Tuesday, 9 May 2017

The Top?



Baltic Dry Index. 1001 +07     Brent Crude 49.40

"There is no cause to worry. The high tide of prosperity will continue."

Andrew W. Mellon, Secretary of the Treasury, Sept. 1929.

In major market news, is everything already priced in? As Spring moves into Summer, and GB and France hold parliamentary elections, and harvest season approaches in the northern hemisphere, and American frackers hit peak production, and the Fed is about to hike its key interest rate, is downward price pressure the next shoe to drop? Is this as good as it gets?

Asia Stocks Fall After Rally, Aussie Dollar Drops: Markets Wrap

by Adam Haigh
Asian equity markets slipped from a two-year high in the absence of catalysts to spur further gains, while the Australian dollar slumped.

Investors are stepping back after a rally on Monday sent South Korea’s equities to a record and Japan’s Topix to the highest since December 2015. Chinese stocks fluctuated after losses that have erased more than $400 billion from equity values amid a crackdown on financial leverage. The Aussie fell to the lowest level since January after disappointing retail sales data.

“Markets have been struggling to make significant headway,” said Ric Spooner, chief market analyst in Sydney at CMC Markets Plc. “Full valuations have pre-empted a benign macro scenario of ongoing moderate growth, and markets appear to need good news to hold them around current valuations.”

----Investors will be parsing comments from Federal Reserve Bank of Minneapolis President Neel Kashkari later Tuesday for any clues on U.S. central bank policy. South Korean voters are going to the polls to elect their next president, while Australia’s Treasurer will deliver his budget Tuesday evening in Canberra at a time when the country’s top credit rating is said to be at risk.
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In other news, have we finally hit peak long haul airline travel? What America does today Europe does tomorrow, with the rest of the world following one day later. Is it all over for long haul business travel? Either way, if you fancy keeping your teeth, be sure to exit the plane voluntarily if travelling anywhere near Chicago, when asked by airline goons. But is putting flammable, oxygen rich, lithium-ion batteries en-mass in a planes cargo hold really such a good idea? I think Samsung has the answer to that.

U.S. may soon expand electronics ban to all European flights

Published: May 8, 2017 11:05 p.m. ET

Dramatic expansion of ban on large devices may hit right at summer travel rush

Air passengers flying between the U.S. and Europe may soon have to go without large electronic devices, as a ban on such devices already in effect for several Middle East and North African airports dramatically expands.

The U.S. Department of Homeland Security is considering banning electronics larger than a cellphone on all transatlantic flights, according to a report by CBS News on Monday, and a decision is expected soon, ahead of the busy summer travel season. The Guardian reported last month that such a ban was under consideration.

Aviation expert Alex Macheras tweeted news similar to CBS’s report Monday, saying the ban would likely take effect “in a few weeks.”

That could severely disrupt travel plans on both sides of the Atlantic, impacting everyone from business travelers hoping to get work done on their laptop to vacationers trying to watch a movie on their iPad.

The news division of CBS Corp. CBS, -2.81%    reported that the ban has been discussed for more than a year, and that the government has been meeting with airlines to weigh the security measures against their impact on passengers.

“We have not made any decisions on expanding the electronics ban,” the Department of Homeland Security said in a statement. “However, we are continuously assessing security directives based on intelligence and will make changes when necessary to keep travelers safe.”

Requiring laptops and tablets to be checked with luggage could also cause safety concerns, with a larger number potentially dangerous lithium-ion batteries having to be stored in the cargo hold.
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We close for the day with commodities, specifically grains. Later today the USDA releases a key assessment of world supply and demand estimates. As goes the WASDE so tends to go prices at least in the short term.

What Traders Will Watch for in Key U.S. Crop Report Wednesday

by Jeff Wilson
With U.S. farmers bracing for a fourth year of declining incomes, grain production is poised for a drop. Just how much the smaller output will help to erode massive inventories is one of the main data points traders will be watching when the U.S. releases its monthly crop report on Wednesday.

1. Falling Production

For the first time in 29 years, global harvests of corn, soybeans and wheat will fall simultaneously, according to average estimates of as many as 20 analysts surveyed by Bloomberg. The U.S. Department of Agriculture, in its World Agricultural Supply and Demand Estimates (WASDE) report released at noon in Washington, will also update its outlook for stockpiles from this season with analysts looking for total supplies to increase.

Inventories are piling up to record levels this year after farmers around the world produced more to make up for lower prices with larger volume. Better crop science and favorable weather also means that yields reached all-time highs in 2016, USDA data show. While global demand is also climbing, it hasn’t yet been enough to offset the supply buildup. Will that trend start to reverse next season?

2. Yield Uncertainty

It’s already been a less than perfect start to the new U.S. crop season, and yield uncertainty is offering temporary price support. More details will emerge in June and July on how much production may fall. In the meantime, late spring snow and heavy rains have prompted hedge funds to trim their bearish holdings in some of the agriculture markets amid the supply concerns.

There will be quality losses, and some farmers will abandon wheat fields for harvesting after heavy snow, freezing temperatures and wind hurt crops in the past two weeks, according to Tanner Ehmke, senior economist at CoBank, who recently traveled Kansas wheat fields. Flooding and cold temperatures delayed planting and damaged some corn and soybean crops from Louisiana to Ohio. Hard red winter wheat futures jumped to a seven-week high on May 2 before giving back most of those gains.

“The take-away from the quick run up in wheat prices and subsequent retreat is that even small disruptions in production will not produce significant rallies,” said Richard Feltes, head of market insights for Chicago-based RJ O’Brien & Associates LLC. “The grain and soybean markets are saddled with huge carryover inventory cushions.”

3. First Look at 2017-18 Crops

This will be the first government outlook that includes production projections for the 2017-2018 season. The U.S. wheat crop is expected to drop 20 percent from the prior year to 1.858 billion bushels, according to a Bloomberg survey
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"Secretary Lamont and officials of the Commerce Department today denied rumors that a severe depression in business and industrial activity was impending, which had been based on a mistaken interpretation of a review of industrial and credit conditions issued earlier in the day by the Federal Reserve Board".

The New York Times, Oct. 14, 1929.

Crooks and Scoundrels Corner

The bent, the seriously bent, and the totally doubled over.
In the EUSSR today, situation normal. Below, another Italian vanity project flies on a wing and a prayer.
Sat May 6, 2017 | 11:07am EDT

Stricken Alitalia debts totaled $3.3 billion at end of February

Loss-making airline Alitalia, which asked to be put under special administration on Tuesday, had debts of around 3 billion euros ($3.3 billion) as of the end of February, Italy's government said on Saturday.
In a document marking the opening of the special administration process and the appointment of three commissioners to run the airline, the government said Alitalia had current liabilities of around 2.3 billion euros and assets worth 921 million.
Alitalia, 49 percent owned by Abu Dhabi's Etihad Airways, has filed to be put under special administration for the second time in less than a decade after workers rejected its latest rescue plan.
Rome has ruled out renationalising Alitalia, an airline that was once a symbol of Italy's post-war economic boom but is now struggling to compete at home against low-cost carriers and high speed trains, and has not invested sufficiently in the higher-margin long-haul routes to get back to profit.
The airline's balance sheet will be scrutinized by the three commissioners who have been given six months to assess whether it can be restructured, either as a standalone company or through a partial or total sale, or else liquidated.
One of them, Luigi Gubitosi, has already said that the airline's costs - especially for leasing, fuel and maintenance - were above market rates and will have to be slashed to make Alitalia attractive for any potential buyers.
The Italian government has thrown the airline a short-term lifeline with a bridge loan of 600 million euros to see it through the process.
Sources have said the airline is losing at least a million euros a day and risked running out of cash by the middle of this month without the handout.
Rival airlines including Lufthansa (LHAG.DE) and Norwegian Air (NWC.OL) have shown little interest in buying Alitalia and creditors have refused to lend more money, putting more pressure on the government to find a way to save the flag carrier.
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“Stock prices have reached what looks like a permanently high plateau. I do not feel there will be soon, if ever, be a 50 or 60 point break from present levels, such as (bears) have predicted. I expect to see the stock market a good deal higher within a few months.”
Irving Fisher, leading U.S. economist, Oct. 17, 1929.
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?

Posted on May 08, 2017

The Graphene paradigm shift is coming

IDTechEx has invited a series of industrial players and leaders active in graphene commercialization to contribute their opinions about the state of the technology and markets. As part of article series, we will today hear from × Standard Graphene Standard Graphene is exhibiting at the IDTechEx Show! Berlin, Germany 10 - 11 May 2017 Standard Graphene who talks about a graphene paradigm shift. To contact Standard Graphene directly please contact Mr Kim Gunsoon, CTO, on kimgunsoo@standardgraphene.com
To learn more about the graphene markets please refer to our report on Graphene, 2D Materials, and Carbon Nanotubes 2016-2026: Markets, Technologies, and Opportunities External Link. You can also meet with many industry leaders at our business-focused event Graphene Europe 2017 External Link taking place on May 10th and 11th in Berlin, Germany.

The materials industry is in the midst of a global Graphene paradigm shift. Since Graphene (a 2 dimensional sheet of carbon atoms) was discovered in 2004 by University of Manchester Professors Andre Geim and Konstantin Novselov, academic and commercial groups have been researching and developing applications using Graphene's properties of mechanical strength (200x stronger than a steel), electrical conductivity (100x higher than copper), electrical capacity, thermal conductivity (2x higher than a diamond), transparency (more transparent than glass), impermeability, and flexibility to improve traditional materials and products. Production methods are also being researched and developed as Graphene has the potential to become a multi-trillion dollar industry.

----Quality is a hurdle in the commercialization of Graphene. Commercially available "Graphene" is often "GNP" or Graphene Nano Platelets consisting of dozens to hundreds of layers of carbon atoms. This material (GNP) is more graphite like in structure and performance. While perfect one layer sheets of Graphene is still a theoretical goal for mass production; STANDARD GRAPHENE (a South Korean based manufacture and Research Company) has a product with a 1.7 atom layer average. One of the methods implemented to qualify the quality of Graphene is called Ramen Spectra. Ramen Spectra uses lasers to analyze the ratio of 3 dimensional carbon bonds to 2 dimensional Graphene bonds. A South Korean University has been working to establish a standard of quality for Graphene using Ramen Spectra. STANDARD GRAPHENE has the highest ratio of 2 dimensional Graphene bonds to 3 dimensional carbon bonds of all the mass production Graphene tested.

Graphene quantity and price are additional hurdles for commercialization. STANDARD GRAPHENE spent 6 years optimizing its modular and automated production line which uses a proprietary chemical exfoliation method to produce high quality GO (Graphene Oxide) and rGO (Reduced Graphene Oxide) with 4.4 ton GO and 1.1 ton rGO capacity per year. Commercial prices are currently avalible in the market and quality remains the major differentiating factor among the industry's top producers.
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The monthly Coppock Indicators finished April

DJIA: 20,941 +149 Up. NASDAQ:  6,048 +190 Up. SP500: 2,384 +152 Up.

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