Tuesday 31 July 2018

Dress Up Tuesday. So Far So Good.

Baltic Dry Index. 1703 +27   Brent Crude 74.78

There can be few fields of human endeavour in which history counts for so little as in the world of finance. Past experience, to the extent that it is part of memory at all, is dismissed as the primitive refuge of those who do not have the insight to appreciate the incredible wonders of the present.

J. K. Galbraith.

We have reached month end and dress up Tuesday. Can the stock perma bulls retake the markets from trade war, gun shy, scaling back investors?  Is it all over for the rigged FANG leadership? Was late January the peak and it’s all downhill for most stocks from here?  Can Tesla survive?

If dress up Tuesday becomes dress down Tuesday, as money managers start adjusting to a second half getting off to a poor trade war start, Trump’s “easy to win” trade war may have just killed off the stock market’s FANG golden goose.

In any great organization it is far, far safer to be wrong with the majority than to be right alone.

John Kenneth Galbraith.
July 31, 2018 / 1:42 AM

Asian shares slip on tech rout, focus shifts to BOJ

     SYDNEY (Reuters) - Asian share markets weakened on Tuesday, taking cues from the rout in global technology shares while the yen edged higher ahead of the Bank of Japan’s rate review, at which it could flag a shift away from its massive monetary stimulus.

    Japan's Nikkei .N225 fell 0.5 percent. South Korea's Kospi index KS11 dipped 0.1 percent despite solid second-quarter results from Samsung Electronics (005930.KS) which posted a 5.7 percent rise in profit.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was mostly unchanged at 543.23 as were Australian shares .

Overnight in Wall Street, the Dow .DJI and the S&P 500 .SPX each lost 0.6 percent and the Nasdaq .IXIC skidded 1.4 percent.

The technology index .SPLRCT crumbled 1.8 percent overnight as disappointing results from Facebook (FB.O), Twitter (TWTR.N) and Netflix (NFLX.O) spurred concerns about future growth for a sector that has led U.S. equities to record highs.

----Elsewhere, most major currencies stuck to narrow trading ranges ahead of several central bank decisions. The U.S. Federal Reserve concludes its policy meeting on Wednesday and the Bank of England is seen raising interest rates on Thursday. Month-end macroeconomic data is also due from China on Wednesday.

The British pound GBP= held at $1.3132, drifting away from a more than 10-month trough of $1.2955 touched earlier in July.

The euro EUR=EBS was flat at $1.1707 after two consecutive sessions of gains. The dollar index .DXY, which measures the greenback against a basket of major currencies, was flat at 94.332.

In commodities, U.S. crude CLc1 eased 3 cents to $70.10 a barrel after a sharp rally overnight while Brent LCOc1 settled up 68 cents at $74.97.

Spot gold was a tad firmer at $1,223 an ounce.


Morgan Stanley Says Correction Worse Than February Is Building

By Dani Burger
The market’s leaders have gone missing this earnings season. For Morgan Stanley, that’s a worrying sign that the stock rally may have exhausted itself.

Despite more than 85 percent of S&P 500 members beating analyst estimates, the type of pro-cyclical companies you’d expect to surge amid banner earnings have been falling behind. Not even the biggest winners of the year are posting reliable gains, as earnings misses from the likes of Netflix Inc. and Facebook Inc. hamper the momentum trade.

As such, risks to the July stock rally are building, and with peaking growth rates and extended positioning, the three-day slide that started Thursday will only get worse, Morgan Stanley analysts said.

“The selling has just begun and this correction will be the biggest since the one we experienced in February,” Morgan Stanley equity strategists led by Mike Wilson wrote in a note Monday. “It could very well have a greater negative impact on the average portfolio if it’s centered on tech, consumer discretionary and small caps, as we expect.”

The Nasdaq Composite Index fell 1.3 percent as of 2:48 p.m. in New York, bringing its three-day slide to 3.7 percent. The measure sank almost 10 percent from a January high through Feb. 8.

Some below-the-surface moves are setting the market up for a bigger downturn. One of the more curious developments since the reporting season began has been lagging value stocks -- those priced cheaply to their assets. Typically, strong earnings reports spur investors to bid up underpriced stocks. However, a market-neutral version of value has tumbled for the past three weeks.

“Maybe this reflects a realization that while the results are great they may also represent a peak,” Sanford C. Bernstein analysts, led by Inigo Fraser Jenkins, wrote in a note Monday. “Analysts covering value stocks are already ‘maxed out’ in terms of their upgrading of earnings forecasts for such names; we struggle to see how they can get even more positive.”

What to Watch in Commodities: Oil, El Nino, Arcelor, Trade, ADM

By Thomas Biesheuvel, Alex Longley, and Mario Parker
30 July 2018, 01:05 GMT+1 Updated on 30 July 2018, 05:22 GMT+1
Commodity investors have a mass of information to deal with in the coming week: earnings season is in full flow; the oil market is tracking OPEC’s decision to add supplies; and there are likely to be developments on global trade spats, especially on China. Raw materials are set to close out July with another loss after retreating in June. Let’s see what August brings.

Among the highlights, tanker-tracking figures will give the first full month of data since OPEC’s decision to add more barrels, and with weather woes dominating the news, there’s a key forecast on the outlook for an El Nino. Among top companies reporting, we’ve a focus on ArcelorMittal, as well as Archer-Daniels-Midland Co. and Bunge Ltd. Investors will also watch for earnings from BP Plc and Rio Tinto Group, Caterpillar Inc. and output data from Glencore Plc.

Troubled Waters

From ship tracking to geopolitics, there’s plenty to keep an eye on in the oil market this week. There’ll be the first full month of tanker tracking since the Organization of Petroleum Exporting Countries and its allies agreed to ramp up output in June. Bloomberg will also release its monthly output estimate for the group. OPEC’s biggest producer, Saudi Arabia, said that its July exports would be “roughly equal” to June, but expect to see some increases from its allies.
 We’ll also be watching developments in the Bab el-Mandeb Strait after Saudi Arabia said that it was halting shipments via that choke point after two tankers came under attack from Houthi militia. Look for signals of whether flows from other nations will continue and what the Saudis’ next moves will be.
    The world’s weather has been pretty feisty in recent weeks, with extreme heat seen from Texas to Japan, and the blame being laid on a kink in the jet stream. There may be more trouble ahead, with a possible El Nino looming. Australia’s forecasters deliver their next update on the outlook on Tuesday.

    The pattern, driven by a warming of the equatorial Pacific Ocean, can profoundly impact the planet, baking swathes of Asia, making it wetter in California and risking drought in Brazil. Australia’s Bureau of Meteorology has an El Nino watch in place, and next up would be an alert should the outlook firm up. The U.S. Climate Prediction Center has already put the chances of an El Nino at 70 percent between December and February.


Crooks and Scoundrels Corner 

The bent, the seriously bent, and the totally doubled over.

In trade war news, “so far so good,” as the man who fell off the Empire State building said as fell past the 60th floor. It’s all about what comes next.

If economists could manage to get themselves thought of as humble, competent people on a level with dentists, that would be splendid.

John Maynard Keynes.

July 31, 2018 / 2:59 AM

China's July manufacturing growth slows on trade dispute, softer domestic demand

BEIJING (Reuters) - Growth in China’s manufacturing sector slowed more than expected in July, as the worsening trade dispute with Washington, bad weather and weaker domestic demand weighed on factory activity.

The official Purchasing Managers’ Index (PMI) released on Tuesday fell to 51.2 in July, from 51.5 in June and below the 51.3 in a Reuters poll of economists. It was also the lowest index reading since February but remained above the 50-point mark that separates growth from contraction for a 24th straight month.

Firms were hurt by trade frictions, rain and high temperatures in July, which is also a cyclically slow season for some sectors, said statistics bureau official Zhao Qinghe in a statement released with the data.

The gauge of factory activity is the first major reading of the world’s second largest economy since the second quarter of this year, when China logged a modest slowdown in growth, weighed by government efforts to tackle debt risks and escalating U.S. trade tensions.

ANZ Senior China Economist Betty Wang said while trade tensions were a factor in the moderation in growth, the ongoing deleveraging campaign and unfavourable weather were bigger drivers behind the slowdown.

The PMI’s July new export orders index remained in contraction in July, but did not change from the previous month’s reading of 49.8, a sign trade conditions have not worsened significantly.

However, the sub-index on imports, viewed as a proxy for domestic demand, dipped into contraction in July and was the lowest since February.

----Beijing and Washington have been engaged in a tit-for-tat exchange of punitive measures and threats of measures against each other’s goods.

Earlier this month, the United States imposed tariffs on $34 billion of Chinese imports. China promptly responded by levying taxes on the same value of U.S. products, leading U.S. President Donald Trump to threaten tariffs on $500 billion of Chinese goods.

China’s June exports growth cooled slightly from the previous month but remained solid, as exporters rushed to move shipments before tariffs went into effect on July 6.

Every generation imagines itself to be more intelligent than the one that went before it, and wiser than the one that comes after it.

George Orwell.

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?

Technique to easily fabricate ceramic films used as OPV inter-layers developed

Researchers develop coating technique to create ceramic ultra-thin films using solution

Date: July 26, 2018

Source: Osaka University

Summary: Researchers developed a technique for coating Zinc related oxide (ZnOx, ZnOHx) simply by depositing the films in a solution process using the Metal Organic Decomposition method at ambient temperature and pressure without heating. They also demonstrated that their thin films produced by this technique were useful as buffer layers for OPV cells and that the films achieved a power conversion efficiency equivalent to that of ZnO thin films produced by conventional methods involving sintering.

As environmental and energy issues have become increasingly aggravated in recent years, photovoltaic (PV) cells are drawing attention as a new energy source. However, since the cost of silicon PV cells is still high, it's important to reduce the cost of PV cells. On the other hand, organic photovoltaic (OPV) cells using organic compounds have several advantages: they are lightweight, flexible, and sophisticated, and their production cost is low. For these reasons, they are anticipated as next-generation PV cells.

As for the development of OPV cells, in addition to organic semiconductors that absorb light, (1) materials for buffer layers in OPV cells (buffer layers, or OPV inter-layers, that efficiently separate electrons and holes produced from light energy and transport electrons and holes to each electrode and (2) the design of OPV devices are actively being studied. In these circumstances, one of the techniques that grabs the most attention is a spin coating technique to create Zinc related oxide (ZnOx, ZnOHx) ultra-thin films (ceramic films) using a solution.

OPV cells using ZnO thin films as buffer layers are actively being studied. In conventional production processes of ZnO thin films, a sintering process by high temperature heating or alternative energy irradiation was necessary.

A joint group of researchers from Osaka University and Kanazawa University developed a technique for coating Zinc related oxide (ZnOx, ZnOHx) simply by depositing the films in a solution process using the Metal Organic Decomposition (MOD) method at ambient temperature and pressure without a heating process. They also demonstrated that their thin films produced by this technique were useful as buffer layers for OPV cells and that the films achieved a power conversion efficiency (PCE) equivalent to that of ZnO thin films produced by conventional methods involving sintering. Their research results were published in Scientific Reports.

One of the authors Tohru Sugahara says, "We succeeded in forming nano-sized oxide ultra-thin films by our blended solution coating method without heating."

The monthly Coppock Indicators finished June.

DJIA: 24,271 +221 Down. NASDAQ: 7,510 +267 Down. SP500: 2,718 +169 Down.
All three slow indicators moved down in March and have continued down in April. May and June. For some a new bear signal, for others a take profits and get back to cash

Monday 30 July 2018

Trump - The Best Laid Schemes.

Baltic Dry Index. 1676 -32   Brent Crude 74.29

“The best laid schemes o' mice an' men - Gang aft a-gley.”

Robert Burns, To A Mouse.

We open with two days left to dress up stocks for the month end and first month of the second half of the year. Trickier this time round with central bank meetings, including a two day Federal Reserve meeting, the possible start of the next round of the tariff wars, a massive crack in the FANGS, and everyone waiting to see what happens next in the Yuan depreciation/devaluation.

Not the usual easy going “all news is good news” spin to dress up Tuesday.  In fact, if the great FANG crack sets off a great rotation out of technology in general, that great crack could all too easily turn into a chasm.

July 30, 2018 / 1:49 AM

Asia shares subdued for central bank, data test

SYDNEY (Reuters) - Asian share markets drifted lower on Monday while currencies kept to familiar ranges at the start of a busy week peppered with central bank meetings, corporate results and updates on U.S. inflation and payrolls.

Technology and energy shares led Japan's Nikkei .N225 down 0.7 percent, and tech also featured in South Korea's .KS11 0.2 percent decline.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS eased 0.5 percent and Chinese blue chips .CSI300 by 0.3 percent.

The week features quarterly earnings from more than 140 S&P 500 companies, including Apple Inc (AAPL.O).

Disappointing results from Intel Corp (INTC.O) and Twitter Inc (TWTR.N) soured the mood on the Nasdaq .IXIC on Friday, though the S&P 500 <.SPX) and Dow .DJI still ended firmer for the week.
Analysts at JPMorgan cited relatively aggressive moves into “value” stocks - in particular banks - and away from shares leveraged to economic growth.

“Tech really began cracking on Tuesday before the floodgates opened on Friday,” they wrote in a note.

----The U.S. Federal Reserve meets on Tuesday and Wednesday and is widely expected to stand pat while reaffirming the outlook for further gradual rate rises.

The market is almost fully priced for a hike in September and leaning towards a further move before year-end.

A Bank of Japan policy meeting that ends on Tuesday has taken on greater importance amid talk it could tweak its massive asset-buying campaign.

Elias Haddad, a senior currency strategist at Commonwealth Bank of Australia, doubted the BoJ would move just yet, but felt it may abandon the negative interest rate applied to accounts held by financial institutions at the central bank.

A good trial barrister learns fast to never ask a question of a witness that he doesn’t already know the answer to. It makes sense when starting trade wars to follow that same logic. Never start a trade war that you don’t know the final outcome of.

Even though US Trump Trade Tariffs, and their retaliation, are only so far affecting a tiny proportion of global trade, the tempest in a teapot trade war, so far, is not responding to Washington’s script. If all the planned tariff escalations actually happen, the Great Global Trump Trade War will soon go off script entirely.

Below, as the best laid plans of mice and Trump go oft awry.

     But Mousie, thou art no thy-lane,
     In proving foresight may be vain:
     The best laid schemes o’ Mice an’ Men
          Gang aft agley,
     An’ lea’e us nought but grief an’ pain,
          For promis’d joy! 

Robert Burns. To A Mouse.

July 28, 2018 / 6:05 PM

G20 agriculture ministers slam protectionism, pledge WTO reforms

BUENOS AIRES (Reuters) - Agriculture ministers from the G20 countries criticised protectionism in a joint statement on Saturday, and vowed to reform World Trade Organization (WTO) rules, but did not detail what steps they would take to improve the food trade system.

In the statement, they said they were “concerned about the increasing use of protectionist non-tariff trade measures, inconsistently with WTO rules.”

The ministers from countries including the United States and China, in Buenos Aires for the G20 meeting of agriculture ministers, said in the statement they had affirmed their commitment not to adopt “unnecessary obstacles” to trade, and affirmed their rights and obligations under WTO agreements.

The meeting came amid rising trade tensions that have rocked agricultural markets. China and other top U.S. trade partners have placed retaliatory tariffs on American farmers after the Trump administration put duties on Chinese goods as well as steel and aluminium from the European Union, Canada and Mexico.

U.S. growers are expected to take an estimated $11 billion hit due to China’s retaliatory tariffs. Last week, the Trump administration said it would pay up to $12 billion to help farmers weather the trade war.

U.S. Agriculture Secretary Sonny Perdue told Reuters in an interview on the sidelines of the meeting that Trump’s plan would include between $7 billion and $8 billion in direct cash relief that U.S. farmers could see as early as late September.

---- Citing the Trump administration’s relief measures, German Agriculture Minister Julia Kloeckner said farmers “don’t need aid, (they) need trade.”

“We had a very frank discussion about the fact that we don’t want unilateral protectionist measures,” Kloeckner said in a news conference after the meeting.

The ministers, whose countries represent 60 percent of the world’s agricultural land and 80 percent of food and agricultural commodities trade, did not specify which measures they were referring to in the statement. Asked for details, Kloeckner said the ministers did not want to “criticise a single country.”

Trump's Soybean 'Deal' With the E.U. Is Actually Pretty Insignificant

Europe already imports soybeans for free, and the European market isn't big enough to make up for China anyway.

Eric Boehm|Jul. 26, 2018 12:00 pm
It's a testament to the power of the tiny soybean—or, actually, the political power of the farmers that grow them—that the Trump White House has been scrambling this week to appease growers' complaints about the consequences of the president's ill-thought-out trade war. But the president's latest maneuver will do nothing to alleviate the harm caused by his own bellicose trade policies.

First, there was the attempt to buy farmers' support, with the White House announcing that it would spend $12 billion through a New Deal-era crop insurance program to bail out farms harmed by tariffs. This is the policy equivalent of lending a garden hose to the fire department after setting your house on fire (and then sticking taxpayers with the water bill). Then, on Tuesday, Trump was eager to announce the bare bones of a trade deal with European Commission President Jean-Claude Juncker that would see the E.U. importing more soybeans.

Soybeans are a critical battleground in the trade war because the United States produces so damn many of them. Farmers planted more than 89 million acres of soybeans across the United States in 2018, narrowly edging out the 88 million acres of corn that were planted, according to an annual survey by the Department of Agriculture. The United States is the world's largest exporter of soybeans, with nearly half the U.S. crop exported annually—and China is the largest importer of them. There are few singular products that better illustrate the benefits of global trade between the world's two largest economies than the humble soybean.

But it was only after this year's soybean crop was already planted that Trump announced his tariffs on steel, aluminum, and Chinese-made goods. China responded to those tariffs by targeting America's soybean crop—since then, the price of soybeans has fallen dramatically—leaving American farmers in the lurch.

That's why, at first blush, yesterday's joint announcement by Trump and Juncker appears to be a positive development—and, to be fair, any indication of a cease fire in the trade war is welcome. But a mere handshake agreement to send more soybeans across the Atlantic won't make up for a reduction in exports across the Pacific.

For starters, that's because the European Commission doesn't actually have authority over how many soybeans Europe imports. It doesn't procure soybeans for European markets and it doesn't tell European businesses where to buy their soybeans.

Of course, there are other ways that governments can encourage businesses within their borders to purchase materials from certain sources. Lowering trade barriers is one way to do it. If the Trump-Juncker agreement would lower European tariffs on American-grown soybeans, for example, that might do the trick of getting Europe to buy more American beans.

Except, well, the European Commission currently doesn't charge any tariffs on American soybeans. Which means European businesses already have access to all the American soybeans they would want. It's hard to see how—short of subsidizing demand across the pond—Juncker will follow through with his promise to have Europe buy more soybeans (falling global prices might encourage more buying in Europe, but not to a significant degree).

Rather than being an agreement to import more soybeans, it seems like Tuesday's deal was really nothing more than a pledge that Europe would not slap new tariffs on soybeans in response to American tariff-raising, like China did. Further reporting from Brussels seems to bear out that conclusion.

----It's also worth considering the scale of the soybean markets in China and Europe. In 2016, the most recent year for which full data are available in the United Nations Food and Agriculture Organization database, China imported more than 86 million tons of soybeans while Europe imported just under 19 million tons. Unless Juncker and Trump plan to start jamming soybeans down European throats, foie gras-style, there's simply no way that Europe can consume enough soybeans to make up for the loss of China as an American export market.

Koch network meeting kicks off with anti-protectionism message from Charles Koch

by Michelle Ye Hee LeeJuly 28 at 7:18 PM
COLORADO SPRINGS — In 2003, billionaire industrialist Charles Koch gathered a small group of like-minded business leaders to oppose increased federal spending and steel tariffs under the George W. Bush administration.

Koch, 82, is now ringing the alarms again 15 years later at this weekend's meeting, which has grown to include more than 500 major donors to his influential network, amid the brewing trade war under President Trump.

The twice-annual confab kicked off Saturday afternoon with a video message released to reporters in which an impassioned Koch decries protectionism and those who support it.

“They’re doing whatever they can to close themselves off from the new, hold on to the past and prevent change,” Koch says in a video. “This is a natural tendency, but it’s a destructive one because when people act in protectionist ways, they erect barriers, which makes everyone worse off.”

----He describes the beginnings of Koch Industries as historical footage of a younger Koch flashes on the screen, and he credits the growth of his company to “rejecting protectionism for a vision of mutual benefit and continual transformation.”

“When the U.S. has followed this vision, it's succeeded beyond what anyone could have imagined,” Koch says in the video. “And if we remain true to this vision as a network, we will help people improve their lives beyond what any of us can imagine.”

But, he adds, “we face a herculean task. Protectionism is perverting the key institutions of our society. It’s created immense barriers that are holding people back. So if we want to help all people realize their potential, we have to break these barriers.”

----“The policy response to tariffs in order to achieve anything is absolutely inappropriate policy, and we intend to make that case very strongly to the American people,” said Brian Hooks, a top Koch official. “The policies right now are hurting people, no doubt about it.”

The network’s top officials sharply criticized Trump's plan to provide $12 billion in emergency aid to farmers caught in the trade war, calling it a “bailout of bad policy.”

“We put tariffs, supposedly, to hurt and put pressure on China, and then it actually hurts farmers here,” said James Davis, a Koch network spokesman. “Crops waste away in the field, and then you pull a Depression-era program out to bail out farmers, to make them whole. But who’s underwriting our debt?”

      Still, thou art blest, compar’d wi’ me!
      The present only toucheth thee:
      But Och! I backward cast my e’e,
          On prospects drear!
      An’ forward tho’ I canna see,
          I guess an’ fear!
Robert Burns. To A Mouse.

Crooks and Scoundrels Corner

The bent, the seriously bent, and the totally doubled over.

Today, the US auto industry. While everyone’s watching the Fed’s 2-10 yield curve to forecast the next recession arriving, did US motors just signal recession six months ahead?

Carmageddon in Detroit

by Wolf Richter • Jul 26, 2018 • 

Suddenly it gets ugly – but these are still the good times.

It’s confession time among the Detroit automakers: GM, Fiat Chrysler, and Ford all got ugly, in unison, in one day, something we haven’t seen since the Financial Crisis.

Back at the end of May, GM shares (GM) were trading at $38 when it announced that SoftBank, the Japanese company that is blowing borrowed billions left and right, would invest $2.25 billion in GM’s self-driving car unit Cruise. By June 11, GM shares had shot up to $45. But this morning they’re at $37.16. That’s a 17% plunge from June 11, including the 5% drop Wednesday and today.

In its earnings report Wednesday morning, it lowered its profit outlook for 2018 by 5% to 9%, as its operating profits in its North America business plunged 23% in the quarter. GM’s “adjusted” profits had hit a record in 2017 of $12.8 billion. That record is now moving out of reach.

It blamed currency woes in Brazil and Argentina and raw materials, primarily steel and aluminum, whose prices – “driven by a variety of market forces,” as CFO Chuck Stevens said – rose more sharply than it had expected when it gave its guidance at the beginning of 2018.

Fiat Chrysler didn’t help. Wednesday morning it announced earnings and slashed full-year earnings guidance by about 7%. Its shares (FCAU) on Wednesday and this morning have plunged 13% and are down 31% since April.

FCA lost $114 million in Asia-Pacific region, mainly China, and blamed “lower shipments from the China JV as a result of market decreases, particularly in the SUV segments, and increased competition from domestic brands in China.”

“Clearly when you step back and look at our results for the quarter, the biggest challenges we face, and frankly we’re going to face to some extent for the balance of the year, are all focused in China,” said the new guy, CEO Mike Manley, who just filled the slot of Sergio Marchionne who passed away this week. He added, “With duty changes that were announced, these particularly impacted Maserati, which resulted in a slowdown of sales and shipments to dealers.”

Ford’s turn to confess came Wednesday evening – and it was ugly. It’s Q2 earnings plunged nearly 50% to $1.1 billion, as total revenues fell 2.4% to $38.9 billion. It slashed its earnings projections for the full year by about 11% and announced another restructuring program that could drag out for three to five years and cost $11 billion.

Or whatever, because in April, CEO Jim Hackett, the new guy, had announced a rejiggering process that would cost $25.5 billion through 2022 that included abandoning all car lines in the US, except for the Mustang [Carmageddon for Cars: “Cars” Are Scheduled to Die].

Hackett said in the statement that his cost-cutting measures “continue to take hold.”

Ford blamed the current set of problems on a disruption at a supplier for its high-margin pickups, rising costs of commodities, particularly steel and aluminum, difficulties in Europe, where it had a $73 million operating loss in Q2, and collapsing sales in China, where it had a $483 million operating loss in Q2.

But the collapse of Ford’s sales in China isn’t a new thing. That started in 2016. The chart below shows deliveries (in thousands) of all models made by Ford and its Chinese joint ventures for the first half of each year (data via carsalesbase.com):

----Not since the Financial Crisis have we seen earnings warnings by the three Detroit automakers balled up like this, all in one day, in unison.

But this isn’t the Financial Crisis. This is as good as it gets. The economy is growing. GDP in Q2 is projected to rise, depending on who is doing the projecting, between 2.8% and inexplicably 4.5%. Deliveries of new vehicles in the US peaked for the big three Detroit automakers in 2015 and have edged down since then, but they have raised prices on their profitable and hot trucks, SUVs, and crossovers, and in dollar terms, sales and profits in the US were solid – until now.

So these ugly outlooks hailing down on the good times are rattling nerves and leaving folks to wonder what will happen to the automakers when the times are no longer this good.

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?

New two-dimensional material could revolutionize solar fuel generation

International group of researchers including Brazilian scientists obtain new material from iron ore with application as a photocatalyst

Date: July 26, 2018

Source: Fundação de Amparo à Pesquisa do Estado de São Paulo

Summary: Scientists have obtained from hematite a new material with application as a photocatalyst, christened 'hematene.' The three-atom thick hematene is a ferromagnetic material, as opposed to the iron ore from which it was created.

Following the isolation of graphene in 2004, a race began to synthesize new two-dimensional materials. 2D materials are single-layer substances with a thickness of between one atom and a few nanometers (billionths of a meter). They have unique properties linked to their reduced dimensionality and play a key role in the development of nanotechnology and nanoengineering.

An international group of researchers including Brazilian scientists affiliated with the University of Campinas (UNICAMP) have succeeded in producing a new material with these characteristics.

The researchers extracted a 2D material they call hematene from ordinary iron ore like that mined in many parts of the world, including Brazil. The material is only three atoms thick and is thought to have enhanced photocatalytic properties.

The innovation is described in an article published in Nature Nanotechnology. The research was conducted at the Center for Computational Engineering and Sciences (CCES), one of the Research, Innovation and Dissemination Centers (RIDCs) funded by the São Paulo Research Foundation -- FAPESP, and during a research internship abroad that was also supported by FAPESP .

"The material we synthesized can act as a photocatalyst to split water into hydrogen and oxygen, so that electricity can be generated from hydrogen, for example, as well as having several other potential applications," said Douglas Soares Galvão, one of the authors of the study and co-principal investigator at CCES.

The new material was exfoliated from hematite, one of the most common minerals on earth and the main source of iron, which is the cheapest metal, used in many products and above all to make steel.

----Hematene photocatalysis is more efficient because photons generate both negative and positive charges within a few atoms of the surface, the researchers said. By pairing the new material with titanium dioxide nanotube arrays, which provide an easy pathway for electrons to leave the hematene, the scientists found they could allow more visible light to be absorbed.

"Hematene may be an efficient photocatalyst, especially for splitting water into hydrogen and oxygen, and could also serve as an ultrathin magnetic material for spintronic-based devices," said the FAPESP RIDC researcher. Spintronics (or magnetoelectronics) is a new technology used to store, display and process information based on changes brought about by an electron's spin, which is directly coupled to its magnetic moment.

The group have investigated other non-van der Waals materials for their potential to give rise to other 2D materials with exotic properties. "There are a number of other iron oxides and derivatives thereof that are candidates for originating new 2D materials," Galvão said.

The monthly Coppock Indicators finished June.

DJIA: 24,271 +221 Down. NASDAQ: 7,510 +267 Down. SP500: 2,718 +169 Down.
All three slow indicators moved down in March and have continued down in April. May and June. For some a new bear signal, for others a take profits and get back to cash signal