Tuesday, 8 August 2017

Stocks – 1987 Again?

Baltic Dry Index. 1032     Brent Crude 52.17

It is a far, far better thing to have a firm anchor in nonsense than to put out on the troubled seas of thought.

John Kenneth Galbraith

Does history repeat? Well probably no, not exactly. Not with the global central banks actively rigging global stock and bond markets, something that only happened en-mass with fallen guru “Bubbles” Greenspan’s actions on the Tuesday morning after Black Monday, October 19, 1987. Forever gun shy thereafter, Greenspan and his ilk, have monetised and rigged every stock market bubble bust, ever since.  

But since the insane, rent-seeking, derivatives gambling bust of 2008 almost wiped out the whole western gambling financial system, each panicked market central bank rig gets less effective than the one before, until now we have reached the absurd situation, that the central banksters and their crony riggers, are the markets and market movers. Pavlov and his dogs comes to mind. As do Potemkin villages. 

But now our “omnipotent” central banksters have built a ZIRP and NIRP debt fuelled, Mount Everest of a current gambling bubble, compared to a mere Mont Blanc of 2008, and they seem to have run out of road and talent, here in the summer of 2017. What could possibly go wrong? Won’t the Olympian Gods, aka central banksters always be able to rig any problems away?

To this old dinosaur trader, following markets since 1968, the motor crash at Le Mans 1955, comes to mind. The experts had built race cars that far exceeded track capabilities. The race organisers completely failed to see the danger to the public.  Emergency services were still following long outdated plans. Tragedy ensued.

In any great organization it is far, far safer to be wrong with the majority than to be right alone.

John Kenneth Galbraith

August 8, 2017 / 1:35 AM / an hour ago

Asia stocks deflate as China trade disappoints

SYDNEY (Reuters) - Asian shares went flat on Tuesday as disappointing Chinese trade data clouded the otherwise upbeat outlook on global growth, leaving currencies and commodities becalmed in summer doldrums. 

MSCI's broadest index of Asia-Pacific shares outside Japan gave up modest early gains to be barely changed, though it was still within a whisker of its recent decade high.

South Korea's market dipped 0.2 percent while Japan's Nikkei eased 0.3 percent. China's main markets were also down a shade in thin trade.

Beijing reported exports and imports both grew much less than expected in July, breaking a run of better numbers from the Asian giant that had fueled optimism on global growth and a rally in industrial commodity prices.

Ratings agency Fitch this week lifted its outlook for the world economy for this year and next.

"The revisions are led by emerging markets and China in particular, whose recovery has been more pronounced than anticipated," said Fitch chief economist Brian Coulton.

"Data continue to suggest a synchronized global expansion across both advanced and emerging market economies. Spill-overs from the rebound in emerging market demand are reflected in the fastest growth in world trade since 2010."

On Wall Street, the Dow rose 0.12 percent, while the S&P 500 added 0.16 percent and the Nasdaq 0.51 percent. The Dow has risen 10 sessions in a row and three more would match the all-time winning streak in January 1987.

Volumes were light as the news flow dried up with the U.S. Congress and President Donald Trump on vacation and a bumper profit season drawing to a close.

U.S. Stocks Rise, Shrugging off Energy Weakness: Markets Wrap

By Eric J Weiner
U.S. stocks gained modestly Monday with the S&P 500 Index and Dow Jones Industrial Average continuing their record runs, as strength in technology and consumer staples balanced out weakness in energy. Oil dropped amid speculation that an abundance of supply will weigh on the market. The dollar climbed, and the euro also rose.

European equities slipped after a report showed German industrial data unexpectedly fell in June, with declines in travel and leisure shares offsetting advances for ArcelorMittal and Anglo American Plc after iron ore and steel prices increased. West Texas Intermediate crude sat below $50 a barrel as producers gathered in Abu Dhabi to address oversupply issues. The S&P 500 Energy Index was down 1 percent, making it the worst performing group in the broader gauge.

-----Among the key events looming this week:
  • Representatives from OPEC and non-member nations meet in Abu Dhabi Monday to discuss supply cut compliance, which fell to 86% in July.
  • It’s a week of industrial data in Europe. U.K. factory output for June is due Thursday. After Monday’s industrial production for Germany, Italy is on Wednesday and France on Friday.
  • Kenya holds a presidential election starting Tuesday with President Uhuru Kenyatta challenged by former Prime Minister Raila Odinga.
  • Among a number of Fed speakers this week, keep a keen ear out for comments by New York Fed boss Bill Dudley on Thursday.
  • South African President Jacob Zuma faces a no-confidence vote. Dutch Prime Minister Mark Rutte resumes talks to form a coalition government on Wednesday.
  • The Fed’s inflation puzzle means Friday’s CPI data in the U.S. will get close attention.
  • Argentina, Mexico, New Zealand, Peru, the Philippines, Serbia and Zambia set monetary policy.

Americans now have the highest credit-card debt in U.S. history

Published: Aug 7, 2017 5:20 p.m. ET

U.S. households collectively have more than $1 trillion in credit-card debt

American consumers just hit a scary milestone.

They now collectively have the most outstanding revolving debt — often summarized as credit card debt — in U.S. history, according to a report Monday released by the Federal Reserve. Americans had $1.021 trillion in outstanding revolving credit in June 2017. This beats the previous record in April 2008, when consumers had a collective $1.02 trillion in outstanding credit revolving credit.

“This record should serve as a wake-up call to Americans to focus on their credit card debt,” said Matt Schulz, a senior industry analyst at CreditCards.com, a credit card website. “Even if you feel your debt is manageable right now, know that you could be one unexpected emergency away from real trouble.”

Revolving credit had been growing at an annual growth rate of 4.9%. One reason: More consumers are getting access to credit cards backed by major banks and issuers in recent months. More than 171 million consumers had access to those cards in the first quarter of 2017, the highest number that has had access since 2005, when about $162.5 million people had access.

For the first time since the Great Recession, lenders have given more consumers with sub-prime, or below average, credit scores, access to credit cards, but they are giving them lower spending limits, according to the credit reporting agency TransUnion TRU, +0.22%  .

The New York Federal Reserve released a new report Wednesday that showed U.S. collective household debt balances totaled $12.73 trillion in March 2017, surpassing the 2008 peak of $12.68 trillion.

Le Mans 1955

Finally, another day, yet another red flag in Asia. Doesn’t Asia have any other colour than red for flags?

World's Top Stock Market Really Just a Handful of Top Stocks

By Kana Nishizawa
6 August 2017, 17:00 GMT+1 7 August 2017, 10:03 GMT+1
Among the world’s biggest stock markets, there haven’t been any better investments this year than Hong Kong’s Hang Seng Index.

But under the surface of that 26 percent surge, gains are getting more concentrated -- and that means for some shares, volatility is on the rise. Take one of the Hang Seng’s heaviest weighted stocks, Tencent Holdings Ltd. Its 69 percent surge this year has accounted for about a quarter of the index’s gain, according to data compiled by Bloomberg. And its 30-day volatility has jumped 51 percent, as price swings across the index grow ever more muted.

Market watchers say mainland Chinese investors are causing the phenomenon, favoring Hong Kong’s biggest shares as they funnel cash into the city through exchange links. While that creates opportunities -- and pitfalls -- for stock pickers, some strategists see the lack of breadth as a risk for passive money too, in that it’s a sign of a fragile rally.

“There are certain funds coming down from China and they are buying into well-known stocks from their point of view, like Tencent or Ping An. The Hang Seng Index has moved quite considerably upwards but then the second or third liners haven’t been able to follow," said Victor Au, chief operating officer at Delta Asia Securities Ltd. The rally’s reliance on just a few stocks means “an external shock would give the market a good excuse to have a big correction," he said. “Investors are too complacent to the current situation."

In economics, the majority is always wrong.

John Kenneth Galbraith

Crooks and Scoundrels Corner

The bent, the seriously bent, and the totally doubled over.

Today, while President Trump huffs and puffs away at Iran, President Macron’s lads get on with business as usual there.

Renault Sets Up New Iran Partnership Amid U.S. Trade Tensions

7 August 2017, 11:51 GMT+1
Renault SA plans to increase its car manufacturing in Iran by 75 percent, defying efforts by U.S. President Donald Trump’s administration to isolate the country with additional sanctions.

The French automaker is setting up a joint venture with Iran’s Industrial Development & Renovation Organization and local dealer Parto Negin Naseh Co. to build 150,000 vehicles a year, Renault said Monday in a statement. The company reached an initial deal with IDRO in September, when it said the partnership will begin producing cars next year.
Investment in the project’s first phase will total 660 million euros ($779 million), Iran’s official IRNA news agency reported, without specifying how much each partner will spend. Renault declined to comment on any amount. The French company will hold 60 percent of the business and local partners the rest, IRNA cited Mansour Moazami, head of IDRO, as saying.
The manufacturer, based in the Paris suburb of Boulogne-Billancourt, is following French competitor PSA Group’s renewed push to grow in Iran after international trade restrictions eased following a deal in 2015 on the country’s nuclear program. Trump’s hostility toward the settlement is seen putting it at risk, and an Iranian space launch in late July prompted the U.S. to sanction six Iranian companies in retaliation.

Renault has been making cars in Iran since 2003 in a joint venture with two other partners, Iran Khodro and Saipa Group, and it said Monday that current capacity in the country is 200,000 autos a year. Chief Executive Officer Carlos Ghosn said in January 2016 that Renault would “considerably intensify operations in Iran,” with a wider range of local partners, once trade sanctions were removed.
The first vehicles produced under the new IDRO deal will be the latest versions of the Symbol and Duster models. Renault’s deliveries in Iran more than doubled last year to 109,000 vehicles, and the growth rate continued in the first half of 2017, with the company saying it had a 9.7 percent market share.
The process by which banks create money is so simple that the mind is repelled.

John Kenneth Galbraith

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?

Graphene’s usefulness in space to be tested

August 7, 2017
Two experiments this autumn will test graphene’s viability for space applications.

The first experiment will observe if graphene-based coatings can improve efficiency in loop heat pipes, found in satellite cooling systems. The second will test how graphene could be used as a material for space sails. Both experiments are being carried out by the Graphene Flagship, Europe’s largest pan-research initiative, aiming to commercialise graphene research.

Professor Jari Kinaret, Director of the Graphene Flagship, said: “These two projects exemplify the two-fold character of the Graphene Flagship: the loop heat pipe project is targeting a specific application, while the light sail project is firmly linked to basic research and builds upon the unique combination of properties that only graphene can offer.”

A large component of the loop heat pipe in satellites is the wick, typically constructed from porous metal. The experiment will see a number of wicks coated with different types of graphene-related materials to improve the heat pipes’ efficiency. The coated wicks will then be tested in a low-gravity parabolic flight. Lucia Lombardi, a PhD researcher student, said: “The idea is to use graphene to improve the thermal conductivity and the capillary pressure by growing a sponge in the pores of the wicks.”

The tests for space sails will be carried out by a group of students, who will use microgravity conditions in the ZARM Drop Tower based in Germany, to carry out their research. By shining laser light on suspended graphene-membranes, the researchers hope to measure how much thrust can be generated.

Dr Andrea Ferrari, Science and Technology Officer of the Graphene Flagship, said: “Space is the new frontier for the Graphene Flagship. These initial experiments will test the viability of graphene-enabled devices for space applications.”
Both experiments will launch between 6-16th of November. For more information on the experiments watch the two videos below.

Drop Your Thesis!: https://www.youtube.com/watch?v=UpFvZr5j5tw

Parabolic Flight: https://www.youtube.com/watch?v=x-nVw6RsUaA

In economics, hope and faith coexist with great scientific pretension and also a deep desire for respectability.

John Kenneth Galbraith

The monthly Coppock Indicators finished July

DJIA: 21,891 +207 Up. NASDAQ:  6,348 +250 Up. SP500: 2,470 +171 Up.

1 comment:

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