Friday, 10 November 2017

And On To Danang, Vietnam



Baltic Dry Index. 1481 -05   Brent Crude 63.83

'Sometimes I wonder whether the world is being run by smart people who are putting us on, or by imbeciles who really mean it.'

Mark Twain.

With Presidents Xi and Trump in Danang, Vietnam to set out their competing ideas on APEC’s future, and a meeting between Presidents Putin and Trump off the agenda because both are too busy, plus President Trump’s aspirational tax cuts suffering a setback in Washington, and rising trouble in Saudi Arabia, it’s a good weekend to sit out events in cash and fully paid up physical precious metals. It’s also a good weekend to keep the car’s petrol tank fully topped up.

Below, events have an unfortunate way of often throwing sand into the well oilled machine.

"Until government administrators can so identify the interests of government with those of the people and refrain from defrauding the masses through the device of currency depreciation for the sake of remaining in office, the wiser ones will prefer to keep as much of their wealth in the most stable and marketable forms possible - forms which only the precious metals provide."

Elgin Groseclose

Asian markets pull back following Wall Street’s losses

Published: Nov 9, 2017 10:44 p.m. ET
Global equities remained under selling pressure on Friday with Japan’s benchmark index leading declines in Asia, tracking overnight weakness on Wall Street on concerns over the U.S. tax-overhaul plan.

Key U.S. stock indexes slid as the U.S. Senate’s plan to push through a different tax proposal than what the House of Representatives released last week caused some investors to question the Republicans’ ability to get a bill through to the White House.

The Nikkei Stock Average NIK, -0.79%   was down 1.4%, adding to Thursday’s declines, following the market’s recent strong run that saw the index close at a 25-year high on Wednesday. Stocks in Tokyo were also hit by further gains in the yen, with the U.S. dollar trading at around ¥113.31, compared with ¥113.59 at Thursday’s stock-market close.

“Investors are slowly unwinding their expectations from the Trump tax bill,” said Margaret Yang, market analyst at CMC Markets. Given the significant run-up in global shares over the past few weeks, traders took cues to take profit, she said.

Chip-maker stocks led Friday’s declines in Tokyo, extending weakness from the previous session, after technology giant Qualcomm QCOM, -1.36%   signed significant, but preliminary deals with three Chinese companies to supply components.

The tie-ups fueled fears that other companies in the region that rely on Qualcomm’s patents to develop and make chips would be at a disadvantage.

----Overnight in the U.S., the Dow Jones Industrial Average DJIA, -0.43%   shed 0.4% and the Nasdaq Composite COMP, -0.58%   fell 0.6%. Technology stocks in the S&P 500 SPX, -0.38%  , the best-performing sector of the year so far, fell 0.9% on Thursday.

In commodities, oil futures were weaker in Asian trade following a modest rebound overnight. Futures contracts for Brent LCOF8, -0.17%   and Nymex CLZ7, -0.14%   were trading down around 0.2%.

Also, energy stocks in the region faced selling pressure, with Santos STO, -3.44%   and Oil Search OSH, -1.33%   in Australia down 3.3% and 1.1%, respectively. Japan Petroleum 1662, -1.77%   off 1.1% in Tokyo.

Talk of new Trans-Pacific Partnership grips member nations at APEC leaders summit

Canada remains concerned about intellectual property rights and cultural exemptions in renewed TPP deal

By John Paul Tasker, CBC News Posted: Nov 09, 2017 9:21 PM ET Last Updated: Nov 09, 2017 11:55 PM ET
Prime Minister Justin Trudeau has arrived in Danang, Vietnam, the site of the APEC leaders summit, where talk of a new Trans-Pacific Partnership has gripped member countries.

Trade ministers from 11 of the 12 original signatories — with the notable exception of the U.S. — have been in advanced talks this week in the resort town ahead of the arrival of national leaders.

While some countries are hopeful for a deal by the weekend, Canada has sought to tamp down such optimism. The prime minister has publicly said Canada will not be rushed into any deal, and will not cave to "pressure" from other countries.

Officials from Japan said late Thursday that countries had reached an "agreement in principle," but International Trade Minister François-Philippe Champagne pushed back in a statement to Canadian media saying a final agreement was not yet in reach, a message echoed by Vietnam Trade Minister Tran Tuan Anh.

New Zealand's newly elected Labour prime minister, Jacinda Ardern, said talks are now "down to the wire," but there are still sticking points with some member countries.

"I don't want to predict what way it will go. There are a number of issues still on the table. Not all of them are ours," she told reporters.

New Zealand has concerns about investor-state dispute settlement provisions of the deal — a system through which investors can sue individual countries for alleged anti-competitive practices, a dispute-resolution process often opposed by left-wing stakeholders.

The TPP leaders meeting will be held Friday afternoon in Vietnam — early Friday morning in Canada. So far, talks have only taken place at the ministerial level.

Japan is eager to pen a deal as it looks to check the hegemony of China in the Asia-Pacific region, especially as China's relationship with U.S. President Donald Trump improves after a successful state visit by the American leader to the communist country this week.

Trudeau will meet Japanese Prime Minister Shinzo Abe on the sidelines of APEC on Friday, the prime minister's office said. 

Canada has two major sticking points with TPP, including passages on intellectual property rights and cultural exemptions.

Trudeau said Thursday Canada must maintain the right to regulate, and financially support, the country's cultural industries and not fear retribution at a trade tribunal. Importantly, Canada has long maintained it must be allowed to protect its culture — especially its minority francophone culture — against globalization and cultural assimilation.

---- While TPP talk brews, Trudeau will also meet Friday with Mexican President Enrique Pena Nieto, to discuss the progress of another trade deal, a renegotiated NAFTA.

A fifth round of trade talks will be held  Nov. 15-17 in Mexico amid a standoff on some policy fronts. Canada has sought to work closely with Mexico as it looks to secure another trilateral trade pact. 
  
In Middle East news, events unleashed in Saudi by President Turmp’s nod of approval, spiral out of control and bring the risk of a wider regional conflict. With President Trump occupied elsewhere, French President Macron has rushed in to fill the void.

Saudi Arabia Tells Its Citizens to Leave Lebanon

THE ASSOCIATED PRESS
November 9, 2017, 2:29 PM GMT Updated on November 9, 2017, 2:48 PM GMT
Riyadh, Saudi Arabia (AP) -- The Latest on developments in Saudi Arabia (all times local):
5:40 p.m.

The political party of Prime Minister Saad Hariri is calling for his immediate return to Lebanon after he announced his resignation in a strange, pre-recorded statement from Saudi Arabia.

Following a meeting of his Saudi-aligned Future Party in Beirut Thursday, the party issued a statement saying it was "necessary" for Hariri to return "to restore Lebanon's dignity and respect."

The statement read by former Prime Minister Fuad Saniora seemed to indicate that Hariri is being held in Saudi Arabia against his will.

Hariri resigned his post abruptly on Saturday in a pre-recorded speech from Saudi Arabia and has not returned to Lebanon.

In his absence, Lebanon has been awash with speculation the 47-year old prime minister may be held against his will in Saudi Arabia. Saudi officials have denied Hariri is under house arrest.
___
5:30 p.m.
Saudi Arabia has ordered its citizens out of Lebanon amid skyrocketing tensions between their two governments.

A brief statement carried by the state-run Saudi Press Agency called on all Saudis living in or visiting Lebanon to depart, and warned against travel to the country.

Lebanese Prime Minister Saad Hariri shocked his country Saturday when he announced in a televised statement out of Saudi Arabia that he was resigning. He has not been seen in Lebanon since.

He said his country had been taken hostage by the militant group Hezbollah, a partner in his coalition government and a major foe of Saudi Arabia. Saudi Arabia says it considers Hezbollah's participation in the Lebanese government an "act of war" against the kingdom.

Lebanese President Michel Aoun has said he will not consider the premier's resignation until the two meet in person.

Saudi Corruption Crackdown Hits Gulf

Total market capitalization for the region has fallen to its lowest level since 2016
By Archana Narayanan, Matthew Martin, Ruth David, and Zainab Fattah
November 10, 2017, 3:33 AM GMT

Saudi Arabia’s weekend arrests of dozens of princes, ministers and former and current officials have spooked investors across Gulf Cooperation Council countries. The collective sell-off amid what authorities are calling a crackdown on corruption has resulted in $17.6 billion of lost market capitalization in Gulf markets. Paris, Geneva, Zurich and Asia could all be beneficiaries if more money moves out, according to Sergey Dergachev, who helps oversee about $14 billion in assets as a senior portfolio manager at Union Investment Privatfonds GmbH in Frankfurt.

November 9, 2017 / 4:01 PM

France's Macron broaches Lebanon in surprise Saudi visit

DUBAI/RIYADH (Reuters) - French President Emmanuel Macron held hastily scheduled talks in Riyadh on Thursday with Saudi Crown Prince Mohammed bin Salman amid rising tensions between Saudi Arabia and Iran, notably over Lebanon and Yemen.

Macron, who flew in from a visit to the United Arab Emirates, had earlier declined to discuss a wave of high-level arrests for corruption in Saudi Arabia, but said it was vital to work with the kingdom for the stability of the region.

The first face-to-face talks between the two men focused on regional questions, in particular Yemen and Lebanon, and “ensuring the preservation of stability in the region”, the French presidency said in a statement after the meeting.

Two top Lebanese government officials said on Thursday that Riyadh was holding Lebanon’s Saad al-Hariri captive and a third told Reuters that the Saudi authorities had ordered Hariri to resign while he was in Riyadh last weekend, and put him under house arrest.

Saudi Arabia has denied that he is under house arrest, but Hariri himself has not denied that his movements are being restricted.

France has close ties with Lebanon, a former colony, and with Hariri, who has a home in France after spending several years in the country. Macron said at an earlier news conference in Dubai there had been informal contacts with Hariri, but no request to transfer him to France.

“They discussed the situation in Lebanon following the resignation of Prime Minister Hariri,” the French presidency said. “President Macron reiterated the importance France attaches to Lebanon’s stability, security, sovereignty and integrity.”

The statement made no mention on whether Macron had spoken with or seen Hariri while in Riyadh.
In recent years, France has been able to nurture new links with the Sunni-ruled Gulf Arab states due to its tough stance on Iran in nuclear negotiations, and the broad similarity of their policies on conflicts across the Middle East.

However, the 32-year-old Saudi crown prince has emphasised closer ties with U.S. President Donald Trump at a time when Macron has in turn sought to improve relations with Iran, Saudi Arabia’s Shi‘ite rival for regional influence.

Macron has said he will travel to Iran in 2018, potentially becoming the first French president to travel there since 1971.
More

November 9, 2017 / 12:13 PM

UK to provide Saudi Aramco with $2 billion credit guarantees

LONDON (Reuters) - Britain will provide $2 billion (1.52 billion pounds) in credit guarantees to Saudi Aramco (IPO-ARMO.SE) so it can buy British goods and services more easily, but denied it was part of efforts to persuade the energy giant to list its shares in London.

The loan agreement comes as London Stock Exchange (LSE.L), with backing from Prime Minister Theresa May, competes to host part of Saudi Aramco’s initial public offering (IPO), which is expected to be the biggest float ever.

“This builds on previous support for UK exports as part of Saudi Aramco joint venture projects,” the government said in a statement.

A spokesman for Britain’s finance ministry said the guarantees were not part of the country’s attempt to secure the IPO for London.

The guarantees announced on Thursday were relatively big. Over the past five years combined, previous guarantees have totalled 14 billion pounds ($18 billion), a government spokeswoman said.

Asked what specific projects the guarantees would back, the spokeswoman said Britain would work with the company to identify initiatives which could include British exports.

Saudi officials have said domestic and international exchanges, including New York, London, Tokyo and Hong Kong, have been considered for a partial listing of the state-run firm.

Britain’s financial regulator has proposed new rules to allow sovereign-controlled entities like Saudi Aramco to have their own “premium listing” category while being exempt from requirements such as how much of a company has to be floated.

The government and the City of London are keen to win the listing as a boost to the country’s capital markets just as Britain is preparing to leave the European Union.
More

Finally, why would either president bother to meet, given how unpredictable President Trump is, and how hamstrung he is by the anti-Russian American War Party? Seems from faraway London, President Putin said he was busy. At least this way, there’ll be no “misunderstandings.” Besides with President Trump getting upstaged in APEC by China, and in the Middle East by President Macron of France, and with his tax aspirations unraveling in Washington, President Putin probably sees little PR advantage in Russia by lending his prestige to such a meeting.

November 10, 2017 / 6:02 AM

White House says Trump and Putin will not have separate meeting at APEC

DANANG, Vietnam (Reuters) - U.S. President Donald Trump will not have a separate meeting with his Russian counterpart, Vladimir Putin, at the Asia-Pacific Economic Cooperation (APEC) summit in Vietnam due to scheduling conflicts, the White House said on Friday.

Trump and Putin will both attend the APEC summit in the Vietnamese city of Danang.

“Regarding a Putin meeting, there was never a meeting confirmed, and there will not be one that takes place due to scheduling conflicts on both sides,” White House press secretary Sarah Sanders told reporters minutes before landing in Danang.

“Now, they’re going to be in the same place. Are they going to bump into each other and say hello? Certainly possible and likely. But in terms of a scheduled, formal meeting, there’s not one on the calendar and we don’t anticipate that there will be one,” Sanders said.

Crooks and Scoundrels Corner

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

Today, more on our voodoo money future. If our central banksters get involved with cryptocurrencies, I have every confidence in them, to make a big mess of them in next to no time at all.

The ‘voodoo economics’ of cryptos, from the 23-year-old who created Ethereum

Published: Nov 8, 2017 1:17 p.m. ET

It feels kind of like voodoo economics and the price of the token isn’t really backed by anything. That’s a very spooky thing.’

Sure, coming from any number of bitcoin BTCUSD, +1.41%  critics, those comments would be expected. But coming from the guy who invented the second most valuable crypto before he even turned 20 years old?

Vitalik Buterin, Ethereum’s co-founder, recently told developers that he’s “concerned a lot of these token models aren’t going to be sustainable,” according to Bloomberg.

Buterin is concerned about supply. Where bitcoin has a 21 million coil limit, there’s no scarcity to support Ethereum prices, which are still managing to take out new highs. Regardless, he says he might do something to change that.

Specifically, Buterin says he’s interested in the idea of imposing fees, known as “sinks,” on applications built atop Ethereum. They would limit supply by destroying, or “burning,” ether tokens over time. “Introducing some kind of sinks into Ethereum is definitely something we’re looking at,” he said.

Buterin also spoke of another way to limit supply. The proof-of-stake plan, which may be put into place as early as the end of the year, rewards users for locking up some of their ether for a set amount of time, Bloomberg reported.

Meanwhile, Ethereum saw its price recover a bit on Wednesday, after a coding error resulted in the freezing up of almost $300 million worth of coins.

Blockchain - what’s it all about?

Tue, 07/11/2017 - 10:57
By George Ralph, RFA - Why is Blockchain the latest buzz word? What is it, and do you need it in your alternative investment firm?
Essentially blockchain technology is a distributed ledger tech for real-world applications. It is a peer to peer entity which is not maintained by any one organisation, but is open to all blockchain members. A blockchain ledger is replicated across all users of that blockchain and when a transaction is updated in one ledger, all other ledgers are simultaneously updated in chronological order. Everyone in the blockchain can see and verify the chain of events. The ledger is also reportedly indelible.

Blockchain really came about after the financial crisis of 2007 and was used most popularly as the ledger system behind Bitcoin. Virtual currencies were transferred around, using blockchain as the decentralised way of recording and verifying ownership and the transfer of ownership of currencies, but it’s not only a means of transferring and controlling cryptocurrencies. It is being touted as much wider and by other industries. For buy-side asset management firms, blockchain could be a way of removing the need to use an intermediary between clearing and settlement when a trade has been made. If transactions can be done and settled within seconds, there is no need for a services company to act as an intermediary, deals can be closed more quickly and reporting can be done in a more timely and accurate fashion. By taking blockchain further and writing in smart contracts, firms can build in automated, self-executing contractual clauses. These are triggered when certain parameters are met, and are verified by the blockchain members before being executed. Wins all round. 

Safety in numbers

With no centralised control over verification, and no single owner of the truth, there is an element of safety in numbers. Each blockchain user verifies the transaction, and there has to be a majority in order for the transaction to be verified and committed to the ledger for evermore. Hackers can’t simply break in and verify a fraudulent transaction, they would be rejected and the system would automatically reset. 

Blockchain is not infallible though, as the recent hacks into bitcurrency Ethereum suggest. Konstantinos Karagiannis, Chief Technology Officer, Security Consulting, BT Americas, speaking at the 2017 RSA conference warned that adopters of blockchain should be aware that the technology is built on public encryption keys, which can be cracked with quantum computing, and recommends testing and ethical hacking exercises to make sure the technology is as secure as it can be.

With the healthcare, logistics, property, music and other industries seeing blockchain as the next big thing, there is no denying that it is making waves and technologically savvy firms should keep an eye on it. It could be the technology to give you that much needed competitive edge, trimming down essential costs and speeding up trades and settlements. And when you think about cybersecurity, the systems we use at the moment are not completely secure, so it would be foolish to dismiss blockchain out of hand.

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?

Fully integrated circuits printed directly onto fabric

Date: November 8, 2017

Source: University of Cambridge

Summary: Researchers have successfully incorporated washable, stretchable and breathable electronic circuits into fabric, opening up new possibilities for smart textiles and wearable electronics. The circuits were made with cheap, safe and environmentally friendly inks, and printed using conventional inkjet printing techniques.

Researchers have successfully incorporated washable, stretchable and breathable electronic circuits into fabric, opening up new possibilities for smart textiles and wearable electronics. The circuits were made with cheap, safe and environmentally friendly inks, and printed using conventional inkjet printing techniques.

The researchers, from the University of Cambridge, working with colleagues in Italy and China, have demonstrated how graphene -- a two-dimensional form of carbon -- can be directly printed onto fabric to produce integrated electronic circuits which are comfortable to wear and can survive up to 20 cycles in a typical washing machine.

The new textile electronic devices are based on low-cost, sustainable and scalable inkjet printing of inks based on graphene and other two-dimensional materials, and are produced by standard processing techniques. The results are published in the journal Nature Communications.

Based on earlier work on the formulation of graphene inks for printed electronics, the team designed low-boiling point inks, which were directly printed onto polyester fabric. Additionally, they found that modifying the roughness of the fabric improved the performance of the printed devices. The versatility of this process allowed the researchers to design not only single transistors but all-printed integrated electronic circuits combining active and passive components.

Most wearable electronic devices that are currently available rely on rigid electronic components mounted on plastic, rubber or textiles. These offer limited compatibility with the skin in many circumstances, are damaged when washed and are uncomfortable to wear because they are not breathable.

"Other inks for printed electronics normally require toxic solvents and are not suitable to be worn, whereas our inks are both cheap, safe and environmentally-friendly, and can be combined to create electronic circuits by simply printing different two-dimensional materials on the fabric," said Dr Felice Torrisi of the Cambridge Graphene Centre, the paper's senior author.

"Digital textile printing has been around for decades to print simple colorants on textiles, but our result demonstrates for the first time that such technology can also be used to print the entire electronic integrated circuits on textiles," said co-author Professor Roman Sordan of Politecnico di Milano. "Although we demonstrated very simple integrated circuits, our process is scalable and there are no fundamental obstacles to the technological development of wearable electronic devices both in terms of their complexity and performance."

"The printed components are flexible, washable and require low power, essential requirements for applications in wearable electronics," said PhD student Tian Carey, the paper's first author.

The work opens up a number of commercial opportunities for two-dimensional material inks, ranging from personal health and well-being technology, to wearable energy harvesting and storage, military garments, wearable computing and fashion.

"Turning textile fibres into functional electronic components can open to an entirely new set of applications from healthcare and wellbeing to the Internet of Things," said Torrisi. "Thanks to nanotechnology, in the future our clothes could incorporate these textile-based electronics, such as displays or sensors and become interactive."

The use of graphene and other related 2D material (GRM) inks to create electronic components and devices integrated into fabrics and innovative textiles is at the centre of new technical advances in the smart textiles industry. The teams at the Cambridge Graphene Centre and Politecnico di Milano are also involved in the Graphene Flagship, an EC-funded, pan-European project dedicated to bringing graphene and GRM technologies to commercial applications.

The research was supported by grants from the Graphene Flagship, the European Research Council's Synergy Grant, The Engineering and Physical Science Research Council, The Newton Trust, the International Research Fellowship of the National Natural Science Foundation of China and the Ministry of Science and Technology of China. The technology is being commercialised by Cambridge Enterprise, the University's commercialisation arm.

Another weekend and a good weekend to be out of troublesome positions.  With APEC’s  politician’s all strutting their egos on the world stage, Saudi Arabia generating capital flight from the Gulf, and the Catalonian time bomb ticking away until the December election, plus Brexit of course, who need to go looking for trouble this weekend. Have a great weekend everyone.

"Gold was not selected arbitrarily by governments to be the monetary standard. Gold had developed for many centuries on the free market as the best money; as the commodity providing the most stable and desirable monetary medium."

Murray N. Rothbard

The monthly Coppock Indicators finished October

DJIA: 23,277 +233 Up. NASDAQ:  6,728 +284 Up. SP500: 2,575 +183 Up.

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