Baltic Dry Index. 935 -13
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
“I'm
normally not a praying woman, but if you're up there, please save me Superman.”
The
talking chair, with apologies to Homer Simpson.
After the turmoil of the past week, there were
signs that the Fed’s Plunge Protection Team showed up late yesterday, though I
doubt that they can manage more than a dead cat bounce. Any dead cat bounce
will just be used by over leveraged, margin call pressed speculators and the
HFT algo thieves, as an exit mechanism and chance to clutch at straws. Without
QE Forever, the markets will get the crash that QE was brought in to prevent.
The Pax Americana era of 1945 to 2007 seems to have ended.
Below, yesterday’s action in the central bankster’s
casino world of over-priced stocks. Experts, who needs them?
“Operator!
Give me the number for 911!”
The
NY Fed, with apologies to Homer Simpson.
Asian Stocks Head to Six-Month Low; Bonds Rise, Oil Drops
Oct 16,
2014 4:50 AM GMT
Asian stocks
slid toward a six-month low and average bond yields for the biggest developed
economies fell to a record on concern that Europe’s economic woes may scupper
the global recovery. Crude oil extended declines as South Korea’s won led
emerging-market currencies higher.
The MSCI Asia Pacific Index sank 0.9 percent by 12:49 p.m. in Tokyo, as most major Asian benchmark gauges retreated. Japan’s Topix index dropped 2 percent. Standard & Poor’s 500 Index futures added 0.3 percent after the U.S. gauge fell to a six-month low. The won gained 0.3 percent. Japan’s 10-year bond yield dropped and Treasuries rose an eighth day as investors pushed out the estimate for when the Federal Reserve will raise rates. Oil in New York fell 1.3 percent to $80.75.
Euro-area inflation data is due today after the region’s stocks tumbled, Greek bonds plunged and Germany cut its growth forecast, stirring memories of the bloc’s sovereign-debt crisis. Asian bond risk surged. A bigger-than-projected drop in U.S. retail sales ignited concern over the impact of the global slowdown on the world’s biggest economy.
----The S&P 500 ended last session down 0.8 percent, paring a drop of as much as 3 percent that briefly wiped out its gain for the year. Europe’s benchmark stock gauge plunged 3.2 percent, its biggest retreat in almost three years, and finished the day 11 percent below a June high, meeting the common definition of a correction.
More
US economic fears spark global sell-off
London's benchmark index plunges, while markets in Europe and on Wall Street tumble on poor economic data
Financial markets around the world were plunged into turmoil on Wednesday after poor data from the US heightened fears over the health of the global economy.The Dow Jones Industrial Average tumbled as much as 460 points, a 2.8pc drop, and the S&P 500 lost as much as 3pc on Wall Street.
Yields on safe-haven 10-year Treasuries briefly crashed to 1.86pc – the lowest level since May 2013 – before rebounding, a sudden fall that took traders by surprise.
The violent moves were mirrored by markets across the world. In London, the FTSE 100 dived 181.04 points to 6,211.64, a 2.8pc drop. It was the worst one-day slide for 16 months, taking the index to its lowest since June last year and wiping £46bn off its value.
The FTSE MIB in Italy was down
4.4pc, the CAC 40 in France tumbled 3.6pc and Germany’s DAX lost 2.9pc. The
pan-European Stoxx Europe 600 fell 3.2pc, a decline that meant the index had
officially entered a correction. Similarly, London’s benchmark index is almost
in correction territory, having dropped nearly 10pc from its recent peak.
Meanwhile the Vix, which measures
market volatility, spiked as much as 36pc to its highest since November 2011.
Brent crude futures slumped to about $84 a barrel.
Unsettling economic data from the
US was the major catalyst for the sell-off. Retail sales fell by a worse than
expected 0.3pc last month, producer prices slipped 0.1pc and manufacturing in
New York also slowed. The data spurred speculation the US Federal Reserve would
push back raising interest rates, putting further pressure on Treasury yields.
More
World economy so damaged it may need permanent QE
Markets are realising that the five-and-a-half year recovery since the financial crisis may already be over, says Ambrose Evans-Pritchard
Combined tightening by the United
States and China has done its worst. Global liquidity is evaporating.
What looked liked a gentle tap on
the brakes by the two monetary superpowers has proved too much for a fragile
world economy, still locked in "secular stagnation". The latest
investor survey by Bank of America shows that fund managers no longer believe
the European Central Bank will step into the breach with quantitative easing of
its own, at least on a worthwhile scale.
Markets are suddenly prey to the
disturbing thought that the five-and-a-half year expansion since the Lehman
crisis may already be over, before Europe has regained its prior level of
output. That is the chief reason why the price of Brent crude has crashed by
25pc since June. It is why yields on 10-year US Treasuries have fallen to
1.96pc, and why German Bunds are pricing in perma-slump at historic lows of
0.81pc this week.
We will find out soon whether or
not this a replay of 1937 when the authorities drained stimulus too early, and
set off the second leg of the Great Depression.
If this growth scare presages the
end of the cycle, the consequences will be hideous for France, Italy, Spain,
Holland, Portugal, Greece, Bulgaria, and others already in deflation, or close
to it. The higher their debt ratios, the worse the damage.
Forward-looking
credit swaps already suggest that the US Federal Reserve will not be able to
raise interest rates next year, or the year after, or ever, one might say. It
is starting to look as if the withdrawal of $85bn of bond purchases each month
is already tantamount to a normal cycle of rate rises, enough in itself to
trigger a downturn. Put another way, it is possible that the world economy is
so damaged that it needs permanent QE just to keep the show on the road.
----Gentle declines in the price of oil are typically benign, a shot in the arm for companies and consumers alike. The rule of thumb is that each $10 drop in the price adds 0.3pc to GDP growth over the next year.
Crashes are another story. They
signal global stress, doubly dangerous today because the whole industrial world
is one shock away from a deflation trap, a psychological threshold where we
batten down the hatches and wait for cheaper prices. That is the Ninth Circle
of Hell in economics. Lasciate ogni speranza.
The world is also more stretched.
Morgan Stanley calculates that gross global leverage has risen from $105
trillion to $150 trillion since 2007. Debt has risen to 275pc of GDP in the
rich world, and to 175pc in emerging markets. Both are up 20 percentage points
since 2007, and both are historic records. The Bank for Settlements warns that
the world is on a hair-trigger. The slightest loss of liquidity can have
"violent" effects.
More
Biggest Pain Trade Gives 37% Loss to Bond Bears Getting It Wrong
Oct 15, 2014 10:33 PM GMT
What a dismal time for bond traders who were
optimistic about growth. Investors who poured more than $1 billion this year into a $3.8 billion leveraged exchange-traded fund that bets against long-dated U.S. Treasuries are suffering a 10.7 percent loss this month alone, Bloomberg data show. The fund is down 36.5 percent this year, a small window into the magnitude of pain in a market where many traders have been wagering debt prices would fall.
Treasuries have defied predictions across Wall Street for higher yields all year, and yesterday’s move is sending bond bears into a tailspin. Yields on 10-year Treasuries fell the most since March 2009, trading below 2 percent for the first time since June 2013 as a decline in retail sales prompted traders to reduce wagers the Federal Reserve will start raising interest rates next year.
The move is in part driven by traders covering their short bets, according to Jack Flaherty, an investment manager at GAM USA Inc. in New York.
“There’s been weakness, weakness, weakness and today it’s just ‘Get me out’,” Flaherty said yesterday.
Primary dealers had the biggest short position on benchmark government notes at the beginning of the month since June 2013. They had a net $20.7 billion wager against notes maturing in the seven-to-eleven year range in the week ended Oct. 1, Fed data show.
It seems, though, that almost everything in the world is going against these bears right now. The global economy is slowing down, the Ebola epidemic in Western Africa is spreading, and conflicts in Iraq and Syria are escalating. All of that is translating into a surge in demand for the safety of Treasuries.
More
Wall Street’s Top Bull Says S&P Call ‘Catching Up to Us’
Oct 15, 2014 10:28 PM GMT
In mid-August, Stifel Nicolaus & Co.’s top equity strategist Barry Bannister went from the biggest bear on U.S.
equities to its biggest bull. It might have been too soon, he says. “We definitely pulled the trigger too early and it looks like it’s catching up to us,” Bannister said in a phone interview with Bloomberg News today. “There is a real issue of global deflationary pressures, and the hysteria around Ebola and the Middle East isn’t helping.”
Bannister had long been one of the most pessimistic strategists on Wall Street, starting the year with a forecast that the Standard & Poor’s 500 Index would be at 1,850 by December. As stocks steadily climbed, he made about-face in August and changed his estimate to 2,300, higher than any of the other 19 strategists tracked by Bloomberg.
More
We end for the day with Citigroup talking up its
book and whistling past the graveyard. Yes lower oil prices are good for a few
in the short term and everyone in the long term, but in the long term we’re all
dead. Citigroup has to get out of the present without becoming the next Lehman.
What good is a talking chair if it doesn’t send the banksters cash?
“Aw,
people can come up with statistics to prove anything, Kent. 14 percent of all
people know that.”
Citigroup,
with apologies to Homer Simpson.
Citigroup Sees $1.1 Trillion Stimulus From Oil Plunge
Oct 15,
2014 10:27 PM GMT
The lowest oil price in four years will provide stimulus of as much as $1.1
trillion to global economies by lowering the cost of fuels and other commodities,
according to Citigroup Inc. Brent, the world’s most active crude contract, closed at $83.78 a barrel in London yesterday. That’s more than 20 percent below its average for the past three years, amounting to savings of about $1.8 billion a day based on current output, Citigroup estimates. Savings will climb to $1.1 trillion annually as the slide cuts costs of other commodities, leaving consumers and companies with extra cash to spend and bolstering growth, according to Ed Morse, the bank’s head of global commodities research in New York.
Crude prices are plunging amid signs that OPEC, supplier of 40 percent of the world’s oil, won’t act to eliminate a surplus as global growth slows. Combined supplies from the U.S. and Canada rose last year to the highest since at least 1965 as producers tapped stores locked in shale-rock formations and oil sands. The global economy will rebound next year, with growth quickening to 2.98 percent, the fastest since 2010, according to analyst forecasts compiled by Bloomberg.
“A reduction in oil prices also results in a reduction in prices across commodities, starting with natural gas, but also including copper, steel, and agriculture,” Morse said yesterday in an e-mailed response to questions. “All commodities are energy intensive to one degree or another.”
More
“‘To
Start Press Any Key'. Where's the ANY key?”
The
talking chair, with apologies to Homer Simpson.
At the Comex silver depositories Wednesday final figures were: Registered 66.52
Moz, Eligible 116.01 Moz, Total 182.53 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
No usual subjects today, just yet another New
Carbon Age development that will hopefully lead to a cheap energy future
without the need for dangerous nuclear power plants. Think of a world with almost
free lighting powered by the sun and large scale, lightweight TVs etc., that
operate on hardly any electric power compared to today. Think of a world that
undoes nearly every electric power generating company’s business model sometime
next decade.
“If
something’s hard to do, then it’s not worth doing.”
TEPCO,
with apologies to …..
Beyond LEDs: Brighter, new energy-saving flat panel lights based on carbon nanotubes
October 14, 2014 Source: American
Institute of Physics (AIP)
Summary:
Scientists have developed a
new type of energy-efficient flat light source based on carbon nanotubes with
very low power consumption of around 0.1 Watt for every hour’s operation --
about a hundred times lower than that of an LED.
Enter carbon electronics.
Electronics based on carbon,
especially carbon nanotubes (CNTs), are emerging as successors to silicon for
making semiconductor materials. And they may enable a new generation of
brighter, low-power, low-cost lighting devices that could challenge the
dominance of light-emitting diodes (LEDs) in the future and help meet society's
ever-escalating demand for greener bulbs.
Scientists from Tohoku University
in Japan have developed a new type of energy-efficient flat light source based
on carbon nanotubes with very low power consumption of around 0.1 Watt for
every hour's operation--about a hundred times lower than that of an LED.
In the journal Review of
Scientific Instruments, from AIP publishing, the researchers detail the
fabrication and optimization of the device, which is based on a phosphor screen
and single-walled carbon nanotubes as electrodes in a diode structure. You can
think of it as a field of tungsten filaments shrunk to microscopic proportions.
They assembled the device from a
mixture liquid containing highly crystalline single-walled carbon nanotubes
dispersed in an organic solvent mixed with a soap-like chemical known as a
surfactant. Then, they "painted" the mixture onto the positive
electrode or cathode, and scratched the surface with sandpaper to form a light
panel capable of producing a large, stable and homogenous emission current with
low energy consumption.
"Our simple 'diode' panel
could obtain high brightness efficiency of 60 Lumen per Watt, which holds
excellent potential for a lighting device with low power consumption,"
said Norihiro Shimoi, the lead researcher and an associate professor of
environmental studies at the Tohoku University.
Brightness efficiency tells
people how much light is being produced by a lighting source when consuming a
unit amount of electric power, which is an important index to compare the
energy-efficiency of different lighting devices, Shimoi said. For instance,
LEDs can produce 100s Lumen per Watt and OLEDs (organic LEDs) around 40.
Although the device has a
diode-like structure, its light-emitting system is not based on a diode system,
which are made from layers of semiconductors, materials that act like a cross
between a conductor and an insulator, the electrical properties of which can be
controlled with the addition of impurities called dopants.
The new devices have luminescence
systems that function more like cathode ray tubes, with carbon nanotubes acting
as cathodes, and a phosphor screen in a vacuum cavity acting as the anode.
Under a strong electric field, the cathode emits tight, high-speed beams of
electrons through its sharp nanotube tips -- a phenomenon called field
emission. The electrons then fly through the vacuum in the cavity, and hit the
phosphor screen into glowing.
More
“Facts
are meaningless. You could use facts to prove anything that's even remotely
true.”
Uncle
Scam, John Bull, the Middle Kingdom, with apologies ….
The monthly Coppock Indicators finished September.
DJIA: +141 Down. NASDAQ: +289 Down. SP500: +216 Down.
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