Baltic Dry Index. 1109 -53 Brent Crude 78.67
It is the maxim of every prudent master of a
family, never to attempt to make at home what it will cost him more to make
than to buy...What is prudence in the conduct of every private family, can scarce
be folly in that of a great kingdom.
Adam Smith. The Wealth Of
Nations, 1776.
Maybe if everyone
mailed President Trump a copy of The Wealth of Nations, he might read one of
them, and we might yet escape a ruinous summer trade war. Then again, does he
read anything but Twitter?
Below, the confusion President
Trump wrought on many global stocks and nations this week, friend and foe
alike. In this version of a new cold
war, it seems to be the USA v everyone else in the Rest of the World, including
apparently, US consumers. Hard pressed
US consumers will soon be paying a whole lot more for goods at Walmart.
A summer of great global wealth
destruction lies down the road Trump's America is taking. Is the falling BDI already signalling
trade is falling?
Asian markets cautious after Trump cancels North Korea summit
Published: May 24, 2018 10:54 p.m. ET
Japanese auto makers continue to fall; energy stocks weigh in Hong Kong
Asian markets were mixed in cautious early trading Friday, after President Donald Trump canceled his upcoming summit with North Korean leader Kim Jong Un.Japan’s Nikkei NIK, +0.07% was off 0.1%, after initially dropping 0.5%, as the dollar JPYUSD, -0.261092% pushed above ¥109.50 to session highs from ¥109.30. Commodity-related names were leading the way lower for Japanese stocks as they were poised to notch their first down week in two months. The marine-transportation sector was off 1.6%, the weakest performer in the Topix. Mining was off 1.1% following a sizable drop overnight in oil prices LCON8, -0.16% . But that had the airline sector up 1%. Meanwhile, auto stocks were extending Thursday’s sharp selloff, with Honda 7267, -0.57% and Toyota 7203, -1.22% off nearly 1% more.
Hong Kong stocks started modestly weaker, with the Hang Seng Index HSI, -0.26% off 0.4%, with energy stocks again a sore spot.
After a strong rebound Thursday, Singapore’s Straits Times Index STI, -0.02% was down 0.3%, on the way to a second-straight weekly decline, which hasn’t happened since early February. Telecom stocks were down, with StarHub CC3, -1.89% off nearly 1%. Weakness was also seen in bank and property names.
Malaysian stocks FBMKLCI, +1.11% started strongly higher after two days of heavy selling.
Stocks in South Korea SEU, -0.05% and Taiwan Y9999, +0.24% were up modestly, while Australian stocks XJO, -0.09% dipped lower.
https://www.marketwatch.com/story/asian-markets-cautious-after-trump-cancels-north-korea-summit-2018-05-24
Trump Threatens Allies With New Tariffs, Sowing Global Confusion
By Andrew Mayeda, Ryan Beene, and Jenny Leonard
24 May 2018, 01:24 GMT+1 Updated on
24 May 2018, 11:46 GMT+1
President Donald Trump’s push for tariffs
on imported cars and trucks threatened a shake-up of the global auto industry
while motivating nations including China and Germany to reiterate commitments
of varying strength to free trade.The U.S. statement late Wednesday that it’s investigating auto imports on national security concerns drew pointed responses from Japan and South Korea -- two nations that have been at pains to placate Trump -- as well as Germany.
It also ended the temporary calm between the U.S. and China, which in contrast to Washington’s actions is said to be planning to reduce import duties on a range of consumer goods in a bid to open its market to outsiders.
The competing headlines demonstrate how the world’s two largest economies are likely set for years of skirmishes over commerce as Trump already backs away from an agreement struck just last weekend with China amid domestic criticism.
“Imposing broad, comprehensive restrictions on such a large industry could cause confusion in world markets, and could lead to the breakdown of the multilateral trade system based on WTO rules,” Japanese Trade Minister Hiroshige Seko said Thursday in Tokyo. Automakers were the biggest drag on Japan’s Topix stock index on Thursday.
Trump’s latest probe will be conducted under Section 232 of a 1960s trade law, the same tool the president invoked in imposing global tariffs on imported steel and aluminum earlier this year. An additional tariff on vehicles of up to 25 percent is also under consideration, according to a person familiar with the matter who asked not to be identified.
On
Thursday, German Chancellor Angela Merkel downplayed her nation’s own
discomfort with China’s industrial rise, and locked arms with Premier Li
Keqiang in a pointed defense of the multilateral trading order.
---- While the threat of new tariffs didn’t specifically point to Germany, it would strike at the heart of the German economy, further straining relations between the two sides as they’re locked in negotiations over steel and aluminum tariffs that are set to hit the European Union on June 1. Trump has made clear that he resents Berlin’s trade surplus, which amounted to 14.2 billion euros ($16.7 billion) last year for Germany’s auto industry alone.
In response to the new car tariffs, South Korea’s government said it has formed a task force with automakers and car associations to review the potential impact on the local auto industry of the U.S. move and to consider countermeasures.
Beijing also weighed in, with a Ministry of Commerce spokesman saying “China opposes the abusing of national security provisions, which would severely undermine the multilateral trading system, and disrupt the normal trade order.”
More
May 24, 2018 / 6:45 PM
Republicans in Congress slam Trump probe of auto imports
WASHINGTON
(Reuters) - Some of President Donald Trump’s fellow Republicans in the U.S.
Congress said on Thursday that his administration’s national security
investigation of car and truck imports amid a trade spat with China is being
pursued under false pretenses and could hurt U.S. consumers.
Shortly after, the Commerce Department launched a probe of auto imports under Section 232 of the Trade Expansion Act of 1962 that could lead to new U.S. tariffs similar to those imposed on imported steel and aluminum in March.
Higher tariffs could be particularly painful for Asian automakers, including Toyota Motor Corp (7203.T), Nissan Motor Co (7201.T), Honda Motor Co (7267.T) and Hyundai Motor Co (005380.KS), which count the United States as a key market.
Congressional Republicans said it was unclear what Trump was aiming to accomplish with the probe, warning it could result in U.S. job losses, and with some suggesting it was a political tactic ahead of midterm elections in November.
Senate Foreign Relations Committee Chairman Bob Corker said there was “no reason” to conduct a national security investigation of auto imports.
----“This appears to be either an attempt to affect domestic politics ahead of the election or for some other transactional purpose regarding ongoing trade discussions. This is a dangerous course and should be abandoned immediately,” Corker said in a statement.
Corker is a Republican from Tennessee, where Volkswagen, Nissan and
other auto-related manufacturers have assembly and production plants.
Pennsylvania’s Republican Senator Pat Toomey said on Twitter that Trump
was making the move “under the false pretense of national security” and that it
“invites retaliation.”
More
May 25, 2018 / 4:02 AM
U.S. Commerce's Ross to visit China for trade talks in early June
BEIJING (Reuters) - U.S. Commerce Secretary Wilbur Ross will
visit China early next month for another round of talks amid ongoing trade
frictions between the world’s two largest economies.
Ross will visit China from June 2 to June 4, the official Xinhua news
agency reported on Friday, adding that Vice Premier Liu He, China’s chief
negotiator in the trade dispute, had spoken with Ross over the phone. It gave
no further details.
The trade dispute took on added complexity this week when U.S. President
Donald Trump announced a national security investigation into imports of cars and
trucks, a probe that could lead to tariffs against China as well as key U.S.
allies such as Canada, Mexico, Japan and Germany.
U.S. Treasury Secretary Steven Mnuchin told CNBC on Monday
that Ross is aiming to negotiate “a framework” that could then turn into
“binding agreements ... between companies.”
In the last round of talks in Washington in mid-May, China agreed to ramp up purchases of U.S. agriculture and energy products, and the two sides worked towards a possible reprieve for ZTE Corp (000063.SZ)(0763.HK) from a U.S. ban on American companies supplying the Chinese maker of telecoms equipment.
The developments and constructive comments from both sides eased fears that the United States and China could plunge into a trade war, but President Donald Trump said this week that any deal would need “a different structure,” fueling uncertainty over the negotiations.
More
The rising tensions between China, US
AFP•
Washington (AFP) - President Donald Trump has often bragged of his
friendship with his Chinese counterpart Xi Jinping, but recent events point to
growing stresses between Washington and Beijing.
This week, the Pentagon pulled its invitation for China to participate
in maritime exercises in the Pacific, then Trump on Thursday scrapped a summit
with North Korea after suggesting Xi may have exacerbated a breakdown in
communications.
And all this against a backdrop of simmering trade tensions -- and a
bizarre case involving a US official and a possible "sonic attack."
- Summit sunk -
Trump on Thursday scrapped the historic summit with Kim Jong Un -- set
to take place June 12 in Singapore -- to discuss the
"denuclearization" of North Korea.
Before he pulled the plug, Trump had suggested Xi might have played a role
in a recent toughening of North Korean rhetoric.
"There was a difference when Kim Jong Un left China the second
time," Trump said.
"There was a different attitude after that meeting and I was a
little surprised. ... And I think things changed after that meeting so I can't
say that I am happy about it."
On Monday, Trump suggested China might have prematurely eased up on
enforcing economic sanctions against Pyongyang, a move that runs counter to the
US leader's "maximum pressure" campaign.
China insists it is strictly enforcing sanctions adopted by the UN
Security Council.
- Pacific exercise -
The Pentagon on Wednesday withdrew its invitation for China to join
maritime exercises in the Pacific because of Beijing's "continued
militarization" of the South China Sea.
China hit back at the decision to disinvite it from the Rim of the
Pacific exercises, calling it "very non-constructive" and saying it
was taken without due reflection.
"It's also a decision taken lightly and is unhelpful to mutual
understanding between China and the US," China's Foreign Affairs Minister
Wang Yi said.
More
https://www.yahoo.com/news/rising-tensions-between-china-us-014346160.html?guccounter=1
But is President Trump just following US treaty precedent?
https://www.smithsonianmag.com/smithsonian-institution/why-very-first-treaty-between-us-and-native-people-still-resonates-today-180969157/?utm_source=smithsoniandaily&utm_medium=email&utm_campaign=20180524-daily-responsive&spMailingID=34432451&spUserID=NjUwNDIzNTUzNDE0S0&spJobID=1282806288&spReportId=MTI4MjgwNjI4OAS2
But is President Trump just following US treaty precedent?
Why the Very First Treaty Between the United States and a Native People Still Resonates Today
The Treaty With the Delawares, signed in 1778, has arrived at the National Museum of the American Indian
By
Ryan P. Smith smithsonian.com
https://www.smithsonianmag.com/smithsonian-institution/why-very-first-treaty-between-us-and-native-people-still-resonates-today-180969157/?utm_source=smithsoniandaily&utm_medium=email&utm_campaign=20180524-daily-responsive&spMailingID=34432451&spUserID=NjUwNDIzNTUzNDE0S0&spJobID=1282806288&spReportId=MTI4MjgwNjI4OAS2
We close for the long weekend with more on that growing US
drought.
Drought Conditions In The Southwest Are So Bad That They Are Already Being Compared To The Dust Bowl Of The 1930s
The
worst drought to hit the Southwest in decades continues to grow even worse, and
many are already comparing this current crisis to the Dust Bowl days of the
1930s. Agricultural production is way down, major rivers are running dry,
and horses are dropping dead from a lack of water. The epicenter of this
drought is where the states of Utah, Colorado, Arizona and New Mexico all come
together, but it is also devastating areas of north Texas, Oklahoma and Kansas
as well. Portions of seven states are already at the highest level of
drought on the scale that scientists use, and summer won’t even start for about
another two months.
If
we don’t start seeing some significant rainfall, it won’t be too long before
massive dust storms start devastating the entire region. The mainstream
media is finally beginning to wake up and start reporting on this crisis, and
some reporters are choosing to make a direct comparison between this drought
and the Dust Bowl
conditions during the Great Depression…
---- If you are not familiar with the Dust Bowl period, you should be able to find a good documentary online to watch. It was one of the most painful periods in American history, and we could be right on the verge of a repeat.
Those that have followed my work for an extended period of time know that I have been warning about a return of Dust Bowl conditions, and now it is actually happening. The flow of the Colorado River is way, way down, and in some areas the Rio Grande has already dried up completely…
---- As urban populations have surged, the Southwest has already been dealing with unprecedented water stress, and now this crisis is going to take things to an entirely new level.
Meanwhile, this drought has been hitting farms really hard. Winter wheat production in some areas will be about half of what it was last year, and this summer some wheat farmers may have to abandon their fields entirely…
---- Somewhere around 60 percent of all winter wheat in Texas is being graded “poor” or “very poor”, and Kansas is on pace to have its smallest winter wheat crop in nearly 30 years.
More
Not only must we fight to end
disastrous unfettered free trade agreements with China, Mexico, and other low
wage countries, we must fight to fundamentally rewrite our trade agreements so
that American products, not jobs, are our number one export.
Donald Trump, with apologies
to Bernie Sanders
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Today, Bitcoin fraud again. Unicorn ranching anyone?
U.S. Launches Criminal Probe into Bitcoin Price Manipulation
By Matt Robinson and Tom Schoenberg
24 May 2018, 09:00 GMT+1 Updated on
24 May 2018, 09:41 GMT+1
The Justice Department has opened a criminal probe into whether traders are
manipulating the price of Bitcoin and other digital currencies, dramatically
ratcheting up U.S. scrutiny of red-hot markets that critics say are rife with
misconduct, according to four people familiar with the matter.The investigation is focused on illegal practices that can influence prices -- such as spoofing, or flooding the market with fake orders to trick other traders into buying or selling, said the people, who asked not to be identified because the review is private. Federal prosecutors are working with the Commodity Futures Trading Commission, a financial regulator that oversees derivatives tied to Bitcoin, the people said.
Authorities worry that virtual currencies are susceptible to fraud for
multiple reasons: skepticism that all exchanges are actively pursuing cheaters,
wild price swings that could make it easy to push valuations around and a lack
of regulations like the ones that govern stocks and other assets.
Bitcoin extended its Thursday declines after Bloomberg News reported the
investigation, and was down 3 percent to $7,409 as of 9:32 a.m. London time.
It’s down more than 20 percent since a May 4 peak.
Such concerns have prompted China to ban cryptocurrency
exchanges and nations including Japan and the Philippines to regulate them,
contributing to a slump that has sent Bitcoin below $8,000 this year. Still,
digital coins continue to be a global investment craze, drawing legions of
loyalists to industry conferences, generating celebrity endorsements and
increasingly attracting the attention of Wall Street.
The illicit tactics that the Justice
Department is looking into include spoofing and wash trading -- forms of
cheating that regulators have spent years trying to root out of futures and
equities markets, the people said. In spoofing, a trader submits a spate of
orders and then cancels them once prices move in a desired direction. Wash
trades involve a cheater trading with herself to give a false impression of
market demand that lures other to dive in too. Coins prosecutors are examining
include Bitcoin and Ether, the people said.A Justice Department spokesman declined to comment and CFTC officials didn’t respond to requests for comment.
Spoofing Is a Silly Name for Serious Market Rigging: QuickTake
More
Consumption is the sole end and purpose of all
production; and the interest of the producer ought to be attended to, only so
far as it may be necessary for promoting that of the consumer.
Adam Smith. The Wealth Of Nations, 1776.
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?
Making massive leaps in electronics at nano-scale
Researchers have found ways to control the spin transport in networks of the smallest electrical conductor known to man
Date:
May 23, 2018
Source:
University of the Witwatersrand
Summary:
By chemically attaching nano-particles of the rare earth element, gadolinium,
to carbon nanotubes, the researchers have found that the electrical conductivity
in the nanotubes can be increased by incorporating the spin properties of the
gadolinium which arises from its magnetic nature.
Researchers at the University of the Witwatersrand have found ways to
control the spin transport in networks of the smallest electrical conductor
known to man.
By chemically attaching nano-particles of the rare earth element,
gadolinium, to carbon nanotubes, the researchers have found that the electrical
conductivity in the nanotubes can be increased by incorporating the spin
properties of the gadolinium which arises from its magnetic nature. To put it
plainly the presence of a magnet in an electron transfer media introduces
another degree of freedom that enhances the electron transfer but only if
tailored precisely.
Discovered in Japan in 1993, carbon nanotubes are the thinnest tubes in
the universe, consisting of a cylinder of single carbon atoms. At the time of
its discovery it was revolutionary, and it was expected that it could replace
silicon in electronic circuits, such as microchips and computer hard drives.
"Carbon nanotubes are known for their ability to carry a high
amount of electrical current and they are very strong. They are very thin but
electrons can move very fast in them, with speeds of up to Gigahertz or
Terahertz, and when coupled to nanomagnets they greatly extend the
functionality of the carbon nanotubes, which is required to advance modern
technology through the development of high speed spintronic devices," says
Siphephile Ncube, a PhD student at the Wits School of Physics and the lead
author of the study. Her research was published in Scientific Reports on
Wednesday (23 May 2018).
During her PhD, Ncube collaborated with a team of researchers from the
University of the Witwatersrand, University of Johannesburg and the Paul
Sabatier University in France. The researchers chemically attached gadolinium
nanoparticles on the surface of the carbon nanotubes to test whether the
magnetism increases or inhibits the transfer of electrons through the system. The
measurements to interrogate the effect of magnetic nanoparticles on a network
of multi-walled carbon nanotubes were carried out at the Nanoscale Transport
Physics Laboratory (NSTPL) at Wits. This facility is dedicated to novel
nano-electronics and it was initiated by the NRF Nanotechnology flagship
programme.
"We found that the effect of the magnetic nano-particles is read
off in the electronic transport of the nanotubes. Due to the presence of the
magnet the electrons become spin polarised and the charge transfer is dependent
on the magnetic state of the gadolinium. When the overall magnetic poles of the
gadolinium are oppositely aligned, it causes higher resistance in the nanotubes
and slows down the flows of electrons. When the magnetic poles are misaligned,
it has a low resistance, and assists the electron transport," says Ncube.
This phenomenon is known as the Spin Valve Effect, which finds wide application
in the development of hard disk drives used for data storage.
----"Ncube's
research established the great potential of carbon nanotubes for ultra-fast
switching device and magnetic memory applications, a realisation we have been
working towards since the establishment of the NSTPL facility in 2009,"
says Ncube's PhD supervisor, Professor Somnath Bhattacharyya. "To date,
modified nanotubes have demonstrated good spin transport for devices made from
individual nanotubes. For the first time we have demonstrated spin mediated
electron transport in a network of nanotubes without incorporation of magnetic
leads." The project is part of the objectives outlined in the NRF
Nanotechnology flagship program.
Another weekend and a
long weekend on both sides of the Atlantic too. In the USA Monday is Memorial
Day. In GB, Gibraltar, the Isle of Man, Guernsey and Jersey, Monday is the
Spring Bank Holiday, traditionally in GB at least, the rainy start to summer.
Have a great weekend everyone, whatever the weather.
Whether
the weather be fine
Or whether the weather be not,
Whether the weather be cold
Or whether the weather be hot,
We'll weather the weather
Whatever the weather,
Whether we like it or not.
Or whether the weather be not,
Whether the weather be cold
Or whether the weather be hot,
We'll weather the weather
Whatever the weather,
Whether we like it or not.
Anon.
GB Poem.
The monthly Coppock Indicators finished April.
DJIA: 24,163 +255 Down. NASDAQ:
7,066 +282 Down. SP500: 2,648 +188 Down.
All
three slow indicators moved down in March and continued down in April. For some
a new bear signal, for others a take profits and get back to cash signal.
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