Baltic Dry Index. 1198 +02 Brent Crude
53.89
Eurasian Snow cover. (How bad will
winter be?)
"Those entrapped by the herd instinct are drowned in the deluges of history. But there are always the few who observe, reason, and take precautions, and thus escape the flood. For these few gold has been the asset of last resort."
Antony C. Sutton
All too predictably in 2016, yesterday brought about yet another
political earthquake, this time in Italy. Though the ECB will be out steadying
Italian bonds today, and indirectly Italy’s bankrupt banks, longer term, Italy
appears ungovernable, unfit for membership of the wealth and jobs destroying
German currency union, and at some point next year likely headed for a general
election that sweeps populist anti-establishment parties into power. Anyone
with any sense will switch money out of Italian banks into Swiss, German and US
banks.
Below, Bloomberg covers the beat.
Renzi Quits as Italy Referendum Defeat Deepens Europe’s Turmoil
by John Follain and Chiara Albanese
December 4, 2016 — 5:06 PM EST December 4, 2016 — 8:42 PM
EST
Italian Prime Minister Matteo Renzi quit in the early hours of Monday
after losing a referendum he’d called to push through constitutional changes,
threatening renewed political and financial turmoil for Europe.
Opponents of Renzi’s proposal to rein in the power of the senate won
Sunday’s referendum by 60 percent to 40 percent, with almost all votes counted.
Renzi said he’ll turn in his resignation to President Sergio Mattarella later
in the day and signaled that he won’t stay on to help stabilize a caretaker
administration. The euro fell to a 20-month low.
“In Italian politics, no one ever wins,” Renzi told supporters, his
voice breaking and a tear on his cheek as he thanked his wife for her support.
“I did everything I thought possible in this phase, but we were not
convincing.”
The 41-year-old premier became the second European leader this year to be toppled by a populist revolt that is propelling Donald Trump into the White House and Britain out of the European Union. The result leaves Mattarella seeking a new government chief who can provide a firebreak against the insurgents; polls show an early election would see the anti-euro Five Star Movement swept into power.
A survey by EMG released Sunday showed Five Star winning a second-round ballot by 53 percent to 47 percent against Renzi’s Democratic Party and by 57 percent to 43 percent against the center-right bloc. Five Star had demanded a snap election if Renzi is defeated as it looks to force another referendum -- this time on taking Italy out of the euro.
Still, a poll last month showed only 15.2 percent favored leaving the single currency and 67.4 percent were self-described single-currency believers.
Possible successors who might be asked to lead a caretaker government include Finance Minister Pier Carlo Padoan, Senate Speaker Pietro Grasso and Culture Minister Dario Franceschini. The country’s mainstream parties have been preparing contingency plans to ensure a government would keep functioning if Renzi was forced out.
The result is “a negative outcome for both political stability and the economy in Italy,” said Wolfango Piccoli, co-president of research firm Teneo Intelligence. “However, it will not pave the way for immediate worst-case scenarios such as snap elections.”
Banca Monte dei Paschi di Siena SpA will be in focus when trading opens Monday. The lender is in the middle of a 5 billion-euro ($5.3 billion) capital raising. Its stock has fallen 83 percent this year and a third of its loan book has soured.
Italian bonds may feel a shock too. They rallied in the final days of the campaign, with the spread between the country’s 10-year debt and similar dated German bunds narrowed by 24 basis points to 162 points.
More
In other news, President-elect Trump seems to be picking a deliberate
fight with China. Nothing good comes out of the world’s leading debtor fighting
with the world’s leading creditor. Stay long fully paid up physical gold and
silver, taking advantage of India induced sell-offs. Our precarious world on
the Great Nixonian Error of fiat money, communist money, is about to become
volatile. Fiat money is backed by nothing but the trust of people to continue
to trust it and use it as a medium of exchange and a store of value. After 45
years of relative calm on fiat money, that calmness seems about to disapper.
Trump Takes On China in Tweets on Currency, South China Sea
by Ros Krasny
December 4, 2016 — 6:25 PM EST December 4, 2016 — 11:59 PM
EST
Donald Trump took on the Chinese government via social media on Sunday,
rejecting criticism of his decision to take a phone call from Taiwan’s
president at the risk of triggering a backlash from Beijing.
The U.S. president-elect told his 16.6 million Twitter followers that he
wouldn’t be told by China who he should or shouldn’t talk to, and reiterated
some of the grievances about China used in his winning presidential campaign.
The yuan reacted by declining for the first time in three days.
“Did China ask us if it was OK to devalue their currency (making it hard
for our companies to compete), heavily tax our products going into their
country (the U.S. doesn’t tax them) or to build a massive military complex in
the middle of the South China Sea? I don’t think so!” Trump tweeted.
The offshore yuan traded in Hong Kong fell 0.2 percent to 6.8835 per
dollar, taking its decline since Trump’s surprise presidential election victory
to 1.2 percent. The yuan traded in Shanghai, where moved are limited to 2
percent on either side of a daily central bank reference rate, was little
changed. Trump has threatened to brand China a currency manipulator and slap 45
percent tariffs on the Asian nation’s exports.
“We expect Trump to name China a
manipulator very early in his new term,” said Cliff Tan, East Asian head of
global markets research at Bank of Tokyo-Mitsubishi UFJ in Hong Kong. “Some
might see the U.S. drawing a line for the yuan at 7 against the dollar as the
U.S. begins what will likely be a protracted and multi-year negotiation
process. But if the Chinese economy is still slowing, others will conclude the
yuan has to weaken beyond 7 eventually. In the end, we think fundamentals will
win.”
Over the weekend China complained to the U.S. after Trump flouted almost four decades of diplomatic protocol by directly speaking with the leader of Taiwan, which Beijing considers a rogue province. China urged U.S. authorities to adhere to the so-called one-China principle and “prudently” handle issues related to the self-governed island.
The relatively measured response suggests China wants to keep the incident from escalating into a full-blown crisis.
More
China newspapers say call with Taiwan's Tsai shows Trump's inexperience
Chinese state media on Monday continued to play down the
protocol-bending phone call last week between U.S. President-elect Donald Trump
and Taiwan's president, with editorials in two newspapers saying the move
showed Trump's inexperience.
China's national English-language newspaper, the China Daily, said the
10-minute call "exposed nothing but the inexperience Trump and his
transition team have in dealing with foreign affairs".
"The action was due to a lack of a proper understanding of the
sensitive issues in Sino-U.S. relations and cross-Strait ties," it said.
The Friday call was the first by a U.S. president-elect or president
since President Jimmy Carter switched diplomatic recognition from Taiwan to
China in 1979, acknowledging Taiwan as part of "one China".
China's Foreign Ministry said on Saturday it had lodged "stern
representations" with what it called the "relevant U.S. side,"
urging the careful handling of the Taiwan issue to avoid any unnecessary
disturbances in ties.
China considers Taiwan a wayward province and has never renounced the
use of force to bring it under its control.
Chinese Foreign Minister Wang Yi on Saturday pointedly blamed Taiwan for
the exchange, rather than Trump, calling it "a petty action".
The China Daily said that for Taiwan President Tsai Ing-wen, the call
"achieves nothing substantial, only pride in making what is an illusionary
'groundbreaking move', and temporarily diverting public attention on the island
away from her bad performance".
"It would be a mistake for Tsai and her party to over-interpret the
significance of the call," it said. Her attempts to "stir up
tension... will ultimately backfire".
The Global Times, a hawkish tabloid under the ruling Communist Party's
top newspaper the People's Daily, called Trump "bluffing and
unpredictable", but said he did not have plans to overturn America's
international relationships.
"It seems that Trump is still taking advantage of his perceived
fickleness and unpredictability to make some choppy waves in the Taiwan Straits
to see if he can gain some bargaining chips before he is sworn in," it
said.
The Global Times added targeting him would be inappropriate since he is
not yet president.
"He has zero diplomatic experience and is unaware of the
repercussions of shaking up Sino-U.S. relations," it said.
Instead, China could send a message to Trump by punishing Taiwan, wooing
away one or two of the island's diplomatic allies or beefing up military
deployments against Taiwan, it said.
More
"For more than two thousand years gold's natural qualities made it man's universal medium of exchange. In contrast to political money, gold is honest money that survived the ages and will live on long after the political fiats of today have gone the way of all paper."
Hans F. Sennholz
At the Comex silver depositories Friday final figures were: Registered 33.25 Moz, Eligible 145.36 Moz, Total 178.61 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today, yet more unintended consequences from
India’s botched attempt at outlawing high value cash Rupee notes. In the war
against cash, returning the voters to serfs again, nothing has gone to plan in
India. Below, how India shot itself in both feet.
"Gold would have value
if for no other reason than that it enables a citizen to fashion his financial
escape from the state." William F. Rickenbacker
India’s Cash Crackdown Hits Gold Pawners
Indians struggle to find
valid currency to repay their loans.
by Bruce Einhorn and Anto Antony
November 30, 2016 — 7:00 PM EST November 30, 2016 — 7:00 PM
EST
Abin Baby, an unemployed teacher from the town of Thodupuzha in the
southern Indian state of Kerala, was in a bind. He needed money to cover some
emergency expenses, but since he was out of work, he couldn’t easily get a loan
from a bank. So in August he took a 14-gram gold bangle and used it as
collateral for a six-month loan of 27,500 rupees ($402) from Muthoot Finance,
one of the leading providers of gold-based loans in India.
Such loans are a primary way to borrow money in rural India, where gold
is an especially popular gift at festivals and weddings and millions of poor
people don’t use the banking system. The interest rate on Baby’s loan was 18
percent. Not having many options, he decided getting the loan was worth the
expense. The transaction happened “quickly and smoothly compared to the banks,”
he says.
The gold-loan business has suddenly gotten bumpy. Prime Minister
Narendra Modi’s decision last month to invalidate all 500-rupee and 1,000-rupee
notes has Indians scrambling to get their hands on valid currency. Because
almost three-fourths of payments for gold-loan interest and principal are made
in cash, as opposed to, say, bank transfers, the shortage of legal tender is
hurting lenders. Modi’s move, known as demonetization, is designed to crack
down on tax evasion by forcing people to tender their cash to the bank, where
it can be recorded.
“Demonetization will be a blow” for the gold-loan business, says Payal
Pandya, an analyst with Centrum Wealth Management in Mumbai, who estimates the
companies may have to slash projections of loan growth for the year by 5
percentage points to 7 percentage points. The stock price of Manappuram
Finance, a lender that has 66 tons of gold in collateral, dropped 25 percent in
the 15 trading days following Modi’s announcement, while Muthoot’s fell 16
percent. Loan repayments declined in urban and rural areas, says V.P.
Nandakumar, Manappuram’s chief executive officer. A shortage of cash is also
putting the squeeze on India’s $40 billion market for jewelry: Transactions
will shrink as much as 30 percent because of the shortage of notes, according
to a Nov. 23 report by Ambit Capital analysts.
Modi’s timing is especially bad for PC Jeweller, a New Delhi-based
manufacturer and retailer. The company gets more than 90 percent of its revenue
from wedding-related sales, according to Chief Financial Officer Sanjeev
Bhatia, and the currency shortage is taking place in the midst of wedding
season. “Whatever sales we should have been doing at this point of time—perhaps
we are doing 40 percent of that,” Bhatia told analysts on a conference call on
Nov. 24.
Almost all of India’s gold is imported, and successive administrations
concerned about its impact on the country’s currency and trade balance tried
for years to weaken gold’s prominence in the economy. Starting in the fiscal
year ended March 2009, India’s consumer price index rose by 8.9 percent or more
a year for five consecutive years; gold imports increased in turn, from $17
billion in 2008 to $56 billion in 2012, putting pressure on the current-account
deficit. In response to that soaring demand, the government of Modi’s
predecessor, Manmohan Singh, raised taxes on imported gold three times in 2013,
to 10 percent. The country remains the world’s second-largest gold consumer
after China—it now has more than 20,000 tons of the precious metal.
More
"The paper standard is self-destructive."
Hans F. Sennholz
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?
Physicists decipher electronic properties of materials in work that may change transistors
Date: December 2, 2016
Source: University of Texas at Dallas
Summary: Physicists have published new findings examining the
electrical properties of materials that could be harnessed for next-generation
transistors and electronics.
University of Texas at Dallas physicists have published new findings
examining the electrical properties of materials that could be harnessed for
next-generation transistors and electronics.
Dr. Fan Zhang, assistant professor of physics, and senior physics
student Armin Khamoshi recently published their research on transition metal
dichalcogenides, or TMDs, in the journal Nature Communications. Zhang is
a co-corresponding author, and Khamoshi is a co-lead author of the paper, which
also includes collaborating scientists at Hong Kong University of Science and
Technology.
In recent years, scientists and engineers have become interested in TMDs
in part because they are superior in many ways to graphene, a one-atom thick,
two-dimensional sheet of carbon atoms arranged in a lattice. Since it was first
isolated in 2004, graphene has been investigated for its potential to replace
conventional semiconductors in transistors, shrinking them even further in
size. Graphene is an exceptional conductor, a material in which electrons move
easily, with high mobility.
"It was thought that graphene could be used in transistors, but in
transistors, you need to be able to switch the electric current on and
off," Zhang said. "With graphene, however, the current cannot be
easily switched off."
Beyond Graphene
In their search for alternatives, scientists and engineers have turned
to TMDs, which also can be made into thin, two-dimensional sheets, or
monolayers, just a few molecules thick.
"TMDs have something graphene does not have -- an energy gap that
allows the flow of electrons to be controlled, for the current to be switched
on and off," Khamoshi said. "This gap makes TMDs ideal for use in
transistors. TMDs are also very good absorbers of circularly polarized light,
so they could be used in detectors. For these reasons, these materials have
become a very popular topic of research."
One of the challenges is to optimize and increase electron mobility in
TMD materials, a key factor if they are to be developed for use in transistors,
Khamoshi said.
In their most recent project, Zhang and Khamoshi provided the
theoretical work to guide the Hong Kong group on the layer-by-layer
construction of a TMD device and on the use of magnetic fields to study how
electrons travel through the device. Each monolayer of TMD is three molecules
thick, and the layers were sandwiched between two sheets of boron nitride
molecules.
The behavior of electrons controls the behavior of these
materials," Zhang said. "We want to make use of highly mobile
electrons, but it is very challenging. Our collaborators in Hong Kong made
significant progress in that direction by devising a way to significantly increase
electron mobility."
Morehttps://www.sciencedaily.com/releases/2016/12/161202103257.htm?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+sciencedaily%2Fmatter_energy%2Fgraphene+%28Graphene+News+--+ScienceDaily%29
The monthly Coppock Indicators finished November
DJIA: 19124 +53 Up NASDAQ: 5324 +41 Up. SP500: 2198 +58 Up.
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