Friday, 15 July 2016

Hollande Not “Just Anybody,” It’s Official

Baltic Dry Index. 738 +12       Brent Crude 47.05

LIR Gold Target in 2019: $30,000.  Revised due to QE programs.

We open with our thoughts, prayers, condolences, and sympathies with the people of France, who have suffered yet another moslem fanatical atrocity last night in Nice.

In other news, China’s GDP, despite record stimulus, barely hit the official scripted target. What really happened in the Chinese economy is anyone’s guess. But record stimulus to produce a so so result doesn’t sound that good to me.

China’s Q2 GDP stays steady, thanks to record stimulus

Published: July 14, 2016 10:37 p.m. ET
BEIJING — Chinese growth held steady at 6.7% in the second quarter, as record stimulus poured into the economy in the first quarter lent at least temporary stability to a slumping economy.

The growth report came in above forecasts after prior data had showed weaker manufacturing, exports and private investment. Friday’s data were likely to ease pressure on Beijing to roll out more immediate stimulus measures, which have proven increasingly ineffective in reversing downward momentum.

A poll of 16 economists by The Wall Street Journal had predicted 6.6% growth in China’s gross domestic product in the April-June period.

The National Bureau of Statistics also said Friday that industrial output rose 6.2% in June from a year earlier, accelerating from 6.0% growth in May, while fixed-asset investment climbed 9.0% year on year for the January-June period, compared with an increase of 9.6% in the year’s first five months. Retail sales grew 10.6% in June from a year earlier, accelerating from a 10% increase in May. The industrial-production and retail figures were better than expected while the investment figure was below expectation.

In a bid to boost growth, China’s central bank has flushed funds through the financial system, ramped up infrastructure spending and reduced red tape and corporate taxes. The Finance Ministry reported Friday that government spending rose 19.9% year-over-year in June compared with a 17.6% increase in May.

But that hadn’t appeared to be enough to counter a host of downdrafts hitting the world’s second-largest economy, raising the prospect that China could miss its annual growth target, set at 6.5% to 7% in 2016, for the third year in a row.

China's property market rebound slows down

Published: July 14, 2016 11:02 p.m. ET
SHANGHAI--The rebound in China's property market lost some momentum in June, with smaller gains in housing sales in June holding back investment growth.

Housing sales rose 44.4% in the first half of the year to 4.18 trillion yuan ($625 billion), according to data released by the National Bureau of Statistics Friday. In the first five months of this year, housing sales jumped 53.4%.

In terms of floor area, housing sales rose 27.9% compared with the year earlier in the January-to-June period.

In June alone, housing sales rose 21.8% on-year by value, slower than the 32.9% rise recorded in May, calculations by The Wall Street Journal showed.

Some so-called second tier cities are following the lead from the top-tier cities by implementing property cooling measures such as increased restrictions on loans to home-buyers, following concerns that their housing markets are becoming too frothy. Other smaller cities plagued with large inventories such as Jinhua in Zhejiang province, are offering cash subsidies to home-buyers as part of the country's broader property-destocking mandate.

Investment growth in China's real-estate development rose 6.1% to 4.66 trillion yuan, down from the 7.0% gain recorded in the first five months this year.

Construction starts across residential and commercial real estate rose 14.9% on-year to 755.4 million square meters, moderating from the 18.3% gain recorded in the first five months of 2016.

U.S., China clash over market economy status at WTO

Thu Jul 14, 2016 2:53pm EDT
The United States warned China on Thursday that it had not done enough to qualify for market economy status, especially in steel and aluminium, sowing the seeds for a trade battle between Washington and Beijing at the end of 2016.

Upon China's admission to the WTO in 2001, it was told by other members that they would not use its published, state-controlled prices to judge whether or not it was "dumping" exports unfairly in their markets, but rather "surrogate" prices reflecting what it should be charging without state subsidies.

That was written into its WTO membership agreement in a clause that would expire after 15 years, on Dec. 11, 2016.

If the United States, European Union, and other WTO members begin to take Chinese export prices at face value, it will be much harder for them to challenge China's cheap exports.

U.S. trade diplomat Chris Wilson told the WTO meeting that the expiry of the clause did not require other WTO members to automatically grant China market economy status on Dec. 11

Instead, China must establish under each WTO member country's domestic law that it is a market economy, he said, according to an outline of his remarks seen by Reuters.

In America, the Project Fear Brexit lie continues to unravel. In Dodgy Dave and little boy George Osborne’s inept Remainiac campaign that co-opted half the world’s politicians and central banksters,  the main fallout seems to have been the great car crash of their political careers.

Two More Fed Officials Play Down Brexit Impact on U.S. Growth

July 14, 2016 — 10:34 PM BST
Brexit was a dark cloud on the horizon for the Federal Reserve. With the storm passing, a number of officials have said that repercussions from Britain’s vote to quit the European Union probably won’t derail the U.S. economy, or stop them from raising interest rates.

Comments Thursday from the presidents of the Federal Reserve Banks of Kansas City and Atlanta chimed with other remarks from U.S. central bankers playing down the likely fallout from the U.K. referendum as they prepare for a policy meeting later this month.

“I have no basis -- statistical or anecdotal -- for assuming any significant change in economic momentum,” since the June 23 U.K. referendum, Atlanta Fed chief Dennis Lockhart told an audience in Victor, Idaho.
“To summarize my view of Brexit effects: negligible near-term effect; a risk factor over the medium term; higher uncertainty that could amount to a persistent economic headwind.”

Fed Chair Janet Yellen has not publicly weighed in on the debate and has no appearances scheduled between now and the July 26-27 meeting of the Federal Open Market Committee, which will not be followed by a press conference.
In Europe, it’s still business as usual, although there’s no honour among thieves, apparently.

“Call it the Goldman Sachs test. If this is something Goldman would do to its clients, don't do it."

Felix Salmon.

Hollande Calls Barroso’s Goldman Sachs Job Morally Unacceptable

July 14, 2016 — 5:34 PM BST Updated on July 14, 2016 — 7:20 PM BST
Jose Manuel Barroso’s decision to join Goldman Sachs Group Inc. is “morally unacceptable,” French President Francois Hollande said, adding to criticism of the former European Commission president’s decision to work for the U.S. investment bank.

Hollande, asked about Barroso during his annual Bastille Day television interview on Thursday, said Goldman Sachs was implicated in the financial crisis that began with U.S. sub-prime mortgages and in helping Greece cover up its debt.

“And we find out several years later that Mr. Barroso will join Goldman Sachs,” Hollande said. “It’s legally possible but it’s morally unacceptable.”

The New York-based bank said on July 8 that Barroso, who headed the European Commission from 2004 until 2014, will serve as non-executive chairman of its international unit and help advise on international issues. Those could include the fallout from Britain’s vote to leave the European Union. Barroso, 60, was prime minister of Portugal prior to his EU role.

European Commissioner Pierre Moscovici, a former French finance minister, said Barroso’s decision was “bad for the image” of the commission. French European Affairs Minister Harlem Desir said Wednesday it was “morally, politically and ethically a mistake.” Gianni Pittella, head of the Socialist Group in the European Parliament, said it was “deplorable from a political and moral point of view.”

In Portugal, the Socialist Party said Barroso led the EU’s executive arm during “the worst years of the European project” and his “prize” was to join a company that’s the main cause of “the destruction of social rights in the European Union.” His own Social Democratic Party said it saw “no issue,” while the EU has said Barroso’s move doesn’t violate its ethics rules.

----Draghi has said he had nothing to do with currency swaps arranged by Goldman Sachs that helped Greece hide the extent of its budget deficit before the country sought emergency help from its European partners.

Goldman isn’t the only institution to hire former and future leaders. Former British Prime Minister Tony Blair is a “senior adviser” to JPMorgan Chase & Co. and former German Chancellor Gerhard Schroeder is chairman of the shareholders board at OAO Gazprom-led pipeline project North Stream AG. Schroeder once called President Vladimir Putin a “flawless democrat” and has advocated ending EU economic sanctions on Russia backed by his successor, Angela Merkel.

Eckart von Klaeden caused a stir in 2013 when he moved from Merkel’s chancellery directly to Mercedes carmaker Daimler AG, where he’s vice president for external affairs. His transition from government minister to corporate lobbyist prompted an investigation by Berlin prosecutors, who found no wrongdoing.

Boris Johnson ‘Lied a Lot’ Over EU, French Minister Ayrault Says

July 14, 2016 — 12:06 PM BST
French Foreign Minister Jean-Marc Ayrault said that Boris Johnson, the U.K.’s new foreign secretary, didn’t tell the truth during the campaign to take Britain out of the European Union.

“He lied a lot to the British people and now he finds himself with his back against the wall,” Ayrault said on Europe1 radio in France on Thursday.

Johnson, who led the campaign to leave the EU in the June 23 referendum, was given the job of Britain’s top diplomat by Prime Minister Theresa May on Wednesday. It’s the former London mayor’s first job in government.

“His appointment is revealing about the political crisis in Britain after the vote,” Ayrault said.

Ayrault said that while he didn’t know David Davis, whom May has appointed as chief Brexit negotiator, “I need a partner who is clear, credible and reliable.”

Francois Hollande’s $11,000 could buy Warren Buffett 611 haircuts

Published: July 14, 2016 5:51 p.m. ET

Hollande isn’t ’just anybody’

When the satirical magazine La Mare aux Canards revealed this week that French President François Hollande’s hairdresser makes 9,895 euros a month, or roughly $11,000, social-media users dubbed the situation #CoiffeurGate, tweeting some jokes at Hollande’s expense.

The magazine wasn’t kidding about the number — a French government spokeswoman confirmed the stylist’s salary to Bloomberg after the country’s weekly cabinet meeting and said Hollande isn’t “just anybody.”

She is right; the average consumer spends far less.

If Hollande gets a haircut every day, that comes out to about $367 per hair cut.

On average, men spend about $28 per haircut in the U.S., compared with $44 for women, according to an analysis of “thousands” of appointments from payment company Square. The company declined to give the exact number of appointments it analyzed, but said it looked at the price of haircuts scheduled through its software Square Appointments over several months in 2014.

At these prices, Hollande’s $11,000 a month could pay for about 392 men’s haircuts.
Or, he could pay for 611 of Warren Buffett’s haircuts. The Berkshire Hathaway billionaire only spends $18 per cut.

We close for the week with the Baltic Dry Index rising. A seasonal bounce or are China’s coal imports a sign of something more?

Baltic Dry Index Continues to Ascend

July 15, 2016 01:31 GMT
The Baltic Dry Index has reached 738 points, continuing its recent climb as solid demand to ship raw materials is resulting in increasing hire rates for component ships. Driving index growth is increased demand to ship coal, iron ore, and grains.

Adding extra impetus to the ascent this week was the news that China increased its purchases of overseas coal to 21.75 million metric tons in June, the highest amount since Dec. 2014. Inbound shipments over the first six months of the year increased by 8.2 percent to 108 million tons, compared with a 38 percent slump in the first half of 2015.

China is the world’s largest coal user, and its increasing demand for seaborne coal is a definite positive for the BDI. Declining demand for coal contributed to the BDI’s rapid descent in 2015. China is increasing its coal imports to compensate for declining coal production. Apparently, Chinese government is pushing utilities to decrease their use of coal in order to reduce emissions, but this data seems to show otherwise. There is the possibility that Chinese coal miners are decreasing production in preparation for declining demand, but demand is remaining and, in order to meet this, the country is importing more coal.

Meanwhile, China is working to recover from the damaging Typhoon Nepartak, which killed 21 people and damaged infrastructure. Shipping into the region was halted due to the storm, and this could support the BDI in the coming weeks as demand increases to compensate for the hiatus.

One of the queries Quakers are asked to consider, is: "Do you maintain strict integrity in your business transactions and in your relations with individuals and organizations? Are you personally scrupulous and responsible in the use of money entrusted to you, and are you careful not to defraud the public revenue?"

Probably why there a no Quakers on Wall Street or in the City of London.
At the Comex silver depositories Thursday final figures were: Registered 26.61 Moz, Eligible 125.29 Moz, Total 151.80 Moz. 

Crooks and Scoundrels Corner

The bent, the seriously bent, and the totally doubled over.
Today, what a tangled web we weave…
"On the whole human beings want to be good, but not too good, and not quite all the time.”

George Orwell.


July 13, 2016
The biodiesel factory, a three-story steel skeleton crammed with pipes and valves, squatted on a concrete slab between a railroad track and a field of storage tanks towering over the Houston Ship Channel. Jeffrey Kimes, an engineer for the Environmental Protection Agency, arrived there at 9 a.m. on a muggy Wednesday in August 2011.
He’d come to visit Green Diesel, a company that appeared to be an important contributor to the EPA’s fledgling renewable fuels program, part of an effort to clean the air and lessen U.S. dependence on foreign fuel. In less than three years, Green Diesel had reported producing 50 million gallons of biodiesel. Yet Kimes didn’t know the company. He asked other producers, and they weren’t familiar with Green Diesel either. He thought he ought to see this business for himself.
Kimes, who works out of Denver, was greeted at the Green Diesel facility by a man who said he was the plant manager. He was the only employee there, which was odd. “For a big plant like that, you’re going to need a handful of people at least to run it, maintain it, and monitor the process,” says Kimes, a 21-year EPA veteran. The two toured the grounds, climbing metal stairways and examining the equipment. The place was weirdly still and quiet. Some pipes weren’t connected to anything. Two-story-high biodiesel mixing canisters sat rusting, the fittings on their tops covered in garbage bags secured with duct tape. Kimes started asking questions. “They showed me a log, and from that you could see they hadn’t been producing fuel for a long period of time,” he says.
An attorney for Green Diesel showed up. Kimes asked how he could reconcile the lack of production with what Green Diesel had been telling the EPA. The attorney said he didn’t know, he’d been hired only the day before. “It was obvious what was going on,” Kimes says.
The next day, he appeared at Green Diesel’s office in Houston’s upscale Galleria neighborhood, 15 miles from the plant, hoping to collect production records and other information. Someone stuck him in a conference room. Soon he was on the phone with the lawyer from the day before, who told him not to speak with any more Green Diesel employees.
Kimes went back to Denver and started calling Philip Rivkin, Green Diesel’s founder and chief executive. He wasn’t available. And he never would be. That fall, Rivkin left Houston to live in Spain with his wife, their teenage son, a $270,000 Lamborghini Murcielago Coupe, and a $3.4 million Canadair Challenger jet. A passport Rivkin obtained in Guatemala, where he moved after living for an undetermined period in Spain, shows him with dark hair, a double chin, a lazy eye, and an impassive look. It’s one of the few publicly available photographs of the man. Now serving a 10-year sentence at the federal prison in Bastrop, Texas, Rivkin declined through his lawyer, Jack Zimmermann, to be interviewed for this story. He remains a bit of a mystery. But he is, for now, the king of the latest government playground for con artists. Biodiesel scams are puny compared with Medicare and Social Security fraud. For sheer moxie, though, it’s hard to beat Phil Rivkin.
----How Rivkin made his way into the green fuel business is unclear. A résumé he gave federal investigators said he was vice president at an Atlanta investment company at the age of 18. He doesn’t appear to have graduated from college. Investigators couldn’t confirm his employment at several of the companies listed on his résumé. Public records don’t indicate any past criminal record.
Former Green Diesel employees describe him as a bright man who was fond of boasting about building a $500 million company without any debt. He favored flip phones and loathed the smell of cigarette smoke. Interviewing a job candidate, he might mention that he hadn’t flown commercial in years. He liked to talk about the vintage photographs and fine Bordeaux wines he collected. He also had a temper—and a tendency to express frustration in ALL CAPS e-mails, former employees say.
“He always considered himself the smartest guy in the room,” says Ken Columbia, who worked for Rivkin for 11 months exporting renewable fuels made by other companies. (Rivkin ran multiple businesses out of his offices, buying and selling various fuels in the U.S. and Europe; Columbia wasn’t involved in the crimes that landed Rivkin in prison.) Columbia says his old boss “believed he had an answer for everything and he would never get in trouble.”

Solar  & Related Update.

With events happening fast in the development of solar power and graphene, I’ve added this section. Updates as they get reported. Is converting sunlight to usable cheap AC or DC energy mankind’s future from the 21st century onwards? DC? A quantum computer next?

Graphene-infused packaging is a million times better at blocking moisture

Date: July 13, 2016

Source: American Chemical Society

Summary: Plastic packaging might seem impenetrable -- and sometimes nearly impossible to remove -- but water molecules can still pass through. And this permeability to moisture can limit the lifespan of a product. To better protect goods such as electronics and medicines, scientists have developed a new kind of packaging that incorporates a single layer of graphene. Their material reduces by a million fold how much water can get through.
These days, packaging is everywhere, sometimes even on individual fruits or vegetables. Wrapping products from food to electronics in plastic films protects them from dust, bacteria and to some extent water. But to maximize the lifetime of a moisture-sensitive device such as an organic light-emitting diode for more than a year, for example, the packaging must restrict water vapor from entering at a rate of less than 10-6 grams per square meter every day, according to Praveen C. Ramamurthy. Today's typical packaging is far from achieving that goal. Ramamurthy and colleagues wanted to see whether adding graphene to flexible polymer films would help.
The researchers synthesized a single layer of graphene by chemical vapor deposition and using a simple and scalable process, transferred the graphene to a polymer film. Water vapor permeated the material at the target rate of less than 10-6 grams per square meter per day. An accelerated aging test showed that an organic photovoltaic device wrapped in the graphene-infused film would have a lifetime of more than 1 year compared to less than 30 minutes if packaged in the polymer without the graphene.

Another weekend and a weekend to reflect on the terrible moslem atrocity in France. Have a great weekend everyone.

The monthly Coppock Indicators finished June

DJIA: 17930  -14 Up NASDAQ:  4843 -08 Down. SP500: 2099 -10 Up.

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