Baltic Dry Index. 1188 -03 Brent Crude 66.23
“Rule No. 1: Never lose money. Rule No. 2: Never forget rule No.1”
Warren Buffett.
Chairman Powell came to Washington and
proclaimed the US economy healthy, in fact more than healthy “stimulative.” Back in intensive care, Goldilocks suffered a
relapse. On Wall Street undertakers got busy measuring coffins. The Goldilocks
free money economy now looks to be so rear mirror.
Below how Chairman Powell showed that he’s no
Chairwoman Yellen. The next Lehman just took a giant leap closer. But will the
Great Vampire Squids still try to dress up the month end markets, or did they
just run out of greater fool buyers?
“Price is what you pay. Value is what you get.”
Warren Buffett.
Stock market ends lower as Powell’s testimony stokes fresh inflation, rate-hike fears
Published: Feb 27, 2018 4:39 p.m. ET
U.S. stock-market indexes closed sharply lower Tuesday after Federal Reserve
Chairman Jerome Powell highlighted the strengthening economy during his
congressional testimony, but investors grew jittery that that improvement may
prompt the central bank to be more aggressive in tightening monetary policy.Recap of live blog: Fed Chairman Powell testifies before House
How did the main benchmarks perform?
The Dow Jones Industrial Average DJIA, -1.16% tumbled 299.24 points, or 1.2%, to 25,410.03. Walt Disney Company DIS, -4.50% was the worst performer on the Dow, falling 4.5%. Merck & Co. Inc. MRK, -2.39% fell 2.4%, while Nike Inc. NKE, -2.33% dropped 2.3%.The S&P 500 index SPX, -1.27% fell 35.32 points, or 1.3%, to 2,744.28 with all of the 11 main sectors finishing in the red. Consumer-discretionary and real-estate stocks led the losses, down more than 2%, while telecoms and utilities, sectors—the most sensitive to interest rates—fell 1.8% and 1.7% respectively.
The Nasdaq Composite Index COMP, -1.23% declined 91.11 points, or 1.2%, to 7,330.35
Equity prices turned lower in early trade and extended losses into the close, while the bond yield on the 10-year Treasury shot up to 2.9%.
With one trading day left in the month, the S&P 500 and Dow are set to book their first monthly declines in nearly a year.
What drove markets?
“We’ve seen continuing strength in the labor market. We’ve seen some data that will, in my case, add some confidence to my view that inflation is moving up to target. We’ve also seen continued strength around the globe, and we’ve seen fiscal policy become more stimulative,” Powell said in testimony.Powell’s comments, especially his personal view about the economy, appeared to turn investors cautious as they considered the possibility of faster pace of rate increases. Odds of four rates increases in 2018 rose to 33% from about 20% on Monday, according to CME Group’s data.
Opinion: Powell’s first faux pas came quick
More
Asian markets slip following Wall Street’s post-Powell selloff
Published: Feb 28, 2018 12:56 a.m. ET
Asia-Pacific equities were down Wednesday after an afternoon selloff in the
U.S., as a roller-coaster February closes.After big gains in much of the world in January, February began with a long-awaited slide — widely attributed to rising bond yields and inflation anticipation — and though a rebound followed, the month will go down as the worst in at least a year for a number of stock benchmarks.
Given the rebound, “the urge to take money off the table is quite high,” said Hao Hong, head of research for Bocom Securities in Hong Kong.
Selling was heaviest in Hong Kong and China, as mainland large caps continued their recent weakness.
The Shanghai Composite SHCOMP, -0.72% was off 0.7% — getting back half of its 1.3% morning-session drop — while Hong Kong’s Hang Seng HSI, -1.36% slid 1.7% and a measure of mainland companies also listed in the city slumped 2.6%. Those mainland companies are down 6% to 9% for February, heading for their biggest monthly declines since January 2016, when worries about China’s economic growth fueled a global stock slide.
The decline in Tokyo shares, which began modestly, as elsewhere in the region, accelerated after the Bank of Japan cut purchases of long-term government bonds in its latest market operation by 13%, continuing its gradual retreat from its heavy buying of recent years.
----In the U.S., fresh concerns that the Federal Reserve will pick up the pace of interest-rate increases was seen as stoking Tuesday afternoon’s stock weakness, as well as dollar gains and bond-yield increases.
The cause of the concern: New Fed chief Jerome Powell’s expression of confidence in the U.S. economy.
“My personal outlook for the economy has strengthened since December,” he told the House Financial Services Committee. He pointed to data that increases his confidence that inflation is moving toward the central bank’s 2% target.
Investors responded by boosting bond yields and adjusting their rate-increase expectations. According to CME data, Fed-fund futures now show a 27% chance of four increases in the key rate this year, up from 21% a day earlier, and a 39% chance of three increases, up from 37%. Meanwhile, the probability of just two increases dropped to 21% from 27%.
Today, more on inflation. Is inflation back?
“Risk comes from
not knowing what you are doing.”
Warren Buffett.
February 26, 2018 / 6:32 AM
Corporate America’s new dilemma: raising prices to cover higher transport costs
SEATTLE/BOCA
RATON, Fla. (Reuters) - The drive for cost cuts and higher margins at U.S.
trucking and railroad operators is pinching their biggest customers, forcing
the likes of General Mills Inc (GIS.N) and Hormel Foods
Corp (HRL.N) to spend more on
deliveries and consider raising their own prices as a way to pass along the
costs.
Interviews with executives at 10 companies across the food, consumer
goods and commodities sectors reveal that many are grappling with how to defend
their profit margins as transportation costs climb at nearly double the
inflation rate.
Two executives told Reuters their companies do plan to raise prices,
though they would not divulge by how much. A third said it was discussing
prospective price increases with retailers.
The prospect of higher prices on chicken, cereal and snacks costs comes
as inflation emerged as a more distinct threat in recent weeks. The U.S. Labor Department
reported earlier this month that underlying consumer prices in January posted
their biggest gain in more than a year.
As
U.S. economic growth has revved up, railroads and truck fleets have not
expanded capacity to keep pace - a decision applauded by Wall Street. Shares of
CSX Corp (CSX.O), Norfolk
Southern (NSC.N), and Union
Pacific Corp (UNP.N) have risen an
average 22 percent over the past year as they cut headcount, locomotives and
rail cars, and lengthened trains to lower expenses and raise margins.
Quickening
economic growth, a shortage of drivers and reduced capacity, and higher fuel
prices have driven up transportation costs, prompting some companies to
threaten to raise prices on goods ranging from chicken to cereal.
Cream of Wheat
maker B&G Foods Inc (BGS.N), Cheerios maker
General Mills and Tyson Foods Inc (TSN.N), owner of
Hillshire Farms brand and Jimmy Dean sausage, said they will pass along higher
freight costs to their customers.
Tyson Chief
Executive Officer Tom Hayes told Reuters in an interview that its price
increases ”should be in place for the second half” of its fiscal year, and that
it has begun negotiating price increases with retailers and food service
operators. The company declined to specify how much its freight costs increased
in recent months, but a spokesman said they are up between 10 to 15 percent for
the total industry.
More
Finally, I want free things too.
If the bankster can have free money, I want free money as well. Warning: fake
news or real news? Out of 330 million Americans, these results are based on
just 3,000 adults. Who funded it? Why?
"Cui bono?"
More Americans now support a universal basic income
- Forty-eight percent of Americans support a universal basic income.
- Longtime advocates say we're closer than ever to adopting the program.
February 26, 2018
Political philosopher and economist Karl Widerquist, an associate professor
at Georgetown University in Qatar, remembers a poll from 10
years ago that showed just 12 percent of Americans approved of a universal
basic income. That's changed — and quickly. Today, 48 percent of Americans support it, according to a new Northeastern University/Gallup survey of more than 3,000 U.S. adults.
"It represents an enormous increase in support," said Widerquist, who is a well-known advocate for a universal basic income. "It's really promising."
Proposals for universal basic income programs vary, but the most common one is a system in which the federal government sends out regular checks to everyone, regardless of their earnings or employment.
Pilots of such programs are underway in Finland and Canada. In rural Kenya, a basic income is managed by nonprofit GiveDirectly. India — with a population of more than 1.3 billion residents — is considering establishing a universal basic income.
Some projects are happening closer to the U.S.
Y Combinator Research, based in Oakland, California, started a test of a basic income last year, and is raising funds to expand the research project. This year in Stockton, California, Mayor Michael Tubbs's Stockton Economic Empowerment Demonstration will give several dozen low-income families $500 each month in a study of basic income. And for decades, Alaska residents have each received around $2,000 a year from the Alaska Permanent Fund.
These examples are an opportunity to debunk many of the myths about a universal basic income, said Guy Standing, co-founder of the Basic Income Earth Network. He recently spoke at the World Economic Forum in Davos, Switzerland, on the subject.
"The claim is often made that if you give people a basic income, they'll become lazy and stop doing work," Standing said. "It's an insult to the human condition. Basic incomes tend to increase people's work rather than reduce it."
That's because research has shown that a basic income can improve people's mental and physical health, Standing said, as well as encourage them to pursue employment for reasons more meaningful than just a need to put food on the table.
Rising inequality, and its vast effects, have triggered a "perfect storm" for basic income, Standing said.
"People are saying, 'Look we cannot let inequality continue to grow, because the political consequences could be a disaster'," Standing said, pointing to the recent rise of more authoritarian figures.
More
“It’s far better
to buy a wonderful company at a fair price, than a fair company at a wonderful
price.”
Warren
Buffett. (Such an old fashioned notion.)
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Cryptos again today. Another day, another loony crypto scheme announced.
Who would want to participate in the great cryptocurrency scam? Well America’s IRS
is for one. Crypto tax time is fast approaching in Uncle Scam land. But who is
scamming who?
“The business
schools reward difficult complex behavior more than simple behavior, but simple
behavior is more effective.”
Warren Buffett.
Would you believe this? Steve Wozniak's bitcoins actually got stolen
By Sujata Reddy Feb 26,
2018, 10.21 AM IST
Steve Wozniak has an
inventive mind, so it comes as no surprise that he’s a fan of Bitcoin. The Apple cofounder spoke
at the ET GBS about what made him a fan of the cryptocurrency. “Bitcoins to me
was a currency that was not manipulated by the governments. It is mathematical,
it is pure, it can’t be altered,” he said.
Unfortunately, all of this doesn’t safeguard Bitcoin from fraud. The American inventor and philanthropist told a full house at the summit how his own Bitcoins got stolen. “The blockchain identifies who has bitcoins… that doesn’t mean there can’t be fraud though. I had seven bitcoins stolen from me through fraud. Somebody bought them from me online through a credit card and they cancelled the credit card payment. It was that easy! And it was from a stolen credit card number so you can never get it back,” said Wozniak.
Unfortunately, all of this doesn’t safeguard Bitcoin from fraud. The American inventor and philanthropist told a full house at the summit how his own Bitcoins got stolen. “The blockchain identifies who has bitcoins… that doesn’t mean there can’t be fraud though. I had seven bitcoins stolen from me through fraud. Somebody bought them from me online through a credit card and they cancelled the credit card payment. It was that easy! And it was from a stolen credit card number so you can never get it back,” said Wozniak.
Asked
about his experience of investing in Bitcoin when they were going at $700 a
piece and then selling them for a fortune when the price
shot up, Wozniak said that he “did not invest in bitcoins”, but bought them as
an experiment. “I had them so that I could someday travel and not use credit
cards, wallets or cash. I could do it all on Bitcoin. I studied which hotels
and facilities accepted Bitcoin... it’s still very difficult to do so. I also
tried to buy things online and trade Bitcoin online.”
So, why did he sell them? “Because I didn’t want to watch the price everyday… I sold all except one. It was enough to experiment,” added Wozniak.
So, why did he sell them? “Because I didn’t want to watch the price everyday… I sold all except one. It was enough to experiment,” added Wozniak.
Coinbase tells 13,000 users their data will be sent to the IRS soon
Coinbase heavily resisted the summons. But ultimately, in November last year, the San Francisco court ruled Coinbase had to turn over identifying records for all users who have completed transactions of more than $20,000 through their accounts in a single year between 2013 and 2015. The data requested includes taxpayer IDs, names, dates of birth, addresses, and transaction records from that period.
In an email and on its website on Friday, Coinbase noted that it had tried: “Coinbase fought this summons in court in an effort to protect its customers, and the industry as a whole, from unwarranted intrusions from the government.”
It informed its 13,000 affected customers that the “court order requires us to produce information specific to your account,” but that the company could not provide legal or tax advice. So far, 2018 is shaping up to be the year that tax collectors get serious about bitcoin earnings, meaning that it’s a good time to be extra careful about compliance.
Marshall Islands Preparing a Cryptocurrency, Two Officials Say
By Olga Kharif
The Republic of the Marshall Islands plans to release its own cryptocurrency
to serve as an official legal tender, according to two government officials.
Members of parliament voted this week to proceed with the plan, Kenneth
Kedi, a senator and the body’s speaker, said in a phone interview. A council
still has several days to object, a move he said is unlikely.
The digital coin, to be known as the Sovereign, will probably be issued
this year, David Paul, minister-in-assistance to the president, said in a
phone interview. The government will arrange an initial coin offering and
exchanges will be allowed to apply to trade the currency, he said. The move is
seen as a way to bolster local budgets, he said.
“This was specifically targeted for the long-term needs of the country,” Paul said.
Roughly 70,000 people live in the Marshall Islands, a collection of more than 1,100 islands and islets in the Pacific. Some proceeds from the crypto offering will be used to provide health care to locals affected by U.S. nuclear tests conducted in the area decades ago, Paul said.
Several governments have sought to strengthen their finances with cryptocurrencies. This month Venezuela launched its own digital token, the Petro.
“Honesty is a
very expensive gift. Don’t expect it from cheap people.”
Warren Buffett.
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?
Solar power: the next generation
26/02/2018
Why Scientists are excited by 'next-generation' solar cells and what
they could mean for the future of energy.
Scientists are working on an exciting new material called perovskite – a
light sensitive crystal which could revolutionise solar power.
In just a few years its power conversion efficiency figure is nearly on
a par with traditional silicon at around 22 per cent, and it’s some 1,000 times
thinner.
All this could mean the price we pay for solar power in the future could
fall considerably.
These third generation solar cells are built-up layer by layer, like a sandwich, with perovskite as the light-harvesting active layer.
It is semi-transparent, meaning a building’s windows could one day be replaced by coloured plates of perovskite, that would also generate electricity.
Experiments on the solar cells are taking place in the Ecole Polytechnique Federale Lausanne as part of the EU’s GOTSolar research project. Directing research there is Professor Michael Grätzel.
He says: “What is surprising about perovskites is that they’re made from a solution with simple procedures and from materials which are readily available and we’re seeing performance results which today are already ahead of silicon polycrystals.
“The caveat is the lead, of course, we must be careful we manage this weakness properly. But otherwise, it really is an extraordinary material, which will forge its own path.”
To get around the lead, scientists coat the solar cells in protective glass. This also solves one of the other problems – perovskites are very sensitive to humidity, and the glass protects them from moisture.
The final layer of the solar cell is gold, which acts as an
electrode.
One aspect the GOTSolar project is exploring its so-called tandem
technology, using silicon and perovskite together for super-charged results.
Professor Adelio Mendes is the project coordinator. He explains: “The
most interesting thing is the fact we can combine this technology with the one
that used silicon in order to obtain cells whose efficiency can reach 30%.”
It is in Eindhoven in the Netherlands, that researchers are working on
scaling up the perovskite solar cells.
The challenge is to replicate the results of the laboratory on a larger
scale, an important step along the road to commercialising perovskite solar
cells.
More
“The difference
between successful people and really successful people is that really
successful people say no to almost everything.”
Warren
Buffett.
The monthly Coppock Indicators finished January
DJIA: 26,149 +282 Up. NASDAQ: 7,411 +310 Up. SP500: 2,824 +212 Up.
