Thursday, 8 December 2016

Game Changer.

Baltic Dry Index. 1162 -24   Brent Crude 52.88

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

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

“The principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.”

Thomas Jefferson

The game changer in question today, is in the manufacture of organic solar cells, though it might also be a game changer yesterday  at Deutsch Bank. For more on OSCs scroll down to “Solar and Related Update.” Next decade will be as far from the “naughties” as were the last century’s 20’s from their noughties.

We open today with a Bloomberg explanation for Trumpmania. One I think will turn out to be a giant mistake. Yes interest rates are about to start normalising, so it makes sense to start running from bonds. But normalising interest rates are going to crush those stocks that loaded up on debt to by-back corporate stock to inflate the stock price. As interest rates begin normalising, their interest rate expense will start to soar just as profits dip in the broad economy. Assuming Trump actually delivers on increased infrastructure spending, only a small segment of stocks will actually benefit, while if the increased spending comes about by increased US government debt, interest rates will likely normalise far faster than most now expect.

If all else fails, immortality can always be assured by spectacular error.

John Kenneth Galbraith.

Trump Win Set Off $2 Trillion Shock Rotation to Stocks From Debt

by Garfield Clinton Reynolds and Adam Haigh
Donald Trump’s election win sent a $2 trillion shock wave through global markets over the past month.
That’s how much equities’ global market value has jumped. And that’s about the size of the loss in worth of the Bloomberg Barclays Global Aggregate Index of bonds, over the worst month for global bonds in dollar terms on record. Other assets were roiled, too: the yen plunged the most in 21 years against the dollar. It all amounted to a complete reversal of the playbooks mapped out by a bevy of analysts and investors who had anticipated a Brexit-style rush for havens in the event of a surprise Republican presidential victory.

Those projections did pan out -- for about eight hours, when the yen and Treasuries advanced as the vote-count momentum favored Trump. Then the great reflationary rotation trade started, as Carl Icahn started snapping up S&P 500 futures and other investors decided that the likely new U.S. leader’s promises to cut taxes, boost spending and slash regulation would revive inflation and economic growth. Oh, and potentially force more aggressive interest-rate increases from the Federal Reserve.

How lasting a pattern the new market dynamics will be is an open question, with more than a month to go before Trump takes office and plenty of potential roadblocks to his fiscal and regulatory proposals in a fractious U.S. Congress. For now, eyes turn toward next week’s Fed meeting to set the tone for the outlook as far as monetary policy goes.

“It’s astounding how big the move has been,” said James Audiss, Sydney-based senior wealth manager at Shaw and Partners Ltd., which oversees about $7.5 billion. “It’s been incredible. Now it all hinges on the Fed and the pace of those rate hikes, but for now the markets are happy to be risk-on.”

In other news, OPEC gave a get out of jail card to US frackers.

Exclusive: In mammoth task, BP sends almost three million barrels of U.S. oil to Asia

Wed Dec 7, 2016 | 7:59am EST
Oil major BP (BP.L) is shipping almost three million barrels of U.S. crude to customers across Asia, pioneering a lengthy and complex operation likely to become more popular after OPEC last week announced deep production cuts.

BP's efforts, involving one of the world's longest sea routes, seven tankers and a series of ship-to-ship transfers, underscore a desire among oil traders to develop new routes to sell swelling supplies of cheap U.S. shale oil to Asia, the world's biggest consumer region.

While exports of U.S. crude have been allowed since a 40-year ban was lifted a year ago, the distance, cost and complexity of shipping to Asia has so far kept the flow to a trickle.

Now, using its global shipping and trading network, BP was able to grapple with U.S. port limitations and the need to transfer oil between ships off Malaysia to split cargoes for customers across Asia, according to trade sources and shipping data in Thomson Reuters Eikon.

"Keeping regional price differentials, different tanker rates, and the forward price curve in mind while considering the delivery needs and schedules of your counterparties is not something many oil trading firms can do," said a shipping source in Singapore, who had knowledge of the operations.

"BP is one of perhaps half a dozen firms capable of doing so," he added, speaking on condition of anonymity as he was not authorized to publicly discuss operations.

BP declined to comment.

While BP's operations are currently the most sophisticated, others have also begun developing U.S./Asia trade.

China's Unipec, the trading arm of Asia's largest refiner Sinopec (600028.SS), is shipping about 2 million barrels of WTI to China this month, while trading house Trafigura is also exporting some 2 million barrels of U.S. oil to Asia.

Incentives to bring U.S. crude into Asia have risen after the Middle East-led producer club of the Organization of the Petroleum Exporting Countries (OPEC) and Russia agreed to cut output, encouraging refiners across the region to seek alternatives to offset potential supply shortfalls.

"OPEC is putting U.S. shale oil to the test... (and) we will truly see what it can deliver," said Bjarne Schieldrop, chief commodity analyst at SEB. He predicted 2017 would be a "shale oil party" with a surge in U.S. exports after the OPEC production cuts.

We close with dying EUSSR news. In Brexit, Her Majesty’s Government got the vote that it wanted, though Remainiacs will probably demand a re-vote. In the Volkswagen emissions fraud scandal, the EUSSR is taking steps to make matters worse.

British lawmakers back PM May's Brexit timetable

Wed Dec 7, 2016 | 3:28pm EST
British lawmakers backed Prime Minister Theresa May's Brexit timetable on Wednesday after she headed off a rebellion in her Conservative Party over a lack of insight into the government's strategy to leave the European Union.

May has come under pressure from lawmakers, businesses and investors to set out at least a broad picture of how she sees Britain's future relationship with the EU. She says giving too much away could weaken Britain's hand in the country's most important negotiations since World War Two.

After a sometimes rowdy session in parliament, lawmakers voted by 448 to 75 to support a motion calling on the government to offer up its Brexit plan, but also backed the government's timetable to trigger the divorce procedure by the end of March.

EU takes action against UK, Germany over VW emissions scandal - sources

Wed Dec 7, 2016 | 4:56pm EST
The European Union will take action on Thursday against seven nations including Germany and Britain for failing to police car emissions rules, EU sources said, after the Volkswagen cheating scandal showed suspicious behavior in the industry.

Amid frustration in Brussels over nations' responses to diesel vehicles flouting pollution limits, the European Commission is resorting to the strongest legal action it can take against members of the 28-nation bloc - potentially ending in court.

Nitrogen Oxide (NOx) pollution from diesel engines, which power half of all cars in Europe, lead to respiratory illness and the premature death of 72,000 people per year, European Environmental Agency data shows.

A year after U.S. authorities caught VW (VOWG_p.DE) using software to cheat emissions test, EU officials say many nations wooed by the industry's importance - it employs some 12 million people in the bloc - have shielded carmakers from the kind of sanctions some face in the United States.

According to EU sources familiar with the matter, the EU executive has found fault with countries for failing to set fines to deter sharp practice on emissions, penalize carmakers for breaching the law or cooperate with its demands for information.

Germany and Britain face cases linked to their testing and approval of new VW models, sources said.
"This is not the end; just the first wave of action," one EU source said.

A Commission spokeswoman declined to confirm the reports.

Thursday's notice is the first step in what is known as infringement procedures, allowing the European Union to take action against member states for failing to apply EU law.

Member states have two months to respond. If they fail to satisfy the Commission during a lengthy mediation, the EU can take the issue to European Courts.

Deutsche Bank Records Alleged to Show Silver-Price Rigging

by David Glovin and Edvard Pettersson
Eight months after Deutsche Bank AG settled a lawsuit claiming it manipulated gold and silver prices, documents it disclosed as part of the accord provide “smoking gun” proof that UBS Group AG, HSBC Holdings Plc, Bank of Nova Scotia and other firms rigged the silver market, plaintiffs claim.

The allegation came in a filing Wednesday in a Manhattan federal court lawsuit filed in 2014 by individuals and entities that bought or sold futures contracts.

According to the plaintiffs, records surrendered by Deutsche Bank show traders and submitters coordinating trades in advance of a daily phone call, manipulating the spot market for silver, conspiring to fix the spread on silver offered to customers and using illegal strategies to rig prices.

“Plaintiffs are now able to plead with direct, ‘smoking gun’ evidence,’ including secret electronic chats involving silver traders and submitters across a number of financial institutions, a multi-year, well-coordinated and wide-ranging conspiracy to rig the prices,” the plaintiffs said in their filing. The new scheme “far surpasses the conspiracy alleged earlier.”

For skating on thin ice DB, the sky is now starting to fall.

At the Comex silver depositories Tuesday final figures were: Registered 35.15 Moz, Eligible 143.63 Moz, Total 178.78 Moz. 

Crooks and Scoundrels Corner

The bent, the seriously bent, and the totally doubled over.
Today, the serial criminal banks yet again. So why have they still got banking licences? Take away their banking licence even if only for a month or two, and make forfeit any bonuses paid to the miscreant bankster criminals.
They can resist anything except temptation.
With apologies to Oscar Wilde.

JPMorgan Hit Hardest as EU Fines Euribor Trio $521 Million

by Gaspard Sebag December 7, 2016 — 5:01 AM EST December 7, 2016 — 7:12 AM EST
JPMorgan Chase & Co., HSBC Holdings Plc and Credit Agricole SA were fined a total of 485.5 million euros ($521 million) for rigging the Euribor benchmark as European Union antitrust regulators wrapped up a five-year investigation into the scandal.
The trio colluded to rig the Euribor rate and exchanged sensitive information to suit their trading positions in correlated derivatives markets, in breach of EU antitrust rules, the European Commission said on Wednesday in an e-mailed statement. JPMorgan was fined 337.2 million euros, HSBC got a 33.6 million-euro penalty and Credit Agricole must pay 114.7 million euros.
“The participation in such schemes was very lucrative for the banks,” Margrethe Vestager, the EU’s antitrust commissioner, told journalists in Brussels, adding that it’s very difficult to make an exact estimate of their profits. “Tiny movements of the Euribor rate can have a huge impact given the trading volumes at stake.”

The EU’s investigation into Euribor manipulation was strained three years ago after Credit Agricole, JPMorgan and HSBC refused to join a multi-bank settlement with four other lenders including Deutsche Bank AG and Societe Generale SA. Since then, the holdouts have been a thorn in the commission’s side -- successfully delaying the process and showing up the regulator for its handling of the case.

JPMorgan “did not engage in any wrongdoing with respect to the Euribor benchmark,” Jennifer Zuccarelli, a spokeswoman for the bank in London, said in a statement. “We will continue to vigorously defend our position against these allegations, including through possible appeals to the European courts.”

Credit Agricole in a statement said it “firmly believes that it did not infringe competition law” and that “it will appeal the commission’s decision.” The fine payment “will not affect the 2016 financial statements given the provisions set aside previously,” the Montrouge, France-based bank said.

HSBC said it “did not participate in an anti-competitive cartel,” and is also considering its legal options, according to a statement.

The four banks that settled the Euribor case were accused of sharing, via phone and through online chats, sensitive trading information among themselves and strategizing to push benchmark rates up or down to suit their trading positions.

----About $9 billion in fines have been levied against a dozen banks by global authorities over the manipulation of the London interbank offered rate and similar benchmarks in the last four years and more than 20 traders charged.
Libor and Euribor, the euro interbank offered rate, gauge banks’ estimated cost of borrowing over different periods of time. The rates are a benchmark used to calculate interest payments for trillions of euros worth of financial products including mortgages.

Let us disappoint the Men who are raising themselves upon the ruin of this Country.

John Adams. 

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?

Game changer for organic solar cells

Date: December 6, 2016

Source: University of California - Santa Barbara

Summary: Researchers have developed a simple processing technique that could cut the cost of organic photovoltaics and wearable electronics.

With a new technique for manufacturing single-layer organic polymer solar cells, scientists at UC Santa Barbara and three other universities might very well move organic photovoltaics into a whole new generation of wearable devices and enable small-scale distributed power generation.
The simple doping solution-based process involves briefly immersing organic semiconductor films in a solution at room temperature. This technique, which could replace a more complex approach that requires vacuum processing, has the potential to affect many device platforms, including organic printed electronics, sensors, photodetectors and light-emitting diodes. The researchers' findings appear in the journal Nature Materials.
"Because the new process is simple to use, general in terms of applicability and should be configurable into mass productions, it has the potential to greatly accelerate the widespread implementation of plastic electronics, of which solar cells are one example," said co-author Guillermo Bazan, director of UCSB's Center for Polymers and Organic Solids. "One can see impacts in technologies ranging from light-emitting devices to transistors to transparent solar cells that can be incorporated into building design or greenhouses."
Studied in many academic and industrial laboratories for two decades, organic solar cells have experienced a continuous and steady improvement in their power conversion efficiency with laboratory values reaching 13 percent compared to around 20 percent for commercial silicon-based cells. Though polymer-based cells are currently less efficient, they require less energy to produce than silicon cells and can be more easily recycled at the end of their lifetimes.
This new method, which provides a way of inducing p-type electrical doping in organic semiconductor films, offers a simpler alternative to the air-sensitive molybdenum oxide layers used in the most efficient polymer solar cells. Thin films of organic semiconductors and their blends are immersed in polyoxometalate solutions in nitromethane for a brief time -- on the order of minutes. The geometry of these new devices is unique as the functions of hole and electron collection are built into the light-absorbing active layer, resulting in the simplest single-layer geometry with few interfaces.
"High-performing organic solar cells require a multiple layer device structure," said co-author Thuc-Quyen Nguyen, a professor in UCSB's Department of Chemistry and Biochemistry. "The realization of single-layer photovoltaics with our approach will simplify the device fabrication process and therefore should reduce the cost. The initial lifetime testing of these single layer devices is promising. This exciting development will help transform organic photovoltaics into a commercial technology."
Organic solar cells are unique within the context of providing transparent, flexible and easy-to-fabricate energy-producing devices. These could result in a host of novel applications, such as energy-harvesting windows and films that enable zero-cost farming by creating greenhouses that support crops and produce energy at the same time.

The monthly Coppock Indicators finished November

DJIA: 19124  +53 Up NASDAQ:  5324 +41 Up. SP500: 2198 +58 Up.

No comments:

Post a Comment