Friday, 25 November 2016

A World of Change.

Baltic Dry Index. 1201 -23   Brent Crude 48.48

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

Eurasian Snow cover. (How bad will winter be?)

A bargain is something you can't use at a price you can't resist.

Franklin P. Jones

As Americans head off to the shops to buy Asian made tat they don’t need with money they largely don’t have, running up their debt, they can take heart in the knowledge that next year’s tat will be even cheaper thanks largely due to the surging dollar. For US exporters a surging dollar is a killer, but for US importers and consumers it’s a gift from heaven. A gift all too likely to be enhanced by a Federal Reserve interest rate hike at the upcoming meeting next month. Even OPEC is trying to do its bit to boost dollar demand, with an attempt to cap production and boost crude oil prices next week. We have entered a world of unpredictable change.

Below, some of the global change underway, this “black Friday” 2016.

Dollar taps fresh 13-year high after U.S. data add to rate-hike case

By Barbara Kollmeyer and Kosaku Narioka Published: Nov 24, 2016 6:35 a.m. ET
The dollar flirted with fresh 13-year highs on Thursday, before backing down slightly, after solid U.S. economic indicators and Federal Reserve meeting minutes underpinned speculation for an interest-rate rise.
The ICE U.S. Dollar Index DXY, -0.04%  , which measures the buck against a basket of six currencies, last traded around 101.56 after closing at 101.68 late Tuesday in New York. The index marked fresh 13-and-half-year highs in early European trade, climbing as high as 102.05. On Wednesday, the dollar index hit 101.78, its highest since April 2003.
The index got close to its March 21, 2003, high of 102.15, noted Richard Perry, market analyst at Hantec Markets.
“Basically, the dollar hs been consolidating for a couple of days, but the market had a new leg yesterday,” said Perry in a telephone interview. “It is odd that has been the position taken coming into Thanksgiving, because now you’re going to get illiquid markets, thin trading and spiking around.”
But he said the dollar is getting more stretched on the upside, technically. “The further you get on this dollar bull run, the bigger the chances are we’ll get a retracement snap back,” he said.
The WSJ Dollar Index BUXX, -0.11%  , which measures the greenback against a wider basket of currencies, fell 0.4% to 91.83.
Data boost: Strong U.S. durable goods orders and consumer sentiment data on Wednesday bolstered already heightened expectations the Fed will keep tightening monetary policy to prevent the economy from overheating.
Minutes from the Fed’s November meeting showed strength in key sectors of the U.S. economy, hardening the case for an increase in short-term interest rates in December.

ECB Says It Can Shield Euro Area From Global Finance Instability

November 24, 2016 — 9:04 AM GMT Updated on November 24, 2016 — 12:50 PM GMT
The European Central Bank is confident it will be able to continue shielding the euro area from the risk of a sudden correction in asset prices, after political events such as the election of Donald Trump threaten to increase volatility in coming months.

“We are certainly seeing a correction coming from the U.S.,” ECB Vice President Vitor Constancio said on Thursday in an interview with Bloomberg TV’s Matt Miller. “The ECB will continue to exert its stabilizing role, so I don’t think there will be significant contagion to Europe.” Constancio spoke on the occasion of the publication of the ECB’s twice-yearly Financial Stability Review.

The report warns that the risk of an abrupt global market correction has intensified on the back of widespread political uncertainty, posing a threat to banks, stability and economic growth. While the policies of incoming President Trump may lead to higher spending and faster inflation in the U.S., their effect on the euro area is difficult to gauge given the possibility of protectionist tit-for-tats and higher chances of populist victories in votes across the continent.

“More volatility in the near future is likely and the potential for an abrupt reversal remains significant,” according to the Frankfurt-based central bank. “Elevated geopolitical tensions and heightened political uncertainty amid busy electoral calendars in major advanced economies have the potential to reignite global risk aversion and to trigger a major confidence shock.”

For Constancio, U.S. expansionary policies may be accompanied by “some protectionist measures which would then reduce the impact on other parts of the world.” He said the recent rally in asset prices will only become sustained in Europe if inflation and growth in the region pick up, while a recent appreciation of the dollar won’t have a major effect on the continent as it did for emerging markets.

Trump Is a ‘Game Changer’ for Auto Industry, Fiat CEO Says

November 24, 2016 — 3:35 PM GMT Updated on
President-elect Donald Trump’s critical stance toward free trade could affect Fiat Chrysler Automobiles NV’s business in North America, according to the Italian automaker’s chief executive officer Sergio Marchionne.

Trump’s election “certainly is a game changer, mainly because I think that there are a number of conditions in the U.S. which are not yet spelled out,” Marchionne told Bloomberg Television at an Alfa Romeo plant in Cassino, Italy. Statements Trump has made about trade are “a big issue” because of the North American Free Trade Agreement’s impact on Fiat’s operations in the U.S., Mexico and Canada.

Trump frequently slammed Nafta during his campaign, describing it as the worst deal ever and blaming it for U.S. job losses. The President-elect has singled out Ford Motor Co. for making cars in Mexico and has called for imposing a 35 percent tariff on products made by companies that move their production from the U.S. to other countries. Since 2010, nine global automakers, including General Motors Co., Ford and and Fiat have announced more than $24 billion in Mexican investments.

Fiat, which generates the lion’s share of its profits in North America, assembled about 17 percent of all the vehicles it made in that region in Mexico in the first ten months, according to Kevin Tynan, Bloomberg Industry senior analyst. Almost all of those cars were sold in the U.S. and Canada.

----The change in U.S. leadership is not only impacting carmakers’ trade prospects. Fiat shares have gained 14 percent since the Nov. 8 vote, with a jump three days later after Trump chose a prominent climate change skeptic to lead his Environmental Protection Agency transition team. That fueled speculation that the new administration may loosen fuel-economy rules, which would benefit makers of conventional engines. In addition, gains by the U.S. dollar since the election are positive for Fiat, Marchionne said.

And finally, yet more change.

Central Americans surge north, hoping to reach U.S. before Trump inauguration

Thu Nov 24, 2016 | 11:34pm EST
Central American countries warned on Thursday that large numbers of migrants have fled their poor, violent homes since Donald Trump's surprise election win, hoping to reach the United States before he takes office next year.

Trump won the Nov. 8 vote by taking a hard line on immigration, threatening to deport millions of people living illegally in the United States and to erect a wall along the Mexican border.

Trump's tough campaign rhetoric sent tremors through the slums of Central America and the close-knit migrant communities in U.S. cities, with many choosing to fast-forward their plans and migrate north before Trump takes office on Jan. 20.

During fiscal year 2016, the United States detained nearly 410,000 people along the southwest border with Mexico, up about a quarter from the previous year. The vast majority hail from Guatemala, El Salvador and Honduras.

Since Trump's victory, the number of people flocking north has surged, Central American officials say, contributing to a growing logjam along the southern U.S. border.

"We're worried because we're seeing a rise in the flow of migrants leaving the country, who have been urged to leave by coyotes telling them that they have to reach the United States before Trump takes office," Maria Andrea Matamoros, Honduras' deputy foreign minister, told Reuters, referring to people smugglers.

Carlos Raul Morales, Guatemala's foreign minister, told Reuters people were also leaving Guatemala en masse before Trump becomes president.

"The coyotes are leaving people in debt, and taking their property as payment for the journey," he said in an interview.

Last week, U.S. Customs and Border Protection opened a temporary holding facility for up to 500 people near the Texan border with Mexico, in what it said was a response to a marked uptick in illegal border crossings.

U.S. Department of Homeland Security Secretary Jeh Johnson said earlier this month immigration detention facilities were holding about 10,000 more individuals than usual, after a spike in October of migrants including unaccompanied children, families and asylum seekers.

Unemployed and sick of the lack of opportunities and endemic gang violence that blight his poor neighborhood in the town of San Marcos, south of San Salvador, Carlos Garcia, 25, said he was looking to enter the United States before Trump assumes power.

"There's one thing I'm very clear about," he said. "I want to get out of here."

China says to boost military ties with strategic Djibouti

Thu Nov 24, 2016 | 9:39pm EST
China will boost military ties with Djibouti, strategically located in the Horn of Africa, state media quoted a senior Chinese army officer as saying during a visit to a country where China is building its first overseas naval base.

In February, China began construction in Djibouti of its first overseas military facility, a logistics base that will resupply naval vessels taking part in peacekeeping and humanitarian missions.

Djibouti, which is about the size of Wales, is strategically located at the southern entrance to the Red Sea on the route to the Suez Canal. The tiny, barren nation sandwiched between Ethiopia, Eritrea and Somalia also hosts U.S., Japanese and French bases.

Fan Changlong, a vice chairman of China's powerful Central Military Commission, said after a meeting with Djibouti President Ismail Omar Guelleh the two countries could strengthen ties in all areas, including militarily, state news agency Xinhua said late on Thursday.

"The two sides have made frequent exchanges of visits, and achieved remarkable results in personnel training, naval escort and supplies, and participation in UN peacekeeping operations," Xinhua paraphrased Fan as saying.

Fan said relations between the two militaries had been "developing smoothly in recent years", Xinhua reported.

"China is willing to make joint efforts with Djibouti to continue to promote the healthy and stable development of relations between the militaries," Fan said.

There was no direct mention of the Chinese military base, which China describes as a supply facility.

The Christmas season has come to mean the period when the public plays Santa Claus to the merchants.

John Andrew Holmes

At the Comex silver depositories Wednesday final figures were: Registered 30.90 Moz, Eligible 147.43 Moz, Total 178.33 Moz. 

Crooks and Scoundrels Corner

The bent, the seriously bent, and the totally doubled over.
No crooks today, Ireland’s had enough of them. The UK’s rent-seeking, lying, cheating, stealing, dodgy banksters aren’t that welcome to come to Dublin after Brexit. So far  five month on from the UK voting for freedom, not a single rent-seeking, lying, cheating, stealing, dodgy London bankster has left town. Sadly, John Bull might not be able to get rid of them at all.

Here's Why Ireland May Not Become a Post-Brexit Financial Capital After All

by Reuters  November 23, 2016, 6:29 AM EST
Ireland has signaled to several large investment banks it would be reluctant to host large trading operations, banking sources told Reuters, despite Dublin’s desire to attract financial sector jobs from London after Britain leaves the EU.
This reticence, linked to Ireland’s painful experience of a banking crash in 2008 and subsequent international bailout, means Dublin is unlikely to become a major destination for what is regarded as some of the banks’ riskiest business.
Ireland’s central bank has indicated in talks with the banks that they would face high hurdles to win regulatory approval for such operations, which involve huge sums when compared with the relatively small size of the country’s economy.
“Ireland is being very realistic about what it can and what it wants to do,” said one source at a large global investment bank, speaking on condition of anonymity as the discussions are private. “If you’ve come from all the troubles Ireland has, you want to be very careful about taking on risks.”

The largely U.S., British and Swiss investment banks are working out how to secure access to the European Union when Britain leaves the bloc. The main question is where to trade and clear European securities, euros and other market activities controlled by EU regulation.

Such trade carries a lot of risk and large balance sheets, meaning regulators must supervise the banks’ trading models closely. This, along with the scale of the business, has prompted the cautious response from Dublin, according to the sources.

A spokeswoman for the Irish central bank said there was no blanket policy of turning certain types of business away. “The central bank is open to engagement with any firm wishing to obtain an authorization,” she said.

However, another banking source said Dublin had specific types of financial business in mind. “Yes, Ireland want insurers, asset managers, back office functions … but they don’t want big balance sheet risk. They just don’t want to take on that kind of risk and feel that they don’t have the regulatory bandwidth to do that,” the source said.

Reuters asked the five large U.S. banks as well as Barclays BCS 0.47% and Credit Suisse CSGKF -1.36% , who have some operations in Ireland, whether Dublin was still a contender. All of the banks declined to comment.

----Ireland is already one of the world’s largest centers for back office banking functions such as settling transactions, many of them farmed out from London. On top of that, it hosts a growing financial technology industry.
But it has a population of less than five million and its annual economic output is only around 10 percent of neighboring Britain’s. That left it vulnerable when disaster struck in 2008.
Irish taxpayers had to stump up 64 billion euros (now $68 billion)—or almost 40% of GDP—to rescue a banking system brought down by a property market crash.
The cost of staging the biggest public rescue of banks in the euro zone forced the state to take the 85 billion euro bailout in 2010. Conditions of the three-year EU/IMF program included deeply unpopular austerity polices.
Christmas is the season when you buy this year's gifts with next year's money.

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?

Uncovering the secrets of friction on graphene

Sliding on flexible graphene surfaces has been uncharted territory until now

Date: November 23, 2016

Source: Massachusetts Institute of Technology

Summary: Graphene has been the subject of widespread research, in large part because of its unique combination of strength, electrical conductivity, and chemical stability. But despite many years of study, some of graphene’s fundamental properties are still not well-understood. Now, using powerful computer simulations, researchers have made significant strides in understanding that process.

Graphene, a two-dimensional form of carbon in sheets just one atom in thick, has been the subject of widespread research, in large part because of its unique combination of strength, electrical conductivity, and chemical stability. But despite many years of study, some of graphene's fundamental properties are still not well-understood, including the way it behaves when something slides along its surface.
Now, using powerful computer simulations, researchers at MIT and elsewhere have made significant strides in understanding that process, including why the friction varies as the object sliding on it moves forward, instead of remaining constant as it does with most other known materials.
The findings are presented this week in the journal Nature, in a paper by Ju Li, professor of nuclear science and engineering and of materials science and engineering at MIT, and seven others at MIT, the University of Pennsylvania, and universities in China and Germany.
Graphite, a bulk material composed of many layers of graphene, is a well-known solid lubricant. (In other words, like oil, it can be added in between contacting materials to reduce friction.) Recent research suggests that even one or a few layers of graphene can also provide effective lubrication. This may be used in small-scale thermal and electrical contacts and other nanoscale devices. In such cases, an understanding of the friction between two pieces of graphene, or between graphene and another material, is important for maintaining a good electrical, thermal, and mechanical connection. Researchers had previously found that while one layer of graphene on a surface reduces friction, having a few more was even better. However, the reason for this was not well-explained before, Li says.
"There is this broad notion in tribology that friction depends on the true contact area," Li says -- that is, the area where two materials are really in contact, down to the atomic level. The "true" contact area is often substantially smaller than it would otherwise appear to be if observed at larger size scales. Determining the true contact area is important for understanding not only the degree of friction between the pieces, but also other characteristics such as the electrical conduction or heat transfer.
For example, explains co-author Robert Carpick of the University of Pennsylvania, "When two parts in a machine make contact, like two teeth of steel gears, the actual amount of steel in contact is much smaller than it appears, because the gear teeth are rough, and contact only occurs at the topmost protruding points on the surfaces. If the surfaces were polished to be flatter so that twice as much area was in contact, the friction would then be twice as high. In other words, the friction force doubles if the true area of direct contact doubles."
But it turns out that the situation is even more complex than scientists had thought. Li and his colleagues found that there are also other aspects of the contact that influence how friction force gets transferred across it. "We call this the quality of contact, as opposed to the quantity of contact measured by the 'true contact' area," Li explains.

Another weekend, and in many places the busiest shopping weekend of the year. Not here in the UK, where despite retailers desperate efforts to import America’s “Black Friday” marketing mania, heavily promoted by the advertising shills, the busiest shopping weekend still lies closer to Christmas. Whether shopping or not, with money or debt this weekend, have a great weekend everyone.

Only in America do people trample others for sales exactly one day after being thankful for what they already have.


The monthly Coppock Indicators finished October

DJIA: 18142  +32 Up NASDAQ:  5189 +31 Up. SP500: 2126 +46 Up.

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