Baltic Dry Index. 1117 -05 Brent Crude 69.52
"Markets are only a tiny facet of society,
but being made by mass psychology, they are a good litmus paper for what is
going on. Markets only work when they believe, and this confidence is
based on the idea that men can manage their affairs rationally. If that
belief fades, then so do the markets. They do not merely dive, they dive
and then they disappear. It happened here in the blight of the spirit
from 1930 - 1933, and it happened in other countries."
“Adam Smith” aka George Goodman.
According to a report on Bloomberg, President
Trump's trade war on China starts today, with a broadside of $50 billion of tariffs.
I suspect we will not wait long for China’s broadside in reply. No one ever
really wins in a trade war, although not everyone loses at the same time or to
the same degree. But with Uncle Scam now wracking up one trillion dollar
deficits every six months, picking on Johnny Foreigner is as good a way of
diverting attention and driving up nationalism, as any other.
Below, we all know that another crash and
recession is coming, just not when or why. Is oil signalling the return of
inflation ahead?
"Why
are the economists almost always wrong?"
“Adam Smith” aka George Goodman.
Trump to Announce $50 Billion in China Tariffs, Sources Say
By Andrew Mayeda, Jennifer Jacobs, and Saleha Mohsin
Updated on 22 March 2018, 03:33 GMT
President Donald Trump is set to announce about $50 billion of tariffs
against China over intellectual-property violations on Thursday, according a
person familiar with the matter.
The president is considering targeting more than 100 different types of
Chinese goods, according to the person, who spoke on the condition of
anonymity. The value of the tariffs was based on U.S. estimates of economic
damage caused by intellectual-property theft by China, the person said.
“Tomorrow the president will announce the actions he has decided to take
based on USTR’s 301 investigation into China’s state-led, market-distorting
efforts to force, pressure, and steal U.S. technologies and intellectual
property,” White House official Raj Shah said in an emailed statement on Wednesday.
It will be Trump’s first trade action directly aimed at China, which he
has blamed for the hollowing out of the American manufacturing sector and the
loss of U.S. jobs. The decision comes as policy makers including IMF Managing
Director Christine Lagarde warn of a global trade conflict that could undermine
the broadest world recovery in years.
"If Trump really signs the order, that is a declaration of trade
war with China,” said Wei Jianguo, former vice commerce minister and now an
executive deputy director of the China Center for International Economic
Exchanges, a government-linked think tank.
"China is not afraid, nor will it dodge a trade war," Wei
said. "We have plenty of measures to fight back, in areas of automobile
imports, soybean, aircraft and chips. On the other hand, Trump should know that
this is a very bad idea, and there will be no winner, and there will be no good
outcome for both nations."
More
Fed Lifts Rates, Steepens Path Through 2020 for More Hikes
By Craig Torres
Updated on 21 March 2018, 19:34 GMT
Federal Reserve officials, meeting for the first time under Chairman
Jerome Powell, raised the benchmark lending rate a quarter-point and forecast a
steeper path of hikes in 2019 and 2020, citing an improving economic outlook.
Policy makers continued to project a total of three increases this year.
“The economic outlook has strengthened in recent months,” the
policy-setting Federal Open Market Committee said in a statement Wednesday in
Washington. Officials repeated previous language that they anticipate “further
gradual adjustments in the stance of monetary policy.”
The upward revision in their rate path suggests Fed officials are
looking through soft first-quarter economic reports and expect a lift this year
and next from tax cuts passed by Republicans in December. Financial conditions
have tightened since late January as investors look for signs that the central
bank might raise rates at a faster pace, while forecasters predict stronger
U.S. growth and tight labor markets.
“The job market remains strong, the economy continues to expand, and
inflation appears to be moving toward the FOMC’s 2 percent longer running
goal,” Powell said in a press conference that he kept somewhat shorter than
those conducted by his predecessor, Janet Yellen. Powell said he’s “carefully
considering” expanding the number of such briefings where he explains Fed
decision, cautioning that he wanted to be sure that didn’t send any signals
about the path of policy.
More
‘Mother of all yield shocks’ is about to crush stocks, warns ‘Father of Reaganomics’
Published: Mar 21, 2018 1:35 p.m. ET
David Stockman, the so-called “Father of Reaganomics,” hasn’t been shy — or
close to right — about his frantically bearish calls in recent years. ---- “There is not a snowball’s chance in the hot place that the mother of all yield shocks can be avoided,” Stockman wrote on his blog this week.
He explains that we’re in a uniquely dangerous position, one that really couldn’t have even happened under previous administrations.
“Had Lyndon Johnson, Tricky Dick, Jimmy Carter or even Ronald Reagan
suggested that the Federal Reserve buy government debt at rates which exceeded
annual issuance by the U.S. Treasury, as was the case during the peak years of
QE, they would have been severely attacked — if not subjected to impeachment —
for advocating rank financial fraud,” Stockman claimed.
He said ever since former Federal Reserve Chairman Alan Greenspan
“commenced the age of monetary central planning,” Wall Street has used deficits
as a tool in Washington’s kit of “whatever it takes,” instead of something to
be feared.
“Anything that could fuel even the appearance of short-term economic
growth was embraced unthinkingly,” he said, “because ‘growth’ of any shape,
form or quality became the predicate for endless increases in the stock market
averages.”
That’s a recipe for disaster, says Stockman.
“As the Fed pivots to quantitative tightening for the first time in
decades — and at a scale that has never before been imagined because the Fed’s
balance sheet had never previously approached anything like a quintupling in
just six years — the level of complacency on Wall Street and in Washington is
staggering,” he wrote.
Now that the “age of monetization” is over, the Fed’s balance sheet
“shrinkage campaign” is on auto-pilot, which, Stockman warns, will ultimately
elicit a biblical “road to Damascus experience” on Wall Street.
More
It didn’t take long for the U.S. to rack up another trillion dollars of debt
Published: Mar 20, 2018 12:48 p.m. ET
Latest $1 trillion jump took about six months
It has taken a little more than six months for the U.S. national debt to grow by a trillion dollars, a quick clip that has little precedent over the nation’s recent history.Last week, the debt hit $21 trillion for the first time, rising from the $20 trillion mark it notched on Sept. 8. The debt is guaranteed to go higher, with President Donald Trump having signed a debt-limit suspension in February, allowing unlimited borrowing through March 1, 2019. Economists expect wider deficits to result from the tax cut Trump signed in December.
While a trillion-dollar increase over roughly six months isn’t unprecedented — there was one in 2009, during the Great Recession, and another in 2010 — it’s certainly fast.
The national debt exceeded $20 trillion in September 2017, after taking 20 months to add a trillion dollars. A debt limit that had been in place since March 2015 was raised in March 2017, and again on Sept. 8, 2017.
Farther back, however, such trillion-dollar increases took longer: 43 months, for instance, near the end of Bill Clinton’s first term.
The first time the nation’s debt hit $1 trillion was in October 1981, during Ronald Reagan’s first term.
Looking ahead, analysts see the nation much deeper in debt. The Committee for a Responsible Budget projects trillion-dollar deficits returning permanently by next year, and debt exceeding the size of the economy within a decade.
Guggenheim's Minerd Sees Defaults, U.S. Recession on the Horizon
By Kate Smith
21 March 2018, 14:45 GMT
Companies that went on a borrowing binge may default on their debt as
interest rates increase and the prospect of a recession grows, according to
Scott Minerd, chief investment officer of Guggenheim Partners.
After skirting defaults and bankruptcies during the last recession,
corporations may not be as lucky this time around, Minerd said in an interview
on Bloomberg TV on Wednesday.
“There are a lot of companies that are zombie companies that survived
the last cycle,” he said. “With rates going up, it will be harder and harder
(for them) to stay alive.”
Since the last recession, low interest rates have spurred U.S. companies
to lever up, using cheap debt to buy back stock and boost equity prices. Within
three months, as Libor rates tick up, many are going to struggle with debt
service and free cash flow, Minerd said. Highly-levered firms will also get hit
with a new tax reform policy that limits their ability to deduct interest
costs.
Minerd said as far as debt risk media and utilities sectors are
“disturbing places.” Guggenheim is “moving away” from high-yield debt and bank
loans, he said.
Minerd also predicted the yield curve would be “relatively flat” by this
time next year, and, if the Federal Reserve continues raising rates, the curve
will be inverted by the end of 2019. Following historic trends, the U.S.
economy would be looking at a recession within six to 12 months of a yield
inversion, or as soon as late next year or the first half of 2020, he said.
Finally,
Facebook. When Obama and the Democrats do it, it’s ok. When Trump and the
Republicans do it, it’s a scandal or crime.
Sounds like the extreme left wing BBC.
Below,
the Z’berg starts shutting the stable door. It’s all greatly exaggerated says
the nerd behind that infamous app.
Some people make things
happen, some people watch while things happen, and some people ask what
happened?
Anon.
March 21, 2018 / 7:53 AM /
Updated 3 hours ago
Zuckerberg apologises for Facebook mistakes with user data, vows curbs
SAN FRANCISCO (Reuters) - Facebook
Inc Chief Executive Mark Zuckerberg apologised on Wednesday for mistakes his
company made in how it handled data belonging to 50 million of its users and
promised tougher steps to restrict developers’ access to such information.
The world’s largest social media network is facing growing government
scrutiny in Europe and the United States about a whistleblower’s allegations
that London-based political consultancy Cambridge Analytica improperly accessed
user information to build profiles on American voters that were later used to
help elect U.S. President Donald Trump in 2016.
“This was a major breach of trust. I’m really sorry this happened. We
have a basic responsibility to protect people’s data,” Zuckerberg said in an
interview with CNN, breaking a public silence since the scandal erupted at the
weekend.
Zuckerberg
said in a post on Facebook the company "made mistakes, there's more to do,
and we need to step up and do it." (bit.ly/2DHAlUJ)
He said the social
network planned to conduct an investigation of thousands of apps that have used
Facebook’s platform, restrict developer access to data, and give members a tool
that lets them to disable access to their Facebook data more easily.
His plans did not
represent a big reduction of advertisers’ ability to use Facebook data, which
is the company’s lifeblood.
Zuckerberg said he
was open to additional government regulation and happy to testify before the
U.S. Congress if he was the right person.
More
March 21, 2018 / 7:55 AM
Academic behind Facebook breach says political influence was exaggerated
LONDON (Reuters) - The consultancy at the center of a
storm over Facebook (FB.O)
data greatly exaggerated its role in Donald Trump’s 2016 U.S. presidential
victory and would not have been able to sway an election result, the academic
who provided the data said.
Psychologist Aleksandr Kogan also told the BBC in an interview broadcast
on Wednesday that he was being made a scapegoat by Facebook and Cambridge
Analytica, a British-based company hired by Trump for his election campaign.
Facebook has been rocked this week by a whistleblower who said that
Cambridge Analytica had improperly accessed information on millions of Facebook
users to build detailed profiles on American voters.
The revelation has knocked nearly $50 billion off Facebook’s stock
market value in two days and hit the shares of Twitter and Snap over fears that
a failure by big tech firms to protect personal data could deter advertisers
and users and invite tougher regulation.
Facebook and Cambridge Analytica have both blamed Kogan, an academic at
Cambridge University who gathered the data by running a survey app on Facebook.
Many election campaign groups across the globe gather data on their
electorates, hoping to target swing voters who might be sympathetic to their
message.
However, Kogan said the services provided by the UK political
consultancy had been greatly exaggerated.
“I think what Cambridge Analytica has tried to sell is magic, and
they’ve made claims that this is incredibly accurate and it tells you
everything there is to tell about you. But I think the reality is it’s not
that,” he said.
Arron Banks, who campaigned for Britain to leave the European Union in a
2016 referendum, also questioned the value of psychologically-based data.
Banks told Reuters that Cambridge Analytica had unsuccessfully pitched
for work with his Leave.eu campaign group.
“I don’t think they have this magical system that they say they have. I
think they are nothing more than a company that places Facebook ads and shrouds
in a sort of mystery,” he said.
More
"Such a corporation is called a
"conglomerate" or a "free-form" company, very popular when
the market gets to tulip-time. A conglomerate is a company that grows by
acquiring other companies, and other companies can be in wildly different
businesses. Conglomerate managers are supposed to be a new breed of
brilliant wheeler-dealers, and the idea of the whole game is to take an
ice-cream freezer company and merge it into a valve company and merge with a
flour mill. The valves and the flour and the ice cream never get together
except on a balance sheet and an income statement, but Wall Street does look
for growing earnings, and with the right accountant this whole process can make
the earnings grow like crazy. Capitalism enters a new stage."
The contemporary “Adam Smith” aka George Goodman.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Brexit deal? Brexit baloney. Can the EUSSR Tower of Babel ever agree on
anything sensible?
EC
President, Demi God Juncker, a glutton for punishment, stared at himself in the
mirror.
With
apologies to P G Wodehouse.
Spain refuses to back withdrawal deal over Gibraltar concerns
Madrid wants veto over UK territory enjoying single market access post-Brexit
Tue 20 Mar 2018 19.05 GMT
The hard-fought agreement between the UK and EU over a 21-month transition
period after Brexit has been thrown into doubt after Spain refused to endorse
the deal without further concessions over Gibraltar.With days to go before the 27 EU leaders are expected to welcome the two sides coming together over a 129-page withdrawal agreement, including the terms of the transition, Madrid said it was withholding its support.
It is understood that Spain, which lays claim to the Rock, wants the legal text to be clearer that it has a veto on Gibraltar continuing to enjoy the benefits of the single market and the customs union.
While EU officials are confident they can persuade Spain to back the withdrawal agreement before a sign-off by leaders in Brussels on Friday, it would be a hammer blow if the full 27 member states were not able to endorse a deal in principle on the transition period, given the need to offer reassurance for British businesses.
Spain has gained the rest of the EU’s agreement that the UK must come to a bilateral accord over the future of Gibraltar for it to enjoy the benefits of the deal struck by the British government with Brussels.
The Spanish government was concerned, however, by comments from the Brexit secretary, David Davis, on Monday in which he suggested that this was in doubt. Asked by a Spanish journalist on Monday whether the transition agreement covered Gibraltar, Davis replied: “Yes, it does cover Gibraltar. That is our view of it.”
In an open letter before a leaders’ summit, where the 27 member states were expected to give their support to the withdrawal agreement, Donald Tusk, the president of the European council, warned of the possible breakdown but said he was working to rectify the situation.
“Yesterday [Monday] our negotiators reached a solution on parts of the withdrawal agreement,” he said. “Whether all 27 member states can welcome this at the European council remains open.”
An EU official said: “Spain needs reassurance.”
The EU’s chief negotiator, Michel Barnier, refused to be drawn on the last-minute talks, but told reporters in a press conference on Tuesday: “No agreement between the European Union and the United Kingdom can apply to the territory of Gibraltar without a bilateral agreement between the Kingdom of Spain and the United Kingdom.”
More
"We
can also do stupid."
Jean-Claude Juncker. Failed Luxembourg Prime Minister and
ex-president of the Euro Group of Finance Ministers. Confessed liar. European Commission
President. Scotch connoisseur.
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?
Subsidy-free renewable energy projects set to soar in UK, analysts say
Falling cost of wind and solar will unlock £20bn of investment, Aurora Energy Research says
Tue 20 Mar 2018 18.00 GMT Last modified on Tue 20 Mar 2018
22.00 GMT
The UK is well on the way to a new era of subsidy-free renewable energy projects that will largely kill off prospects for new gas power stations, according to industry analysts.
The falling cost of wind and solar projects combined with advances in battery storage technology will unlock about £20bn of investment in the UK between now and 2030, Aurora Energy Research said. Onshore wind and solar will both be viable without subsidies by 2025 in the UK, it added.
The prediction comes as the Swedish energy firm Vattenfall announced that it had won a Dutch government tender to develop a windfarm which will become the world’s first without subsidies when built off the Netherlands coast in 2022.
“The [subsidy-free] future is within reach,” Magnus Hall, Vattenfall’s chief executive, told an industry audience in Oxford.
But the switch to a post-subsidy world would still require some financial aid during the transition period, Hall said, to ensure that risk was fairly shared between energy firms and governments.
Hall urged ministers to consider reversing the UK’s ban on subsidies for onshore windfarms, saying developers of these projects should be allowed to compete in auctions for subsidies.
His call was echoed by two of the UK’s big six energy firms, SSE and ScottishPower.
Alistair Phillips-Davies, chief executive of SSE, said onshore windfarms should be given a chance where communities support them. “I’d like to see onshore wind coming back in the UK,” he said.
Keith Anderson, chief corporate office at Scottish Power, told the Guardian: “Let’s use it, let’s deploy it. There are still areas absolutely where we could build onshore windfarms, areas where the local community are acceptive of windfarms.”
Wind power is expected to account for half of the 18GW of subsidy-free renewables to be built in the UK between now and 2030, according to a new Aurora Energy Research report.
The other half will be from solar power, which had largely stalled after subsidy cuts in 2015 but received a boost when the UK’s first subsidy-free solar farm opened last year.
Having so much green energy generation will squeeze out the opportunity for the likes of Germany’s RWE to build large gas power stations in the UK.
The government has already downgraded the amount of new gas power capacity it expects to be added by 2030 from 22GW to 7GW, but Aurora said that would shrink to just 1GW if subsidy-free renewables took off as anticipated.
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.
The monthly Coppock Indicators finished February
DJIA: 25,029 +283 Up 01. NASDAQ: 7,273 +313 Up 03. SP500: 2,714 +212 Flat.
No comments:
Post a Comment