SMM News/10-16-2019
“Established less than 20 years ago, the Shanghai Gold Exchange has become the world’s largest physical gold exchange. Debbie Carlson (Debbie Carlson), senior editor of the firm, said in an article on Wednesday that China had become one of the world’s largest gold markets after New York and London, with a growing number of international investors looking to enter the Chinese market.”
USAGOLD note: The gold market is alive and well in Shanghai. This article provides a quick update.
“Imports of the poor man’s gold jumped 72% from a year earlier to 543.21 tons in August, according to the latest available data from India’s trade ministry.”
“The new Brexit pact reached between the European Union and Britain on Thursday will struggle to get through the U.K. Parliament. And for Boris Johnson, the U.K. prime minister, that might not be a terrible outcome.”
“India’s festival of lights is bringing little cheer to jewelers in the world’s second-biggest gold consumer.”
“Russia is exploring currency settlements in euros and roubles for its vast energy exports in an attempt to avoid the dollar and insulate Moscow from the US-led global financial system.”
“The London Bullion Market Association (LBMA) said on Monday a senior executive at Bank of China would join its board.”
“It has been over a decade since Zimbabwe was ravished by one of history’s worst experiences in hyperinflation, reaching 79,600,000,000 percent as prices doubled approximately every 24.7 hours in November of 2008. Today under new leadership, it seems as though the government of Zimbabwe has failed to learn from its previous mistakes in what policy to ascribe to as it enters into another period of tumultuous times and economic hardship for its citizens as hyperinflation has entered the picture again.”
“For many analysts, gold’s ability to recoup a 2% loss at the start of the week and regain what became a critical psychological level is a sign of strong resilience in the marketplace. Many analysts have noted that growing recession fears and financial market uncertainty continue to support gold prices in the near term.”
Germany completed its scheduled transfer of national gold reserves from the New York Fed and the Bank of France in 2017. It will now leave 1236 tonnes at the New York Fed and another 432 tonnes in London. The remainder of its 3378-tonne national holding will be stored in Frankfurt. The repatriation transfers to Frankfurt were completed three years ahead of schedule.
“Barely noticed in a corner of the financial markets, leveraged loans originally worth about $40 billion are staging their own private meltdown.Loans tied to more than 50 companies have lost at least 10 percentage points of face value in just three months, according to data compiled by Bloomberg. Some have dropped a lot more, with lenders lucky to get back just two-thirds of their investment if they tried to sell.”
“The latest U.S. actions against Chinese officials and companies don’t ‘set a good tone’ for an upcoming high-level trade talk, a former American ambassador to China said Wednesday.”
“In September, global gold-backed ETFs and similar products had US$3.9bn of net inflows across all regions, increasing their collective gold holdings by 75.2 tonnes(t) to 2,808t, the highest levels of all time. Holdings surpassed late 2012 levels, at which time the gold price was near US$1,700/oz, 18% higher than current levels.”
“‘This is not QE. In no sense is this QE,’ he said in a question and answer session after the speech.”
“Already considered an unusually volatile period for the stock market, which has logged historically ugly October declines in 1929, 1987 and 2008, worries about geopolitics and growing signs of domestic and international economic weakness have fueled bearish bets and sent stock-market optimists, at least momentarily, scurrying for cover in assets perceived as safe.”
“JPMorgan Chase & Co has become so big that some rival banks and analysts say changes to its $2.7 trillion balance sheet were a factor in a spike last month in the U.S. ‘repo’ market, which is crucial to many borrowers.”
“A group of former senior European central bankers has published a memo attacking the loose monetary policy of the European Central Bank, which they argued was “based on the wrong diagnosis” and risks eroding its independence.
“Chinese officials suggest a broad pact is off the table. U.S. president still suggests any deal has to be ‘100% for us.'”
“All is not lost, according to Ben Bernanke, who led the Fed through the aftermath of the Great Recession. During a panel discussion hosted by the Brookings Institution, he estimated the Fed’s so-called unconventional policies, if used wisely, are the equivalent of 3 percentage point of interest rate cuts.”
“The World Trade Organization gave President Donald Trump the go-ahead to impose tariffs on as much as $7.5 billion worth of European exports annually in retaliation for illegal government aid to Airbus SE. The award is the largest in WTO history — nearly twice as large as the previous record of $4.04 billion set in 2002.”
“Bloomberg investigates how an unexpected diplomatic friendship between Venezuela and Turkey grew into a financial lifeline for Maduro – allowing him to sell off the country’s gold reserves and keep his regime in power.”
“U.S.-China trade needs to be ‘closer to reciprocal in a way that’s good for everybody. I hope we get there. I don’t expect it to happen before the election to tell you the truth, but I hope after that we have a fair trade deal,’ Dimon said in reference to the U.S.’s 2020 presidential election.”
“Société Générale’s chief executive has dismissed calls for the European Central Bank to buy bank bonds, arguing it would support failing rivals and prevent consolidation.”
“’If the world does not take a strong and firm action to deter Iran, we will see further escalations that will threaten world interests. Oil supplies will be disrupted and oil prices will jump to unimaginably high numbers that we haven’t seen in our lifetimes,’ Prince Mohammed said in an interview with CBS on Sunday evening.”
