Baltic Dry Index. 892 +07 Brent Crude
51.95
“We
all know what to do, but we don’t know how to get re-elected once we have done
it.”
Jean-Claude Juncker. Failed Luxembourg Prime Minister and
ex-president of the Euro Group of Finance Ministers. Confessed liar. EC
President.
We open today with the wealth and jobs
destroying EUSSR. Below Bloomberg tries hard to spin the weekend’s banking
merger in Italy as a rare bit of good news from Italy, before lapsing back into
the bad news of Italy’s never ending train wreck. Besides, as per our weekend
update, trying to fix Italian banks can be seriously damaging to one’s health.
Italy is broken and unfixable, lacking an escape mechanism of its own fiat
currency. Trapped in the increasingly unstable German currency union, Italy is
never going to become Germany south of the Alps, any more than Greece can. The
euro zone was a political vanity project, that was supposed to have a wealth
and jobs creating outcome.
By any objective measure it has failed. It has
totally destroyed the jobs and wealth aspirations of the young.
Below, poor Italy heading towards an
uncertain referendum in early December without a “shock absorber.” When will
Europe’s politicians face up to reality?
Italy’s Biggest Bank Merger Since 2007 Wins Investor Backing
October 16, 2016 — 3:27 PM BST
The approval of Italy’s biggest banking merger in almost a decade marks a
first step in a process of consolidation urged by regulators, investors and
Prime Minister Matteo Renzi. But plenty of obstacles remain to further deals
among the country’s beleaguered lenders.Politics, tougher capital standards and a mountain of bad debt on Italian banks’ balance sheets mean the combination of cooperative lenders Banco Popolare SC and Banca Popolare di Milano Scarl, approved by shareholders on Saturday, may be a one-off for now.
Renzi has encouraged Italy’s weaker banks to combine to shore up their finances and pushed through measures to abolish restrictions on ownership and voting rights, two longstanding hurdles to mergers. Yet further progress may be slow as Banca Monte dei Paschi di Siena SpA, one of Italy’s largest lenders, fights for survival and Renzi’s own political future hangs on the outcome of a December referendum he called to overhaul Italy’s political system.
“Uncertainty linked to Monte Paschi, fragile smaller banks and the referendum will weigh on the whole industry in the next few months, slowing the consolidation process.” said Jacopo Ceccatelli, chief executive officer of Marzotto SIM SpA, a Milan-based broker-dealer.
Italian banks are burdened with about 360 billion euros ($396 billion) of non-performing loans, sluggish economic growth and record-low interest rates. Monte Paschi, shown in European stress tests to be the region’s most vulnerable lender to a severe economic shock, is seeking to tap investors for capital in a complex restructuring plan to stay afloat.
The troubled lender was bailed out twice by the government since 2009 and raised 8 billion euros of fresh capital from investors in the last two years. The bank is now studying a proposal from Corrado Passera, Italy’s former economic development minister, that envisages raising 5 billion euros through a share sale and long-term backers, according to a person familiar with the plan.
Renzi and his finance minister, Pier Carlo Padoan, have struggled to shore up lenders without resorting to direct state aid under European Union rules, which would probably force losses on retail investors. In April, they persuaded Italian banks to set up a 4 billion-euro rescue fund dubbed Atlante, a program critics have deemed too small to restore confidence given that soured debt is equivalent to a fifth of Italian gross domestic product.
Should Renzi lose the Dec. 4 referendum, his possible downfall would create political turmoil in the euro region’s third-largest economy and jeopardize his planned measures
More
BoE's Broadbent: pound's fall a 'shock absorber' after EU vote - BBC radio
Sterling fell to its lowest level on record against a basket of currencies last week as investors became increasingly worried that Britain will lose its preferential trading terms with the EU - a so-called "hard Brexit".
"Having a flexible currency is an extremely important thing, especially in an environment when your economy faces shocks that are different from your trading partners," Broadbent told BBC Radio 5.
"In the shape of the referendum, we've had exactly one of those shocks. Allowing the currency to react to that I think is a very important shock absorber."
In a sign of just how sclerotic the
EUSSR has become, now even Germany is considering turning itself into France.
Germany considers protecting firms from foreign takeovers: newspaper
Welt am Sonntag (WamS) said Deputy Economy Minister Matthias Machnig had in the past week sent to members of the German government a paper containing six key points for reviewing investment at the European Union level.
The paper foresees wide-reaching rights for the EU and national governments to prohibit company acquisitions by investors in non-EU countries, the newspaper said.
The issue of foreign takeovers has come to the fore in Germany with Chinese home appliance maker Midea (000333.SZ) buying German robot maker Kuka (KU2G.DE) and Chinese chipmaker Sanan Optoelectronics (600703.SS) saying on Monday it had been in contact with German lighting group Osram (OSRn.DE) about a potential acquisition or cooperation deal.
Asked about the newspaper report, a spokesman for the Economy Ministry said he would not comment on internal government working papers.
More
Euro 'house of cards' to collapse, warns ECB prophet
16 October 2016 • 4:51pm
The European Central Bank is becoming dangerously over-extended and the
whole euro project is unworkable in its current form, the founding architect of
the monetary union has warned.
"One day, the house of cards will collapse,” said Professor Otmar
Issing, the ECB's first chief economist and a towering figure in the
construction of the single currency.
“Realistically, it will be a case of muddling through, struggling from one crisis to the next. It is difficult to forecast how long this will continue for, but it cannot go on endlessly," he told the journal Central Banking in a remarkable deconstruction of the project.
The comments are a reminder that the eurozone has not overcome its
structural incoherence. A beguiling combination of cheap oil, a cheap euro,
quantitative easing, and less fiscal austerity have disguised this, but the
short-term effects are already fading.
The regime is almost certain to be tested again in the next global
downturn, this time starting with higher levels of debt and unemployment, and
greater political fatigue.
Prof Issing the lambasted the European Commission as a creature of
political forces that has given up trying to enforce the rules in any
meaningful way. "The moral hazard is overwhelming," he said.
More
http://www.telegraph.co.uk/business/2016/10/16/euro-house-of-cards-to-collapse-warns-ecb-prophet/?WT.mc_id=e_DM172030&WT.tsrc=email&etype=Edi_FAM_New_AEM_Recipient&utm_source=email&utm_medium=Edi_FAM_New_AEM_Recipient_2016_10_17&utm_campaign=DM172030 We close out on Europe today, with what was left out of last week’s BBC fifth columnist Remainiac Brexit reporting. Our news is no longer simply news, but news spun for hidden agendas. Somehow, the German job cuts never made it into the anti Brexit spin.
Fujitsu to cut 400-500 jobs in Germany: Nikkei
The company on Tuesday had said it would cut 1,800 jobs in Britain, about 18 percent of its UK workforce.
Fujitsu's German unit, which has about 12,000 employees, will make a final decision on the reductions once the negotiations with workers conclude, the business daily reported. (s.nikkei.com/2dq2uG5)
The job cuts in Germany would mainly be in information technology system operations and development services, according to the Nikkei report.
In really better news for the global
economy, the recent OPEC aspirational and short covering rally in crude oil,
seems to have passed its peak. Even the extra recent demand for oil from China’s
“teapot” refineries seems to have peaked.
Oil prices fall on rise in U.S. drilling, strong dollar
Oil prices fell early on Monday, pulled down by a rising rig count in
the United States, a strong dollar and record OPEC-output which comes amid
slowing global economic growth that could erode fuel demand.
U.S. West Texas Intermediate (WTI) crude oil futures were trading at
$50.16 per barrel at 0115, down 19 cents from their last settlement.
Traders said that WTI was pulled down by another rise in U.S. oil
drilling activity.
A closely watched report on Friday by oil services provider Baker Hughes
showed U.S. drillers added four rigs in the week to Oct. 14. It was the 16th
week in a row that oil drillers had gone without making cuts, indicating more
production to come.
International benchmark Brent crude oil futures LCOc1 were also down,
shedding 11 cents from their last settlement to $51.84 per barrel.
Traders said that a seven-month high of the dollar against a basket of
other leading currencies .DXY, which was due to an expected hike in U.S.
interest rates later this year, was also weighing on crude prices.
Since oil is traded in dollar, a stronger greenback makes it more
expensive for countries using other currencies at home to purchase fuel,
potentially undermining demand.
Brent was also weighed by fresh production records from the Organization
of the Petroleum Exporting Countries (OPEC), which pumped out a record 33.6
million barrels of crude oil per day in September PRODN-TOTAL.
"Record supply from OPEC year-to-date, weaker global GDP estimates,
and still elevated inventories cause us to lower and flatten our oil price
outlook," Bernstein Energy said in a note to clients on Monday.
"We reduce our Brent forecast to $60 per barrel in 2017 ($70 per
barrel before) and $70 per barrel in 2018 ($80 per barrel before)," it
added.
More
"We finished the
year, and we reported that we had $17 billion of cash sitting at the bank's
parent company as a liquidity cushion. As the year has gone on, that liquidity
cushion has been virtually unchanged."
Alan
Schwartz, CEO Bear Stearns, March 12, 2008. Bust March 16, 2008
At the Comex silver depositories Friday
final figures were: Registered 29.29 Moz, Eligible 143.95 Moz,
Total 173.24 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today, why America needs to vote in outsiders like Trump.
“A good politician is
quite as unthinkable as an honest burglar.”
H L Mencken.
The Sept. 11 Lawsuit Bill Is Weaker Than It Appears
Congress is considering further weakening its law allowing suits against the Saudi government, but some say it’s useless as it stands.
October 14, 2016 — 11:00 AM BST
For 14 years families of Sept. 11 victims have tried unsuccessfully to
use the courts to pin responsibility for the terrorist attacks on Saudi Arabia.
Legal obstacles have blocked those efforts, but on Sept. 28, Congress passed
legislation—overriding a veto by President Obama—advertised as clearing the
families’ path. “We rejoice in this triumph and look forward to our day in
court,” declared Terry Strada, whose husband, Tom, died at the World Trade
Center and who heads 9/11 Families & Survivors United for Justice Against
Terrorism.
A close inspection of the statute, however, reveals that last-minute
changes diluted the law’s effectiveness. As a result, “it’s unlikely the 9/11
victims and families’ claims will get anywhere,” says Stephen Vladeck, a law
professor at the University of Texas at Austin specializing in national
security.
Survivors of the terrorist attacks and families of victims began suing
the Saudi kingdom and various Saudi government-supported charities in 2002,
arguing that the defendants bore at least partial responsibility for al-Qaeda’s
assault; 15 of the 19 hijackers were Saudi. Riyadh has denied any hand in the
attacks. The suits, which were consolidated in federal court in New York, ran
up against a defense based on the concept of sovereign immunity, which in most
circumstances protects foreign governments from private legal action in U.S.
courts.
Plaintiffs in the Sept. 11 case allege, among other things, that Saudi
officials in the U.S. assisted two of the hijackers in Southern California. The
plaintiffs also claim that a Saudi religious official spent the night before
the attacks in the same Virginia hotel as three hijackers. The Saudi government
has argued that the plaintiffs lack sufficient evidence to prove any of these
allegations. Lawyers representing the kingdom did not respond to a request for
comment.
Seven years ago, the families and survivors—numbering about 9,000
individuals—began lobbying for legislation that would, in effect, instruct the
courts that they were misinterpreting sovereign immunity law and to let the
Sept. 11 litigation finally proceed to the substantive question of Saudi
liability. Earlier versions of the legislation would indeed have accomplished
that goal by allowing suits even when the defendant was a foreign country and
most of the alleged wrongful conduct took place overseas.
The bill, known as the Justice Against Sponsors of Terrorism Act
(Jasta), drew opposition from the Obama administration—and eventually the
president’s veto—because of the likelihood that it would provoke the ire of
Saudi Arabia, a key U.S. ally in the Middle East, and the possibility it would
influence other countries to pass similar laws encouraging lawsuits against
American soldiers, diplomats, and civilians. And within a day of the veto
override, congressional leaders appeared to be backtracking from the statute—for
the very reasons Obama cited. “I would like to think there’s a way we can fix
so that our service members do not have legal problems overseas while still
protecting the rights of the 9/11 victims,” House Speaker Paul Ryan told
reporters.
The version of the law he pushed through Congress, over the opposition
of an army of lobbyists for the Saudi government, included a series of
compromises added by Republican Senator John Cornyn of Texas, a leading sponsor
in the Senate. Seeking to achieve unanimous support from lawmakers, Cornyn made
changes to accommodate concerns expressed by Republican senators such as
Lindsey Graham of South Carolina and Bob Corker of Tennessee, who worried that
the original version of the bill would provoke a backlash against the U.S.,
according to a Cornyn aide. Representatives of the Sept. 11 families and their
lawyers approved the Senate changes, says one of the plaintiffs’ attorneys,
Jerry Goldman: “All the law does is clarify existing U.S. law, nothing more,
and that will help us.”
Vladeck, along with Harvard Law School professor Jack Goldsmith, says
that’s not necessarily so. They point out that the amended version of Jasta
includes a procedure—not found in the original—that allows the executive branch
to seek to delay indefinitely any suit against a foreign country. This delay
turns on the U.S. Department of State certifying that it’s negotiating a
resolution of the claims against the foreign nation.
Other
changes include the removal of a provision that would have made it easier for
federal courts to hear claims against private Saudi defendants located
overseas. Another excised part of the law would have allowed claims against
foreign governments based exclusively on indirect support for Sept. 11. The
substitute version of the legislation “is much, much weaker—for better or
worse,” Vladeck wrote on a blog called Just Security.
More
http://www.bloomberg.com/news/articles/2016-10-14/the-sept-11-lawsuit-bill-is-weaker-than-it-appears
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?
Engineers reveal fabrication process for revolutionary transparent sensors
Date:
October 13, 2016
Source:
University of Wisconsin-Madison
Summary:
Researchers have described in great detail how to fabricate and use transparent
graphene neural electrode arrays in applications in electrophysiology,
fluorescent microscopy, optical coherence tomography, and optogenetics.
when University of Wisconsin-Madison engineers announced in the journal
Nature Communications that they had developed transparent sensors for use in
imaging the brain, researchers around the world took notice.
Then the requests came flooding in. "So many research groups
started asking us for these devices that we couldn't keep up," says
Zhenqiang (Jack) Ma, the Lynn H. Matthias Professor and Vilas Distinguished
Achievement Professor in electrical and computer engineering at UW-Madison.
Ma's group is a world leader in developing revolutionary flexible
electronic devices. The see-through, implantable micro-electrode arrays were
light years beyond anything ever created.
Although he and collaborator Justin Williams, the Vilas Distinguished
Achievement Professor in biomedical engineering and neurological surgery at
UW-Madison, patented the technology through the Wisconsin Alumni Research
Foundation, they saw its potential for advancements in research. "That
little step has already resulted in an explosion of research in this
field," says Williams. "We didn't want to keep this technology in our
lab. We wanted to share it and expand the boundaries of its applications."
As a result, in a paper published in the journal Nature Protocols,
the researchers have described in great detail how to fabricate and use
transparent graphene neural electrode arrays in applications in
electrophysiology, fluorescent microscopy, optical coherence tomography, and
optogenetics. "We described how to do these things so we can start working
on the next generation," says Ma.
Now, not only are the UW-Madison researchers looking at ways to improve
and build upon the technology, they also are seeking to expand its applications
from neuroscience into areas such as research of stroke, epilepsy, Parkinson's
disease, cardiac conditions, and many others. And they hope other researchers
do the same.
MoreThe monthly Coppock Indicators finished September
DJIA: 18308
+28 Up NASDAQ: 5312 +21 Up. SP500: 2168 +32 Up.
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