Weather Models Forecast Coldest Thanksgiving On Record In Northeast

According to new weather models, the US mid-Atlantic and Northeast regions are expected to experience the coldest/earliest temperatures to the start of any winter season on record. 

Weather Prediction Center: “Highs 20-35 degrees below normal” 

The culprit: a massive area of high pressure from the Arctic Circle will descend across Canada and into the Northeast, collapsing temperatures to life-threatening conditions ahead of Thanksgiving and into Black Friday.  

“Very cold air will make its way into the Northeast just in time for Thanksgiving and Black Friday. Most major cities along the I-95 corridor will rival coldest maximum temperatures for the date, including New York City, Boston, Providence, and Philadelphia. Most cities will run 20 to 25 degrees below average for late November, and combined with breezy conditions, will make for brutally cold “feels like” temperatures even colder than the air temperature. This will make for an interesting dilemma for shoppers on the fence about heading out for Black Friday, with temperatures Thursday night in the single digits and teens for most. With this increased cold risk, natural gas continues to be heavily influenced by weather model forecasts through the end of the month,” said Ed Vallee, head meteorologist at Vallee Weather Consulting.

The National Digital Forecast Database (NDFD) released new weather models that indicate the blast of arctic air could affect much of the mid-Atlantic and North East regions, threatening to keep America’s consuming herd indoors, crippling shopping intentions and keeping tens of millions of Americans away from their favorite retailer of choice.

NDFD Low Temperatures For Thanksgiving  

“November is running more than 4°F below normal across the Lower 48. Unprecedented cold coming by Thanksgiving will turn this map dark purple across the Northeast,” said Ryan Maue of weathermodels.com. 

“New York City has only had three Thanksgivings dating to 1870 when the high temperature failed to rise out of the 20s, according to National Weather Service statistics. The coldest was a high of 26 degrees on Nov. 28, 1901.

Forecast highs Thursday could be near that all-time record coldest high set almost 117 years ago.

In southern New England, Boston could come within a couple of degrees of its coldest Thanksgiving high of 24 degrees, also set Nov. 28, 1901.

Providence, Rhode Island, Philadelphia and Burlington, Vermont, may also see highs within striking distance of the coldest on record for Thanksgiving Day in each city.

Low temperatures Thanksgiving morning and Black Friday will likely be 15 to 25 degrees below average for late November.

The temperature for the Macy’s Thanksgiving Day parade in New York City is expected to be in the low- to mid-20s. It will feel even colder when you factor in the wind chill, possibly in the mid-teens.

A low temperature of 20 degrees Thursday morning would also be near the record coldest Thanksgiving low at New York City’s Central Park.

Elsewhere, low temperatures Thursday and Friday mornings will be in the single digits and lower teens across the interior Northeast. Closer to the coast, it will be in the teens or lower 20s. 

A few cities may flirt with daily record lows for Nov. 22 (Thursday) or Nov. 23 (Friday).

This includes Albany, New York, and Providence, Rhode Island, where the daily record-low temperature Thursday is 9 degrees and 16 degrees, respectively.

Although it will be cold, the air will also be dry, which means there won’t be any snowfall to worry about Thursday and Friday,” said the Weather Channel

With weather models pointing to record low temperatures, it has been no surprise that natural gas prices have been moving higher, besides OptionSellers.com and other funds who were recently blown out of their short positions when price popped almost 18% last Wednesday. 

NatGas Chart

The Energy Information Administration reported that natural gas storage in the lower 48 states was below the five-year average as of October 31. 

Storage Inventory Forecast, US Lower-48, Latest GFS

US Lower-48 EC Heating Degree Day (HDD) Operational 

With some regions along the North East expected to smash 100-year lows in the coming days, it is also noted that the sun is currently entering one of the deepest Solar Minima since the 1800s when the last mini ice age was observed. 

“The sun is entering one of the deepest Solar Minima of the Space Age,” wrote Dr. Tony Phillips just six weeks ago, on September 27, 2018. The lack of sunspots on our sun could bring about record cold temperatures, and perhaps even a mini ice age.

If the next few days are a habinger of what to expects, the US Northeast is going to have a brutal winter ahead, an excuse which Wall Street analysts will gladly use to explain why the economy is rapidly slowing and potentially throwing a wrench in any Fed plans to deviate from its tightening course if Jerome Powell once again assumes that it is not the economy, stupid, but the cold weather. 

“Democratic Socialist” Ocasio-Cortez Couldn’t Name The 3 Branches Of Government

If you needed more evidence that “Democratic Socialist” Alexandria Ocasio-Cortez – who, at 29, is the youngest woman ever elected to Congress – isn’t ready for prime time, here it is.

Ocasio

During a conference call with prospective far-left candidates over the weekend, Ocasio-Cortez advised her comrades that the time for revolution is at hand: “[We need to] work our butts off to make sure that we take back all three chambers of Congress – Uh, rather, all three chambers of government: the presidency, the Senate, and the House” – in 2020. We can’t start working in 2020.”

For the record, the three branches of government are the legislative, the executive and the judiciary.

Ocasio-Cortez then blasted Republicans for “drooling” over every minor slip up that she “corrects in real-time.”

But this is only the latest in an embarrassing stream of slip ups and gaffes from Ocasio-Cortez, who has a degree in economics from Boston University, but has spent most of her time since graduating working in restaurants and non-profits. Since being thrust into the limelight after her upset primary win, Ocasio-Cortez has claimed that unemployment is low because everybody has two jobs (that’s not how it works), struggled to explain Israel’s occupation of Palestine, claimed that the “upper-middle class doesn’t exist anymore” (it’s actually growing) and wrongly accused Joe Crowley, the Democratic leader whom she defeated in an upset primary win, of plotting a third-party run against her (he wasn’t, and didn’t). And perhaps most memorably of all, Ocasio-Cortez told Chris Cuomo over the summer that Medicare for All would be much cheaper than the current system because the current health-care cost data don’t factor in the funeral costs for all those who die for lack of health care.

That’s right: Ocasio-Cortez’s health-care plan is so good, it’s going to stop people from dying. Now that’s something even libertarian venture capitalist Peter Thiel could get behind.

Does China Have Enough Gold To Move Toward Hard Currency?

Authored by Alasdair Macleod via The Mises Institute,

Are the Chinese Keynesian?

We can be reasonably certain that Chinese government officials approaching middle age have been heavily westernised through their education. Nowhere is this likely to matter more than in the fields of finance and economics. In these disciplines there is perhaps a division between them and the old guard, exemplified and fronted by President Xi. The grey-beards who guide the National Peoples Congress are aging, and the brightest and best of their successors understand economic analysis differently, having been tutored in Western universities.

It has not yet been a noticeable problem in the current, relatively stable economic and financial environment. Quiet evolution is rarely disruptive of the status quo, and so long as it reflects the changes in society generally, the machinery of government will chug on. But when (it is never “if”) the next global credit crisis develops, China’s ability to handle it could be badly compromised.

This article thinks through the next credit crisis from China’s point of view. Given early signals from the state of the credit cycle in America and from growing instability in global financial markets, the timing could be suddenly relevant. China must embrace sound money as her escape route from a disintegrating global fiat-money system, but to do so she will have to discard the neo-Keynesian economics of the West, which she has adopted as the mainspring of her own economic advancement.

With Western-educated economists embedded in China’s administration, has China retained the collective nous to understand the flaws, limitations and dangers of the West’s fiat money system? Can she build on the benefits of the sound-money approach which led her to accumulate gold, and to encourage her citizens to do so as well?

China’s economic advisors will have to display the courage to drop the misguided economic policies and faux statistics by which she will continue to be judged by her Western peers. If she faces up to the challenge, China should emerge from the next credit crisis in a significantly stronger position than the West, for which such a radical change in economic thinking undertaken willingly is impossible to imagine.

Post-Mao Financial and Monetary Strategy

Following Mao Zedong’s death in 1976, the Chinese leadership faced a primal decision over her destiny. With Mao’s demise, the icon that forcibly united over forty ethnic groups was gone. It was the end of an era of Chinese history, and she had to embrace the future with a new approach. Failure to do so risked the fragmentation of the state through civil disobedience and would probably have ended in a multi-ethnic civil war.

Wise heads, which had observed the remarkable successes of Hong Kong and Singapore being driven by Chinese diasporas, prevailed. It was clear that in order to survive, the Communist Party would have to embrace capitalism while retaining political control. Mao’s nominated successor, Hua Gofeng, lasted no more than a year, being promoted upstairs out of harm’s way. It was his successor, Deng Xiaoping, who reinvented China. In the late-1970s, Deng, hating the Soviets for their involvement in Vietnam, reaffirmed the USSR as China’s main adversary. At this crucial point in China’s pupation she secured a strategic relationship with America by sharing a common enemy.

The seeds for the relationship with America had already been sown by Nixon’s first visit to China in 1972, so the Americans were prepared to help ease China into their world. Through the 1980s, the relationship opened China up to inward investment by American and other Western corporations, and there was a rush to establish new factories, taking advantage of a cheap diligent labour force and the lack of restrictive regulations and planning laws.

By 1983 it was clear that China’s central bank, the Peoples Bank (PBOC), had a growing currency problem on its hands, because it bought all the foreign exchange against which it issued yuan for domestic circulation. Inward capital flows were added to by the policy of managing the yuan exchange rate lower in order to stimulate economic development. Accordingly, as well as foreign currency management the PBOC was tasked with the sole responsibility of the state’s gold and silver purchases as a policy offset.1 The public was still banned from owning both metals.

In those days, China’s gold objective was simply to diversify her reserves. The leadership grasped the difference between gold and fiat money, just as the Arabs had in the 1970s, and the Germans had in the 1950s. It was prudent to hold some physical gold. Furthermore, Marxist economic theory taught in the state universities impressed on students that western capitalism was certain to fail, and that being the case, their fiat currencies would become worthless as well.

China’s secret accumulation of gold in the 1980s was also an insurance against future economic instability, which is why it was spread round the institutions that were fundamental to the state, such as the Peoples Liberation Army, the Communist Party and the Communist Youth League. Only a relatively small portion was declared as monetary reserves.

In the 1990s, inward capital flows were beginning to be supplemented by exports, and a new wealthy Chinese class was emerging. The PBOC still had an embarrassment of dollars. Fortunately, gold was unloved in Western markets, and bullion was readily available at declining prices. The PBOC was able to accumulate gold secretly on behalf of the state’s institutions in large quantities. But there was a new strategic reason emerging for buying gold, following the collapse of the USSR.

The end of the USSR in 1989 meant it was no longer America’s and China’s common enemy, altering the strategic relationship between the two. This led to a gradual change in China’s foreign relationships, with America becoming increasingly concerned at China’s emergence as a super-power, threatening her own global dominance.

These shifting relationships changed China’s gold policy from one where gold acted as a sort of general insurance policy against monetary unknowns, to its accumulation as a strategic asset.

Bullion was freely available, partly because Western central banks were selling it in a falling market. The notorious sale of the bulk of Britain’s gold by Gordon Brown at the bottom of the market was the public face of Western central banks’ general disaffection with gold. China was on the other side of the deal. Between 1983 and 2002, mine supply added 42,460 tonnes to above-ground stocks, when the West were net sellers.

The evidence of China’s all-out gold policy is plain to see. She invested heavily in gold mining and is now the largest national miner of gold by far. Chinese government refiners were also importing gold and silver doré to process and keep, and they set a new four-nines standard for one kilo bars. Today, China has a tightening grip on the entire global bullion market.

A decision was taken in 2002 by China to allow the public to buy gold, and the benefits of ownership were widely promoted by state media. We can be certain this decision was taken only after the State had accumulated sufficient bullion for its supposed needs.

China’s public has accumulated approximately 15,000 tonnes to date, net of scrap recycling, based on deliveries out of the Shanghai Gold Exchange’s vaults. Given the public is still banned from owning foreign currency, gold ownership should continue to be popular as an alternative store of value to the yuan, and currently between 150-200 tonnes are being delivered from SGE vaults every month.

Other than declared reserves, it is not known how much gold the state owns. But assessing capital flows from 1983 and allowing for the availability of physical bullion through mining supply and the impact of the 1980-2002 bear market, the PBOC could have accumulated as much as 15,000-20,000 tonnes before the public were permitted to buy gold. If so, it would represent approximately 10% of those capital flows at contemporary gold prices.

The truth is unknown, but we can be sure gold has become a strategic asset for China and its people. China must have always had an expectation that in the long-term gold will become money again, presumably as backing for the yuan. Otherwise, why go to such lengths to monopolize the global bullion market?

But there is a problem. As time goes on and a newer, western-educated generation of leaders emerges, will they still fully recognize the value of gold beyond being simply a strategic asset, and will they recognize the real reasons behind the West’s economic failures, given they have successfully embraced its economic and monetary policies?

Were the Chinese to take a turn toward hard-money policies, it is hard to see how the US could match a sound-money plan from China. Furthermore, the US Government’s finances are already in very poor shape and a return to sound money would require a reduction in government spending that all observers can agree is politically impossible. This is not a problem the Chinese government faces.

Whether China implements such a plan, one thing is for sure: the next credit crisis will happen, and it will have a major impact on all nations operating with fiat money systems. The interest rate question, because of the mountains of debt owed by governments and consumers, will have to be addressed, with nearly all Western economies irretrievably ensnared in a debt trap. The hurdles faced in moving to a sound monetary policy appear to be simply too daunting to be addressed.

Ultimately, a return to sound money is a solution that will do less damage than fiat currencies losing their purchasing power at an accelerating pace. Think Venezuela, and how sound money would solve her problems. But that path is blocked by a sink-hole that threatens to swallow up whole governments. Trying to buy time by throwing yet more money at an economy suffering a credit crisis will only destroy the currency. The tactic worked during the Lehman crisis, but it was a close-run thing. It is unlikely to work again.

[Adapted and shortened from the original.]

Saudis Agree To Yemen Peace Talks – Ceasefire In Effect For First Time Since War’s Start

The prospect for peace – or at least a lasting ceasefire – is advancing rapidly following a surprise weekend proposal by Yemen’s Houghis to halt all attacks on Saudi coalition forces. On Sunday the head of Yemen’s Iran-backed Houthi Supreme Revolutionary Committee Mohammed Ali al-Houthi, said “We are willing to freeze and stop military operations” something which now appears to have taken effect, according to a breaking Reuters report.

In the biggest turning point in the war which has raged since 2015, Reuters confirms:

Houthi rebels in Yemen said on Monday they were halting drone and missile attacks on Saudi Arabia, the United Arab Emirates and their Yemeni allies, responding to a demand from the United Nations.

“We announce our initiative…to halt missile and drone strikes on the countries of aggression,” an official Houthi statement reads. Crucially, it appears this halt in fighting was precipitated by a Saudi agreement to the Houthi extension of an olive branch as according to the AFP Yemen’s internationally recognized Saudi-backed government says it has informed UN envoy Martin Griffiths it is ready to take part in proposed peace talks with Houthi rebels to be held in Sweden.

Pro-Saudi forces in Yemen, via Getty images

“The [Saudi-backed Yemen] government has informed the UN envoy to Yemen … that it will send a government delegation to the talks with the aim of reaching a political solution,” Yemen’s pro-Saudi foreign ministry said, quoted by the official Saba news agency.

The development is of monumental importance and has broader geopolitical implications as crown prince MbS remains under international scrutiny following the early October killing of journalist Jamal Khashoggi. Following the murder at the hands of Saudi operatives the plight of millions of suffering Yemeni civilians under Saudi coalition bombs suddenly found its way into the media spotlight after the mainstream had long ignored the conflict, partly due to the fact that the United States and Western allies have played a lead role in the devastating bombing campaign. 

On Monday Saudi King Salman told his country’s top advisory body, the Shura Council: “our support for Yemen was not an option but a duty… to help the Yemeni people confront the Iran-backed militias” — choosing to frame the ceasefire as if Riyadh has been on the side of “the people” the whole time. The King agreed there should be a “political solution” and a “comprehensive national dialogue” in Yemen, according to Reuters.

UN envoy Griffiths is expected to be in the Yemeni capital of Sanaa this week seeking to finalize preparations for peace talks in Sweden, though a date for the negotiations has yet to be set. 

The broader picture is that the Saudis appear to be bowing to U.S. pressures over reducing the Saudi coalition’s actions and atrocities in Yemen as media and western public outrage builds in the wake of the Khashoggi killing.