Baltic Dry Index. 1069 -21 Brent Crude 55.55
Eurasian Snow cover. (How bad will
winter be?)
Sometimes I wonder whether the world is being run by smart people who are putting us on or by imbeciles who really mean it.
Mark Twain.
It is day one of the Fedster’s two day
meeting in Washington. It is universally expected that they will increase their
key interest rate tomorrow by a tiny quarter of one percent. Will it be enough
to stop Trumpmania in US and global stock markets? That’s unlikely, I think.
Mania’s run and run, until an outside event shocks the market, or the insider
cronies stage a bear raid, generating a panicked sell-off allowing the bear
raid to generate massive profits.
My guess is that Trumpmania will run on into
early January. Even so, I would ever so cautiously buy puts, using the new highs to
add scaled, highly speculative, fully paid up, deep-out-of-the-money stock
futures put options. In the first six
months of a Trump presidency, a nasty clash with China looms. Forr more on that
scroll down to Crooks Corner.
Trump rally could mark biggest postelection stock market rise since Hoover
By Sue Chang Published: Dec
12, 2016 4:43 p.m. ET
Yardeni: ‘The mania phase of this bull market may be under way’
If the postelection stock market rally continues at its current pace it
could be the largest stretching back to the gains scored in the wake of Herbert
Hoover’s 1928 election victory.
Major indexes are trading at record levels with the S&P 500 SPX, -0.11% up more than 5% and the Dow
Jones Industrial Average DJIA, +0.20% rising 7.8% since Nov. 8
over optimism that President-elect Trump will usher in a new era of economic
boom on the back of higher fiscal spending and pro-growth policies.
Blogger Macro Man on Monday noted
that the Trump surge is already among the biggest following an election going
back more than a century. For historical context, the blog looked as far back
as 1896, tracking the market’s performance between election day and
inauguration and then the following 12 months after a new president has been
sworn in.
“The Trumpflation rally is
already quite a bit bigger than average, though there have been postwar rallies
that have been bigger (Clinton, JFK, Ike.). Then again, we’re only halfway between
the election and the inauguration; if the market keeps this up, it will be the
biggest postelection rally since [Herbert] Hoover,” according to Macro Man.
----Hoover’s victory was followed by a double-digit
percentage gain by inauguration day on March 4, 1929 (inauguration was moved to
Jan. 20 by the 20th amendment in 1933). However, that was followed a little
under eight months later by the Crash of 1929, which stands as a signpost for
the start of the Great Depression.
----Apart from history, the market has few other Trump
cards to count on, according to Ed Yardeni, chief investment strategist at the
eponymous consultancy.
While some investors argue for taking some money off the table in the
wake of the gains, Yardeni argues there’s plenty of room for euphoria to build.
“The mania phase of this bull market may be
under way. It may have further to go once overseas cash actually does get
repatriated and if retail investors start to pile into the market,” wrote Yardeni
in a report.
More
Japan Stocks Rally as Yen Drops on Fed Countdown; China Steadies
by Emma O'Brien and Kana Nishizawa
Japanese stocks rallied as the yen
weakened before the U.S. Federal Reserve’s meeting this week, while Chinese
stocks reversed earlier declines amid strong economic data. Bonds consolidated
following a two-month collapse.
The yen traded near its weakest in 10
months against the dollar as the Fed begins a two-day policy meeting. Shares in
Shanghai rallied and yuan government bonds declined after China’s official data
showed stronger-than-expected industrial output and retail sales. Sovereign
debt in most other markets snapped declines as oil failed to build on a rally
spurred by OPEC’s deal with rivals to curb production.
Investors are focused this week’s Fed
meeting and the impact of People’s Bank of China monetary tightening, with
inflationary pressures coming to the fore of global central-bank thinking. The
market sees 100 percent odds of a rate hike in the U.S. Wednesday, and a
two-in-three chance of additional tightening by June. Chinese regulators are
pushing money market rates higher and curbing leveraged purchases of both
stocks and bonds.
More
We close for today with Bloomberg
speculating on just how fast OPEC can drain the swamp. Of course, for any
draining to happen all the liars and cheats must stick to their pledges and
Libya, Nigeria, Brazil, US frackers and Canada’s tar sands producers, must all
resist producing extra production to gain market share. Pigs will probably
learn how to fly first.
OPEC-Russia Deal Could Drain Almost Half the Global Oil Surplus
by Grant Smith 12 December 2016, 18:04 GMT
On paper, OPEC’s supply deal could drain almost half
the global oil glut within six months.
Record inventories accumulated since
2014 will dwindle at a rate of about 760,000 barrels a day in the first half of
next year if OPEC and 11 other oil producers deliver the supply cuts pledged on
Dec. 10, according to Bloomberg calculations using data from the International
Energy Agency. Over the six months covered by the deal, that would remove 46
percent of the 300 million-barrel stockpile surplus OPEC aims to clear.
Reaching that target would require full compliance with the almost 1.8 million-barrel cut promised by the Organization of Petroleum Exporting Countries, Russia and their other allies. That’s an achievement that has eluded previous supply deals.
Bringing about a crude-supply deficit of 760,000 barrels a day in the first half of 2017 would require OPEC to fully implement its 1.2 million barrel-a-day cut, a goal that is challenged by rising production from exempt members Libya and Nigeria. Among non-OPEC producers, it would be crucial that Russia completely follows through on its pledge to gradually curb output by as much as 300,000 barrels a day.
Full compliance with the deal would mean OPEC crude supply in the first half is about 400,000 barrels a day lower than demand, the data show. If the 11 non-OPEC nations stick to their pledges, their combined output would be 17.97 million barrels a day over the period, almost 360,000 barrels a day lower than the IEA’s current forecast.
The whole history of civilization is strewn with creeds and institutions which were invaluable at first, and deadly afterwards.
Walter Bagehot.
At the Comex silver depositories Monday
final figures were: Registered 37.92 Moz, Eligible 141.80 Moz,
Total 179.72 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
In the rapidly developing Trump v China war, China
is threatening to get rough. Below the
BBC reports on China’s final warning of it red line. But is anyone listening in
Trump Tower?
Trump on China: Beijing 'seriously concerned' over policy
12 December 2016
China says it is "seriously concerned" after President-elect
Donald Trump expressed doubts about continuing to abide by the "One
China" policy.
Under the policy, the US has formal ties with China rather than the
island of Taiwan, which China sees as a breakaway province.
In a TV interview on Sunday, Mr Trump said he saw no reason why this
should continue without key concessions.
China urged Mr Trump to understand the sensitivity of the Taiwan issue.
Beijing's reaction came in a statement from foreign ministry spokesman
Geng Shuang, who told reporters that the "One China" policy was the
basis for relations with Washington.
The "One China" understanding has been crucial to US-China
relations for decades.
---- In the interview, broadcast by Fox
News on Sunday, Mr Trump said: "I don't know why we have to be bound by a
One China policy unless we make a deal with China having to do with other
things, including trade."---- Reaction in the normally hawkish Global Times, which is linked to the ruling Communist Party, was less nuanced than the foreign ministry.
The "One China policy cannot be traded", it warned, and called
for a strong response.
"China must resolutely battle Mr Trump, only after a few serious
rebuffs then will he truly understand that China and other global powers cannot
be bullied."
---- So far, at each stage - from Mr
Trump's campaign rhetoric, to his protocol-breaching phone call with the
Taiwanese president - China has been measured in its response, daring to hope
that it has all been based on bluster or miscalculation.
That may now begin to change, with the blow-hard state-run tabloid, The
Global Times, true to form in being the first to up the ante, with the talk of
retaking Taiwan by force, or of arming America's foes.
More
‘Donald Trump is ignorant and one-China negotiations won’t happen’, state media says
Editorial in state-run newspaper hits back at US-president elect after he questions whether Washington should be bound by one-China policy
PUBLISHED : Monday, 12 December, 2016, 11:27am UPDATED :
Monday, 12 December, 2016, 12:29pm
China’s state-run Global Times went on the offensive on Monday
after Donald Trump’s remarks questioning whether the US should continue its
one-China policy.
In an editorial published on Monday, the Global Times, slammed
the US president-elect for being “as ignorant as a child in terms of foreign
policy” as it ruled out negotiation over the one-China policy.
Beijing would have no reason to “put peace above using force to take
back Taiwan” if Trump abandoned the policy, which recognises Taiwan as part of
China, stated the editorial in the state-run newspaper published by the People’s
Daily.
---- In Global Times, the editorial stated: “The
one-China policy is not something that can be negotiated. It seems Trump knows
only about business. He thinks he can put a price on everything.
“At that time [after Trump abandons the one-China policy] ... mainland
China will put forward a series of decisive new Taiwan policies. We will prove
that the United States no longer dominates the Taiwan Strait.”
---- The Global Times editorial said Trump would
be wrong if he thought the one-China policy could be used as leverage to force
Beijing into make concessions on trade and other issues.
“It seems Trump needs to study foreign affairs humbly. He particularly
needs to learn what the relationship between China and US is about,” the
editorial said.
“Many people will be amazed by how ‘business-minded’ the new US leader
is, and how he is as ignorant as a child in terms of foreign policy.”
More
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?
High performance graphene photodetectors set speed record
Date: December 8, 2016
Source: Graphene Flagship
Summary: Graphene is an ideal material for optical communications
systems. A new, waveguide-integrated photodetector now sets a record high
bandwidth for ultrafast, high data rate graphene devices.
Graphene is an ideal material for optical communications systems. A new,
waveguide-integrated photodetector from AMO, Germany sets a record high
bandwidth for ultrafast, high data rate graphene devices.
Graphene-based technologies are proving integral to the new generation
of communications -- enabling high performance optical communication systems
through ultra-fast and compact optoelectronic devices. Researchers from the
Graphene Flagship working at TU Vienna, Austria and AMO, Germany, have
demonstrated ultrafast photodetectors that have the highest reported bandwidth
for graphene-based devices, enabling data rates of up to 100 Gbit/s. The
research, recently published in Nano Letters, points the way towards graphene
applications in high-speed communications systems.
Simone Schuler, a researcher at TU Vienna, explained the importance of
increasing data capabilities. "These kinds of photodetectors are typically
used in optical data links, which form the back-bone of the internet. The
maximum operation speed of a photodetector defines the maximum data rate the
detector can receive. So, the faster the photodetector the more data it can
receive."
Graphene's properties make it ideal for next-generation optoelectronics
and optical communications systems. Its excellent electrical properties and
broadband optical absorption are highly suited for high-performance
optoelectronic devices, and it can be readily integrated with silicon photonic
systems. The photodetector demonstrated here is highly sensitive, due to its
very compact structure. This enables the use of such detectors alongside other
opto-electronic devices including switches in functionally dense, integrated
chips.
"This could open the path towards a complete integration on one
CMOS chip. Graphene will be the enabling material for realising high
performance photodetectors on a silicon platform," added Schuler.
MoreThe monthly Coppock Indicators finished November
DJIA: 19124
+53 Up NASDAQ: 5324 +41 Up. SP500: 2198 +58 Up
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