Thursday, 4 May 2017

The Trump Effect.



Baltic Dry Index. 1034 -39     Brent Crude 50.68

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

This is not your father’s Oldsmobile…This is the new generation of Olds.

Below, the Trump effect, putting America first. The world as we knew it is undergoing a great sea change. If Trump can do it for America, can Brexit’s Mrs May do it for GB? Marine Le Pen for France? It’s not Obamaland and the Hillbillies anymore.

Apple announces $1 billion investment fund to boost U.S. manufacturing

Published: May 3, 2017 7:15 p.m. ET

Tim Cook says first investment will be announced later this month

Apple Inc. will create a $1 billion investment fund to boost U.S. manufacturing jobs, Tim Cook said Wednesday.

Speaking on CNBC’s “Mad Money” with host Jim Cramer, Apple’s chief executive said bringing advanced manufacturing jobs back to the U.S. is a high priority.

“If we can create many manufacturing jobs ... those manufacturing jobs create more jobs around them because you have a service industry that builds up around them,” Cook said.

“We’re announcing it today. So you’re the first person I’m telling,” Cook told Cramer. “Well, not the first person because we’ve talked to a company that we’re going to invest in already.” Cook said the first investment will be announced later this month.

Besides the roughly 80,000 people it directly employs in the U.S., Apple AAPL, -0.31%   claims to have created more than 2 million American jobs through its app ecosystem since it launched the iPhone in 2007.

Also see: Tesla hopes to prove manufacturing can thrive in high-cost areas

It was unclear if Apple’s plans include a joint project it was reportedly considering in January with Taiwan-based iPhone manufacturer Foxconn Technology Group 2354, +0.11%   to build a $7 billion display-panel manufacturing facility in the U.S. that could create 30,000 to 50,000 new jobs.

Apple is not the only tech giant looking to invest in America. Late last year, Japan’s Softbank Group Corp. 9984, +0.25%   announced plans to invest $50 billion in U.S. startup companies, aiming to create 50,000 jobs, and earlier this year Amazon.com Inc. AMZN, -0.62%   said it would add 100,000 new full-time jobs in the U.S. over the next 18 months.
http://www.marketwatch.com/story/apple-announces-1-billion-investment-fund-to-boost-us-manufacturing-2017-05-03

Asian Stocks Decline as Iron Ore Futures Tumble: Markets Wrap

by Adam Haigh and Will Davies
3 May 2017, 23:39 GMT+1
Australian and Chinese stocks fell further on Thursday after metals prices declined, while South Korean shares rallied and the dollar held gains in the wake of the Federal Reserve’s policy meeting.

Iron ore futures tumbled amid inventory concerns in industrial metals. Bonds in Asia tracked a retreat in Treasuries after the Fed reiterated plans for gradual interest-rate increases. The Aussie dollar recouped losses after the central bank reaffirmed its faith in the jobs market. South Korean stocks climbed to a record intraday high, building on gains as foreign investors snapped up shares. Facebook Inc. shares fell in after-hours U.S. trading on concern about its sales growth.

Fed Chair Janet Yellen and at least five other central bank officials are scheduled to speak Friday, giving policy makers a chance to explain their decision more fully. The U.S. fiscal outlook may also be in play, with the House expected to vote Thursday on a new version of a health-care bill. Majority Leader Kevin McCarthy says the Republican legislation will have the numbers to pass, but given the earlier struggles it’s far from a done deal.

A U.S. report Wednesday showed private payroll gains slowed in April, ahead of Friday’s key official employment report amid concern around the U.S. economy’s tepid start to the year. The next hurdle for investors to clear is Sunday’s French presidential election.
More
https://www.bloomberg.com/news/articles/2017-05-03/bonds-slip-with-u-s-stocks-as-fed-lifts-dollar-markets-wrap

Wed May 3, 2017 | 6:21pm EDT

Puerto Rico files for biggest ever U.S. local government bankruptcy

Puerto Rico announced a historic restructuring of its public debt on Wednesday, touching off what may be the biggest bankruptcy ever in the $3.8 trillion U.S. municipal bond market.

While it was not immediately clear just how much of Puerto Rico's $70 billion of debt would be included in the bankruptcy filing, the case is sure to dwarf Detroit's insolvency in 2013.

The move comes a day after several major creditors sued Puerto Rico over defaults its bonds.

Bankruptcy may not immediately change the day-to-day lives of Puerto Rico's people, 45 percent of whom live in poverty, but it may lead to future cuts in pensions and worker benefits, and possibly a reduction in health and education services.

The island's economy has been in recession for nearly 10 years, with an unemployment rate of about 11.0 percent, and the population has fallen by about 10 percent in the past decade.

The bankruptcy process will also give Puerto Rico the legal ability to impose drastic discounts on creditor recoveries, but could also spook investors and prolong the island's lack of access to debt markets.
More
http://www.reuters.com/article/us-puertorico-debt-bankruptcy-idUSKBN17Z1UC

Greece, Oil and Fed Give Markets the Look of Wonderland

May 3, 2017 9:30 AM EDT
The markets are full of presumptions. They are often incorrect. They are generally manufactured, and driven, by politicians touting their own particular wares in an attempt to bolster their positions to the detriment of market participants and investors. This is not noise but purposeful misdirection.

Take Europe. The European Union structure is a large part of the problem. Brussels makes the pronouncements, but Berlin writes the scripts. Brussels is little more than a mouthpiece and all statements that emanate from there should be viewed with great suspicion. A politician from one country makes some pronouncement, then one from another country replicates it, then some member of the EU reinforces it, and they all hope that you accept it as truth. Don’t be fooled. These people have their own agenda, and accuracy is not part of their equation.

If you read the business press you would think that some deal had been achieved between Greece and its creditors. This is not factual. Athens is being forced to accede, once again, to more European demands, and, once again, more austerity has been demanded. That part of the story is correct. The ball is back in Athens’ court.

European finance ministers still have to approve the deal and Greece has a $7 billion debt payment looming in July. The rub here is the International Monetary Fund. Sweden, the Netherlands and Germany have all voted in their parliaments to not approve any deal without the IMF’s involvement. The IMF has stated, repeatedly, that they will not support any deal unless there is “debt forgiveness” and Germany, for its own political purposes, will not allow it. The crux of that matter, then, comes down to what the IMF may or may not do.

Bear in mind that America provides most of IMF’s funds and that our representatives now report to the Trump administration. This is a game-changer for the IMF, in my view.
More
https://www.bloomberg.com/view/articles/2017-05-03/greece-oil-and-fed-give-markets-the-look-of-wonderland

Gold Imports by India Climb to Highest in More Than Two Years

by Swansy Afonso
4 May 2017, 05:00 GMT+1
Gold imports by India, the world’s biggest market after China, jumped to the highest level since 2014 in the first three months of the year, spurred by jewelers restocking for weddings and improving cash flow in the financial system, the World Gold Council said.

Net inbound shipments more than doubled to 270.1 metric tons from 127.4 tons a year earlier, council data showed Thursday. That’s the biggest amount since the 279.5 tons imported in the fourth quarter of 2014.

Domestic demand gained 15 percent to 123.5 tons in the first quarter, and “if this trend continues and there are no sharp changes in prices,” purchases may be at the upper end of the range of 650 tons to 750 tons estimated for 2017, according to P.R. Somasundaram, the council’s managing director in India.

Consumption is recovering after plunging to a seven-year low of 666.1 tons in 2016. Imports last year tumbled 39 percent to 557.7 tons after buyers reduced spending on jewelry because of higher prices, the government’s measures to increase transparency in the financial system and a crackdown on black money.
More

"For more than two thousand years gold's natural qualities made it man's universal medium of exchange. In contrast to political money, gold is honest money that survived the ages and will live on long after the political fiats of today have gone the way of all paper."

Hans F. Sennholz

At the Comex silver depositories Wednesday final figures were: Registered 33.59 Moz, Eligible 163.48 Moz, Total 197.07 Moz.

Crooks and Scoundrels Corner

The bent, the seriously bent, and the totally doubled over.
Another Trump effect, presented without comment.

Tillerson downplays human rights in U.S. foreign relations

Published: May 3, 2017 6:04 p.m. ET

In a shift of priorities, secretary of state says national security, economic interests come first

WASHINGTON — Secretary of State Rex Tillerson said the U.S. will pursue national security and economic interests before turning to human rights concerns in its relationships with other countries, signalling a shift in Washington’s global outlook.

Tillerson’s remarks, to U.S. diplomats and employees at the State Department on Wednesday, amounted to the clearest expression yet of President Donald Trump’s “America First” foreign policy doctrine, in which the U.S. won’t condition its approach to other countries based on “how they treat people,” he said.

“We really have to understand, in each country or each region of the world that we’re dealing with, what are our national security interests, what are our economic prosperity interests, and then, as we can advocate and advance our values, we should,” he said.

In separating U.S. policies from values such as human rights, democracy, press freedom and the treatment of minorities, Tillerson appeared to outline a departure from priorities pursued during both the Bush and Obama administrations.

An expanded version of this report appears on WSJ.com.

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?

The US is using so much solar power that it will have to prepare for the August eclipse

May 02, 2017
In the ancient world from the Mayans to the Egyptians, a solar eclipse portended one thing: “a disruption of the established order,” says E. C. Krupp, director of the Griffith astronomical observatory in Los Angeles.
So it is today. With a solar eclipse due to sweep across the US on Aug. 21, utility operators are preparing to guard against a steep drop in solar power, reports the Financial Times (paywall). As the shadow of the moon passes over North America, the eclipse is expected to knock out about 70 megawatts a minute— two to three times faster than the typically daily drop, reports the California Independent System Operator (pdf). It will rebound even faster.
That’s not unmanageable, but it has prompted US utilities from California to North Carolina to look for a solution to a new problem: managing grids increasingly reliant on solar power.

California, which boasts about half the country’s solar capacity, has seen its share of solar power on the grid soar to 10% from 0.4% in the last five years, reports the US Energy Information Administration. On Aug. 21, that will translate into a 6,000 MW shortfall during the hours of the eclipse, enough to power a large city, relative to normal supply.
To compensate, utility operators are reserving spare capacity from gas and hydroelectric power plants, as well as coordinating with industrial sources to temporarily curb demand. Europeans, who saw 90% of new energy on the grid come from renewable sources in 2016, have already weathered eclipses successfully in the past. US operators are taking lessons from them.

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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