Baltic Dry Index. 752 -18 Brent Crude
57.07
“What
me worry?”
Mad
Magazine.
We open today with Europe, where
continental Europe has far more to worry about than Brexit. Later today,
Catalan independence moves back onto the agenda, while elections in France,
Holland, Germany and probably Italy, will keep the EUSSR destabilised all the
way out to autumn. Euros anyone?
Meanwhile the Baltic Dry (shipping)
Index is sinking again, and this might be as good as it gets for the crude oil
price this year. Trumpmania seems to
have hit an iceberg in the US courts.
"The great merit of gold is precisely that it is scarce; that its quantity is limited by nature; that it is costly to discover, to mine, and to process; and that it cannot be created by political fiat or caprice."
Henry Hazlitt
High-profile Spain trial stokes Catalan independence fervour
Michaela Cancela-Kieffer and Daniel Bosque in Barcelona
AFPFebruary 4, 2017
Madrid (AFP) - Separatists in Catalonia plan to come out
in force Monday when the Spanish region's former leader, Artur Mas, stands
trial over a non-binding independence referendum he held, further straining
ties with Madrid.
Supporters of independence for the wealthy, northeastern
region say they hope to draw at least 30,000 protestors on the large avenue
next to the Barcelona court Monday morning.
Inside, Mas -- who was president of the semi-autonomous
region from 2010 to 2016 -- his former vice-president Joana Ortega and Irene
Rigau, the official once responsible for education in Catalonia, will face
accusations of "serious civil disobedience" and
"misfeasance".
Prosecutors want them banned from holding public office
for nine to 10 years for having organised a symbolic, non-binding referendum in
November 2014 in public schools, despite a ban from the Constitutional Court.
- 2.3 million 'on trial' -
Their defence argues they were merely defending "the
right to freedom of expression" of Catalans, many of whom want a say in
the future of their 7.5-million strong region -- be it for or against
independence.
More than 80 percent of those who cast their ballot in the
2014 vote did so for independence -- although just 2.3 million people out of a
total of 6.3 million eligible voters took part.
"On February 6, it is those 2.3 million people who
will be on trial," Mas said Friday.
Faced with a pro-independence movement that refuses to die
down, the conservative government of Prime Minister Mariano Rajoy insists that
this type of local, one-region-only referendum is unconstitutional.
- 'More than ready' -
The fight for greater autonomy, or independence, for Catalonia,
a region with its own culture and language, has for decades soured relations
with Madrid but the clash has worsened over the past few years.
A watershed moment was in 2010, when Spain's
Constitutional Court watered down a special statute awarded to Catalonia in
2006 under the Socialist government, giving it more powers.
Supporters of independence slammed what they said was
"judicial harassment" and asked for a referendum similar to the one
organised in Scotland in 2014.
After the Constitutional Court banned that, Mas and his
associates held the non-binding vote for which they are on trial.
Then in 2015, a coalition of separatist parties won
regional elections, promising to steer Catalonia towards independence in 2017
and to organise a "real referendum" which is planned for September,
with or without Madrid's consent.
"We are more than ready," a Catalan government
source said this week, requiring anonymity. "If we win the referendum,
everything will speed up," he said.
----
Madrid, though, refuses to be caught short, and considers that Catalonia is
ruled by a "bunch of separatists" who are using independence to hide
bad management of the region and corruption.
A probe is ongoing over alleged commissions received by
members of Mas's party in exchange for public contracts.
And a week ago, prosecutors launched an investigation into
claims made by an outspoken pro-independence senator that the regional
government had illegally obtained Catalans' tax records to create a separate
treasury -- claims he later retracted.
This week, reports emerged in several national dailies
that Madrid was considering drastic measures to stop a referendum, such as
closing schools where polling booths could be set up or taking control of the
police, which is normally managed by the regional government.
The central government is also banking on the 100,000
civil servants in Catalonia whose salary depends on Madrid to refuse to obey
orders.
More
French Candidates on Offensive as Fillon Campaign Stumbles
by Gregory ViscusiThe National Front’s Marine Le Pen held a two-day meeting in Lyon where she unveiled a 144-point program calling for leaving the euro-zone, holding a referendum on European Union membership, and limiting immigration. Independent Emmanuel Macron was also in Lyon while Benoit Hamon was officially sworn in as the ruling Socialist Party’s candidate in Paris.
“Globalization is my enemy, one in the name of global finance and one in the name of radical Islam,” Le Pen said Sunday. “They will lead to the disappearance of this France, as we remember it and as we love it. One advances under the guise of liberal economics, the other under the guise of religious liberty.”
Meanwhile, the Republicans are still divided on whether Fillon should be replaced following reports his wife and two of his children allegedly earned more than 900,000 euros ($969,000) in public funds as parliamentary aides without actually doing a commensurate amount of work.
“It’s clear we can’t continue with Francois Fillon,” Bruno Gilles, the head of the Republicans party in the Marseille region, said on BFM TV. “We cannot win with Francois Fillon and someone has to make him understand he has to stop.” Eric Woerth, a former budget minister, spoke in favor of backing Fillon.
Fillon, who had been favorite to win the election, released a video Friday saying that he has no intention of stepping down and will fight to clear his name. Paris Match reported that Fillon is planning a television appearance early in the week. He didn’t hold a rally this weekend.
A poll released Saturday by BVA shows Le
Pen winning 25 percent in the first round and Macron 21-22 percent, with both
qualifying for the run-off where Macron would defeat her 66-34 percent. Fillon
would receive 18-20 percent in the first round.
More
We close for the day with an oil update.
Month two of OPEC and friends production cuts, doesn’t seem to be working so
far. Trumped by Trump uncertainty, the Chinese slowdown, and rising production
activity in the USA. With the northern hemisphere winter gradually passing, is
the crude oil price already at its 2017 high?
Oil prices rise on weaker dollar, but U.S. output drags
Oil prices rose on Monday, with traders shifting money into crude
futures as the dollar weakened, and on concerns that new U.S. sanctions against
Iran could be extended to affect crude supplies.
But markets were held back by more signs of growing U.S. production and
by worries that import demand in China could slow.
International Brent crude futures were trading at $57.01 per barrel at
0620 GMT, up 20 cents from their last close.
U.S. West Texas Intermediate (WTI) futures were up 19 cents at $54.02 a
barrel.
Traders said the rising prices were a result of cash being poured into
crude futures due to a weakening dollar and because of a generally firm outlook
thanks to producer efforts to cut output.
Investors raised their net long U.S. crude futures and options positions
in the week to Jan. 31 to a record 412,380 lots, the U.S. Commodity Futures
Trading Commission said on Friday.
"A weaker U.S.-dollar and OPEC news are supporting the base,"
said Jeffrey Halley of futures brokerage OANDA.
The dollar has lost almost 4 percent in value against a basket of other
currencies since early January, making investments into other products,
including crude futures, more attractive.
Traders said that tensions between Tehran and Washington were also
supporting oil as a recent Iranian ballistic missile test prompted U.S.
President Donald Trump to impose sanctions on individuals and entities linked
to Iran's elite Revolutionary Guards military unit.
"The move by the U.S. to impose new restrictions on Iran ... does
raise the risk of further tensions disrupting supply," ANZ bank said.
On the supply-side, the Organization of the Petroleum Exporting
Countries (OPEC) and other producers like Russia are trying to reduce a global
fuel supply overhang by cutting their output by a planned average of almost 1.8
million barrels per day (bpd) during the first half of the year.
Despite this, crude was held back by rising U.S. drilling activity, where
17 oil rigs were added in the week to Feb. 3, bringing the total up to 583, the
most since October 2015, according to Baker Hughes on Friday.
More
Top Trader Vitol Sees Oil Rattled as Trump Makes Market Fret
by Serene Cheong and Sharon ChoAs investors are kept on tenterhooks over U.S. policies and whether OPEC and other nations will curb output as pledged, global benchmark Brent crude may vacillate between $52 and $62 a barrel, according to Kho Hui Meng, the head of the Asian arm of Vitol Group. The market’s structure could also shift in the third quarter, with near-term cargoes turning costlier than those for later delivery, flipping from the other way around.
“I think this market is going to be very volatile,” Kho, the president of Vitol Asia Pte., said in an interview in Singapore. “People are worrying about U.S. policy. With the new administration, a lot of things are being speculated. So we can’t predict the future, we just have to wait.”
The sentiment reflects the uncertainty gripping markets amid Trump’s ascent, with traders of everything from currencies to metals and stocks trying to decipher the effects of measures by the leader of the world’s biggest economy. The oil market has been ruffled by the prospect of more geopolitical tensions on his harder line on major producer Iran. He’s also mooted a border tax on imports, which Goldman Sachs Group Inc. says had a low chance of being introduced but could trigger an oil selloff if implemented.
Trading companies such as Vitol and rivals including Trafigura Group and Glencore Plc could reap rewards from volatility. Vitol’s $1.6 billion in earnings in 2015 were boosted as it profited from price swings in the energy market. It posted a 42 percent decline in first-half 2016 profit amid fewer opportunities to benefit from price changes.
The company, which is formally incorporated in Rotterdam but operates from locations including Geneva, London, Singapore and Houston, has experienced strong growth over the last 20 years on the back of expanding oil trade, large price swings and, more recently, investment in storage and refining. In 1995, Vitol earned just a little over $20 million.
More
Oil's Promised Land Slips Away on OPEC Leaks
By Julian
Lee
Feb 5, 2017 3:00 AM EST
It's just one month into OPEC's deal to cut production, and this could
be as good as it gets for the group's attempt to rebalance the market. Rising
output from those not included in the accord and from the U.S. is already
undermining the effectiveness of the deal. The prospect for this leakage to
worsen means we may now be seeing the beginning of the end of the march
upward in prices.
When 10 OPEC members agreed on Nov. 30 to cut their combined output by
around 1.2 million barrels a day, that target included an exception for Libya,
Nigeria and Iran.
So far those ten countries have mostly taken much bigger steps towards
meeting their obligations than most analysts thought possible. Saudi Arabia has
cut output by even more than it pledged -- perhaps reflecting much lower
domestic demand as gas supply increased and temperatures fell from summer highs.
The outlier in this is Iraq, which has cut supply by only around a quarter of
the amount it agreed to.
The effectiveness of these cuts in rebalancing the oil market is being
undermined, though, both from within OPEC and outside. Rising supply from
the three countries excused from the agreement is offsetting the cuts
made by the rest, reducing the size of the overall reduction in OPEC output to
little more than 800,000 barrels a day
In the coming months compliance from the ten countries bound by the deal
might get a bit better than it was in January, but probably not by much. It is
difficult to see Saudi Arabia being prepared to keep production below 10
million barrels a day -- once domestic consumption begins its seasonal climb
towards its summer peak, output will have to rise in order to maintain exports,
which is where they make their money. Iraq, already short of its target, is
planning to raise exports from the south of the country this month to a
near-record level.
If prices, which have already risen on the promise of cuts, stop
increasing, producers may be less willing to toe the line in the coming months. History
shows that, after an early burst of enthusiasm, compliance with OPEC output
cuts typically wanes as time passes.
Add to this the prospect of further recovery in production from Libya
and Nigeria and some small growth in Iran, and we may see total OPEC supply
starting to creep back up.
That would probably undermine the willingness of the group's non-OPEC
friends to fulfill their part of the bargain. Russian production fell by
117,000 barrels a day last month, putting it ahead of its own schedule to
satisfy its agreement with OPEC, but that may not last if the group's
compliance begins to slip.
An even bigger threat to market rebalancing is coming from outside the
group. U.S. supply is rising rapidly and is already up more than 400,000
barrels a day since October, according to preliminary weekly data. That is not
anywhere near as much as OPEC output has fallen over the same period, but it is
still a work in progress.
More
Remember
that there is nothing stable in human affairs; therefore avoid undue elation in
prosperity, or undue depression in adversity.
Socrates
At the Comex silver depositories Friday
final figures were: Registered 30.20 Moz, Eligible 148.80 Moz,
Total 179.00 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Below, Greece, presented without too much need for
comment. Greece should never have joined the Euro. Germany should have written
off the relatively small Greek debts to give them a new start. The IMF should
never have taken on a bankrupt state. Time for Europe to do the right thing for
the poor Greeks, who weren’t part of the thieving politicians, banksters, and
German Vampire Squids.
The whole history
of civilization is strewn with creeds and institutions which were invaluable at
first, and deadly afterwards.
Walter Bagehot.
The IMF Should Get Out of Greece
Feb 3, 2017 1:00 AM EST
The International Monetary Fund's involvement in Greece has been an unmitigated
disaster: Time and again, its failure to heed crucial lessons has visited
suffering upon the Greek people. When the fund's directors meet on
Monday, they should agree to forgive the country's debts and get out.The IMF should never have gotten into Greece in the first place. As late as March 2010, with concerns about the Greek government's ability to pay its debts roiling markets, Europe's leaders wanted the IMF to stay away. Europeans feared that the fund’s financial assistance to one of their own would signal broader weakness in the currency union. As Jean-Claude Juncker famously put it: “If California had a refinancing problem, the United States wouldn’t go to the IMF.”
Nonetheless, German Chancellor Angela Merkel decided that the IMF’s presence was the signal needed to persuade German citizens that Greece needed urgent financial support and that strict discipline in the use of those funds would be enforced. Merkel’s political priorities coincided with the interests of Managing Director Dominique Strauss Kahn, who was desperate to pull the IMF out of irrelevance. From that moment on, the IMF became Europe's -- mainly Germany’s -- instrument in Greece.
Then came the cardinal error: At the IMF’s Board, over the fierce opposition of several executive directors, the Europeans and Americans pushed through a bailout program that, contrary to the fund’s rules, did not impose losses on Greece’s private creditors. The decision was based on a spurious claim that “restructuring” private debt would trigger a global financial meltdown.
Thus, European governments and the IMF lent Greece a vast sum to repay its existing creditors. Greece’s debt burden remained unchanged and onerous, and the most vulnerable Greeks were forced to accept crippling austerity to repay the country’s new official creditors. The economy quickly and predictably went into a tailspin.
Even when the IMF recognized the error of its ways, it didn't change course. An internal “strictly confidential” report, later made public, acknowledged that the program was riddled with “notable failures,” including the lack of private debt restructuring and excessive austerity.
But the IMF never took responsibility. Instead, it demanded even more austerity throughout 2014. In December, the public rebelled and brought the opposition Syriza party to power, which only made the IMF’s demands more insistent. At this point, the evidence that the strategy was pushing Greece to economic and financial collapse was overwhelming. It was like requiring a trauma patient to run around the block before being admitted to intensive care. Yet as usual, the inevitable suffering was blamed on Greece's unwillingness to cooperate.
The absurdity reached an apex in mid-2015, when the IMF released a report stating plainly that under Europe's latest set of austerity proposals, Greece would need a miracle to repay its debts. At the time, the IMF’s own research showed that the best course would be to forgive the debt and abandon any further fiscal austerity. This would allow the country some freedom to grow again and possibly even attract new investment. And once that process was underway, Greece could be free of its official creditors and rely once again on private investors under notice that they were fully responsible for the risks they took.
More
Success is the ability
to go from one failure to another with no loss of enthusiasm.
Winston Spencer Churchill.
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?
Novel liquid crystal could triple sharpness of today's televisions
By upping the pixels per inch, new material could enable more realistic virtual reality displays
Date: February 1, 2017
Source: The Optical Society
Summary: An international team of researchers has developed a new
blue-phase liquid crystal that could enable televisions, computer screens and
other displays that pack more pixels into the same space while also reducing
the power needed to run the device. The new liquid crystal is optimized for
field-sequential color liquid crystal displays (LCDs), a promising technology
for next-generation displays.
An international team of researchers has developed a new blue-phase
liquid crystal that could enable televisions, computer screens and other
displays that pack more pixels into the same space while also reducing the
power needed to run the device. The new liquid crystal is optimized for
field-sequential color liquid crystal displays (LCDs), a promising technology
for next-generation displays.
"Today's Apple Retina displays have a resolution density of about
500 pixels per inch," said Shin-Tson Wu, who led the research team at the
University of Central Florida's College of Optics and Photonics (CREOL).
"With our new technology, a resolution density of 1500 pixels per inch
could be achieved on the same sized screen. This is especially attractive for
virtual reality headsets or augmented reality technology, which must achieve
high resolution in a small screen to look sharp when placed close to our
eyes."
Although the first blue-phase LCD prototype was demonstrated by Samsung
in 2008, the technology still hasn't moved into production because of problems
with high operation voltage and slow capacitor charging time. To tackle these
problems, Wu's research team worked with collaborators from liquid crystal
manufacturer JNC Petrochemical Corporation in Japan and display manufacturer AU
Optronics Corporation in Taiwan.
In the journal Optical Materials Express, from The Optical Society
(OSA), the researchers report how combining the new liquid crystal with a
special performance-enhancing electrode structure can achieve light
transmittance of 74 percent with an operation voltage of 15 volts per pixel --
operational levels that could finally make field-sequential color displays
practical for product development.
"Field-sequential color displays can be used to achieve the smaller pixels needed to increase resolution density," said Yuge Huang, first author of the paper. "This is important because the resolution density of today's technology is almost at its limit."
----"With color filters, the red, green and blue light are all generated at the same time," said Wu. "However, with blue-phase liquid crystal we can use one subpixel to make all three colors, but at different times. This converts space into time, a space-saving configuration of two-thirds, which triples the resolution density."
The blue-phase liquid crystal also triples the optical efficiency
because the light doesn't have to pass through color filters, which limit
transmittance to about 30 percent. Another big advantage is that the displayed
color is more vivid because it comes directly from red, green and blue LEDs,
which eliminates the color crosstalk that occurs with conventional color
filters.
More
The monthly Coppock Indicators finished January
DJIA: 19864
+92 Up NASDAQ: 5615 +95 Up. SP500: 2279 +95 Up
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