="500" height="281" /></a></p> <p>JP Morgan Asset Management portfolio manager Iain Stealey said markets were now fully set for the Fed to officially announce it will cut, or taper, the amount it re-invests from the profits of its $4.2 trillion crisis-era bond portfolio. “They have already announced the amounts they are going to start with, $10 billion on a monthly basis and probably starting over the next month or so,” Stealey said. “What may be more important to keep an eye on is the dot-plot. We still think they will have the dots set up to expect one more hike this year, which will obviously be in December, and three next year.”</p> <p>With little in terms of overnight newsflow, the highlight was Japanese shares which surged to <strong>their highest level in more than two years as the yen weakened for a third day, </strong>bolstering appetite for electronics makers, autos and banks. Japanese equities gained on expectations Prime Minister Shinzo Abe will call a snap election. As reported on Sunday, Prime Minister Abe is considering calling a poll for as early as next month to take advantage of his improved approval ratings in the wake of the North Korea crisis, and disarray in the main opposition party, according to sources. The benchmark Topix index extended gains after capping its best week since April on Friday, as investor focus shifted to economic fundamentals from concerns over North Korea. <strong>The yen dropped to an almost two-month low against the dollar Tuesday. </strong></p> <p><strong></strong>Abe said Monday he’ll decide on calling a snap election after he returns from a trip to the U.S., <a href="http://www.zerohedge.com/news/2017-09-17/yen-weaker-after-abe-decides-hold-snap-elections">confirming our previous report </a>that he’s considering calling a vote a vote more than a year early, prompting speculation for more fiscal stimulus while keeping the BOJ on hold. “The weaker yen is providing tail wind to export-related stocks” after the market shrugged off the North Korea’s missile launch last week, Hiroaki Hiwada, a strategist at Toyo Securities told Bloomberg. “The equity market is taking the news about a possible snap election positively as it boosts expectations Abe’s coalition parties will retain power.” As a result, "Japanese shares generally gain around calls to hold new elections", Nomura Securities wrote in a report. </p> <p>Stefan Worrall, director of Japan equity sales at Credit Suisse in Tokyo said there has been concern growing for a while among foreign investors about the future of Abe’s stimulus-focused Abenomics program. “If Abe is cemented in power for another few years, that would be a market-positive event,” he said. “Certainty is preferred to uncertainty, when it comes to market confidence.”</p> <p>The Nikkei’s 2 percent jump overnight took its gain to almost 30 percent since Abe took power in late 2012.</p> <p>Another notable overnight move was <a href="http://www.zerohedge.com/news/2017-09-18/offshore-yuan-tumbles-2-week-lows-biggest-drop-election">the sudden drop in the yuan</a>, where the CNH tumbled to a two-and-a-half week low as a state-run firm was said to be buying dollars to make dividend payments. The onshore yuan dropped as much as 0.34% to 6.5987 per dollar and was down 0.12% at 6.5838 as of this morning. In addition to the currency move, the PBOC pumps in net 150b yuan ($23b) via reverse- repurchase agreements, after adding 300b yuan Monday. </p> <p><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/09/18/20170918_cnh_0.jpg" width="500" height="260" /></p> <p>Elsewhere in Asia the mood had been more subdued. South Korean shares dipped 0.1 percent, against a backdrop of caution ahead of the Fed meeting as well as continuing tensions on the Korean peninsula. The MSCI Emerging Market Index decreased 0.3 percent, the largest dip in more than two weeks. Asian stock traded cautiously ahead of the FOMC and as the region failed to maintain the early impetus from US where financials led the S&amp;P 500 and DJIA to fresh record closes. Australia's ASX 200 (-0.1%) and Nikkei 225 (+2.0%) were positive in which the latter surged as it played catch up to the gains on return from holiday, while weakness in defensive stocks restricted upside in Australia. Shanghai Comp. (-0.2%) and Hang Seng (-0.4%) were dampened despite another firm PBoC liquidity operation, with the underperformance in China the rest of the region attributed to profit taking. <strong>The PBOC injected net 150b yuan in open-market operations on Tuesday, bringing the additions since last Thursday to 750b yuan</strong>. 10yr JGBs lacked demand amid the positive risk tone in Japan and although the BoJ were present in the bond market, this was for a relatively reserved JPY 535bln total. </p> <p><strong>In Europe, the Stoxx Europe 600 Index was fractionally in the red, amid mixed regional benchmarks. Gauges from Hong Kong to South Korea had retreated earlier, even as Japan soared following a holiday on Monday. </strong>Germany’s DAX Index decreased 0.1 percent while the U.K.’s FTSE 100 Index rose 0.2%. The pound reversed an advance as investors weighed the latest political disarray over Brexit strategy, and the euro headed for a fourth daily advance.&nbsp; Elevated risk appetite in Europe meanwhile saw the gap between Portuguese and Italian 10-year government bond yields narrow to levels not seen since the start of the euro zone debt crisis of 2010-2012. That followed a strong rally in Portuguese debt over the last two sessions, after S&amp;P became the first major ratings agency to give the country back an investment grade rating, more than five years after it first sank into junk territory.</p> <p>In currencies, Britain's sterling also started to retreat again having been pushed off post Brexit highs on Monday by Bank of England governor Mark Carney who said any upcoming UK rate hikes would be gradual and limited. The Bloomberg Dollar Spot Index fell less than 0.05 percent. The euro increased 0.2 percent to $1.1978, the strongest in more than a week. The British pound decreased 0.1 percent to $1.3477.</p> <p>In commodity markets, metals shifted lower and oil prices steadied near last week’s multi-month highs. Traders braced for a potential stockpile build-up expected later this week, limiting the prospect for further gains. U.S. crude futures were up 19 cents at just above $50 per barrel, within sight of Thursday’s nearly four-month high of $50.50. Brent crude hovered at $55.50, not far from an almost five-month high of $55.99 it had marked that day.</p> <p>In rates, the yield on 10-year Treasuries fell one basis point to 2.22 percent, the largest fall in more than a week. Germany’s 10-year yield declined one basis point to 0.45 percent, the biggest fall in more than a week. Britain’s 10-year yield declined two basis points to 1.281 percent, the largest fall in more than a week.</p> <p>On the news front, President Trump is scheduled to address the United Nations on Tuesday for the first time as world leaders continue to seek a diplomatic solution to North Korea’s nuclear provocations. Data include August housing starts and 2Q current account. Adobe, AutoZone, Copart, FedEx are among companies reporting earnings. The Iraq Oil Minister said he does not think now that there is a need for more output reductions, but if there was a need for more cuts in the future, Iraq will support consensus within OPEC, Adding, that there are proposals for more cuts, but he does not think it will be implemented, but will be studied.</p> <p><strong>Bulletin Headline Summary</strong></p> <ul> <li>European bourses trade with little in the way of firm direction ahead of upcoming risk events this week</li> <li>GBP/USD saw some selling pressure early doors with initial gains in USD/JPY trimmed throughout the session</li> <li>Looking ahead, highlights include NZ Dairy Auction and US APIs</li> </ul> <p><strong>Market Snapshot</strong></p> <ul> <li>S&amp;P 500 futures little changed at 2,503.20</li> <li>VIX Index down 1.3%, falling for the 7th day</li> <li>STOXX Europe 600 down 0.1% to 381.66</li> <li>MSCI Asia up 0.5% to 164.03</li> <li>MSCIA Asia ex Japan down 0.3% to 543.02</li> <li><strong>Nikkei up 2% to 20,299.38</strong></li> <li><strong>Topix up 1.8% to 1,667.88</strong></li> <li>Hang Seng Index down 0.4% to 28,051.41</li> <li>Shanghai Composite down 0.2% to 3,356.84</li> <li>Sensex up 0.09% to 32,453.75</li> <li>Australia S&amp;P/ASX 200 down 0.1% to 5,713.58</li> <li>Kospi down 0.09% to 2,416.05</li> <li>German 10Y yield fell 0.6 bps to 0.449%</li> <li>Euro up 0.3% to $1.1984</li> <li>Italian 10Y yield fell 0.6 bps to 1.78%</li> <li>Spanish 10Y yield fell 1.4 bps to 1.573%</li> <li>Brent futures up 0.3% to $55.67/bbl</li> <li>Gold spot little changed at $1,308.52</li> <li>U.S. Dollar Index down 0.2% to 91.87</li> </ul> <p><strong>Top Overnight News</strong></p> <ul> <li>EU wants the Paris-based regulator European Securities and Markets Authority to get a bigger role in reviewing fund managers’ activities, Financial Times reports, citing plans seen</li> <li>Japanese Prime Minister said he is considering dissolving parliament to hold a snap general election, ruling Liberal Democratic Party Secretary General Toshihiro Nikai told reporters in Tokyo; Abe to express his intention to dissolve the Lower House at a press conference on Sept. 25, FNN reports, without attribution</li> <li>French President Macron is planning to provide details on his proposals for euro-zone reforms in a speech on the future of EU on Sept. 26, FT reports, citing unidentified aides; proposal includes a separate budget, a finance ministry and a European Monetary Fund</li> <li>Norway’s sovereign wealth fund hit $1 trillion for the first time on Tuesday, driven higher by climbing stock markets and a weaker U.S. dollar</li> <li>Germany ZEW Sept. survey expectations 17 vs est. +12</li> <li>Toys ‘R’ Us Seeks Bankruptcy, Crushed by Debt and Online Rivals</li> <li>BNP Among Firms Said to Be Eyeing Axa Asset- Management Tie-Up</li> <li>Mexico’s Femsa Sells $3 Billion Stake in Brewer Heineken</li> <li>Park Hotels Is Said to Seek Over $500 Million for 15 Properties</li> <li>Bayer Sees Monsanto Transaction Closing Delayed to Early 2018</li> <li>Wall Street’s Bond Gurus Have It All Wrong as QE Unwind Looms</li> <li>Trump at UN to Urge Action on North Korea, Iran Threat; U.S. to Act on North Korea Rockets That Pose Threat, Mattis Says</li> <li>Maria Weakens as Storm Passes Dominica on Way to Puerto Rico</li> <li>Brexit Rift Widens as Johnson Talks of Life After Government</li> </ul> <p><strong>Asia equity markets traded with a cautious tone as the FOMC draws closer </strong>and after the region failed to maintain the early impetus from US where financials led the S&amp;P 500 and DJIA to fresh record closes. ASX 200 (-0.1%) and Nikkei 225 (+2.0%) were initially positive in which the latter surged as it played catch up to the gains on return from holiday, while weakness in defensive stocks restricted upside in Australia. Shanghai Comp. (-0.2%) and Hang Seng (-0.4%) were dampened despite another firm PBoC liquidity operation, with the underperformance in China the rest of the region attributed to profit taking. 10yr JGBs lacked demand amid the positive risk tone in Japan and although the BoJ were present in the bond market, this was for a relatively reserved JPY 535bln total. PBoC injected CNY 130bln via 7-day reverse repos and CNY 20bln via 28-day reverse repos. PBoC set CNY mid-point at 6.5530 (Prev. 6.5419). <strong>Japanese PM Abe is told hold a press conference on Monday 25th September; comes in the context of recent speculation that he could call a snap election. <br /></strong></p> <p><em>Top Asian News</em></p> <ul> <li>Hong Kong Dollar Surges With Hibor Rates as HKMA Mops Up Cash</li> <li>Goldman Sachs Names Hitchner Chairman, CEO Asia-Pacific Ex- Japan</li> <li>Markets Are Betting That Japan’s Abe Would Win a Snap Election</li> <li>Alibaba Is Said to Buy $100 Million in Best Inc.’s Downsized IPO</li> <li>Tata Is Said to Be Boosting Carmaker Stake for $312 Million</li> </ul> <p><strong>European equity markets trade in subdued fashion, </strong>as much anticipation remains on the FOMC tomorrow. EU bourses are mixed for the session, failing to gather any bullish impetus from another record close on Wall Street, not helped by a morning bullish grind in the Euro. Equity specific stories have also dragged down markets, noticeably, Heineken is a leading faller, down close to 4%, after bottler and retailer Femsa has sold a 5.24% stake in the firm. Kantar and Nielsen released their 12-week supermarket sales, helped lead to Sainsbury’s and Morrisons to be two of the out-performers in the FTSE. The grocer optimism has not spread however, with despite what appeared to be strong results for Ocado, the concerns of rising costs have seen the Co. down over 4%. Bond markets have traded in a consolidated range through the European morning. Spreads have seen some marginal volatility, the 10y Spain/Germany has been tightening on the back of Portuguese bonds. PGBs continue to stand out, being down as much as 2-4.0bps along the curve, with the 10y trading through -2.40%. Supply has come from the DMO this morning who came to market with a 30yr auction which drew a smaller b/c than previous (albeit still healthy at 1.97) and a wider tail than previous but did little to cause traction in longer duration paper. </p> <p><em>Top European News</em></p> <ul> <li>Merkel Eyes BMW Homeland for Final Election Boost After Spat</li> <li>Carney Says U.K. Rate Increase Looms in Brexit-Hobbled Economy</li> </ul> <p><strong>In currencies, </strong>the pound has seen some marginal selling this morning, as cable looks to attempt a break through yesterday’s low. Position unwinding in cable is evident as the Fed is due tomorrow, with buyers potentially not convinced by Carney’s 'gradual and limited’ comments. Elsewhere, an upbeat ZEW report from Germany failed to inspire any noteworthy price action in the EUR. USD/JPY caught a bid heading into European trade after breaking above the prior session’s highs before dissipating throughout the EU session. AUD was largely unreactive to an unsurprising minutes release where the RBA stuck to its usual rhetoric.</p> <p><strong>In commodities,</strong> oil markets have been relatively unfazed by the speech from the Iraq Oil Minister who said there are proposals for more OPEC cuts, yet with no clear clarity the OPEC extension comments seem disconcerting to markets. WTI crude futures has seemed to consolidate above 49.50, above 50/bbl and looking to break through 50.50, where stops are likely to be triggered. Price action in metals has been subdued overnight with copper also relatively subdued. </p> <p><strong>Looking at the day ahead, </strong>there are housing starts, building permits, current account balance and the import / export price index. President Trump is scheduled to address the United Nations on Tuesday for the first time as world leaders continue to seek a diplomatic solution to North Korea’s nuclear provocations.</p> <p><strong>US Event Calendar</strong></p> <ul> <li>8:30am: Housing Starts, est. 1.17m, prior 1.16m; Housing Starts MoM, est. 1.65%, prior -4.8% <ul> <li>Building Permits, est. 1.22m, prior 1.22m; Building Permits MoM, est. -0.81%, prior -4.1%</li> </ul> </li> <li>8:30am: Current Account Balance, est. $116.0b deficit, prior $116.8b deficit</li> <li>8:30am: Import Price Index MoM, est. 0.4%, prior 0.1%; Import Price Index YoY, est. 2.2%, prior 1.5% <ul> <li>Export Price Index MoM, est. 0.2%, prior 0.4%; Export Price Index YoY, prior 0.8%</li> </ul> </li> </ul> <p><strong>DB's Jim Reid concludes the overnight wrap</strong></p> <p>It's been a quiet start to the week ahead of the important Fed meeting today and tomorrow, but no news is good news as risk continues to recover from a few difficulties in recent weeks. In fact the VIX briefly fell below 10 yesterday for the first time since the 7th of August (closed 10.15). Elsewhere, the S&amp;P edged up 0.15% to consolidate around its record high.</p> <p>There was a bit more action in sovereign bond yields yesterday, in particular for Portugal where its 10y yields fell 37bp, mainly reflecting S&amp;P’s upgrade of its credit rating back to investment grade (BBB-) - the first main agency to do so since 2012. The spread to Bunds has now narrowed to 196bp, which is the lowest since January 2016. Other peripherals slightly outperformed too, with Italian BTPs (2Y: -1bp; 10Y: -1bp) and Spanish (2Y: +0.5bp; 10Y: -1.6bp) yields down c1bp, with Ireland’s 10y yields unchanged after Moody’s upgraded its rating from A3 to A2-. Core bond yields underperformed, but changes were modest, with Bunds (2Y: +1bp; 10Y: +2bp) and Gilts (2Y: +3bp; 10Y: unch) up slightly, while UST 10yr also rose 2.6bp.</p> <p>Turning to the UK, BOE’s governor Carney spoke at IMF’s headquarters and reiterated the need for some withdrawal of stimulus if the UK economy evolves as expected. On rates, he noted that there are global factors that could justify UK’s potential move to hike rates, in part as UK’s monetary policy “has to move in order to stand still” and that Brexit undermines UK’s supply capacity and makes it harder for the economy to grow without generating inflationary pressures. However, relative to the hawkish BOE tone set last week, some interpreted his rate hike comments of “gradual and to a limited extent” as a bit dovish, partly contributing to a softening in Sterling yesterday (-0.73%). On Brexit, he said there remains “considerable risks to the UK outlook” and that the Brexit process would weigh on the economy’s potential growth for a period.</p> <p>Elsewhere, at a Reuter’s interview, ECB’s governing council member Ardo Hansson reiterated that solid Eurozone growth will allow the ECB to dial back stimulus but normalisation will be gradual. Notably, he called out that ECB’s “forward guidance could be more precise about interest rates”.</p> <p>This morning in Asia, markets are paring back initial gains and are now trading broadly unchanged ahead of the FOMC meeting. As we type, the Nikkei is up 1.47%, partly playing catch up as the market was closed yesterday for holiday. Elsewhere, the Hang Seng (-0.07%), Kospi (-0.05%) and ASX 200 (+0.05%) are fairly flat. The UST 10y is also trading a bit firmer (-1bp) this morning. In his first visit to the UN, President Trump has said that a decision on Iran’s nuclear deal will be seen “very soon” and that the UN has not reached its full potential. Trump's first official address will occur later today so eyes will be on that.</p> <p>Turning back to markets yesterday. Equities strengthened further in both the US and Europe, but changes were modest, in part as investors await for the FOMC meeting. The S&amp;P edged 0.15% higher, while the Nasdaq and the Dow rose 0.10% and 0.28% respectively. Within the S&amp;P, gains were led by the financials (+1.02%) and materials sector, partly offset by losses from utilities. European markets were all higher, with the Stoxx and DAX both up c0.3%, while the FTSE firmed 0.52% following four consecutive days of losses.</p> <p>Currency markets were fairly quiet excluding the changes for Sterling, where it weakened 0.73% and 0.77% versus the Greenback and Euro respectively. Elsewhere, the US dollar index gained 0.19% and EURUSD rose 0.08%. In commodities, WTI oil was broadly flat again while precious metals fell (Gold -0.97%; Silver -2.15%) given the bias away from safe haven assets. Elsewhere, base metals as per LME prices have broadly increased, with Copper (+0.31%), Aluminium (+0.17%) and Zinc (+2.21%) all slightly higher.</p> <p>Away from the markets and onto the topic of elections. In Spain, the Catalan government has passed a law organising an independence referendum on 1 October, although the move has been ruled illegal by the Spanish courts and government. The Spanish economy minister Luis de Guindos warned yesterday that Catalonia’s independence would result in an automatic exit from the EU and that the hit to Catalonia’s economy would be “brutal”, with GDP falling 25%-30% and unemployment to double. The Catalonia region accounts for c20% of Spain’s GDP. Moody’s noted earlier the vote was negative for credit, but it expects the Catalonia region to remain part of Spain.</p> <p>Over in Germany, according to ARD Deutschland-trend, the winner of the upcoming election seems to be clearly Merkel’s CDU/CSU party, but the composition of the next coalition is not so clear. DB’s Stefan Schneider takes a look at the coalition scenarios and their possible implications for Germany’s economic and EU policies as well as financial markets. For more details Turning to Japan, there were weekend reports that PM Shinzo Abe is considering an earlier Lower House election sometime in October 2017. Our Japanese team notes the move appears to be motivated by a rebound in Abe’s approval ratings and his potential intent to lengthen his time in power. Our team thinks that a key economic focus in this election (if it takes place),could be whether the consumption tax should be raised as planned in October 2019 from 8% to 10% and a transformation of the social security system from one orientated towards the elderly to one focused on all generations. </p> <p>Before we move to today’s calendar a few things to wrap up. First the latest ECB CSPP holdings were released yesterday. They bought €2.12bn last week which equates to €423mn/dayvs. €348mn/day since CSPP started. After the summer lull and with more primary issuance, the ECB have made up for the low levels of summer buying with the CSPP/PSPP ratio of net purchases at 19.2% last week (vs. 13.6%, 12%, 10.3%, 9.6%, 11.4% in previous weeks). The CSPP/PSPP ratio since the taper in April has been c.12.9% which is higher than the pre-taper ratio of 11.6%. So still suggesting the ECB has tapered credit purchases less than Government bonds.</p> <p>Circling back to Brexit, Oliver Robbins has left his post as the official in charge of the Brexit department to focus full time on the Brexit negotiations. This coupled with PM Theresa May’s big speech later this week could add momentum back to the stalled negotiation talks with the EU.</p> <p>Finally, turning to a fairly quiet day for key macro data, in the US, the NAHB Housing market index was slightly lower than expected at 64 (vs. 67), with both the current sales and sales expectations indices returning to their July readings. In Europe, the final reading of Eurozone’s August inflation was unchanged, with headline inflation at 1.5% yoy (0.3% mom) and core at 1.2% yoy. Italy’s total trade balance for July increased to $6.6bln (vs. $4.5bln previous). In the UK, the Rightmove index pointed to a further softening of the housing market in September, with nationwide asking prices falling 1.2% mom, leaving annual growth at 1.1% yoy – the slowest pace since February 2012.</p> <p>Looking at the day ahead, the Eurozone’s current account and construction output stats are due. There is the ZEW survey on economic growth for Germany and the Eurozone. Over in the US, there are housing starts, building permits, current account balance and the import / export price index. Onto other events, Germany’s Merkel will give a pre-election interview to RTL television.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="800" height="450" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/dec%20possible.jpg?1505818646" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-19/global-equities-hit-new-all-time-high-ahead-fed-vix-10-japan-stocks-surge#comments Abenomics Abenomics Aftermath of the United Kingdom European Union membership referendum ASX 200 Australia B+ Bank of England Bank of England Bank of Japan Bloomberg Bloomberg Dollar Spot BOE Bond Bond duration British Pound Business Catalan government China Copper Credit Suisse Crude DAX 30 Dow 30 Economy Economy of the European Union Equity Markets Europe European Central Bank European Monetary Fund Norway European Securities and Markets Authority European Union European Union Eurozone Eurozone federal government Federal Reserve System FTSE 100 Germany Gilts Hang Seng 40 Hong Kong Housing Market Housing Starts International Monetary Fund Investment Grade Iran Iraq Japan Jim Reid Liberal Democratic Party Liberal Democratic Party Lower House Merkel’s CDU/CSU party Merrill Merrill Lynch Monetary Policy Monsanto MSCI All-Country World MSCI Emerging Market NAHB NASDAQ NASDAQ 100 Nielsen Nikkei Nikkei 225 Nomura North Korea OPEC Organization of Petroleum-Exporting Countries Portugal Precious Metals Price Action ratings Renminbi Reserve Bank of Australia S&P S&P 500 S&P/ASX 200 Stock market crashes STOXX Topix Trade Balance U.S. Trust Unemployment United Nations US Dollar Index VIX Volatility Withdrawal from the European Union Yen Yuan Tue, 19 Sep 2017 10:58:07 +0000 Tyler Durden 603751 at http://www.zerohedge.com Bill Blain: "One Fund I Met Is Convinced Bond Markets Are On The Edge Of A Precipice" http://www.zerohedge.com/news/2017-09-19/bill-blain-one-fund-i-met-convinced-bond-markets-are-edge-precipice <p><em>Submitted by Bill Blain of <a href="http://www.mintpartners.com">Mint Partners</a></em><a href="http://www.mintpartners.com"></a></p> <p><strong>Blain’s Morning Porridge – September 19th 2017</strong></p> <p>&nbsp;&nbsp;&nbsp;&nbsp; <em>“I had to phone someone so I picked on you. Hey, that far out so you heard him too..”</em></p> <p>There is a veritable hurricane of new issues hitting the market. Like the new Ukraine deal they are being priced to sell – perhaps racing to get down before the rains come.<strong> There is the sure and certain knowledge this feeding frenzy is going to stop. With a thumping great crunch. </strong></p> <p>But the new issue bond market is always feast/famine. There is bigger stuff happening. I managed to spend some time yesterday in the West End of London, speaking with a number of clients about where they think markets are going. Three big themes emerged: </p> <ol> <li><strong>Much of the current “noise” is utter distraction </strong>– including what’s really going on in Washington, the nuances of the Brexit negotiations, Korea and all the other political rumour and sigh hitting markets. Some of stories emanating from Whitehall, Brussels, Berlin and Washington are tremendous – I’d love to share them, but…&nbsp; </li> <li><strong>Strip out the political flummery and noise, and the prospects for global stock markets should be positive</strong>. Every major economy that matters is now in positive growth, after 10-years we finally seem to have shaken off the Global Financial Crisis, and stock markets (which high) are not impossibly overvalued. The reflation trade is on. </li> <li><strong>The fly in the ointment is the bond market</strong>. One fund I met is convinced Global bond markets and credit are on the edge of precipice and about to take that terminal step forward. <strong>Others fear the unintended consequences of taper and the “End of QE” triggering a reset across global financial asset values – especially across the bond markets. </strong></li> </ol> <p><strong>It’s the possibility of a Global Bond Tremblor unwinding confidence that’s the biggest fear. </strong>While the imminent decision (perhaps announced tomorrow) the Fed will no longer reinvest coupon income is significant, most minds aren’t overly concerned on the effects of US taper and a slow gradual rise in US rates on dollar asset values – should be positive for currency.<strong> Most believe the US economy is fundamentally fixed, and there is upside potential (more on which below). </strong></p> <p>The things that have clients more concerned are Europe and Credit. Everyone knows that yield tourists have made credit spreads from EM, Hi-yield and IG implausibly tight. Although any rise in European rates is still a long-way down the road, and likely to be even more gradual than the US, it’s the implied with-drawl of the “do-what-ever-it-takes” Draghi put which makes a renewed circle of doubt around Southern European Sovereign debt a real possibility. </p> <p><strong>European sovereign debt remains a game of Pretend and Extend. Without the implied support of the ECB – WHO WOULD BUY? Seriously… If Europe’s sovereigns were businesses, they’d be well bust by now</strong>. Growth in parts of Southern Europe is past 3% - but it will need a number of years more of this kind of performance to correct the imbalances. </p> <p>Now… all across Europe, readers of the Morning Porridge will be shaking their heads and saying: “Blain is talking rubbish again.. European sovereigns are not going bust”. No they aren’t… but they are uninvestible at these levels without the Draghi put, and a real interest rates these countries will be consigned to Euro-Austerity purgatory. Something has to change.&nbsp; </p> <p><strong>Without the Draghi promise who would willingly buy the debt of Sovereign Credits without access to their own currency printing presses, have been borrowing exclusively in someone else’s currency, have essentially unreformed economies at different levels of competitiveness and productivity to Germany, and are characterised by dodgy banking systems that have been encouraged to invest liquidity in the same dodgy sovereign credit debt..? </strong></p> <p>Either we get a crisis or we get a complete mutualisation – a political impossibility at this stage. Just asking..&nbsp; S&amp;P clearly disagrees with me.. they just upgraded Portugal to IG. </p> <p>It’s a very different situation in the US - or UK – where sovereign debt is still sovereign debt, banks are fixed, and it’s just the everyday idiocy that dominates the headlines. </p> <p>Which leads us back to the prospects for the US and stocks – there is more upside than downside. Taking the global macro of recovering economies, the lack of inflation, coordinated central bank action, and rising activity, slot in the US elections next year. </p> <p><strong>I read you can get odds-on that Trump will be impeached by 2020 and you can get odds-on he will win the next US Election.</strong> With the mid-term elections next year, the Republicans face a very real prospect of an election walloping unless they are clearly seen to rally round the still massively popular Trump. <strong>He is making it clear he’s not dancing to their tune, and giving them one very simple choice – dance to mine. </strong>Which is why it’s increasingly likely we’ll get somewhere on tax-cuts if not the more complex issue of tax reform. A US tax cut will help – and if we don’t get it, then nothing actually changes.. </p> <p>All of which suggests to me there may be further upside in stocks… but stay nervous on bonds.. </p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="460" height="306" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/traders%20looking_39.jpg?1505815429" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-19/bill-blain-one-fund-i-met-convinced-bond-markets-are-edge-precipice#comments Bond Bond Business Currency Economy Economy of the European Union Euro European Central Bank Eurozone Finance Fiscal policy fixed Germany Government debt headlines Portugal Real Interest Rates Southern Europe Sovereign Debt Sovereigns Standard & Poor's Stock market crashes Systemic risk Ukraine US Federal Reserve World Health Organization Tue, 19 Sep 2017 10:06:10 +0000 Tyler Durden 603750 at http://www.zerohedge.com Hillary Clinton May Challenge Legitimacy Of Presidential Election http://www.zerohedge.com/news/2017-09-18/hillary-clinton-may-challenge-legitimacy-presidential-election <p>The US presidential election took place nearly one year ago, but to Hillary Clinton it may as well never have ended. </p> <p>In an <a href="http://www.npr.org/2017/09/18/551217204/hillary-clinton-says-shes-optimistic-about-our-country-but-i-am-not-naive">interview with NPR</a>, the former first lady said that "if Russian interference turned out to be deeper than previously thought" she wouldn’t rule out challenging its legitimacy or the outcome. </p> <p><strong>“No, I wouldn't rule it out</strong>,” she said.</p> <p>Still, even the defeated Democratic nominee admitted that she does not "believe" there is a means to officially challenge the election’s outcome. "I don't know if there's any legal, constitutional way to do that," Clinton said. </p> <p>“There are scholars, academics, who have arguments that it would be [possible], but I don’t think they’re on strong ground. But people are making those arguments. I just don’t think we have a mechanism,” Mrs. Clinton said. “I think you can raise questions." </p> <p>Your sure can, especially if it means staying in the public eye day after day reminding the world how your loss was everyone else's fault but your own, to the point where even her fellow <a href="http://thehill.com/homenews/campaign/336172-dems-want-hillary-clinton-to-leave-spotlight">Democrats have said enough</a>. Monday’s interview is the latest in a whirlwind of appearances the former first lady has given as she promotes her book, “What Happened.” </p> <p>In addition to Russia, over the past week, she’s continued to blame James Comey, Bernard Sanders and others for her defeat, and she’s also doubled down on her call to end the Electoral College.</p> <p>None of this is new: Hillary has repeatedly blamed Russia’s efforts to intervene in last year’s election for her loss to Donald Trump, but her latest comments reflect the depth of her frustration with the Kremlin’s efforts which apparently were channeled by Trump himself.&nbsp; She charged that the president knew the Russians were trying to sabotage her campaign, but that it’s unclear if he can be held accountable at this point.</p> <p> “[Trump] knew they were trying to do whatever they could to discredit me with emails, so there’s obviously a trail there, but I don’t know that in our system we have any means of doing that, but I just wanted to add to the point you made. There’s no doubt they influenced the election: We now know more about how they did that.”</p> <p>Clinton also said she would have reacted differently than Trump did and established an “independent commission with subpoena power” to probe it. </p> <p>“Let me just put it this way, if I had lost the popular vote but won the electoral college and in my first day as president the intelligence community came to me and said, ‘The Russians influenced the election,’ I would've never stood for it,” she said. “Even though it might've advantaged me, I would've said, ‘We've got to get to the bottom of this.’” She probably meant disadvantaged.</p> <p>She then proceeded to psychoanalyze Trump, saying that "I think part of the reason Trump behaves the way he behaves is that he is a walking example of projection. Whatever he's doing and whatever he thinks is happening <strong>he will accuse somebody else of</strong>", she concluded without a trace of irony.&nbsp; </p> <p>Well, even if Hillary fails to challenge Trump over Putin's unprecedented hacking of millions of middle-class Americans, she can always find comfort in the stupendous, fantastic, if just a little fabricated rating of <a href="https://www.amazon.com/What-Happened-Hillary-Rodham-Clinton/dp/1501175564">her book on Amazon</a>, which as of today has 4.8 completely unhacked stars out of 5... with <a href="http://www.zerohedge.com/news/2017-09-13/watch-amazon-deletes-hundreds-one-star-reviews-hillary-clintons-new-book">Jeff Bezos' sincerest compliments</a>. </p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/clinton%20book.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/09/05/clinton%20book_0.jpg" width="500" height="391" /></a></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="885" height="516" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/hillary%20angry%205.png?1505770072" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-18/hillary-clinton-may-challenge-legitimacy-presidential-election#comments Bill Clinton Donald Trump Electoral College Hillary Clinton Nationality None Politics Rodham family United States Tue, 19 Sep 2017 09:48:51 +0000 Tyler Durden 603736 at http://www.zerohedge.com Guaranteed Income And Living Wage Schemes Cannot Possibly Work http://www.zerohedge.com/news/2017-09-18/guaranteed-income-and-living-wage-schemes-cannot-possibly-work <p><a href="https://mishtalk.com/2017/09/17/zuckerberg-lost-his-mind-why-guaranteed-living-wages-cannot-possibly-work/"><em>Authored by Mike Shedlock via MishTalk.com,</em></a></p> <p>Facebook founder <a href="http://money.cnn.com/2017/05/26/news/economy/mark-zuckerberg-universal-basic-income/index.html" rel="noopener" target="_blank">Mark Zuckerberg Supports Universal Basic Income</a>.</p> <p>In its basic form, universal basic income means <strong><em>&ldquo;everyone gets a paycheck, whether they have a job or not.&rdquo;</em></strong></p> <p>Many expect even more. <strong>They want a guaranteed &ldquo;living wage&rdquo;.</strong></p> <p><a href="https://mishgea.files.wordpress.com/2017/09/universal-basic-income.png"><img class="alignnone size-large wp-image-48044" src="https://mishgea.files.wordpress.com/2017/09/universal-basic-income.png?w=529&amp;h=283" style="width: 600px; height: 321px;" /></a></p> <h3><u><strong>Useless Trials</strong></u></h3> <p>Such schemes cannot possibly work.<strong> But that does not stop fools from trying.</strong></p> <p>For example, Finland is giving out a <a href="http://money.cnn.com/2017/01/02/news/economy/finland-universal-basic-income/?iid=EL" rel="noopener" target="_blank">guaranteed monthly income</a> of nearly $600 to 2,000 citizens.</p> <p>Canada&rsquo;s province of Ontario, which includes Toronto, started a <a href="http://money.cnn.com/2017/04/24/pf/canada-ontario-money-basic-income-program/?iid=EL" rel="noopener" target="_blank">pilot program</a> in April that provides 4,000 citizens with an unconditional income of about $12,600 a year. Applicants must be between ages 18 and 64 and living on a limited income.</p> <p><em><strong>Those studies cannot prove anything, no matter what the results.</strong></em></p> <h3><u><strong>Free Money Proposals Do Not Scale</strong></u></h3> <p>Sure, one can do a trial and show that 20,000 or whatever sample size is better off.</p> <p>However, <strong>any benefit to the trial participants&nbsp;<em>must</em> at the expense of a bigger deficit or higher taxes on everyone else.</strong></p> <p>Imagine giving 200 million people a guaranteed living wage.<em><u><strong> Who is going to pay for it?</strong></u></em></p> <p>Next, imagine all of Europe doing this coupled with freedom of movement.</p> <p><strong>Why stop there? Imagine the same program for the entire world? Free money for everyone!</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/09/15/20170917_ubi.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/09/15/20170917_ubi.jpg" style="width: 601px; height: 369px;" /></a></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="731" height="449" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170917_ubi.jpg?1505738284" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-18/guaranteed-income-and-living-wage-schemes-cannot-possibly-work#comments Basic income Economy Employment Finland Free Money Health Income distribution Labour relations Living wage Mark Zuckerberg Market socialism Politics Social Security Tue, 19 Sep 2017 09:00:00 +0000 Tyler Durden 603683 at http://www.zerohedge.com About That "Coordinated Global Economic Recovery" http://www.zerohedge.com/news/2017-09-18/about-coordinated-global-economic-recovery <p>Day-in, day-out, asset-gatherers and commision-rakers remind hapless investors that all is well in stock markets because <strong><em>&quot;there is a coordinated global economic recovery&quot; going on... &quot;that hasn&#39;t happened for years.&quot;</em></strong> As you might imagine... that is not exactly true when one looks at the hard data.</p> <p><strong>As global growth expectations slipped throughout 2015 and into Q1 2016, so global stocks (and bond yields) also declined.</strong></p> <p>However, since then stocks have gone only higher as global growth expectations have merely got back to even - not exactly the exciting global recovery that is so often pitched (especially as China&#39;s credit impulse begins to strike).</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/09/18/20170918_end.jpg"><img height="323" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/09/18/20170918_end_0.jpg" width="600" /></a></p> <p>&nbsp;</p> <p><strong>So - to summarize</strong> - global stocks have risen almost 30% from Q1 2016 lows and both 2017 and 2018 GDP growth expectations are unchanged.</p> <p><span style="text-decoration: underline;"><strong>What changed?</strong></span> Simple... G3 Central Banks printed over $3 trillion to save the world again.</p> <p>So what happens next when The Fed (and/or The ECB) begin to normalize? &quot;paint drying&quot;, we suspect will not describe it.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="935" height="504" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170918_end.jpg?1505770130" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-18/about-coordinated-global-economic-recovery#comments Bond Business Central Banks China European Central Bank recovery US Federal Reserve Tue, 19 Sep 2017 08:15:00 +0000 Tyler Durden 603734 at http://www.zerohedge.com Turkey Faces Threats For Inking Landmark Arms Deal With Russia http://www.zerohedge.com/news/2017-09-18/turkey-faces-threats-inking-landmark-arms-deal-russia <p><em><a href="https://www.strategic-culture.org/news/2017/09/18/turkey-faces-threats-inking-landmark-arms-deal-with-russia.html">Authored by Alex Gorka via The Strategic Culture Foundation,</a></em></p> <p><strong>The long awaited deal has taken place. </strong>A deposit has already been paid. Turkey has finally signed the $2.5bn (&pound;1.9bn) contract with Russia to buy S-400 advanced missile defense system. With a range of 400 kilometers (248 miles), <strong>the system can shoot down up to 80 targets simultaneously, aiming two missiles at each one, at an altitude of up to 30 km.</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/09/18/20170918_turk.jpg"><img height="289" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/09/18/20170918_turk_0.jpg" width="600" /></a></p> <p><strong>The system is not operationally compatible with the systems used by NATO countries, which gives Turkey a military capacity independent of the alliance. </strong>NATO commanders will not have control over it. <strong>The identification friend or foe (IFF) equipment won&rsquo;t prevent Turkey from using it against NATO aircraft and missiles.</strong> Reaching full operational capability will require Russian personnel to be stationed in Turkey on advice, assistance and training missions.</p> <p><strong>The technology transfer component of the S-400 deal is especially important as it would allow Turkey to rapidly expand domestic defense industry with Russia&rsquo;s help.</strong> Russia would supply two batteries and help Ankara build two more such systems. A few years ago, the US refused to let Turkey produce Patriot air defense systems on its soil and the deal was off.</p> <p>Ankara does not have industrial infrastructure to produce air defense systems. Russian specialists will have to come and build it from scratch. As a result, Russia will get access to the defense infrastructure of a NATO member state. <strong>The&nbsp;<a>agreement to build the Akkuyu nuclear power plant</a>&nbsp;in Turkey, which is to be launched by 2023, is another example of fruitful economic cooperation.</strong></p> <p>NATO insists members of the alliance are obligated to use military hardware that is interoperable with each other&#39;s systems. But the S-400 deal is not the first time the principle of interoperability is not observed. <strong>Greece purchased Russia&#39;s S-300 missile system several years ago.</strong></p> <p>The move - a further sign of Ankara&#39;s gradual estrangement from its Western allies &ndash; meets the strategic goal to acquire the nationally controlled defense capability. Turkey has also criticized the US and its allies for their reticence about selling it military arms and technology.</p> <p><u><strong>As had been expected, the deal triggered the anger of the United States and other NATO members.</strong></u> The US had long been warning Turkey against the deal. &quot;We have relayed our concerns to Turkish officials regarding the potential purchase of the S-400. A NATO interoperable missile defense system remains the best option to defend Turkey from the full range of threats in its region,&quot; Pentagon spokesman Johnny Michael&nbsp;<a href="https://www.voanews.com/a/us-turkey-tensions-escalate-over-russian-missile-deal/4028355.html" target="_blank">said</a>&nbsp;in a statement.</p> <p>Maryland Sen. Ben Cardin, the ranking Democrat on the Senate Foreign Relations Committee, asked the US administration to assess how the deal might affect Turkey&rsquo;s NATO membership and US security assistance to Ankara, which includes weapons sales. He issued the warning on September 14 in a letter to Secretary of State Rex Tillerson and Treasury Secretary Steve Mnuchin.&nbsp;<a href="http://www.politico.com/story/2017/09/14/turkey-russia-purchase-may-trigger-sanctions-242725">According to</a>&nbsp;him, <strong><em>the deal violated a bill signed into law in August that imposes sanctions &quot;on any person that conducts a significant transaction with the Russian Federation&rsquo;s defense or intelligence sectors.&quot;</em></strong></p> <p>The idea of introducing sanctions against Turkey&nbsp;<a href="http://www.araratnews.am/german-expert-european-union-may-apply-sanctions-against-turkey/?lang=en">has been on the EU&rsquo;s agenda</a>&nbsp;for quite some time. The announcement of the deal with Russia came after German Foreign Minister Sigmar Gabriel&nbsp;<a href="https://www.reuters.com/article/us-germany-turkey-arms-exports/germany-has-put-most-arms-exports-to-turkey-on-hold-minister-idUSKCN1BM2K1">said</a>&nbsp;his country was suspending all major arms exports to Turkey because of the deteriorating human rights situation in the country and the increasingly strained ties.<strong> Gabriel added he believed that Turkey had also abandoned NATO&rsquo;s common values. The idea of economic sanctions against Turkey&nbsp;<a href="https://anfenglish.com/news/80-percent-of-germans-support-sanctions-against-turkey-21248">is quite popular</a>&nbsp;in Germany.</strong></p> <p><strong>So, the three big powers, Russia, Turkey and Iran, united by the desire to end the bloodshed in Syria and rout terrorists, have become the targets of Western sanctions already imposed or still to be introduced. </strong>The pressure makes them get closer to each other. The cooperation between Russia and Turkey is on the rise and offers&nbsp;<a href="https://www.strategic-culture.org/news/2017/04/20/analysis-turkish-referendum-may-spur-cooperation-with-russia.html">great prospects</a>. Iran&#39;s Armed Forces Chief of Staff, Major General Mohammad Bagheri visited Turkey in mid-August - the first visit by an Iranian chief of staff since Iran&rsquo;s 1979 Islamic revolution. The common threat of terrorism and Western pressure&nbsp;<a href="https://www.strategic-culture.org/news/2016/12/21/moscow-declaration-russia-turkey-iran-join-together-end-syria-tragedy.html">nudge</a>&nbsp;Russia, Turkey and Iran towards one another.</p> <p>The three states work together within the framework of Shanghai Cooperation Organization (SCO) where Russia is a full-fledged member, Turkey has the status of dialogue partner and Iran, an observer, is expected to become a member soon. Last November, Turkish President Recep Tayyip Erdogan&nbsp;<a href="http://www.voanews.com/a/erdogan-turkey-doesnt-need-eu-at-all-costs/3604259.html" target="_blank">said</a>&nbsp;Turkey could become part of the&nbsp;SCO.</p> <p>Ankara is also showing increasing interest in the Eurasian Economic Union (EAEU). It was invited to join the organization in 2014. This will open new opportunities for developing trade. Furthermore, many of the present and potential members of the EAEU are countries with whom Turkey already has close relations. The Eurasian Economic Union aims to finalize a free-trade deal with Iran by the end of the year. Reaching a deal with Iran on free trade would represent a notable victory for the organization. With Turkey and Iran as members, the EAEU would acquire a global dimension.</p> <p><u><em><strong>Obviously, there is one result the Western sanctions produce &ndash; the targeted countries come together to create alternative poles of power. Threats and restrictive measures spur the process. This policy has failed to keep Turkey away from military cooperation with Russia. In the multipolar world there is always an alternative to turn to.</strong></em></u></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="627" height="302" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20170918_turk.jpg?1505782108" /> </div> </div> </div> http://www.zerohedge.com/news/2017-09-18/turkey-faces-threats-inking-landmark-arms-deal-russia#comments Economic integration Economy of Armenia Economy of Kazakhstan Eurasian Economic Union Eurasian Economic Union Eurasianism European Union Foreign Relations Committee Germany Greece International relations Iran military hardware Missile defense Mohammad NATO NATO–Russia relations North Atlantic Treaty Organization Nuclear Power Pentagon Politics Rex Tillerson Shanghai Cooperation Organisation Shanghai Cooperation Organization Strategic Culture Foundation Turkey Turkey United Nations General Assembly observers US Administration War Tue, 19 Sep 2017 07:30:00 +0000 Tyler Durden 603745 at http://www.zerohedge.com