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On Tuesday just after midnight U.S. Eastern time, the Trump administration is set to bring back a first wave of restrictions that had been waived under the Iran nuclear deal, an Obama-era agreement that gave Iran sanctions relief in exchange for curbs on its nuclear program. The new sanctions limit dealings in Iran’s currency and with its automotive industry. They also threaten U.S. penalties for banks that finance the precious-metals trade with Iran and against anyone who sells precious metals to the Iranian government.

And, as The Wall Street Journal reports, worries about a shaky economy and enticed by government sales of gold coins, Iranians have converted savings into gold recently even as prices skyrocketed. 

According to Bonbast, a site that tracks unofficial exchange rates, Iran’s currency, the rial, has seen a record weakening this year – currently trading at roughly 101,000 per U.S. dollar compared with about 43,000 in January,

And this has sparked panic among Iranians, as The Wall Street Journal reports they are hoarding gold as a safeguard against a collapsing local currency and soaring cost of living pushing the metal’s price to records in Tehran.

“People are changing their money into gold because it’s a reliable investment commodity,” said Mohammad Kashtiaray, the head of gold and jewelry committee under Iran’s Chamber of Guilds, a coalition of merchants.

Demand for gold bars and coins in Iran tripled year-over-year in the second quarter to about 15 metric tons, according to a World Gold Council report on Thursday. Iran’s central bank has minted hundreds of thousands of new coins – more than 60 tons of gold in total – to feed the demand. The move has had little impact beyond stoking more demand for the metal.

Gold prices in the country are soaring above ‘fair value’ as WSJ notes, people have lined up outside banks this year to place advance orders for Emami coins in central bank auctions, where they are often priced at lower-than-market rates.

The price of an Emami, a central bank-minted gold coin weighing 8.13 grams, stood at around 36 million rials on Sunday, more than double its price in January. It had hit a record of more than 45 million rials a week ago. The demand for gold in Iran is also bucking a shaky picture globally; spot gold prices have fallen by about 6% this year to about $1,200 an ounce.

Demand for gold has been so resilient that prices are outpacing even the rial’s historic depreciation against the dollar. After factoring out fluctuations in the rial, the price of an Emami coin went from $346 in January to $379 today, a 9.5% rise.

With prices near records, many people said they were buying only because they had to do so. A computer engineer who identified himself as Mr. Bani said he was shopping for a set of bridal jewelry.

“It’s what you have to do,” he said. “I’m buying now because I should, but otherwise it’s not a good time.”

And all of this is happening despite Iranian authorities attempts to put the brakes on gold prices including turning their focus to prosecuting people who allegedly are hoarding coins in an effort to keep prices high.

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The Turkish Lira today…

Missile stalls on launch pic.twitter.com/NzwgFuT6rg

— Catastrophic failure (@SafetyFlrst) August 6, 2018

Chinese stocks had an ugly start to the week…

 

European stocks were not much better (not helped by the collapse in German factory orders)

 

And while US equity futures were down in the pre-market, the cash open prompted the ubiquitous buying panic…

 

Trannies, Small Caps, and Nasdaq outperformed on the day…

 

As yet another short squeeze was engineered…

 

But as we noted earlier, breadth in the rally has collapsed…

 

FANG stocks mounted valiant rebound today thanks in large part to Facebook’s 4% pop…

 

VIX closed at lowest since Jan 26th…

 

Despite Jamie Dimon’s fearmongering over 5% rates, yields actually fell on the day

 

10Y Yields fell to near 3-week lows…

 

The biggest action today was in the FX markets however.

The dollar ended the day higher…

 

Emerging Market FX dropped to 3-week lows… while the Turkish Lira dominated, the Rand, Ruble, and Colombian Peso, and Brazilian Real were all hit today…

 

The Loonie slammed lower overnight on the Saudi sun headlines (but rebounded after US equity markets opened)…

 

However, The Turkish Lira was clubbed like a baby seal as a central bank dollar liquidity boost utterly failed sending Erdogan’s currency crashing to new record lows…NOTE – today was a 22 big figure crash (biggest absolute drop ever)!! The 2nd worst percentage change day for the Lira since Lehman.

 

Cable slumped back below 1.30 – to 11-month lows – after hard brexit headlines hit…

 

And finally, offshore Yuan manage to unwind most of the kneejerk gains from Friday’s PBOC forward market intervention…

 

Cryptos are off to a weak start to the week…

 

WTI managed to hold on to gains ahead of the Iranian sanctions but copper led the commodity slide with PMs weaker again…

 

Copper diverging lower from gold signals another leg lower in Treasury yields…

 

Which could be a problem for the record shorts…

 

And finally, as disappointing as the economic data becomes, high-flying tech stocks remain impervious…

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Authored by Benny Johnson via The Daily Caller,

Former President Barack Obama has received another peace prize.

The former president was named a Robert F. Kennedy Human Rights Ripple of Hope laureate Monday. The award honors those who “work toward a more just and peaceful world.” The RFK nonprofit tweeted that it is “honored to present Barack Obama” with the award.

We are honored to present @BarackObama with our 2018 Ripple of Hope Award. #RFK50 pic.twitter.com/7MEAZ5vwOs

— RFK Human Rights (@RFKHumanRights) August 6, 2018

Obama responded that Kennedy was one of his heroes. “Bobby Kennedy was one of my heroes,” Obama said, “He was someone who showed us the power of acting on our ideals, the idea that any of us can be one of the “million different centers of energy and daring” that ultimately combine to change the world for the better.”

Bobby Kennedy was one of my heroes. He was someone who showed us the power of acting on our ideals, the idea that any of us can be one of the “million different centers of energy and daring” that ultimately combine to change the world for the better. https://t.co/nAiPiGercs

— Barack Obama (@BarackObama) August 6, 2018

Obama will officially be presented with the award by Ethel Kennedy in December at the organization’s annual gala. Obama infamously was awarded the Nobel Peace Prize just months into his presidency. Obama faced criticism for multiple human rights abuses during his tenure as commander in chief.

Obama was criticized harshly for pulling U.S. troops out of Iraq and creating a vacuum that was filled by ISIS. He has also been harshly condemned for his embrace of drone warfare. According to the Bureau of Investigative Journalism, Obama killed nearly 1,000 civilians in more than 500 drone strikes during his presidency.

“There were ten times more air strikes in the covert war on terror during President Barack Obama’s presidency than under his predecessor, George W. Bush,” the Bureau report states. “Obama embraced the US drone programme, overseeing more strikes in his first year than Bush carried out during his entire presidency. A total of 563 strikes, largely by drones, targeted Pakistan, Somalia and Yemen during Obama’s two terms, compared to 57 strikes under Bush. Between 384 and 807 civilians were killed in those countries, according to reports logged by the Bureau.”

Still, we suspect that any criticism of this award’s lack of candor will be dismissed immediately as racist.

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It has long been speculated that Mattress Firm, the US mattress retailing giant, was in a solvency crisis, largely as a result of the spectacular collapse of its parent, Steinhoff International Holdings NV following an accounting scandal in late 2017 and has been struggling to restructure the debt of some subsidiaries with its creditors.

Now, according to Reuters, Mattress Firm, the largest U.S. mattress retailer, is planning to file for bankruptcy Reuters reports, as the firm struggles to exit costly store leases and shut some of its 3,000 locations that are losing money.

A bankruptcy filing would make Mattress Firm the latest U.S. retailer struggling due to competition from e-commerce firms such as Amazon.com putting pressure on brick-and-mortar retailers, as well as a decline in demand as the business model transforms. However, a key driver behind any Chapter 11 filing would be the sorry financial state of insolvent Steinhoff,  which acquired Mattress Firm for $3.8 billion in 2016 as part of an aggressive global roll-up which ultimately pushed the company into bankruptcy.

According to Reuters, both the Houston-headquartered Mattress Firm and Steinhoff have been working with distressed turnaround consultancy AlixPartners, which is often hired just ahead of a bankruptcy filing.

A bankruptcy filing, while leading to numerous store closures, would allow Mattress Firm to clean up its real estate portfolio and improve cash flow and profitability, according to Piper Jaffray analysts. In recent Chapter 11 cases, discount footwear retailer Payless ShoeSource closed roughly 700 mall-based stores in bankruptcy last year, while children’s clothing shop Gymboree Corp closed about 300.

That said, some retailers have managed to close huge swaths of their store base outside of bankruptcy, although the inability to renegitate leases – unless the landlord is especially friendly as was the case with Bebe stores – usually requires an in court process.

The loudest warning sign for Mattress Firm came last year when the retailer lost Tempur Sealy, the maker of popular mattress brand Tempur-Pedic, as a supplier last year, limiting its offerings. Mattress Firm secured a $225 million asset-backed revolving loan last year.

As part of its breakneck expansion which prompted many questions in recent years, Mattress Firm acquired HMK Mattress Holdings, the parent company of competitor Sleepy’s, in 2016 for $780 million and then rebranded the shops. Sleepy’s had over 1,050 stores on the U.S. East Coast and Illinois.

Meanwhile, Mattress Firm’s parent, Steinhoff, booked a $12 billion write-down earlier this year relating to accounting irregularities. Expect a similar outcome in this case.

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Authored by Erin Cooke via Campus Reform,

An employee of the University of Georgia (UGA), is suing the state’s university system over what he claims are “discriminatory health insurance policies for transgender employees.”

Plaintiff Skyler Jay enrolled at UGA in 2009 as a woman and was later hired by the university in 2013. During this time, Jay came out as a man and began the transition process to become a male, including a transition surgery in 2017, according to The Atlanta Journal-Constitution.

Jay, who recently appeared in an episode of the Netflix series Queer Eye, says he was refused coverage for a surgery to treat gender dysphoria in May of 2017, and alleges that this amounts to discrimination by the university.

According to the publication, Skylar appealed the denial to the insurer, Blue Cross Blue Shield (BCBS), which refused his appeal by noting that the plan is self-insured and provides no room to override the plan exclusion. 

Jay’s attorneys, however, argue that this transformational surgery is necessary care and that non-trans employees get their necessary medical care covered. 

Noah Lewis, Jay’s attorney, told the Journal-Constitution that some other institutions of higher education and major companies do not deny coverage for transition surgeries.

“The fact that transgender employees are not able to access medically necessary care while non-transgender employees have their medically necessary care covered evidences a disparate impact on a protected class,” Jay’s legal team asserts.

Likewise, the website LGBTQ Nation suggests that the language of the Board of Regents Equal Opportunity Clause should require coverage of gender reassignment surgery. 

According to the language of the clause, “no person shall, on the grounds of race, color, sex, religion, creed, national origin, age, disability, or veteran status be excluded from employment or participation in, be denied the benefits of, or otherwise be subjected to discrimination under any program or activity conducted by the Board of Regents of the University System of Georgia.”

After his insurance claim for roughly $8,300 was denied by BCBS, Jay sought to meet with USG leaders to discuss the situation, but claims that he was rebuffed.

Jay shared his story when he appeared on Queer Eye, and subsequently created a GoFundMe page in response to an outpouring of offers from people wanting to help him after seeing the show.

“This fundraiser will go directly toward my medical debt and some funds I will donate to couple of community organizations that could also use the help,” Jay explains, noting that the transgender community had previously come to his aid by donating $8,200 toward the cost of his surgeries.

He plans to repay that assistance by donating the same amount to five LGBTQ organizations, saying that once he has done so, all further donations will go directly toward his medical expenses.

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Hours before renewed sanctions on Iran are set to snap back tonight at 12:01 a.m. US Eastern time, Iranian President Hassan Rouhani has announced his country is “open to negotiations” while also calling on the European Union to urgently step up with practical action to save the 2015 nuclear deal. 

His words, however, were generally couched in terms of a rebuke against “untrustworthy” Washington, saying Monday in a televised interview carried on state television: “Negotiations with sanctions doesn’t make sense. They are imposing sanctions on Iranian children, patients and the nation.”

Rouhani referred to items like medicines and other basic living necessities, while the first round of sanctions are also set to target primarily automobiles, currency, and gold.

Basic civilian safety related supplies will be impacted too as export or re-export commercial airplanes as well as services and parts will be banned. The second round of renewed sanctions are set to take effect on November 5, for which the US has pressured EU countries to cease receiving oil exports by this date. 

Rouhani said Iran had “always welcomed negotiations” but that Washington would have to take clear steps to prove they can restore trust after reneging on the 2015 JCPOA.

“If you’re an enemy and you stab the other person with a knife and then you say you want negotiations, then the first thing you have to do is remove the knife.”

“How do they show they are trustworthy? By returning to the JCPOA.”

And in an apparent reference to recent protests that initially arose in early summer primarily over a collapsing economy, he lashed out: “They want to launch psychological warfare against the Iranian nation and create divisions among the people,” Rouhani said.

Rouhani’s words, which could be taken as an ultimatum, are likely to leave the White House unmoved, which has ratcheted up the pressure in hopes that Iran will initiate renegotiations on Washington’s terms. 

In early August Trump’s National Security Advisor John Bolton said in a Fox News interview, “They could take up the president’s offer to negotiate with them, to give up their ballistic missile and nuclear weapons programs fully and really verifiably not under the onerous terms of the Iran nuclear deal, which really are not satisfactory.”

“If Iran were really serious they’d come to the table. We’ll find out whether they are or not,” Bolton said. 

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