Friday, 3 February 2017

Brexit. Frexit. I-exit.



Baltic Dry Index. 770 -16   Brent Crude 56.83

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

“When it becomes serious, you have to lie.”

Jean-Claude Juncker. Failed former Luxembourg P.M., serial liar, president of the European Commission.

Today we look at the wealth and jobs destroying, one size fits all, insane asylum called Europe. As the EUSSR’s Great Leaders head off to Malta for yet another useless summit, the first of the President Trump era,  it’s more obvious than ever that the EU in its present form isn’t working for most of its members, just Germany and couple of its closest suppliers. With President Trump calling time on Germany, and Great Britain headed for a Great Escape like a second Dunkirk, the mood of optimism in Valletta Malta today, will be similar to a Berlin bunker in 1945.

Below, the EUSSR 2017.

Why Italians Might Be Outright Economic Losers in Era of Euro

by Lorenzo Totaro and Giovanni Salzano
Almost two decades after the creation of the euro single currency, Italians are proving to be the big losers among the 19 member countries.

Gross domestic product per capita in real terms shrank 0.4 percent in the last 18 years, according to Bloomberg calculations based on data from the European Union statistics office up to 2015 and estimates for 2016. While Italy’s economy expanded 6.2 percent since 1998, its population increased by 6.6 percent over the period -- thus accounting for the per-head drop.

“The comparison with other countries clearly shows that the Italian economy has expanded at too-slow a pace over the period,” said Loredana Federico, an economist at UniCredit Bank AG in Milan. “It will be very difficult for Italy to close, in the years to come, the gap with other economies that already returned to the pre-crisis level or even surpassed it.”

Eleven members of the EU introduced the euro as an accounting currency in January 1999; they were later joined by Greece. The actual notes and coins were introduced in January 2002, and expansion of the zone has since continued, with Lithuania becoming the 19th member in 2015.

Italy’s per-capita GDP has fared even worse than Greece, which was severely hit by the financial crisis. The value of all goods and services produced in that country rose in the last 18 years by 4 percent on an individual basis, Bloomberg calculations show.

In Germany, the euro region’s largest economy, per-capita output rose by 26.1 percent since 1998. That makes the citizens of Chancellor Angela Merkel’s nation the winners among all of the bloc’s main economies.
https://www.bloomberg.com/news/articles/2017-02-02/why-italians-might-be-outright-economic-losers-in-era-of-euro

Europe Confronts a Lonelier Future

by Ian Wishart and Jonathan Stearns
The European Union often struggles to conceal its splits. But they are nothing compared to the chasm opening up in its relations with the U.S.

With U.S. President Donald Trump forecasting the unraveling of the EU, sowing division between member states and cheerleading for Brexit, EU leaders arrive at their first summit since Trump unleashed his inaugural whirlwind more exposed than ever. The superpower which until now has bought their goods, paid for their security and ratified their values has suddenly become an uncertain partner.

“There is no hiding place anymore,” said Shada Islam, director for geopolitics at the Friends of Europe think tank in Brussels. “The Valletta summit should be a chance for the 28 EU leaders to take a hard look at how Europe is going to conduct itself in the Trump era.”

In response, EU President Donald Tusk is calling for an extraordinary show of unity. In a letter to the bloc’s leaders this week, Tusk ranked Trump’s broadsides alongside Russian aggression, an assertive China and radical Islam as threats to the bloc’s future.

“The challenges currently facing the European Union are more dangerous than ever before,” Tusk wrote. “In a world full of tension and confrontation, what is needed is courage, determination and political solidarity of Europeans. Without them we will not survive.”

The one-day summit in Valletta, Malta, offers EU leaders an opportunity to make a statement of those values.
More
https://www.bloomberg.com/politics/articles/2017-02-03/goaded-by-the-white-house-europe-confronts-a-lonelier-future

Germany's Gabriel condemned Berlin's handling of Greece in letter: report

Thu Feb 2, 2017 | 3:31pm EST
German Foreign Minister Sigmar Gabriel criticised the German government's handling of Greece in a letter he wrote to Chancellor Angela Merkel last month, a newspaper reported on Thursday.

Handelsblatt newspaper said Gabriel - who swapped the Economy Ministry for the Foreign Ministry last week - had expressed his "great concern" about the talks on Greece's financial rescue and thought the government in Berlin should play a "more constructive role".

Germany wants the International Monetary Fund (IMF) to have a stake in Greece's bailout to give the rescue plan greater credibility, but also opposes granting Athens significant debt relief. The IMF says it will only join in if this rescue is the country's last and it includes significant debt relief.

Gabriel, a member of the Social Democrats (SPD) - the junior coalition partner to Merkel's conservatives - said the German Finance Ministry and the International Monetary Fund (IMF) seemed to have such diverging stances that reaching an agreement "at this time seems impossible".

Germany, Europe's largest economy, has opposed large-scale debt relief unless Greece completes wide-ranging reforms and keeps running budget surpluses of 3.5 percent for the medium-term after the end of the bailout program in 2018.

In the letter to Merkel, Gabriel proposed only requiring Greece to have a 3.5 percent primary budget surplus for the next three years, Handelsblatt said.

It reported that German Finance Minister Wolfgang Schaeuble, a member of Merkel's Christian Democrats (CDU), had replied in mid-January, saying that relaxing budget demands would lead to more calls for forgiving part of Greece's debt pile, which Germany is against.
http://www.reuters.com/article/us-eurozone-greece-germany-idUSKBN15H2P3

Bumper start to 2017 pushes British M&A to nine-year high

Thu Feb 2, 2017 | 1:59pm EST
Britain has had its strongest start to the year for M&A activity since 2008 on the back of a spate of big deals, a sign that some businesses are trying to plan for a more uncertain future outside the European Union.
British consumer goods company Reckitt Benckiser's (RB.L) $16.7 billion bid for U.S. baby formula maker Mead Johnson Nutrition (MJN.N) on Thursday, pushed the value of deals announced so far this year to almost $35 billion, according to Thomson Reuters data, the highest in nine years.

Bankers say fears of an economic slowdown after Britain leaves the EU has put pressure on companies to secure growth in new markets and business areas, making them more open to large deals than they were before the June vote on EU membership.

"Brexit is a long-term structural shift which needs to be addressed now," Dwayne Lysaght, head of UK M&A at JPMorgan, said.

"M&A has its risks but strategically sound, well-financed and properly implemented takeovers have enormous benefits in the long run."

Last week, Britain's biggest retailer Tesco (TSCO.L) announced a 3.7 billion pound takeover of food supplier Booker, increasing its exposure to the fast-growing catering sector.

That was followed by a long-awaited announcement by Royal Dutch Shell (RDSa.L) that it was selling a package of oil and gas fields to private equity-backed Chrysaor for up to $3.8 billion.

"Of course there may be bumps in the road with Brexit but CEOs are seeing the glass half full," said Pieter-Jan Bouten, managing director at boutique investment bank Greenhill (GHL.N), which acted as lead adviser to Tesco on its purchase of Booker.

Most of the companies announcing takeovers, including Tesco and Reckitt, have seen their share prices rise when their deals became public, pushing bankers to tout the benefits of doing transactions now.
More
http://www.reuters.com/article/us-britain-eu-m-a-idUSKBN15H2J0

Bank of England sharply raises 2017 growth outlook

 2 February 2017
The Bank of England has made another dramatic rise in its growth forecast for this year.

It expects the economy to grow 2% in 2017, up from a November forecast of 1.4%, which was itself an upgrade from the 0.8% forecast made in August.

The Bank also made a striking forecast about the savings rate, which it expects to fall to 4%, the lowest rate since the early 1960s.

As expected the Bank kept interest rates on hold at 0.25%.

The raised growth forecast follows much criticism levelled at the Bank for being too gloomy when it drastically cut its growth forecast after June's vote in favour of Brexit.

"Domestic demand has been stronger than expected in the past few months, and there have been relatively few signs of the slowdown in consumer spending that the committee had anticipated following the referendum," the Bank said in its latest Quarterly Inflation Report.

The Bank said the latest, improved forecast was partly the result of higher spending and investment contained in Chancellor Philip Hammond's Autumn Statement.

It also credited stronger growth in the US and Europe, rising stock markets and the greater availability of credit for households, for its more optimistic outlook for the UK economy.
More
http://www.bbc.co.uk/news/business-38841747

"If the EU cannot resolve a small problem the size of Greece, what is the point of Europe?"

Romano Prodi, former President of the European Commission, former Italy Prime Minister.

At the Comex silver depositories Thursday final figures were: Registered 30.20 Moz, Eligible 148.09 Moz, Total 178.29 Moz. 

Crooks and Scoundrels Corner

The bent, the seriously bent, and the totally doubled over.
No crooks today, just a very English Declaration of Independence from the EUSSR.  At 77 pages long I will pass on reading this aspirational propaganda, and rely, as usual, on the normal leftist claptrap from the BBC and Sky, and draw appropriate conclusions. I see no point in trying to negotiate with a rumpEUSSR of 27, plus Belgium's Walloonatics, plus 5 EU presidents, any one of which parties can veto anything the others agree to, plus a European Court that has already said it will interfere.
Just quit and get out of the asylum before Deutsche Bank or Italy blow up, or the Catalans vote out of Spain. God must be English after all, giving us a second Dunkirk.
...for, as long as but a hundred of us remain alive, never will we on any conditions remain under EUSSR rule. It is in truth not for glory, nor riches, nor honours that we are fighting, but for freedom – for that alone, which no honest man gives up but with life itself.

Declaration of Westminster June 24th 2016, with apologies to the Declaration of Arbroath April 6th 1320.

The United Kingdom’s exit from and new partnership with the European Union


'You just never know. That unpredictability is the great thing about life. You change. The world changes. You live in a country where we are still blessed with enormous opportunity. Leave yourself open to the world of possibility. You have the ambition, you have the smarts and you have the toughness. So, turn the page on your biography - you have just started a new chapter in your lives.'

Lloyd Blankfein, “Mr. Goldman  Sacks, CEO of Goldman Sachs unintentionally backs Brexit in a US speech to graduates, mid 2016.

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?

With new hybrid, Nissan offers cheaper route to electric cars

Wed Feb 1, 2017 | 6:57pm EST
Nissan Motor Co has taken a step back into gasoline hybrids with its Note e-Power model, which the Japanese automaker hopes will act as a gateway for drivers who will later shift to all-electric cars.
The move will also trim Nissan's costs.
Nissan's battery-electric Leaf, the industry's first mass-market, all-electric car launched in 2010, is the world's top-selling electric vehicle (EV), but sales have failed to reach initial targets. Globally, more than 250,000 Leaf cars have been sold.
With drivers yet to be fully won over by electric cars, Nissan hopes its new "near-electric" hybrid - which shares some parts with the Leaf - will allow it to shave costs and fend off competition in developing cheaper electric cars.
It's a reversal of sorts for Nissan. When it developed the Leaf, CEO Carlos Ghosn signaled Nissan would leapfrog gasoline-hybrid technology and go straight to battery-powered cars with zero emissions.
That has left it trailing rivals including Toyota Motor Corp in hybrids, a segment between gasoline-powered cars and EVs. Toyota has sold more than 9 million hybrids since it launched the Prius in 1997.
"We can't avoid the fact that EVs remain expensive compared with conventional gasoline vehicles, while there's also an ongoing assumption that EVs aren't suited to traveling long ranges," Hideyuki Sakamoto, a Nissan executive vice president, told Reuters.
Late last year, Nissan launched the e-Note, a compact hatchback that uses the same motor as the Leaf. The Note operates like an EV, but instead of drawing its power from a large, costly battery, it uses a smaller battery that is charged by a gasoline engine.
The result is similar to General Motors' Chevrolet Volt, an electric car that resorts to its engine for charge when the battery is running low.
With a starting price of 1.77 million yen ($15,577), the e-Note, so far available only in Japan, is nearly 40 percent cheaper than the all-electric Leaf.
Nissan says affordability is key to attracting drivers and eventually getting them to upgrade to pure electric cars.
Sakamoto said he hopes to eventually use the Note's new e-Power hybrid system for most of Nissan's hybrid offerings - helping lower production costs for both hybrids and EVs.
"Until now, components including the inverter and motor were different between our hybrids and EVs. But the new system is different in that it shares parts with the Leaf. This creates manufacturing efficiencies," he said, declining to give details.
More

Another weekend, and who will President Trump get to insult/annoy/trash this weekend? The Emperor of Japan? The King of Thailand? The Pope? Stick around with American Fake News mainstream media.  Only another 4 years still to run! Have a great weekend everyone, and don’t take any phone calls from Washington, District of Crooks.

“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.

The monthly Coppock Indicators finished January

DJIA: 19864  +92 Up NASDAQ:  5615 +95 Up. SP500: 2279 +95 Up

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