Baltic Dry Index. 1361
-13 Brent
Crude 61.30
"We
shouldn't pour cold water on everything.
We, the eight or nine players in global investment banking, have a very
good future."
Deutsche
Bank, CEO Josef Ackermann. Davos, January 2007.
For more on caveat
emptor and the “new Leonardo,” scroll down to Crooks Corner.
We open this November
Friday with hopium and hype back in fashion, and then some. Party on like it’s
2005-2007 again.
We do not err because truth is difficult to see. It is visible
at a glance. We err because this is more comfortable.
Alexander Solzhenitsyn
November 17, 2017 / 12:48 AM
Asian shares up on US tax, earnings hopes; Mueller report hits dollar
TOKYO
(Reuters) - Asian shares rose firmly on Friday as strong U.S. earnings and a
step forward in Congress on U.S. tax reform brightened the mood, even though
investors noted that many hurdles remain to passage of a deal on tax cuts.
But
the dollar fell after the Wall Street Journal reported Special Counsel Robert
Mueller’s team last month subpoenaed President Donald Trump’s campaign for
documents containing specified Russian keywords from more than a dozen
officials.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 0.8 percent while Japan's Nikkei .N225 gained 0.4 percent, extending its recovery from a near three-week intraday low hit on Thursday.
Wall Street’s main indexes rose sharply on Thursday, boosted
by strong gains in Wal-Mart (WMT.N)
and Cisco (CSCO.O)
following their earnings.
The S&P 500 .SPX
advanced 0.82 percent to turn positive for the week, a day after hitting a
three-week low, while the Nasdaq Composite .IXIC
added 1.3 percent to a closing record high of 6,793.29.
MSCI’s broadest gauge of the world’s stock markets
.MIWD00000PUS stemmed its five-day losing streak and posted its biggest daily
gain in two months, of 0.80 percent, on Thursday.
Junk bond prices rebounded sharply, with iShares High Yield Bond ETF (HYG) gaining almost one percent to recoup more than half of its losses since the start of the month.
“The markets had been wary of fall in credit products during the last
few days but it seems we just had a healthy correction. As the European Central
Bank and the Bank of Japan are still pumping liquidity, the world’s asset
markets will be supported,” said Masahiro Ichikawa, senior strategist at
Sumitomo Mitsui Asset Management.
The U.S. House of Representatives approved a broad package of tax cuts
sought by Trump, passing its first, if smallest, hurdle and providing a
catalyst for fresh buying in risk assets.
The tax debate now moves to the U.S. Senate, where that chamber’s
separate plan has already encountered resistance from some Republicans. No
decisive Senate action is expected until after next week’s Thanksgiving holiday
on Nov. 23.
---- The positive mood on Wall Street helped to lift the yield on two-year U.S. notes US2YT=RR to a nine-year high, with a Fed rate hike in December seen almost as a done deal.
Fed funds rates futures are now pricing in about a 90 percent chance of
another rate hike by June next year, the highest level in recent months and up
from about 50 percent just over a month ago.
More
From Bitcoin to Global Equities, It’s Risk-On Again in Markets
By Chris Anstey and Adam Haigh
It might be the rebound that was bound to happen.
The world is still in a synchronous economic expansion across developed
and emerging markets. It still has at least half a year of liquidity pumping
ahead from the key central banks, taken together. And it’s still fascinated by
the prospects of digital currencies.
Sure enough, across asset classes the week is ending with a bounce-back
from recent sell-offs in equities, higher-risk bonds and Bitcoin. It’s been a
long time since Japan led global dynamics, but nevertheless the equity retreat
that appeared most strongly in Tokyo Thursday afternoon last week was over a
week later.
Just
a handful of days after tumbling 29 percent from its all-time high in a rout
that wiped $38 billion from its market value, Bitcoin surged back to set a fresh
record. It’s on its way to $8,000 and CME Group Inc. is poised to start offering
professional traders ways to hedge the price with futures on the world’s
largest exchange next month.
The
tumult in the junk bond market got so severe at one stage this week that Deutsche Bank’s chief international
economist was inundated with questions as to whether it would lead to a U.S.
recession. The U.S. gauge of high-yield debt was on course for its worst week
since March before buyers came to the rescue on Thursday, though it still
remains down from its high last month.
Adding
to good cheer in Asia on Friday was a Moody’s Investors Service
sovereign-credit rating upgrade for India, where policy makers have mounted a
new campaign to deal with the country’s non-performing loans. That spurred a
rally in the rupee and sent equities soaring together with bonds.
More
Next up, China
tightens. We are transitioning from easy, “free” money, to something closer to “normal”
money. We are in for an exciting few months.
“Only when the
tide goes out do you discover
who's been swimming naked."
Warren
Buffett
November 17, 2017 / 4:23 AM
China overhauls 17.8 trillion yuan public-private projects as debt fears rise
BEIJING (Reuters) - China’s finance ministry has ordered an overhaul of
its existing public-private partnership (PPP) projects and tightened approval
rules for new ones, as Beijing has grown increasingly concerned about rising
hidden debt risks from potential abuses of the programme.
In recent years, the government has tightened controls on new local
government debt to help ward off risks following a borrowing binge since the
global financial crisis.
Instead,
Beijing has heavily promoted the PPP model since 2014, which channels private
money into public infrastructure projects, to keep capital investment growing
while easing the burden on heavily-indebted local governments.
The value of China’s 14,220 existing PPP projects totalled 17.8 trillion
yuan (2.03 trillion pounds) by end-September, according to a national database
managed by the finance ministry.
But the aggressive PPP boom has started to alarm authorities who say
some local governments are using public-private partnerships, government
investment funds and government procurement services as “disguised channels”
for raising debt.
All provincial finance bureaus should weed out “unqualified” PPP
projects by March 2018, the finance ministry said in a notice posted on its
website on Thursday.
The criteria for such projects includes failure to conduct
return-on-investment evaluation and fiscal stress test, poor project progress
and information transparency, exceeding fiscal spending upperlimit, and making
illegal debt guarantees.
The ministry also tightened rules on approving new PPP projects, specifying
that non-public services projects, such as commercial real estate development
projects, are ineligible.
In Europe, Germany struggles to get a coalition government
that can work, as Jamaican forgery fails. Most people in GB would be only too
happy not to have a government at all. The Germans don’t know how lucky they
are.
November 17, 2017 / 5:14 AM
German coalition talks miss deadline; parties still at odds
BERLIN
(Reuters) - Chancellor Angela Merkel’s efforts to forge a three-way ruling
coalition could stretch into the weekend after the parties missed Merkel’s
Thursday deadline and failed to reach agreement on key issues such as migration
and finances.
Merkel’s conservatives, the pro-business Free Democrats (FDP) and the
environmentalist Greens told reporters around 4 a.m. that they were taking a
break of several hours and would resume talks around midday on Friday.
“We still believe that it’s worth it to work at it with our full
energy,” said Peter Tauber, secretary general of Merkel’s Christian Democratic
Union (CDU). “On the other hand, it’s evident that it’s difficult.”
Wolfgang Kubicki, deputy leader of the FDP, told reporters he was
“extremely frustrated” after four weeks of negotiations that have failed to
produce agreement.
“If things stay like this, we won’t get any further,” Kubicki said.
“It’s frustrating when you sit together and then you realise that you’re right
back where you started.”
Michael
Kellner, a top official with the Greens, said there was much to be done yet.
“Nothing is agreed, nothing has been decided,” he said.
More
Finally, more on God’s work in Gotham, New York City.
Hopefully, coming soon to a EUSSR continental city near you, ex-London. If it’s bad for Ebenezer Squid, it’s got to
be good for the clients and everyone else. Remember, “Call it the Goldman Sachs test. If this is something
Goldman would do to its clients, don't do it." Felix Salmon.
“I’m just a banker doing God’s work”
Lloyd Blankfein, “Mr. Goldman Sacks,” CEO of
Goldman Sachs.
Goldman, other big banks secretly shared client info to rig U.S. Treasury auctions, lawsuit alleges
Published: Nov 16, 2017 2:42 a.m. ET
Banks mined their own customers’ bids for Treasury bonds, then shared the information in online chat rooms, according to a class-action lawsuit
Wall Street banks secretly shared client information in online chat rooms in order to rig auctions for the $14 trillion U.S. Treasurys market, according to an explosive lawsuit filed in Manhattan federal court on Wednesday.The move wrongly fattened the banks’ profits and picked profits from clients, the suit claims.
The new accusations, leveled by several pension funds and wealthy individual investors, are contained in an expanded class-action suit originally filed in July 2015 — and include an unusual twist: Some of the evidence came from confidential informants and one of the banks sued in the earlier action.
That bank is now cooperating with the plaintiffs in the massive civil action, and is providing an in-depth look into how Wall Street allegedly conspired to rig Treasury bond trades.
The revised lawsuit expands on details on how the banks conspired to set Treasury bond prices TMUBMUSD10Y, +1.41% — like moves to manipulate the price of the bonds higher on days when there was a lot of demand, and vice versa, court papers claim.
The banks worked their scam for years until The Post first reported in June 2015 of the existence of a government investigation into the alleged actions, the updated lawsuit claims.
The funds, representing retirees and public workers, also claim the banks conspired to rig the secondary Treasury markets beginning in the 1990s through tightly controlled electronic platforms that inhibited more competitive trading — a new allegation that wasn’t in the original suit but mirrors similar complaints filed against banks in other markets, like stock loans.
The amended suit tightens its focus on a select number of banks, naming Goldman Sachs GS, +0.16% , Deutsche Bank DB, +2.71% DBK, +3.05% , Morgan Stanley MS, -0.58% , the Royal Bank of Scotland RBS, +0.14% , RBS, -0.18% BNP Paribas BNP, +0.36% , and UBS UBS, -0.18% , UBSG, +1.25% among others, as the firms behind the rigging, which they allege occurred from Jan. 1, 2007 to mid-2015.
Last year, the judge presiding over the class-action suit had questioned whether the claims were strong enough to proceed.
The funds continue to allege the banks mined their own customers’ bids for Treasury bonds to get a bigger share of the auction and sell the bonds for more profit.
Probes on the auction practices are being conducted by the Justice Department, the Securities and Exchange Commission and other federal, state and overseas regulators, sources said. No regulator has accused any bank of wrongdoing.
The banks named in the suit are primary dealers, which means they buy the debt directly from the Treasury and resell it to their clients at a pre-determined price.
Typically, the Treasury holds an auction, then banks submit their bids for U.S. debt based on how much they think those bonds are worth. The Treasury then doles out the bonds proportionately to the bidders at the same price. The bank that asked for the best price gets the most bonds.
Traders at the Wall Street banks shared the prices that their clients had sought to buy the bonds, giving each of the banks in the alleged cartel a clearer picture of what they thought the market was, and a better chance at getting a bigger share of the bonds to sell, according to the complaint.
Details about bid prices are supposed to be a closely held secret.
Each bank declined to comment on the lawsuit after it was first filed.
Blankfein Tweets Many CEOs Want to See Second Brexit Referendum
By Dakin Campbell and Alex Morales
November 16, 2017, 2:59 PM GMT Updated
on November 16, 2017, 4:00 PM GMT
Goldman
Sachs Group Inc. Chief Executive Officer Lloyd Blankfein said in a post on
Twitter that many corporate executives want to see a second vote on the U.K.’s
decision to exit the European Union.“Many wish for a confirming vote on a decision so monumental and irreversible,” Blankfein wrote, referring to fellow CEOs. “So much at stake, why not make sure consensus still there?”
Goldman Sachs Group Inc. Chief Executive Officer Lloyd Blankfein said in a post on Twitter that many corporate executives want to see a second vote on the U.K.’s decision to exit the European Union.
“Many wish for a confirming vote on a decision so monumental and irreversible,” Blankfein wrote, referring to fellow CEOs. “So much at stake, why not make sure consensus still there?”
The tweet is Blankfein’s third in the past month to explicitly reference Brexit and is indicative of the growing unease of business at the uncertainty surrounding Britain’s departure. A survey last week for the Confederation of British Industry found that some 10 percent of companies were implementing for a no-deal scenario. By March, that will rise to 60 percent.
Banks including UBS AG, Standard Chartered Plc and Nomura Holdings Inc. are preparing to move workers to mainland Europe from London’s City financial district, to ensure they have access to European markets after Brexit. In the absence of early clarity on post-Brexit arrangements, many are already taking up new offices and moving staff.
Blankfein’s recent tweets illustrate the preparations that Goldman Sachs is making.
On Oct. 19. he tweeted praise for Frankfurt, saying "Good, because I’ll be spending a lot more time there.” That tweet was completed with the #Brexit hashtag, which he deployed again on Oct. 30 in a tweet about the bank’s new office building in London. “Expecting/hoping to fill it up, but so much outside our control,” he wrote.
More
'You
just never know. That unpredictability is the great thing about life. You
change. The world changes. You live in a country where we are still blessed
with enormous opportunity. Leave yourself open to the world of possibility. You
have the ambition, you have the smarts and you have the toughness. So, turn the
page on your biography - you have just started a new chapter in your lives.'
Lloyd
Blankfein, “Mr. Goldman Sacks,” CEO of
Goldman Sachs unintentionally backs Brexit in a US speech to graduates, mid
2016.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Today, caveat emptor. Beauty
may lie in the eye of the beholder, but where does truth in auction houses lie?
Today, more on that $450 million “da Vinci.” I have no way of knowing what is
false news from truth regarding the Salvator Mundi. But if I had 400 million to
toss around, I know, I wouldn’t be writing this almost useless daily market update, I
hope I would find some good causes to help, even if the poor will always be
with us, and can be helped at any time we wish.
Below, the other side of the “new Leonardo.” But surely Christie’s knows
a thing or two about old masters.
Christie’s Is Selling This Painting for $100 Million. They Say It’s by Leonardo. I Have Doubts. Big Doubts.
Sandwiched between onlookers who’d waited in line outside
in the cold to be ushered into the dimmed Christie’s gallery to gaze and gawk
at what the auction house trumpets as “the greatest and most unexpected
artistic rediscovery of the 21st century” — that is, a brand-new Leonardo da
Vinci lost in the 1600s, scheduled to be auctioned off this week — a well-known
expert in the field leaned over and asked me a question. “Why is a Leonardo in
a Modern and Contemporary auction?” Before I could say, “Yeah! Why?” he
answered, “Because 90 percent of it was painted in the last 50 years.”
He’s
right. Not only does it look like a dreamed-up version of a missing da Vinci,
various X-ray techniques show scratches and gouges in the work, paint missing,
a warping board, a beard here and gone, and other parts of the painting
obviously brushed up and corrected to make this probable copy look more like an
original.
The painting is titled Salvator Mundi (Savior
of the World) and is a portrait of a smoky floating man in a blue robe
looking at us, raising his right hand in blessing, holding a crystal orb in his
left hand, pictured against a black background. It’s said to have been painted
around 1500, when the real Leonardo would have been 48 years old and already
the most famous artist alive. On Wednesday night, this small picture is being
auctioned off by Christie’s with massive jubilation. The opening bid is set at
$100 million. (Which might even seem cheap when you remember that Damien
Hirst’s 2007 For the Love of God, a diamond-and-platinum-encrusted
human skull, was priced the same.) This explains why one Christie’s official
rapturously primed the collector pump by wondering aloud if someone might bid
“$2 billion.” In a world this out of whack, that could happen. Promoting the
sale is a glossy 162-page book with quotes from Dostoyevsky, Freud, and
Leonardo, and several platitudinal Christie’s videos of enraptured gazers
gawking in wonder at “the new masterpiece.”
Don’t miss the extended clip of
three male company bigwigs pitching it to Hong Kong clients as “the holy grail
of our business, a male Mona Lisa, the last da Vinci, our baby, something with
blockbuster appeal, akin to the discovery of a new planet, and more valuable
than a petro chemical plant.”
I’m no art historian or any kind of expert in old
masters. But I’ve looked at art for almost 50 years and one look at this
painting tells me it’s no Leonardo. The painting is absolutely dead. Its
surface is inert, varnished, lurid, scrubbed over, and repainted so many times
that it looks simultaneously new and old. This explains why Christie’s pitches
it with vague terms like “mysterious,” filled with “aura,” and something that
“could go viral.” Go viral? As a poster, maybe. A two-dimensional ersatz
dashboard Jesus.
Why else do I think this is a sham? Experts estimate
that there are only 15 to 20 existing da Vinci paintings. Not a single one of
them pictures a person straight on like this one. There is also not a single
painting picturing an individual Jesus either. All of his paintings, even
single portraits, depict figures in far more complex poses. Even the figure
that comes remotely close to this painting, Saint John the Baptist, also
from 1500, gives us a turning, young, randy-looking man with hair utterly
different from and much more developed in terms of painting than the few curls
Christie’s is raving about in their picture. Leonardo was an inventor of — and
in love with — posing people in dynamic, weaving, more curved, and corkscrewing
positions, predicting the compositions of Raphael, then in his 20s, and already
being highly influenced, according to Vasari, by his acquaintance Leonardo.
Renaissance masters were all about letting figures interact with the surface
and the structure of the painting, curving space, involving the viewer in way
more than an old-fashioned direct headshot. Leonardo never let a subject come
at you all at once like this much more Byzantine, flat, forward-facing
symmetry. No other Renaissance master was involved with Byzantine portraiture
like this either. They were all pushing way beyond that by then.
More
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?
Tuning the optical, photocatalytic properties of so-called carbon dots
Date:
November 15, 2017
Source:
Ludwig-Maximilians-Universität München
Summary:
The optical and photocatalytic properties of so-called carbon dots can be
precisely tuned by controlling the positions of nitrogen atoms introduced into
their structure, physicists have demonstrated in a new study.
As LMU physicists demonstrate in a new study, the optical and
photocatalytic properties of so-called carbon dots can be precisely tuned by
controlling the positions of nitrogen atoms introduced into their structure.
Thanks to their unusual optical properties, carbon particles with
diameters on the order of a few nanometers -- so-called C-dots -- show great
promise for a wide range of technological applications, as diverse as energy
conversion and bio-imaging. Moreover, C-dots have several practical advantages
over comparable materials insofar as they are easy to fabricate, stable and
contain no toxic heavy metals. Their versatility is largely due to the fact
that -- depending on their chemical composition and aspects of their complex
structure -- they can either act as emitters of light in the form of
photoluminescence or function as photocatalysts by absorbing light energy and
triggering chemical reactions, such as water splitting. However, the factors
that determine these disparate capabilities are not well understood. Now LMU
physicists led by Dr. Jacek Stolarczyk have taken a closer look at the
mechanisms underlying these very different properties. Their study, which
appears online in the journal Nature Communications, shows that the
physicochemical characteristics of these nanomaterials can be simply and
precisely tuned by introducing nitrogen atoms into their complex chemical
structure in a controlled manner.
"Up until now, C-dots have typically been optimized on the basis of
the principle of trial and error," says Stolarczyk. "In order to get
beyond this stage, it is essential to obtain a detailed understanding of the
mechanisms that underlie their diverse optical characteristics." The study
was carried out as part of the interdisciplinary project "Solar
Technologies Go Hybrid" (SolTech) coordinated by Prof. Jochen Feldmann.
SolTech is funded by the State of Bavaria to explore innovative concepts for
the transformation of solar radiation into electricity and the use of
non-fossil, and preferably non-toxic and abundantly available, fuel sources for
the storage of energy. C-dots are in many respects ideally suited for such
applications.
----"Our investigation showed that the chemical environment of the
nitrogen atoms incorporated has a crucial influence on the properties of the
resulting C-dots," says Dr. Santanu Bhattacharyya, the first author of the
paper and Alexander-von-Humboldt fellow in the research group of Professor
Jochen Feldmann. Incorporation inside the graphene-like structures, found at
intermediate polymer concentrations, led to the dots which predominantly emit
blue photoluminescence when irradiated with light of a suitable wavelength. On
the other hand, incorporation at edge positions, found for either very high or
very low amounts of the polymer, suppressed photoluminescence and resulted in
C-dots that photocatalytically reduced water to hydrogen instead. In other
words, the optical properties of the C-dots can be modified at will by varying
the details of the procedure used to synthesize them. The members of the LMU
team believe that their latest insights will stimulate further work on the use
of these intriguing nanomaterials, both as photoluminescent light sources and
as photocatalysts in energy conversion processes.
Another weekend and
so much to worry about, we are spoiled for choice. Zimbabwe. Venezuela. Spain. Catalonia.
China and North Korea. Germany still lacking its Jamaican Government. All those
Saudi billionaires locked up in the Riyadh Ritz Carlton. Italy crashing out of
the 2018 World Cup. The next Lehman getting closer by the day. Automation and
artificial intelligence threatening the next generations jobs. Universal
guaranteed income, will it happen before I get my Universal e-Currency scheme
underway? Frost season has finally
arrived to brighten up my morning walks with the dog. Have a great weekend everyone.
Some of
the queries Quakers are asked to consider, are: "Do you maintain strict
integrity in your business transactions and in your relations with individuals
and organizations? Are you personally scrupulous and responsible in the use of
money entrusted to you, and are you careful not to defraud the public
revenue?"
Probably
why there a no Quakers on Wall Street, in the City, or in Parliament.
The monthly Coppock Indicators finished October
DJIA: 23,277 +233 Up. NASDAQ: 6,728 +284 Up. SP500: 2,575 +183 Up.
No comments:
Post a Comment