Baltic Dry Index. 1496 -26 Brent Crude 60.86
There is only one class in the community that
thinks more about money than the rich, and that is the poor. The poor can think
of nothing else.
Oscar Wilde.
Today, while we await
the US employment report, something of a mixed bag. The Bank of England, as
expected, raised its key interest rate
by a baby step and indicated more baby steps to come, if slowly. Bloomberg
posits that the era of easy money is just about over. As widely leaked,
President Trump nominated Jerome Powell to head up the Fed. The Republicans finally revealed their
aspirational tax cuts. Good luck with that.
And Volkswagen is thinking about becoming a British bank thanks to
Brexit..
But why keep a dog
and bark oneself. Below, Reuters does an excellent job at barking at yesterday’s
and today’s market developments.
November 3, 2017 / 12:32 AM /
Updated 3 hours ago
Asia shares relieved by Powell pick, pause for U.S. jobs test
SYDNEY
(Reuters) - Asian shares took a breather on Friday as investors gave a guarded
reception to Republican plans for massive U.S. tax cuts, while welcoming the
appointment of a centrist at the helm of the Federal Reserve.
Apple’s stock (AAPL.O) reached new heights after it forecast
holiday sales would beat market expectations, a likely positive for its many
suppliers scattered across Asia.
EMini futures for the Nasdaq NQc1 were already up 0.3 percent in reaction.
A holiday in Japan kept volumes light, while investors
observed the usual caution ahead of the U.S. payrolls report which is expected
to show a big bounce back from September’s hurricane-hit result.
MSCI’s broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS inched up 0.15 percent, to be just a whisker from its highest
since late 2007.
Australia's main index firmed 0.6 percent, while China's
blue chips .CSI300
were a fraction softer.
News that Federal Reserve Governor Jerome Powell would be the new head of
the U.S. central bank was well flagged, but still something of a relief. ----In Washington, House Republicans finally unveiled long-delayed plans for deep tax cuts that President Donald Trump has promised, setting off a frantic race in Congress to give him his first major legislative victory.
Passage of legislation that mainly favours corporations and the wealthy
was far from certain, and some business groups quickly came out against it.
“The
tax package will undergo several re-writes and given the contentious debate on
day one the final version is likely to be delayed and will be smaller in
scope,” said Richard Franulovich, an economist at Westpac.
While the Dow .DJI rose 0.35 percent on the back of banking shares, the S&P 500 .SPX added just 0.02 percent and the Nasdaq .IXIC eased 0.02 percent.
Housing stocks also slid amid concerns over the tax plan’s
cap on deductions for mortgages. [.N]
Currency investors were equally underwhelmed, leaving the
U.S. dollar flat against most peers as Treasury yields dipped. Against a basket
of currencies it was stuck at 94.672 .DXY after a week of narrow range-trading.
It was also steady on the yen at 114.00 JPY=
having repeatedly failed to break resistance in the 114.28/45 zone.
Not so steady was sterling, which took a hammering overnight
when the Bank of England hiked rates for the first time in a decade but said
further moves would be “very gradual”.
The pound suffered its largest single day slide against the
euro since October last year and was last huddled at 89.20 pence EURGBP=D4. On
the U.S. dollar it was down at $1.3061 GBP=,
having shed 1.45 percent on Thursday.
In commodity markets, spot gold XAU= was steady at $1,276.36
an ounce, after touching the highest since Oct. 20 at$1,284.10 on Thursday.
Oil prices edged back up toward recent two-year peaks as OPEC-led output cuts tightened supplies and drained inventories.
Brent crude LCOc1 gained 23 cents to $60.85 per barrel. The benchmark hit $61.70 on Wednesday, its highest since July 2015. U.S. crude CLc1 added 26 cents to $54.80, almost 30 percent above its June lows.
More
November 2, 2017 / 6:44 PM
VW explores UK banking licence ahead of Brexit
HAMBURG
(Reuters) - Volkswagen (VOWG_p.DE) is exploring applying for a
full UK banking licence so that it can continue to offer car loans after
Britain leaves the European Union, the German automaker said on Thursday.
The company confirmed comments to the Financial Times by David Maloney,
chief executive of its UK financial services arm, that discussions were
underway with the Prudential Regulation Authority. These may lead to an
application.
“It would diversify our funding sources whilst helping to alleviate
post-Brexit uncertainty and ensure we continue to provide lending products”,
Maloney told the FT.
Volkswagen’s loan book in the UK is worth 15 billion pounds, larger than
any other carmaker’s in-house financing arm.
Prime Minister Theresa May has set a deadline for Britain to leave the
European Union by March 2019. With negotiations dragging, concerns are growing
of a “hard” Brexit that would leave little time for businesses to adjust.
November 2, 2017, 9:00 PM GMT
The Age of Easy Money Is Nearly Over
Central banks are
finally ready to ease off the stimulus.
By Chris Anstey
After
a decade of flooding economies with money, key central banks next year will
finally start turning off the tap. Since the financial crisis, they’ve kept
interest rates near zero and some have bought trillions of dollars in
government and corporate bonds. The idea was that low rates would encourage
spending by businesses and consumers.
More
SocGen Execs Are Drawn Into U.S. Libor Probe
By Tom Schoenberg, Gaspard Sebag, and Fabio Benedetti Valentini
Updated on November 2, 2017, 11:47 AM GMT
The U.S. Justice Department’s investigation into interest-rate manipulation
at global banks is piercing the executive suite, with prosecutors scrutinizing
the activities of senior Societe Generale SA officials, according to people
familiar with the matter.The government has collected documents suggesting Societe Generale executives were aware that bankers there were submitting fake U.S. dollar Libor rates, the people said. Such misleading numbers, which made bank borrowing costs look lower than they actually were, have been the focus of years of U.S. and European investigations, charges against more than a dozen bankers and brokers, and more than $2 billion in U.S. criminal penalties. Yet such allegations have rarely touched global banks’ upper reaches.
Clues about the government’s Societe Generale probe can be found in an indictment filed in August against two lower-level employees of the bank. One of the bank employees warned about problematic rate submissions in an email to executives, at least one of whom replied, according to the court documents, which didn’t identify the executives.
Paris-based Societe Generale, which has said it is cooperating with U.S. investigators, declined to comment. Justice Department spokeswoman Nicole Navas Oxman declined to comment.
Societe Generale’s shares fell as much as 1.1 percent in Paris and were down 0.9 percent at 47.38 euros at 12:37 p.m., erasing earlier gains. The lender’s shares are up about 1 percent this year, trailing the 9 percent increase of Europe’s 46-member STOXX 600 Banks Index.
Several challenges confront prosecutors, however. France stopped cooperating with U.S. information requests last year after deciding that doing so could hurt the country’s economy and threaten its national interest, said three people familiar with the dispute over the Mutual Legal Assistance Treaty. The decision was shaped, two of them said, by U.S. authorities’ moves to levy billions of dollars in penalties against French firms including BNP Paribas SA in recent years.
Also,
it may be difficult under French law to extradite the two division
managers who’ve been charged, hindering any potential efforts by U.S.
prosecutors to gain their cooperation to build cases against the executives.
More
In other news, Spain
turned all Franco and imprisoned most of the hapless, friendless former Catalan
government. The EUSSR stood around impotently
and silently as democracy is dying in Spain. Nothing good for Catalonia or
Spain lies down the route Spain is travelling. The notion that any Catalan
republican can get a fair trial under a Spanish judge sitting in Madrid, is
Kafkaesque, to say the least. Tesla under pressure to deliver more than words.
November 2, 2017 / 6:29 AM
Spanish judge orders custody for Catalan leaders pending trial
MADRID (Reuters) - A Spanish judge ordered nine Catalan
secessionist leaders to be held in custody on Thursday pending a potential
trial over the region’s independence push.
The lawyer for ousted Catalan President Carles Puigdemont said a warrant
had also been issued for his client’s arrest - though the statement was
dismissed by a senior official in Spain’s High Court. The reason for the
differing accounts was not immediately clear.
In an short address broadcast by Catalan regional television TV3, Puigdemont
called for the release of “the legitimate government of Catalonia”, a call
echoed by hundreds of people gathered outside the Catalan parliament.
Prime Minister Mariano Rajoy sacked Puigdemont and his government last
week, hours after the Catalan parliament made a unilateral declaration of
independence - a vote boycotted by the opposition and declared illegal by
Spanish courts.
Puigdemont later travelled to Belgium with four associates and ignored
an order to appear before the High Court to answer charges of rebellion,
sedition and misuse of public funds relating to the region’s secessionist
drive.
“Mr. Puigdemont will stay here. He has said that he will fully cooperate
with Belgian authorities during the procedure,” lawyer Paul Bekaert told
Belgian state broadcaster VRT.
He said Puigdemont had told him a European arrest warrant has been
issued, though the court source said that would most likely happen on Friday.
The detention of the secessionist leaders and Puigdemont’s flight to
Belgium make it difficult for leading figures from the independence movement to
stand in a snap election in the wealthy region called by the Spanish government
for Dec. 21.
More
Model 3 ‘Hell’ Is Burning Tesla’s Other Projects
While consumers must
wait until 2018 for a $35,000 electric car, efforts to fix bottlenecks are
sapping resources elsewhere in Elon Musk’s empire.
By Tom Randall November 2, 2017, 6:35 PM GMT
There will be no $35,000 Teslas in 2017.
The electric carmaker updated its website for customer reservations
on Wednesday, including a table that shows the base Model 3 won’t be available
until some time next year. That follows a painful earnings call for Chief
Executive Officer Elon Musk, who described the company as being in the “eighth
level of hell” (there are nine, in case you’re counting). The stock price fell
8.9 percent on Thursday, the most in more than 16 months.
People from key teams at Tesla are focused on fixing bottlenecks
that have hobbled production, said Musk, who held his earnings call at the
Nevada battery factory where he and co-founder J.B. Straubel are
spending their days and nights. Despite earlier reports that it was the
company’s California assembly plant that was gumming up the works, it turns out
the famed Gigafactory is the heart of the problem. The reallocation of
resources to fix the difficulties may be contributing to delays for Autopilot,
the Solar Roof, the Tesla Semi, and the Tesla Network.
“Tesla’s cash burn is astounding, and time is ticking,” said Salim
Morsy, an electric-car analyst at Bloomberg New Energy Finance. “They have some
pretty urgent things to deal with, and we just don’t have any
visibility right now.”
Here are five key products still waiting to catch an elevator out of the
inferno:
More
Finally, in EUSSR
news, as goes Sicily this weekend, so goes Italy? Rome and Brussels can only
watch and pray.
November 2, 2017 / 12:21 PM
Sicilian election holds mirror up to national trends
ROME (Reuters) - A regional ballot in Sicily this weekend
will serve as a dress rehearsal for a forthcoming general election, with the
political dynamics on the Mediterranean island matching those being played out
on the national stage.
Bolstered by the return of four-times prime minister Silvio Berlusconi
to the campaign trail, a resurgent centre-right is looking to reclaim its
supremacy over Sicily and show that after years of scandals it is once again a
force to be reckoned with.
It faces a fierce opponent in the anti-establishment 5-Star Movement,
which has never won control of a Italian region and hopes victory on Sunday
might propel it to success in next year’s parliamentary election.
Meanwhile, the centre-left, which now heads both the Sicilian and
national governments, has succumbed to feuding with leftist rivals - a
fratricidal struggle that looks likely to wreck its chances of regaining power.
Sicily is one of the poorest regions in Europe, ranking 237 out of 263 in
European Union competitiveness rankings, and has become a byword for bloated
public payrolls, wasteful administration and the ever-present scourge of
corruption and organised crime.
It is also seen as a bellwether of national politics.
More
We hold these
truths to be self evident: that all men are created equal; that they are
endowed by their Creator with certain inalienable rights; that among these are
life, liberty, and the pursuit of happiness outside of the EUSSR.”
With grateful
thanks to the writers of the US Declaration of Independence.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
No crooks today, just more on a fledgling technology that I think will
rival solar power and storage, as a leading growth sector/industry across the
21st century. If not “Go West young man, go west,” the 21st
century equivalent is probably, “go solar, young man, go blockchain.” And were
I 23 again, and just arriving in Manhattan, I would.
Real-World Use Cases for Blockchain in the Energy Sector: Grid+ and Power Ledger
In this week’s episode of The Interchange: We explain how blockchain can be applied to energy trading.
Stephen Lacey October 26,
2017
Two startups just raised a combined $65 million to test out real-world use
cases of blockchain in energy: Grid+ and Power Ledger.Blockchain for energy is starting to gain traction, and there's actual money flowing into the space. So what do these companies actually do?
In this episode, Shayle Kann talks with Scott Clavenna about the ideas, strategies and risks behind each of these startups. Then we talk about the heady world of ICOs -- initial coin offerings -- and why so much capital is flowing into this market all at once.
This is an update to our previous conversation on blockchain and energy. Listen to that episode for a primer on blockchain.
Recommended resources:
- GTM: Grid+ Raises $40 Million as Blockchain Fever Grows
- GTM: Blockchain Energy Trading Startup Power Ledger Raises $17M in Cryptocurrency ‘ICO’
- Deloitte: Blockchain Is Coming to Disrupt Your Industry
The future of Blockchain infrastructure, with Gavin Wood and Jutta Steiner at Disrupt Berlin
Since its invention a few years ago, the Blockchain has become the infrastructure layer that the Internet was crying out for. The promise of a decentralised world was made in the 90s. Some 27+ or so years later it might now be coming true.Bitcoin was first introduced in 2008, but the Ethereum protocol project has paved the way for a number of new applications and use-cases for the technology.
To help separate the wheat from the chaff of this brave new world, TechCrunch Disrupt Berlin welcomes two of the founding figures in the burgeoning blockchain infrastructure world to our stage.
TechCrunch Disrupt Berlin welcomes two of the founding figures in this space to our stage: Gavin Wood, former CTO and Co-Founder of Ethereum along with Jutta Steiner, also formerly of the Ethereum Foundation.
Since working on Ethereum, they have gone on to launch Parity Technologies, which builds core technology and Dapps (decentralized apps) for businesses and organizations utilizing blockchain technology.
More recently, Wood founded the Web3 Foundation, the entity responsible for stewarding and deploying the Polkadot Protocol, which recently had a very successful token sale. Polkadot is an ambitious project that seeks to be “the internet of blockchains” and is laying a claim to solving the scalability, governance and interoperability challenges which exist on current blockchain architectures.
The two founders will be on stage to discuss their roles in building Ethereum, the infrastructure they are currently building to drive mainstream adoption of blockchain, and their visions for the future of the space.
Tickets for the show are still on sale, so don’t miss out on the chance to hear
from two legends of this new industry.
Disrupt Berlin.
TechCrunch
Disrupt is the world’s leading authority in debuting revolutionary startups,
introducing game-changing technologies and discussing what’s top of mind for
the tech industry’s key innovators. Disrupt gathers the best and brightest
entrepreneurs, investors, hackers, and tech fans for on-stage interviews, the
Startup Battlefield competition, a 24-hour Hackathon, Startup Alley, Hardware
Alley, and After Parties.
"Go West, Young Man, Go West"
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?
India Takes the First Steps Toward a Utility-Scale Energy Storage Market
After a few failed attempts, a state-owned energy company runs a sucessful auction for batteries.
Jason
DeignOctober
30, 2017
The Indian energy storage industry hopes a 28-megawatt-hour battery
plant in the Andaman and Nicobar Islands will kick-start a utility-scale market
that has been slow to emerge.
“This will help open up opportunities for such hybrid projects in
India,” said Dr. Rahul Walawalkar, executive director of the India Energy
Storage Alliance (IESA), after Indian EPC provider Mahindra Susten this
month won the project tendered by state-owned coal mining company NLC India.
“With the development of a local ecosystem and skills training, we are
confident that solar and storage will continue to have accelerated adoption in
India in coming years,” Walawalkar said. “This should also help companies that
are considering setting up manufacturing in India.”
IESA has a vision of making India a global advanced energy storage
systems manufacturing hub by 2020, he said. Given India’s track record on
utility-scale energy storage, the aim is ambitious, to say the least.
Prior to the Andaman and Nicobar project, the Solar Energy Corporation of India (SECI) and NTPC, India’s largest power utility, had already launched three other utility-scale energy storage tenders in the country.
However, “all these tenders, with aggregate capacity of 35 megawatt-hours, have been scrapped without any reasons being given,” noted analyst firm Bridge to India in a blog post.
----The lack of progress on utility-scale storage in one of the most important renewable energy markets in the world is due to a mix of pricing challenges and lack of technical expertise, according to Bridge to India.
With solar prices as low as 65 cents per watt in India, it is cheaper for tendering authorities such as the SECI to build out extra PV and curtail it to balance supply and demand.
And Bridge to India pointed to the disparity in pricing offers in the NLC India tender as evidence of “inconsistent understanding of technical specification” in the deployment of storage assets.
The analyst firm said quotes for the engineering, procurement and construction of the NLC India plant ranged from INR 3.42 billion (USD $53 million), from solar player Hero, to INR 1.79 billion ($28 million) from Mahindra Susten.
The total value of the contract, according to a statement posted by Mahindra Susten, was INR 2.89 billion ($44 million), said to be 38 percent below government estimates.
The high cost of electricity in Andaman and Nicobar, a group of islands in the Bay of Bengal with a population of 400,000, helped make the tender successful. Andaman and Nicobar’s aggregate peak demand of 67 megawatts is mostly served by gensets firing on diesel at a price of INR 15 ($0.23) per kilowatt-hour.
“Replacing them with integrated [solar-plus-storage] plants is highly desirable from an economic and environmental perspective,” said Bridge to India. “High cost of storage is not a deterrent because of the very high cost of diesel.”
More
Another weekend and weekend full of political uncertainty
and financial foreboding. What if Bloomberg is right and the era of easy money has
mostly passed? What if democracy dies in
Europe? What if the dying EUSSR actually dies in the next few years? While the UK
gets ready on Sunday to celebrate a failed attempt in 1605 to blow up
Parliament, in 2017 most UK voters can only look at today’s Parliament, wish
and dream. Have a great weekend everyone.
It is better to have a permanent income than
to be fascinating.
Oscar Wilde.
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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