Month: July 2017

Another day, another tumble in SNAP.

Today’s tumble continues the slide from $29 highs, $24 open, and $17 IPO as SNAP shares trade down to $13.20 in the pre-open after this weekend’s IPO lockup expiration…

The exact number of shares available after the lockup expires isn’t disclosed, according to Bloomberg data.

JPMorgan believes ~400m shares owned by early investors will become available on July 31, while MKM estimated that 60% of the 844m outstanding shares will be unlocked.

Snap has 682.1m shares outstanding (250.8m-share float) as of April 30.

via http://ift.tt/2vlrTuC Tyler Durden

President Trump is active this morning. His first tweet of the week was a shot across the bow of Congress (who exempted themselves from Obamacare because it was such a disaster) and suggesting – shockingly to many in DC – that insurance companies may face some pain…

If ObamaCare is hurting people, & it is, why shouldn't it hurt the insurance companies & why should Congress not be paying what public pays?

— Donald J. Trump (@realDonaldTrump) July 31, 2017

But then, having discussed the "bad", he pivoted to what he sees as "the good" – the stock market, unemployment, and wages – proclaiming there is "No White House Chaos"…

Highest Stock Market EVER, best economic numbers in years, unemployment lowest in 17 years, wages raising, border secure, S.C.: No WH chaos!

— Donald J. Trump (@realDonaldTrump) July 31, 2017

            Which, as we detailed previously,             could be a big mistake…

The president wants people to think that he is the reason for the stock market bubble.

This is a big mistake.

The Fed is the premier member of the so-called "Deep State". In fact, without The Fed, there would hardly be a "Deep State" to speak of.

The Fed sits at the top of the Deep State. They have the ultimate power (that no human beings should ever have) to create new money out-of-thin-air.

In case Trump hasn't figured it out yet, the Deep State does not like him.

Should a major decline in the stock market occur during Trump's Administration, guess who will take the blame?

President Trump.

After all, he took ownership of the bubble!

Should the market tumble, the mainstream media (that also despises Trump) will have plenty of his quotes, YouTubes, and Tweets to use against him.

The economic woes will be pinned on Trump.

Will Trump deserve the blame? No, but it'll be too late.

?This is not to say that a major decline will occur during Trump's tenure. Bubbles can take on a life of their own, and this one may last during Trump's full term.

But that's a risky gamble to make.

This bubble is going on almost 10 years now without a serious decline.

Should we see a major selloff, Trump has very few friends in the major power centers that will come to his aid.

As Peter Schiff points out in this fantastic clip below: The Fed now has their fall guy:

via http://ift.tt/2uMV5ZL Tyler Durden

As many traders quietly leave for summer break soaking up even more liquidity as they go, a busy US calendar unfolds in the week ahead, with ISM, PCE price data and, of course, payrolls in the spotlight.

Key Events, courtesy of RanSquawk

• Monday:               Eurozone CPI (Jul, P), China Official PMIs (Jul)
• Tuesday:              RBA MonPol Decision, Eurozone GDP (Q2, Initial)                                                                                                  
• Wednesday:         ADP, Fed’s Mester, Williams speak
• Thursday:            BoE MonPol Decision, Meeting Minutes & Quarterly Inflation Report                                                    
• Friday:                 US Labour Market Report (Jun), Canadian Labour Market Report (Jun), RBA SoMP

In North America, June’s US Labor Market Report headlines the docket next week. Analysts expect the Nonfarm Payrolls headline to print at 187,000, with the unemployment rate expected to tick down to 4.3%, while hourly earnings are expected to remain subdued. The H1 average for the Nonfarm Payrolls release sits at 180,000. Following its latest statement, the Federal Reserve noted that “job gains have been solid, while household spending and business fixed investment have continued to expand.” The main worry is wage growth, which has remained muted, and is perhaps keeping a lid on the Federal Reserve’s hiking cycle at present, as inflation has been kept in check.

Friday will also bring the Canadian labour market report for July. Analysts looks for 14,500 jobs to have been added, although they do expect that the unemployment rate will remain steady at 6.5%. Following a string of hot labour market reports the Bank of Canada stated that “the robust labour market” was underpinning economic growth, as it hiked its key interest rate by 25bps at its most recent decision. In front of this specific print, RBC highlight that “July numbers have traditionally been affected by large fluctuations in the education sector; however, these swings have been smaller in the last two years and we assume little impact from education hiring this month.” Looking forwards RBC suggest that “broadly speaking, employment growth is expected to moderate alongside slower – albeit still above-trend – GDP growth.”

Other releases of note during the week: Tuesday US ISM manufacturing survey (Jul) Wednesday US ADP Employment Report (Jul) Thursday US ISM manufacturing survey (Jul) Friday Canadian Trade Balance (Jun)

Across the G-10 spectrum, announcements from the RBA & BOE will keep FX volatile, even if both banks are expected to remain on hold.

Here are the details from Bank of America and RanSquawk, laying out the US summer data bonanza week:

• We have a busy US calendar ahead, with ISM – both manufacturing and non-manufacturing – PCE price data and Friday’s employment report all in the spotlight. Consensus expects July NFP growth around 187k, unemployment holding at 4.3% and wages up 0.3% m/m, but down to 2.4% y/y growth. June core PCE inflation is likely to print only 0.1%, leaving the y/y rate unchanged at 1.4% and the ISM manufacturing index should edge down to 57.0 in July from 57.8. See our US Economic Weekly for full details.
• In G10 Central Banks: RBA and BOE on hold: The RBA can afford to be patient and any case for normalization of policy will take time to build, with recent AUD strength adding to the case for caution. The RBA will be slower and more gradual than other central banks. In the UK, hawkish expectations for the Bank of England beat a retreat in the face of a smorgasbord of soft data. Expect a 6-2 vote to keep rates on hold and little disagreement with the market rate profile.
• The Bank of England (BoE) convenes for its quarterly ‘Super Thursday’ event this week, where it will issue its latest monetary policy decision, the minutes from the meeting, and its quarterly inflation report. While almost all of those surveyed expect the BoE to stand pat, analysts at Nomura are looking for a 25bps hike, although they do assign a 40% probably of the Bank remaining on hold. The last decision yielded a surprising 5-3 vote, although Forbes’ (a hawkish dissenter) term has now come to an end. Analysts expect dissenters McCafferty and Saunders to vote for a 25bps hike once again, with focus falling on chief economist Andy Haldane following a hawkish intra-meeting speech. As a result, analysts will focus on whether the vote split is 6-2, or 5-3, with newcomer Tenreyro expected to side with the majority this time out. With UK consumers’ pockets feeling the squeeze of higher inflation Barclays remain “confident that the bank will maintain the monetary status quo over the foreseeable future.” It is probably fair to say that the Bank’s most recent inflation report was a little optimistic, and that the UK’s economic condition has deteriorated in Q2. As a result eyes will fall on the Bank’s growth projections, while the inflation outlook could be driven by a lower trade weighted sterling and a modest recovery in oil prices. The Bank’s assessment of the labour market will also be key as it grows ever tighter, with wage growth remaining subdued.
• July’s PMI releases will also garner interest. The manufacturing survey is due on Tuesday, while its services counterpart is scheduled to be released on Thursday. In the wake of last month’s surveys Markit noted that “a slowing in services sector growth completed a triple-whammy of disappointing PMI survey readings. Although the three PMI surveys are running at levels that are historically consistent with GDP growing by around 0.4% in the second quarter, it’s clear that the economy heads into the third quarter losing momentum. The indications are that the economy’s resilience is being tested. There are pockets of growth, notably in financial services and business services, but the overall picture is one of business spending, investment and exports failing to provide sufficient impetus to fully offset the consumer slowdown. Given the deterioration in the forward-looking indicators, such as business optimism and order book growth, the risks are tilted towards the economy slowing in the third quarter.”
• The week ahead in Emerging Markets: There are monetary policy meetings in India, Czech Republic, Romania and Ukraine. We forecast India’s RBI to cut 25bp. Czech Republic CNB will likely hike 20bp. Sovereign rating review in Israel and Kuwait. We also get China PMIs.

We next look at the global economic calendar on a daily basis courtesy of DB’s Jim Reid.

• Monday we have German retail sales (+0.2% mom expected; +0.5% previous) and UK consumer credit data for June due, followed by the Eurozone unemployment rate (9.2% expected) for June and CPI estimate (+1.3% YoY expected) for July. In the US we will get the Chicago PMI number (60 expected; 65.7 previous), the Dallas Fed manufacturing activity reading (13 expected; 15 previous) for July and June pending home sales (1% expected).
• Tuesday kicks off in Asia where we will get the Caixin China manufacturing PMI reading and the final Nikkei Japan manufacturing PMI reading for July. In Europe we will get July data for the UK Nationwide House Price index, followed by a first look at the remaining manufacturing PMIs out of Europe and the final July manufacturing PMIs for France, Germany and the Eurozone as a whole. We will also get the advance estimate for Q2 Eurozone GDP. In the US we will get personal income and spending numbers for June and the ISM manufacturing PMI for July.
• Wednesday is a quiet day in both the Europe and the US with no real data of note outside of ADP and the Eurozone PPI. Thursday’s calendar will round out July PMI data for the week. In Asia we will get the July composite and services PMI numbers for China (Caixin) and Japan (Nikkei). In Europe we get the July PMIs with the final services and composite PMIs for France, Germany and the Eurozone due as well as a first look at some of the same data for the rest of Europe. Thereafter all focus should shift to the BoE policy meeting. Over in the US we should also get jobless claims data followed by the ISM non-manufacturing composite for July. Thereafter we will get factory orders data as well as the final readings for durable and capital goods orders for June.
• Friday is relatively quiet day for data in both Asia and Europe with only German factory orders data for June due. The US should be in greater focus as the July payrolls number is due along with other labour market data. Alongside that we will also get the trade balance reading for June.

Other notable events: on Tuesday, trade ministers from the BRICS countries will meet in Shanghai. Then Wednesday, the Fed’s Mester will speak at a Community banking conference and the Fed’s Williams will speak in Las Vegas on monetary policy. For Thursday, ECB will publish its economic bulletin and the Baker Hughes US rig count will out on Friday. Finally, notable US companies due to report include: Apple, Pfizer, Tesla, Berkshire Hathaway. Closer to home, we also have HSBC, Heineken, BP, ING Groep, Siemens, BMW and Swisss Re due to report.

* * *

Finally, here is Goldman focusing on the US with key events and consensus estimates for every event:

The key economic releases this week are the personal income and spending and ISM manufacturing reports on Tuesday, and the employment report on Friday. There are a few scheduled speaking engagements by Fed officials this week.

Monday, July 31

• 09:45 AM Chicago PMI, July (GS 58.5, consensus 60.0, last 65.7): We expect the Chicago PMI to moderate to 58.5 following a 7.3pt jump in June to a 3-year high. The index has risen sequentially over the last five months and is likely to remain at a level consistent with solid growth in the manufacturing sector.
• 10:00 AM Pending home sales, June (GS +0.5%, consensus +1.0%, last -0.8%): Regional contract signings data released so far were mixed in June, and we estimate pending home sales rebounded 0.5%, following an 0.8% decline in the May report. We suspect some of the May weakness reflected the lagged impact of higher mortgage rates, the impact of which may have peaked. We have found pending home sales to be a useful leading indicator of existing home sales with a one- to two-month lag.
• 10:30 AM Dallas Fed manufacturing index, July (consensus +13.0, last +15.0)

Tuesday, August 1

• 8:30 AM Personal income, June (GS +0.2%, consensus +0.4%, last +0.4%); Personal spending, June (GS +0.1%, consensus +0.1%, last +0.1%); PCE price index, June (GS +0.05%, consensus flat, last -0.1%); Core PCE price index, June (GS +0.14%, consensus +0.1%, last +0.1%); PCE price index (yoy), June (GS +1.47%, consensus +1.3%, last +1.4%); Core PCE price index (yoy), June (GS +1.53%, consensus +1.4%, last +1.4%): We estimate a 0.2% increase in personal income and a 0.1% increase in personal spending (nominal, mom sa) in June. Based on details in the PPI and CPI reports as well as the firmer price-related news in Friday’s GDP report, we forecast that the core PCE price index rose 0.14% month over month in June and was up 1.53% from a year earlier. Additionally, we expect that the headline PCE price index rose 0.05% and was up 1.47% from a year earlier.
• 09:45 AM Markit US manufacturing PMI, July final (consensus 53.1, last 53.2)
• 10:00 AM ISM manufacturing, July (GS 56.8, consensus 56.4, last 57.8): We expect the ISM manufacturing index to decline 1.0pt to 56.8 in the July report. Regional manufacturing surveys were weaker on balance in July, with declines in the Empire State, Philly Fed, and Kansas City manufacturing surveys. However, the Richmond Fed and Markit PMI manufacturing surveys both moved higher. On net, our manufacturing survey tracker—which is scaled to the ISM index—fell 0.9pt to 56.8 in July.
• 10:00 AM Construction spending, June (GS +0.5%, consensus +0.5%, last flat): We expect construction spending to rebound 0.5% in June following a below-consensus May report, which showed declines in both private residential and private nonresidential spending.
• 4:00 PM Total vehicle sales, July (GS 17.1mn, consensus 16.8mn, last 16.4mn): Domestic vehicle sales, July (GS 13.4mn, consensus 13.0mn, last 12.8mn)

Wednesday, August 2

• 08:15 AM ADP employment report, July (GS +195k, consensus +190k, last +158k): We expect a 195k increase in ADP payroll employment in July, reflecting a boost from the stronger headline payrolls growth in June utilized in the ADP model. We expect an additional modest boost from net strength in the financial and economic indicators also used in the model. The ADP report introduced methodological changes last fall and now offers more details by sector. While we believe the ADP employment report holds limited value for forecasting the BLS’s nonfarm payrolls report, we find that large ADP surprises vs. consensus forecasts are directionally correlated with nonfarm payroll surprises.
• 11:00 AM Cleveland Fed President Mester (FOMC non-voter) speaks: Cleveland Federal Reserve President Loretta Mester will give the keynote speech at the Community Bankers Association of Ohio’s Annual Convention in Cincinnati, Ohio.
• 01:30 PM San Francisco Fed President Williams (FOMC non-voter) speaks: San Francisco Fed President John Williams will give a speech titled “Monetary Policy’s Role in Fostering Sustainable Growth” in Las Vegas, Nevada. Audience and media Q&A is expected.

Thursday, August 3

• 08:30 AM Initial jobless claims, week ended July 29 (GS 235k, consensus 240k, last 244k); Continuing jobless claims, week ended July 22 (consensus 1,955k, last 1,964k): We estimate initial jobless claims fell by 9k to 235k in the week ended July 29. Initial claims can be particularly volatile around this time of year due to annual summer auto plant shutdowns, and we believe the prior week’s larger than expected increase likely reflected a number of plant closures. Additionally, we expect some retracement from elevated levels of claims in California. Continuing claims – the number of persons receiving benefits through standard programs – likely declined in the week ending July 22.
• 09:45 AM Markit US services PMI, July final (consensus 54.2, last 54.2)
• 10:00 AM ISM non-manufacturing index, July (GS 57.0, consensus 56.9, last 57.4): Regional service sector surveys were mostly weaker in July, and we expect the ISM non-manufacturing index to pull back 0.4pt to 57.0 in July. The New York Fed, Richmond Fed, and Philly Fed surveys all deteriorated month-over-month in July, while the Markit PMI services survey was flat in the flash estimate. Our non-manufacturing survey tracker decreased 1.5pt to 54.2, but continues to suggest expansion in business activity.
• 10:00 AM Factory orders, June (GS +2.6%, consensus +2.8%, last -0.8%); Durable goods orders, June final (consensus +6.0%, last +6.5%); Durable goods orders ex-transportation, June final (last +0.2%); Core capital goods orders, June final (last -0.1%); Core capital goods shipments, June final (last +0.2%): We estimate factory orders rose 2.6% in June – following an 0.8% decrease in May – reflecting a sharp rise in commercial aircraft orders. Despite positive revisions, the June durable goods report showed a modest decline in core capital goods orders but a rise in core capital goods shipments.

Friday, August 4

• 8:30 AM Nonfarm payroll employment, July (GS +190k, consensus +180k, last +222k); Private payroll employment, July (GS +190k, consensus +181k, last +187k); Average hourly earnings (mom), July (GS +0.3%, consensus +0.3%, last +0.2%); Average hourly earnings (yoy), July (GS +2.4%, consensus +2.4%, last +2.5%); Unemployment rate, July (GS 4.3%, consensus 4.3%, last 4.4%): We estimate nonfarm payrolls rose 190k in July, following a 222k increase in June and compared to three- and six-month moving averages of 194k and 180k, respectively. Labor market fundamentals remained solid – business employment surveys remain at strong levels, and the Conference Board’s labor market differential rose to a 16-year high – though we note some modest deterioration in jobless claims data. July payroll growth has been relatively firm in recent years – rising by more than 200k in July in each of the last three years. This trend may reflect changing seasonality in labor market flows and hiring rates in the month, and to the extent the seasonal factors have lagged such an evolution, this would suggest scope for above-trend job growth in the upcoming report as well. We expect the unemployment rate to edge down to 4.3%. The June unemployment rate barely rounded up (at 4.357%), and we believe solid overall job creation will more than offset a modest rise in continuing claims between the survey period. Finally, we expect average hourly earnings to increase 0.3% month over month and 2.4% year-over-year, reflecting somewhat favorable calendar effects.
• 08:30 AM Trade balance, June (GS -$44.1bn, consensus -$44.8bn, last -$46.5bn): We estimate the trade deficit narrowed by $2.4bn in June. The Advance Economic Indicators report last week showed a narrower goods trade deficit, and we forecast a similar narrowing in the broader trade balance in this week’s report.

Source: BofA, DB, GS, RanSquawk

via http://ift.tt/2vYe3LK Tyler Durden

With high-margin FICC revenues stick in a secular decline across the financial industry, banks are forced to extract as much profit as possible from existing product lines. Which explains why JPMorgan will soon be using a “first-of-its-kind robot” to do away with carbon-based traders altogether and execute trades across its global equities algorithms business, after a recent trial of JPM’s new artificial intelligence (AI) program showed it was “much more efficient than traditional methods of buying and selling“, the FT reports.

JPMorgan, the world’s biggest bank by revenue, believes it is the first on Wall Street to use AI with trade execution and said it would take rivals 18 to 24 months and an investment of “multiple millions” to come up with similar technology.

The AI — known internally as LOXM — has been used in the bank’s European equities algorithms business since the first quarter and will be launched across Asia and the US in the fourth quarter, Daniel Ciment, JPMorgan’s head of global equities electronic trading, told the Financial Times.

In the latest victory for robot kind over humans, LOXM’s job will be to execute client orders with maximum speed at the best price, “using lessons it has learnt from billions of past trades — both real and simulated — to tackle problems such as how best to offload big equity stakes without moving market prices.”

“Such customisation was previously implemented by humans, but now the AI machine is able to do it on a much larger and more efficient scale,” said David Fellah, of JPMorgan’s European Equity Quant Research team. Mr Ciment said that, so far, the European trials showed that the pricing achieved by LOXM was “significantly better” than its benchmark.

The development guarantees another round of downsizing among bank front offices as increasingly inefficient human traders are removes from the equation… and payroll. As the FT notes, investment banks have been increasingly using AI, automation and robotics to help cut costs and eliminate time-consuming routine work. “For example, UBS’s recent deployment of AI to deal with client post-trade allocation requests, which saves as much as 45 minutes of human labour per task. UBS has also brought in AI to help clients trade volatility.“

Commenting on the launch, Ciment said that “best execution is becoming more and more important to clients,” adding that it could become part of the marketing pitch the bank makes to clients.  The AI was developed using “Deep Reinforcement Learning” methods, which are able to learn from millions of historic scenarios. Mr Fellah said DRL had “many other potential uses in banking, such as in automatic hedging and market making”.

One possible evolution of LOXM is teaching the machine how to get to know individual clients, so that it could consider their behaviour and reaction as it decides how to trade. “Any customisation would only be if the client agrees to that,” Mr Ciment added.

Unlike similar robotic advancements on the buyside, especially at Blackrock which is increasingly automating stock-picking using “big data” and robots in a wholesale push for passive investing, JPMorgan’s AI has no decision-making capabilities around what is bought and sold – a differentiation from existing robo advisors – as its role is solely to decide how things are bought and sold.

JPM also said it had no risk management issues with the technology. “The machine is restricted in its trading behaviour, as it learns under, and operates within, our general electronic trading risk framework, which is overseen by internal control groups and validated by regulators,” Mr Fellah said.

Of course, with such rapid propagation of technology among both stock investing and trade processing, it is only a matter of time before a “black hat” hack takes place, and sends trading – and markets – haywire. Which, incidentally, may be among the reasons for the concerted push: after all what better way to avoid blame for what is coming than to blame it on, who else, Russian hackers.

via http://ift.tt/2f1eyAB Tyler Durden

Despite US threats of “strong and swift economic sanctions” that the WSJ reported overnight could cut off a crucial source of revenue for Venezuela’s financially distressed state oil company, PDVSA, the socialist state’s leader Nicolas Maduro is claiming victory in a vote to create a new “constituent assembly,” a vote that US government officials have labeled a "sham."

The ruling Socialist party's candidates purportedly won all 545 seats in the vote. Venezuela electoral council head Tibisay Lucena said more than 41% of the country’s registered voters participated, a number that is being widely discreditr by outside sources. Per press reports, the assembly will now replace the opposition controlled Congress, which was annulled by the Maduro-allied Supreme Court in March, allowing Maduro to rewrite the country's constitution, cementing his hold on power as his favorability rating with the public falls below 30%.

The U.S., Colombia, Spain, Peru, the EU and Argentina have already said they will not recognize the results of the vote, which was boycotted by the country's opposition parties.

According to Bloomberg, opposition leader Henrique Capriles claimed the real participation in the vote was closer to 15% of registered voters. An unofficial referendum held by the opposition several weeks ago received more than 7.6 million votes against the current regime. Torino Capital’s Francisco Rodriguez said the firm’s exit polls recorded 3.6 million votes. Counting of the ballots was said to begin Sunday night, after the vote was extended by an hour as opposition protests across the country turned violent.

As has become all too common in Venezuela, where daily antigovernment protests are frequently marred by government killings, several fatalities have been recorded as supporters of Maduro’s government headed to the polls, according to Al Jazeera. Ten people, including an election candidate, were killed on the day of the vote as protesters tried to shut down polling stations by erecting barriers in the street. During clashes with masked protesters, soldiers fired into crowds, sometimes with live ammunition, according to AFP.

Opposition activists have promised to continue the daily protests that have seen more than 120 deaths since mid-April as clashes between soldiers and the opposition threaten to explode into a "war in the streets," according to AFP.

Among other, an opposition leader was killed as scuffles broke out between soldiers and masked protesters:

“Shootings at protests killed a 13-year-old and a 17-year-old in the western state of Tachira. A soldier was also shot dead there. The death toll also included a 30-year-old regional leader of a youth opposition party in the northeast town of Cumana and two protesters in the western state of Merida.

 

Anti-Maduro activists wearing hoods or masks erected barricades on roads and scuffles broke out with security forces who moved in quickly to disperse the demonstrators.

 

Al Jazeera's Lucia Newman, reporting from the capital Caracas, said that it was a "sad and bloody day in Venezuela". She said that half a dozen protesters with bullet wounds were rushed to neighboring Colombia for treatment.”

The State Department released a statement in response to the "flawed election,"  saying it would soon "take action" against the "architects of authoritarianism" in Maduro's government, according to Fox.

"The United States stands by the people of Venezuela, and their constitutional representatives, in their quest to restore their country to a full and prosperous democracy," the State Department said in a statement, according to Reuters.

"We will continue to take strong and swift actions against the architects of authoritarianism in Venezuela, including those who participate in the National Constituent Assembly as a result of today’s flawed election.”

UN Ambassador Nikki Haley called the vote a “sham" on Twitter.

Maduro’s sham election is another step toward dictatorship. We won't accept an illegit govt. The Venezuelan ppl & democracy will prevail.

— Nikki Haley (@nikkihaley) July 30, 2017

The European Union has also condemned the results, according to Reuters.

"We will not recognise this election," said European Parliament head, Antonio Tajani. "It is very clear that the current regime is clinging to power. The will of the people is to change the regime. It is necessary to go to elections now."

Meanwhile, members of the Socialist party are celebrating their "victory," according to Reuters, as Venezuelan media broadcast footage of Maduro voting at a polling station in Caracas.

"The constituent assembly will start its work right away," Diosdado Cabello, deputy head of the Socialist Party, told a post-election rally in Caracas that featured singers, dancers and culminated after midnight in the announcement of the official vote count and a fiery speech by Maduro.

"Good morning Venezuela. We have a constituent assembly!" he shouted. "I ask our countrymen to close ranks so that the assembly can be a place of dialogue."

Agence France Presse published footage of the violence that broke out near one polling station.

The crackdown on protesters began before the vote as the government issued a ban on protesting during the vote.

Meanwhile, traffic across Venezuela’s border with Colombia came to a standstill on Sunday, according to AFP.

 

via http://ift.tt/2vawT4Q Tyler Durden

• HSBC, miners lift European shares as dollar holds near lows (Reuters)
• Republicans Face Tough Choice: Repeal Obamacare or Cut Taxes (BBG)
• Trump’s Decisions Deepen Divide Among Republicans (WSJ)
• Koch Brothers Move to Back White House’s Tax-Cut Plan (BBG)
• Maduro Waits for U.S. Response After Violent Venezuela Vote (BBG)
• OPEC Has a Crippling Problem: Its Members Can’t Stop Pumping (WSJ)
• Catalan Separatist Chief Is Ready to Go to Jail (BBG)
• Saudi Arabia says that calls for internationalization of holy sites ‘a declaration of war’ (Reuters)
• China Asks Waldorf Owner Anbang to Sell Assets Abroad, Sources Say (BBG)
• China’s overall debt levels still high, central bank official says (Reuters)
• China Bond Buyers Quiz Taxi Drivers to See If Credit Good (BBG)
• How China’s biggest bank got ensnared in a money laundering probe (Reuters)
• Real estate booms in China’s small cities, but construction outpaces demand (Reuters)
• One of China’s ‘most-wanted’ fugitives returns after 19 years in U.S. (Reuters)
• South Africa’s stock market defies recession, scales record highs (Reuters)
• Discovery Communications Agrees to Buy Scripps Networks (WSJ)
• SoftBank Is Said to Plan Making Direct Offer for Charter (BBG)
• Charter Says It Isn’t Interested in Acquiring Sprint (WSJ)
• Shell plans 400 job cuts at Dutch projects and technology department (Reuters)
• The Bust Never Ended for Wall Street’s Most Crisis-Scarred Banks (BBG)
• Hot and cold: Euro zone grows but inflation slows (Reuters)
• Supermarkets Face a Growing Problem: Too Much Space (WSJ)
• Japan’s biggest bank eyes Amsterdam as post-Brexit EU base (FT)
• Alphabet Wants to Fix Renewable Energy’s Storage Problem — With Salt (BBG)
• Late Credit-Card Payments Stoke Fears for Banks (WSJ)
• iPhone’s Toughest Rival in China Is the WeChat app (WSJ)
• Top French court orders government to provide water to Calais migrants (Reuters)
• Private Equity Takes Fire as Some Retailers Struggle (WSJ)

 

Overnight Media Digest

WSJ

– U.S. President Donald Trump’s administration officials urged China and other nations to band together to confront North Korea over its nuclear and ballistic-missile ambitions, with Vice President Mike Pence declaring “all options are on the table” to rein in Pyongyang. on.wsj.com/2uP34nz

– Charter Communications Inc said it is not interested in buying Sprint Corp, rebuffing a gigantic merger offer and potentially ending several weeks of deal talks between the media and communications companies. on.wsj.com/2v9C2d7

– Four big activist investors, including Jana Partners and Trian, are now calling for changes to plans to split DowDuPont , a $150 billion chemical behemoth about to be formed, into three companies. on.wsj.com/2va05sA

– Russian President Vladimir Putin said the United States would have to cut 755 diplomats and staff in the country by September in retaliation for impending U.S. sanctions on Moscow. on.wsj.com/2uPffRn

– Eight months after a landmark deal to cut oil output to force prices up, big budget obligations are driving OPEC members to keep producing. on.wsj.com/2uPCFpC

– U.S. President Donald Trump’s tumultuous past week has widened rifts in his party, between those who vocally support the president’s combative style and others who bridle at it, according to interviews with GOP officials and supporters across the country. on.wsj.com/2v9Ps8Y

 

FT

Japan’s Mitsubishi UFJ Financial Group is planning to make Amsterdam its new EU base for its investment banking operations to cope with the disruption of Brexit.

Pimco attracted nearly $50 billion to its funds in the six months to the end of June, according to numbers compiled by Morningstar for the Financial Times.

Apple Inc says it is removing virtual private network (VPN) services from its app store in China, drawing criticism from VPN service providers, who accuse the U.S. tech giant of bowing to pressure from Beijing cyber regulators.

Billionaire Li Ka-shing has agreed to sell his Hutchison Telecommunications fixed-line phone business for HK$14.5 billion ($1.86 billion) to U.S.-based infrastructure-focused private equity firm I Squared Capital.

 

NYT

– Apple Inc said in a letter it had removed apps from China store that helped internet users evade censorship. Software made by foreign companies to help Chinese users avoid the country’s system of internet filters had vanished from Apple’s app store in the mainland. nyti.ms/2v9Tezx

– Interviews for control over Uber Technologies Inc with more than a dozen people close to the process, indicate that board members’ relationships have been damaged by leaks, shifting wildly as alliances are forged and then broken. nyti.ms/2v9R1Uz

– The owners of DC United, Washington’s major league soccer team, are quietly weighing a sale of the franchise. The potential sale arose from efforts by DC United’s majority owners to sell a 35 percent stake once held by the investor Will Chang who sold that stake to the team last fall. nyti.ms/2v9GXec

 

Britain

The Times

BT Group Plc has offered to spend up to 600 million pounds ($788.70 million) on upgrading internet speeds for more than 1 million rural homes, as it fends off pressure to break up its empire. bit.ly/2heI8n2

HSBC Holdings Plc is said to launch a $2 billion share buyback tomorrow, in the first phase of a three-year programme to run down its vast cash stockpile. bit.ly/2hezZyK

The Guardian

Britain will be hit by huge border delays, require vast lorry parks in the south-east, and suffer more than £1bn a year in economic damage, according to a stark economic analysis of the likely impact of customs checks after Brexit. bit.ly/2heZTCs

Liam Fox has said there is no cabinet-wide agreement for the suggestion by the chancellor, Philip Hammond, that free movement could continue for up to three years after Brexit. bit.ly/2heiONQ

The Telegraph

Billionaire Li Ka-shing has offloaded Hutchison Global Communications, which runs fixed-line and wifi services, to American private equity group I Squared Capital for HK$14.5 billion ($1.86 billion). bit.ly/2eYAaxF

Five more banks, including British-based bank Standard Chartered Plc, have agreed to pay a total of $111 million to settle claims that they manipulated currency markets, as the foreign exchange scandal continues to haunt the finance industry.

Sky News

LoveHomeSwap, one of the UK’s best-known sharing economy start-ups, is close to being sold to the American hotels giant Wyndham Worldwide Corp in 40 million pound deal. bit.ly/2eYbEwq

Financial Times’ journalists could strike over the gender pay gap at the newspaper amid fury that female journalists are being paid 13 percent less than male colleagues. bit.ly/2eZiaD5

The Independent

Japan’s biggest bank Mitsubishi UFJ Financial Group is reportedly set to move its European investment operations from London to Amsterdam because of the uncertainty posed by Brexit. ind.pn/2heDSnB

 

via http://ift.tt/2vXxog9 Tyler Durden

Bitcoin Fork, Hyped ICOs – Immutable Gold and Silver

 – Latest developments show risks in crypto currencies
– Confusion as bitcoin may split tomorrow
– SEC stepped into express concern over ICOs
– ICOs have so far raised $1.2 billion in 2017
– ICOs preying on lack of understanding from investors
– Physical gold not vulnerable to technological risk
– Beauty and safety in simplicity of gold and silver

Editor: Mark O’Byrne

Forks and ICOs solves bitcoin v gold debate

There is still a huge amount of noise in the bitcoin and cryptocurrency space but there have been a few developments of late which have pushed the space further into maturity.

From what I can tell from dinner party conversations people who are vaguely aware of bitcoin now know that there are two terms they need to throw into the chat in order to sound like they know what they are talking about. These two terms are ICO and Fork.

Price is also a major talking point at present. As ever the price of bitcoin remains volatile and headline-worthy.

This week will mark a point in cryptocurrency history as the most powerful of cryptocurrencies, bitcoin will experience a major technical change and the US regulator SEC has just made a significant announcement about fundraising in the space.

We have written previously about how bored we are with the bitcoin vs gold debate, but for those who still like to peddle it then they would do well to see how these latest developments put the issue to bed.

The break-up of the year

For a long time there has been a debate about the scaling of the bitcoin network. What is ultimately a required software upgrade has caused many arguments and fall-outs in recent years.

Pressure has been ramping up within the bitcoin community as to how certain problems can be resolved. The discussion may seem like something which is just technical but has at times become philosophical and political.

The main items up for debate are as follows:

Bitcoin is currently limited in the number of transactions it can process. Today, it can only process up to 1MB of transactions roughly every 10 minutes.

Owing to this limit, transactions take longer to approve during times of heavy use.

As all users pay a fee to miners to make transactions, this limitation on space has increased average fee costs.

Increasing the block size makes network nodes more costly, as node operators must store the entire copy of the blockchain as computer files.

Ref: CoinDesk

Ultimately, the above comes down to the fact that the bitcoin network has failed to address problems associated with its current block size which are long wait times and high fees for transactions.

The debate has become so heated for obvious reasons – bitcoin was delivered to the world with a fairly strong set of principles.

However many believe that these principles either have to change in order to protect the future of the currency, or that the software must be upgraded in order to protect the principles.

A solution (called SegWit2x) had seemingly been reached, a week or so back. However not everyone was in agreement. As a result, last week a separate group of users announced that on August 1st they will split from off from bitcoin and create a new cryptocurrency called Bitcoin Cash.

This will likely cause a fork in the bitcoin network and result in two versions of the Bitcoin blockchain and two separate digital currencies. At this point there is likely to be a taking of sides by companies that operate within the bitcoin space.

The main difference between Bitcoin Cash and bitcoin is the block size. Bitcoin Cash will have a block size of 8MB, compared to Bitcoin’s 1MB block size. In theory Bitcoin Cash’s larger block size could prompt investors to flee Bitcoin in favour of the new currency. This would be negative for the original Bitcoin’s price.

Already I have received multiple emails from companies telling me which version they will be supporting and their reasons why.

So far it looks like the original bitcoin will be gaining the initial surge of support due to the unpredictability of something which was only announced a few day ago.

However, bitcoin owners will also end up with Bitcoin Cash (and a futures market is already open for the new currency) so we will watch this development with some interest.

What this whole drawn-out scenario will do, however, is serve as a reminder to regular crypto buyers and observers that no cryptocurrency is entirely without counterparties that can affect and arguably impact the future of your assets and the future value of them.

SEC, ICO and more acronyms

If you’ve been catching up with the latest series of House of Cards then ICO might sound like a reason for bitcoin to be banned outright as it is the fictional equivalent of ISIS.

But ICO in the real world is a very different thing, it stands for Initial Coin Offering.

An ICO is defined as

‘An unregulated means by which funds are raised for a new cryptocurrency venture. … In an ICO campaign, a percentage of the cryptocurrency is sold to early backers of the project in exchange for legal tender or other cryptocurrencies, but usually for Bitcoin.’

According to Autonomous NEXT, ICOs have raised $1.2 billion in 2017 alone. Given Ethereum raised ‘just’ $18.9 million in its 2014 ICO this shows phenomenal hype (or promise) in the space is growing rapidly.

The hype has even grabbed the attention of that expert-investor and cool-head that is Floyd Mayweather ahead of his big fight with Irish MMA champion Conor McGregor. McGregor is thought to be a bigger fan of gold than cryptos and has tweeted about bringing “more gold back to Dublin.”

When you see this sort of thing it is an example of hype and suggests valuations may be frothy and on the speculative side.

An ICO is really just a promise about the future of a cryptocurrency and the underlying technology.

Most of them are attempts to bring innovation to the fintech space. However concerns have been raised over the lack of due diligence being carried out by investors’ and some ICO projects are playing on this.

ICOs are the offering of crypto tokens which are bought by investors. This then funds ventures in the space. Inevitably the majority of them will fail, but many show great promise as we have seen with Ethereum.

ICOs are almost certainly here to stay. Not only are we seeing a similar movement of people from traditional banking into ICOs  as we did in the early days of blockchain tech. But  we have also seen the SEC feeling the need to get involved. As we have seen with bitcoin, this network effect of growing stakeholders is justifying the ongoing existence and development of ICOs.

Last week the SEC issued a guidance note that tokens issued by an Ethereum project called The DAO were securities.

“The Commission applied existing U.S. federal securities laws to this new paradigm, determining that DAO Tokens were securities.  The Commission stressed that those who offer and sell securities in the U.S. are required to comply with federal securities laws, regardless of whether those securities are purchased with virtual currencies or distributed with blockchain technology.”

This means that all ICOs may be subject to regulations. This announcement was received relatively positively in the crypto space, however some experts believe the SEC are showing a lack of understanding as to how these things work:

Blockchain engineer Elaine Ou pointed out on Twitter, ICO’s are “Untraceable, international, [have] no central authority, [and] funds can’t be frozen. The SEC ICO warning is the best ad for ICO’s.”

What it ultimately shows, however, is that the blockchain space continues to impress with innovation and the amount of money it attracts. However, it is all extremely new, there is a lot of hype and open to a number of threats as well as opportunities.

There will be significant creative destruction in the space.

Conclusion – Beauty and safety in simplicity of gold and silver

Many people bought bitcoin in the early days and have just sat on it.

Happy in the knowledge that it didn’t cost them much and they’ll wait and see what happens to it. Most of these people check-in with the price and whilst the volatility might scare them they are ultimately delighted with the long-term price performance.

The bitcoin price has (of course) felt the impact of the recent changes and debates. However the overall crypto space remains relatively resilient as the market-cap has remained fairly constant in the last week. However, the bitcoin price has faltered.

The problem is that this so-called hard fork has got a lot of people worried.

It has reminded bitcoin holders of the presence of counter-parties in the network, who are able to make decisions about your assets without your say so, whether they are the bitcoin miners or the regulators.

Many googled terms include ‘will I still have my bitcoin after the hard fork?…What will happen to my bitcoin?…Will I own bitcoin cash as well as bitcoin?’

There is confusion and with confusion comes doubt which is never good for price.

The ultimate lesson from all of this debacle is that bitcoin and other cryptos are not worthy substitutes for gold and silver, no matter how much some would like to push this idea.

The joy of owning physical gold which is segregated and allocated in your name is that no-one can announce that they don’t like how gold is mined so they’re changing what you own.

It cannot be manipulated in such a way. If you own gold coins or gold bars, it cannot disappear. It cannot be diluted or suffer a company take over or be hacked. It cannot be affected by alternative versions of it.

Gold is gold and silver is silver. They do not change and are immutable. There is both beauty and safety in this simplicity.

 

News and Commentary

China’s first-half gold output falls 10%, demand up (IndiaTimes.com)

India Trade Ministry Sees Scope for Lowering Gold Import Tax (Bloomberg.com)

EU explores account freezes to prevent runs at failing banks (Reuters.com)

IMF says dollar overvalued, euro, yen, yuan in line with fundamentals (Reuters.com)

Putin Says Hopes Retaliation Ends Once 755 U.S. Staff Ousted (BloombergQuint.com)

Draghi Pledged ‘Whatever It Takes.’ It Took 1.2 Trillion Euros (Bloomberg.com)

Very Bullish Scenario For Gold – Goldcorp CEO (video) (Bloomberg.com)

Baruch Sees Gold Rolling Through $1,300 (video) (Bloomberg.com)

Toxic Fruit of Financialization: Risk Is for Those at the Bottom (DailyReckoning.com)

Miraculous gold rush movies buried under the Yukon ice (TheGuardian.com)

Gold best performing asset “since Australia sold its gold” (TheAustralian.com)

Gold Prices (LBMA AM)

31 Jul: USD 1,266.35, GBP 965.59 & EUR 1,079.06 per ounce
28 Jul: USD 1,259.60, GBP 961.96 & EUR 1,075.45 per ounce
27 Jul: USD 1,262.05, GBP 960.29 & EUR 1,076.53 per ounce
26 Jul: USD 1,245.40, GBP 956.72 & EUR 1,071.29 per ounce
25 Jul: USD 1,252.00, GBP 960.78 & EUR 1,074.59 per ounce
24 Jul: USD 1,255.85, GBP 962.99 & EUR 1,077.64 per ounce
21 Jul: USD 1,247.25, GBP 958.89 & EUR 1,071.39 per ounce

Silver Prices (LBMA)

31 Jul: USD 16.76, GBP 12.77 & EUR 14.29 per ounce
28 Jul: USD 16.56, GBP 12.66 & EUR 14.15 per ounce
27 Jul: USD 16.79, GBP 12.77 & EUR 14.34 per ounce
26 Jul: USD 16.37, GBP 12.54 & EUR 14.06 per ounce
25 Jul: USD 16.31, GBP 12.52 & EUR 14.00 per ounce
24 Jul: USD 16.50, GBP 12.66 & EUR 14.17 per ounce
21 Jul: USD 16.43, GBP 12.63 & EUR 14.11 per ounce

Recent Market Updates

– This Is Why Shrinkflation Is Making You Poor
– Gold A Good Store Of Value – Protect From $217 Trillion Global Debt Bubble
– Why Surging UK Household Debt Will Cause The Next Crisis
– Gold Seasonal Sweet Spot – August and September – Coming
– Commercial Property Market In Dublin Is Inflated and May Burst Again
– Gold Hedges Against Currency Devaluation and Cost Of Fuel, Food, Beer and Housing
– Millennials Can Punt On Bitcoin, Own Gold and Silver For Long Term
– “Time To Position In Gold Is Right Now” says Jim Rickards
– Bloomberg Silver Price Survey – Median 12 Month Forecast Of $20
– “Bigger Systemic Risk” Now Than 2008 – Bank of England
– “Financial Crisis” Coming By End Of 2018 – Prepare Urgently
– Video – “Gold Should Probably Be $5000” – CME Chairman
– India Gold Imports Surge To 5 Year High – 220 Tons In May Alone

Important Guides

For your perusal, below are our most popular guides in 2017:

Essential Guide To Storing Gold In Switzerland

Essential Guide To Storing Gold In Singapore

Essential Guide to Tax Free Gold Sovereigns (UK)

Please share our research with family, friends and colleagues who you think would benefit from being informed by it.

 

via http://ift.tt/2ucu1ji GoldCore

Two days after President Donald Trump tweeted he was “very disappointed” in China
following Pyongyang’s latest missile test adding that “we will no longer allow this to continue”, Beijing has hit back at Trump on Monday, saying the problem did not
arise in China and that all sides need to work for a solution, according to a statement sent to Reuters by China’s Foreign Ministry.

“All parties should have a correct understanding of this,” it said, adding the international community widely recognized China’s efforts to seek a resolution. The essence of Sino-U.S. trade is mutual benefit and win-win, with a vast amount of facts proving the healthy development of business and trade ties is good for both countries, the ministry added.

 

Chinese Vice Commerce Minister Qian Keming, weighed in too, telling a news conference there was no link between the North Korea issue and China-U.S. trade. “We think the North Korea nuclear issue and China-US trade are issues that are in two completely different domains. They aren’t related. They should not be discussed together,” Qian said.

Also on Monday, the state-run nationalistic Chinese tabloid Global Times said that “Pyongyang is determined to develop its nuclear and missile program and does not care about military threats from the U.S. and South Korea” adding “how could Chinese sanctions change the situation?”

China wants both balanced trade with the United States and lasting peace on the Korean peninsula, its official Xinhua news agency added in a commentary. “However, to realize these goals, Beijing needs a more cooperative partner in the White House, not one who piles blame on China for the United States’ failures,” it added.

Reuters adds that “China has become increasingly frustrated with American and Japanese criticism that it should do more to rein in Pyongyang. China is North Korea’s closest ally, but Beijing is angry with its continued nuclear and missile tests.” China, with which North Korea does the large majority of its trade, has repeatedly said it strictly follows U.N. resolutions on North Korea and has denounced unilateral U.S. sanctions as unhelpful.

As reported yesterday, the U.S. Ambassador to the United Nations, Nikki Haley, said in a statement China must decide if it is willing to back imposing stronger U.N. sanctions on North Korea over Friday night’s ICBM test, the North’s second this month. Any new U.N. Security Council resolution “that does not significantly increase the international pressure on North Korea is of no value”, Haley said, adding that Japan and South Korea also needed to do more.

Separately, Japan’s PM Abe told reporters after his conversation with Trump that repeated efforts by the international community to find a peaceful solution to the North Korean issue had yet to bear fruit in the face of Pyongyang’s unilateral “escalation”. “International society, including Russia and China, need to take this seriously and increase pressure,” Abe said. He said Japan and the United States would take steps towards concrete action but did not give details. Abe and Trump did not discuss military action against North Korea, nor what would constitute the crossing of a “red line” by Pyongyang, Deputy Chief Cabinet spokesman Koichi Hagiuda told reporters.

Underscoring the rising severity of the North Korean situation, the United States flew two supersonic B-1B bombers over the Korean peninsula in a show of “lethal, overwhelming force” on Sunday in response to the missile test and the July 3 launch of the “Hwasong-14” rocket, the Pentagon said. The bombers took off from a U.S. air base in Guam and were joined by Japanese and South Korean fighter jets during the exercise.

“North Korea remains the most urgent threat to regional stability,” Pacific Air Forces commander General Terrence J. O’Shaughnessy said in a statement. “If called upon, we are ready to respond with rapid, lethal, and overwhelming force at a time and place of our choosing.”

Meanwhile, South Korea’s Kospi stock index, oblivious of the constant threat of military action in its northern neighbor, closed 0.07% in the green, just shy of all time highs.

via http://ift.tt/2wdnqqn Tyler Durden