Baltic Dry Index. 1282 +42 Brent Crude 51.06
Some people make things happen, some watch while things
happen, and some in the EUSSR wonder what happened?
With apologies to Anon.
It is one day before the UK's Great
Escape. Finally the Bank of England gets it. The City’s rent seeking, dodgy
banksters, might have to banish the worst amongst them to drab Frankfurt, dull Dublin,
dangerous, high tax Paris, or the Siberia of Luxembourg. It couldn’t happen to
a more deserving bunch of thieves. There is a God after all. When the next Lehman hits or Deutsche Bank’s gambling
book blows up, it’ll be the ECB on the hook for what’s left of banksterism, rather than the BOE and the UK
taxpayer.
Bank of England to check banks ready for disorderly Brexit
Britain-based banks should take steps to ensure they do not have to curb lending suddenly if the country leaves the European Union in a disorderly way, the Bank of England said on Monday as Prime Minister Theresa May prepares to start Brexit talks.May has said she is prepared to walk away from the Brexit talks with no deal if only bad terms are offered, and the government has said it is making contingency plans for this "unlikely" scenario.
BoE Governor Mark Carney said in January that the Brexit process was a bigger financial stability risk to EU countries whose businesses relied on raising finance via London than it was to Britain itself.
Just two days before May formally notifies the EU that Britain wants to start two years of exit talks, the BoE asked banks to provide copies of contingency plans to reassure it that they are ready for "a range of possible outcomes".
"Risks to financial stability will be influenced by the orderliness of the adjustment to the new relationship between the United Kingdom and the European Union," the BoE's Financial Policy Committee said in its quarterly policy statement.
Carney has said both Britain and the rest of the EU would benefit from a transitional period after Brexit when British-based banks could continue to serve clients elsewhere in Europe on broadly similar terms as at present.
But many banks operating out of London fear they will lose easy access to the EU's single market. Some like Goldman Sachs (GS.N) have already said they will beef up their presence in continental Europe.
The central bank's Financial Policy Committee is asking lenders to show how they can avoid their continental customers being abruptly cut off after Brexit, which could also damage the British economy.
"Sudden adjustment could disrupt the provision of market liquidity and investment banking services," the BoE said.
Longer-term changes to bank business models after Brexit - as well as more complex legal structures - could reduce the resilience of the UK financial system.
Kirsty Barnes, a partner at law firm Gowling WLG, said Britain-based banks could face major restrictions if they did not achieve preferential access to the EU.
"Banks will either have to shift certain operations or business units to the EU or we will see the closure of lines of business and products due to the increased costs or associated inefficiencies that may arise," she said.
More
Let Go of Customs Union During Brexit, Open Europe Advises May
by Jill Ward and Scott Hamilton
27 March 2017, 00:01 BST
If you’re going to quit the European Union, just avoid “half in, half out”
arrangements.That’s the message from think tank Open Europe to U.K. Prime Minister Theresa May, two days before she hands European allies divorce papers. It’s a variation, but for different reason, on what European leaders have been telling her for months: you can’t have your cake and eat it, and no cherry picking.
Staying in the European Union’s customs union is a bad idea, the group says.
Picking a fight to stay in the area where all goods circulate freely would mean the U.K. would have less of a say in striking its own trade deals, including with the EU itself, the group said. There’s no option that would provide completely “friction-less” -- a word often used by May to describe her goal -- movement of goods that Britain currently enjoys with the EU, it said.
“There is a trade-off between minimizing disruption to U.K.-EU trade and ensuring the U.K. is able to shape its own trade policy post-Brexit,” said Aarti Shankar, policy analyst at Open Europe. “Any model that keeps the U.K. ‘half in’ the EU’s customs union would constrain its ability to strike trade deals across the world.”
On Wednesday, May will kick off two years of formal negotiations with 27 EU governments. She still wants tariff-free, friction-less trade with Europe but prioritizes the right to impose immigration limits above all else.
Open Europe says Switzerland could be a model. But that does include freedom of persons, which is anathema to the May government. The report mentions Britain could try to keep deals it has with non-EU countries like the one passed this year between Canada and the EU.
If the U.K. winds up with no deal at all, it would surrender tariff-free trade with the EU’s 440 million consumers, as well as any hope of a transitional phase to adjust. Either way, these things should be dealt with right away.
“Agreement on a transition period is most useful early in the Brexit negotiations to reduce the risk of companies making rushed decisions on changes,” the report said.
British manufacturers take the view that the loss of access to both the single market and the customs union would be unacceptable, the EEF manufacturing lobby said in a separate report. The industry, which accounts for 45 percent of U.K. exports, would see the average tariff for exports to the EU jump by about 5.3 percent under World Trade Organization rules.
Gulf Arab states push for UK free trade deal after Brexit: officials
Gulf Arab states are pressing for an early deal
on free trade with Britain to secure preferential arrangements after Brexit,
and could have a draft agreement ready within months, Gulf officials say.
Britain cannot formally sign trade agreements while it remains a member
of the European Union, but the British government has said it is keen to start
preparatory work so deals can be reached quickly after it leaves.
One of the first agreements could be with the six-nation Gulf
Cooperation Council, which includes Qatar and the two biggest Arab economies,
Saudi Arabia and the United Arab Emirates, as well as Kuwait, Bahrain and Oman,
according to the officials. Trade between Britain and the GCC totals about 30
billion pounds ($37.5 billion) annually.
In a meeting in December with Britain's Chancellor of the Exchequer
Philip Hammond, Qatari finance minister Ali Sherif al-Emadi discussed a partial
draft of a free trade deal, a Qatari official said, declining to be named under
briefing rules.
GCC states envisage preparing a "signature-ready" deal that
could be signed immediately after Brexit, the Qatari official said.
"A free trade agreement with the UK ... This is something we would
like to encourage and support," another Gulf official said.
GCC states are trying to diversify their economies and boost non-oil
trade after more than two years of low global oil prices that have hurt their
finances. They export mainly oil, gas and related products to Western economies
while importing a wide range of goods and services.
Qataris to Unveil Major Investments in ‘Global Britain’
by Mohammed Sergie
27 March 2017, 00:01 BST 27 March 2017, 12:03 BST
Qatar said it will invest 5 billion pounds ($6.3 billion) in the U.K.
over the next five years, deepening the countries’ trade ties as London
prepares to quit the European Union.
“In our last strategy session we committed a big amount of investment in
the U.K., especially in infrastructure,” the chief executive officer of the
Qatar Investment Authority, Sheikh Abdullah Bin Mohammed Bin Saud
Al-Thani, said Monday at an investment forum in London. “There is a pressure
from my board to diversify in terms of geography and asset class, but we are
still looking, even after Brexit, for opportunities.”
A
delegation of more than 400 Qatari officials and business executives, led by
the emirate’s prime minister, is visiting London and Birmingham for a two-day
meeting with U.K. counterparts, according to Qatari government statements. The
visit concludes on Tuesday, a day before U.K. Prime Minister Theresa May plans
to start the two-year clock on Brexit negotiations by invoking Article 50 of the
Lisbon Treaty.
More
Below, short Scotland if they ever go independent
from the UK. The energy future this century is sun, which Scotland has a dearth
of, though plenty of Edinburgh wind.
UAE Sees $192 Billion Savings in Switch to Green Power From Gas
by Brian Parkin and Weixin Zha
27 March 2017, 12:42 BST
The United Arab Emirates forecasts that savings
generated by switching half its power needs to clean energy by mid century will
outstrip the investment costs.The Gulf state plans to invest $150 billion in renewable power to 2050, weening the country from dependency on subsidized natural gas power in stages, Minister of Energy Suhail Al-Mazrouei said at a conference in Berlin. Clean energy sources will help it save $192 billion, he said.
The UAE leadership is “bullish” about achieving the goal after realizing that the nation can forgo subsidies in the switch to clean power from LNG, Al-Mazrouei said. Sticking to the strategy will “save the environment and at the same time save us lots of money,” he said.
As the costs for solar power fall rapidly, Gulf and Middle East states are reevaluating their power strategies, which currently rely subsidiaries for electricity generated with liquid natural gas. The UAE has set an “incredibly ambitious” clean power target, starting from scratch just a few years ago, according to Bloomberg New Energy Finance.
In September, Chinese panel maker JinkoSolar Holding Co. and Japanese developer Marubeni Corp. won a tender for a solar plant in Abu Dhabi with a record bid of 2.42 U.S. cents a kilowatt-hour. About $1 billion has been invested in utility-scale solar in the UAE since 2007.
Middle East states need to break their reliance on subsidized gas power, where inefficiencies are endemic in the Middle East, Al-Mazrouei said.
“We have so many open-cycle power plants it doesn’t make sense to continue with them - they’ve very low efficiency,” said the former Abu Dhabi Investment Authority executive. “The reason they are there is because gas is subsidized.”
More
At the Comex silver depositories Friday
final figures were: Registered 40.52 Moz, Eligible 149.64 Moz,
Total 190.16 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today a subject we covered earlier, but
Ambrose covers better. Another very troubling red flag, this time from credit
in the USA.Creditors are a superstitious sect, great observers of set days and times.
Benjamin Franklin.
Fading Trump rally threatened by rare contraction of US credit
Ambrose
Evans-Pritchard26 March 2017 • 3:56pm
Credit strategists are increasingly disturbed by a sudden and rare
contraction of US bank lending, fearing a synchronised slowdown in the US
and China this year that could catch euphoric markets badly off guard.
One key measure of US corporate borrowing is falling at the fastest rate
since the onset of the Lehman Brothers crisis. Money supply growth in the
US has also slowed markedly. These monetary and credit signals tend to be
leading indicators for the real economy.
Data from the US Federal Reserve shows that the $2 trillion market for
commercial and industrial loans peaked in December. The sector has weakened
abruptly as lenders tighten credit, especially for non-residential property.
Over the last three months it has dropped at a rate of 5.4pc on annual basis, a
pace of decline not seen since December 2008.
The deterioration in the broader $9 trillion market for loans and leases
has been less dramatic but it too is shrinking, falling at a 1.6pc rate on a
three-month basis. “Corporate lending has ground to a halt and I am staggered
that the Fed is raising rates. They have made a very big mistake,” said Patrick
Perret-Green from AdMacro.
Credit experts at several big US banks have issued warnings over recent
days, albeit sotto voce. "We’ve been surprised how little attention
the slowdown in US bank lending has garnered," said Matt King, global
credit strategist at Citigroup.
While they are not yet alarmed, their concerns are worth heeding. Credit
has tended to pick up signs of trouble several weeks before equity markets in
recent episodes of financial stress.
"Without another big dose of momentum, the cracks in the global
reflationary consensus are liable to grow bigger. All around, existing trends
are being called into question," he said.
Net corporate bond issuance has also stalled, indicating that borrowing
by US firms as a whole is in decline. "So much for a Trump-driven
expansion. Beneath the surface, we think a seismic battle is taking
place," he said.
Elga Bartsch and Chetan Ahya from Morgan Stanley said the credit squeeze
is a warning sign and needs watching closely. “On our estimates, the credit
impulse turned negative at the end of 2016. We have not seen such a sharp
deceleration in bank lending to US corporates since the Great Financial
Crisis,” they said.
“Historically, credit downturns have led recessions. The plunge could
reignite concerns that a highly leveraged US corporate sector may react
strongly to even limited interest rates increases,” they said.
More
Over a long weekend, I could
teach my dog to be an investment banker.
Herbert A. Allen. President of
Allen & Company.
Technology
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?
Self-healing graphene holds promise for artificial skin in future robots
Date:
March 21, 2017
Source:
De Gruyter Open
Summary:
A new study offers a novel solution where a sub-nano sensor uses graphene to
sense a crack as soon as it starts nucleation, or after the crack has spread a
certain distance. This technology could quickly become viable for use in the
next generation of electronics.
With the first ever documented observation of the self-healing phenomena
of graphene, researchers from Hyderabad, India, hint at future applications for
its use in artificial skin.
Graphene, which is, in simple terms, a sheet of pure carbon atoms and
currently the world's strongest material, is one million times thinner than
paper; so thin that it is actually considered two dimensional. Notwithstanding
its hefty price, graphene has quickly become a comer among the most promising
nanomaterials due to its unique properties and versatile prospective
applications.
The paper by published in Open Physics refers to an extraordinary
yet previously undocumented self-healing property of graphene's, which could
lead to the development of flexible sensors that mimic the self-healing
properties of human skin.
The largest organ in the human body, skin has been known for its
fascinating self-healing properties -- but until now, emulating this phenomenon
proved too much of a challenge as humanmade materials lack this ability. Due to
unprecedented stretching or bending and incidental scratches, artificial skin used
in robots is extremely susceptible to ruptures and fissures. The study offers a
novel solution where a sub-nano sensor uses graphene to sense a crack as soon
as it starts nucleation, and surprisingly, even after the crack has spread a
certain distance. This technology could quickly become viable for use in the
next generation of electronics.
"We wanted to observe the self-healing behavior of both pristine
and defected single layer graphene and its application in sub-nano sensors for
crack spotting by using molecular dynamic simulation." Says Dr. Swati
Ghosh Acharyya, the main author of the article. She continues: "We were
able to document the self-healing of cracks in graphene without the presence of
any external stimulus and at room temperature." The results revealed that
self-healing occurred by spontaneous recombination of the dangling bonds
whenever within the limit of critical crack opening displacement.
The researchers subjected single layer graphene containing various
defects like pre-existing vacancies and differently oriented pre-existing
cracks to uniaxial tensile loading till fracture. Interestingly enough, once
the load was relaxed, the graphene started to heal and the self-healing
continued irrespective of the nature of pre-existing defects in the graphene
sheet. No matter what length of the crack, they all healed, provided the
critical crack opening distance lied within 0.3 -- 0.5 nm for both the pristine
sheet as well as for the sheet with pre-existing defects.
Simulating self-healing in artificial skin will open the way to a
variety of daily life applications ranging from sensors, through to mobile
devices and ultracapacitors.
The monthly Coppock Indicators finished February
DJIA: 20,812
+133 Up. NASDAQ: 5,825 +120 Up. SP500: 2,364 +115 Up.
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