Baltic Dry Index. 1756 -04 Brent Crude 73.40
Ne ego si iterum eodem modo uicero, sine ullo milite Epirum
reuertar.
Another such victory and I come back to Epirus alone.
Another such victory and I come back to Epirus alone.
It is August 2018, high summer in the
northern hemisphere and high noon in our rising trade and currency wars. Up
until now, the trade wars have had very little effect on the global economy.
Not so much a war as pot-shots and sniping from all sides. But all that is about
to change later this month.
Trade War Team Trump says it will use the
nuclear option on China, 25 percent tariffs on virtually all Chinese exports
headed into the USA. China says it will retaliate with unspecified measures. If
either event actually happens, expect damage and collateral damage to show up
fast, and in many unexpected ways.
Collapsing much of China’s economy may seem
like a big win for Trade War Team Trump, but it’s all too likely to be a pyrrhic
victory. Taking down a large part of the
Chinese economy, will take down a large part of the emerging market economies,
have an unpredictable result in China’s shadow banking system, and quickly blow
back into our global economy already wobbling from the pressure of too much
debt, in a long in the tooth global recovery.
When the world’s largest debtor fights with his
largest or second largest creditor, it’s foolish to think that anything good
comes from the outcome. Both can only do serious, probably irreparable damage
to each other. Apple may have become the first and only corporation to have
made a trillion dollar valuation, and may become the first and quickest to lose
it once the trade war ratchets up.
Nor is Trump’s trade war over against NATO
and NAFTA. Both are merely in pause, awaiting the next blitzkrieg from Trump.
While President Trump plays to the gallery of doting Trump voters ahead of the
coming mid term elections, his rhetoric and actions undermine US credibility
and reliability in the rest of the world. Both will have long term lasting
unfortunate consequences.
Finally, we are also in the final stages of
President Trump’s intended showdown with Iran. Nothing good for global trade
lies in forcing Iranian oil from the global market. If a shooting war starts,
expect another oil shock like 1973-74.
Below, how we came to the end of the first
mild phase of the trade wars. What happens next depends on Washington. With
election fever rising in America, it’s hard to see President Trump folding and
backing down from his self-imposed corner.
Yuan Extends Drop; Stocks Ending Rough Week Mixed: Markets Wrap
By Adam Haigh
Updated on 3 August 2018, 05:10 GMT+1
Asian stocks were mixed on Friday, ending the worst week for the region’s
shares since March, amid ongoing trade tensions. The yuan extended losses to
reach fresh lows, while Japanese yields edged lower after a tumultuous week for
the bond market.
Shares in Japan and Hong Kong dropped, while equities in South Korea and
India gained. The Shanghai Composite steadied but remains on course for a near
4 percent slide this week. The dollar maintained gains and the yield on 10-year
Treasuries ticked back below 3 percent. China’s currency headed for an eighth
weekly decline, the longest run since the start of the country’s modern
foreign-exchange rate regime in 1994.
The gloom on trade is coming up against a
mostly-positive earnings season and an upbeat message on the American economy
delivered by the Federal Reserve on Wednesday. Of the almost 400 members of the
S&P 500 that have reported earnings this season, about 85 percent of them
beat analysts’ estimates. Data due Friday will probably show that the U.S.
economy added jobs at a healthy clip again in July.
Elsewhere, 10-year JGB yields slipped to 0.11 percent. Turkey’s lira,
bonds and stocks extended their slide after the U.S. imposed sanctions on two
government ministers over the detention of an evangelical pastor.
Oil rallied from the lowest level in more than a month amid signs the
drain from the biggest U.S. supply hub will continue. The pound maintained
losses after the Bank of England’s hawkish rhetoric failed to convince
investors of a brighter economic outlook.
More
August 2, 2018 / 10:49 AM
Commentary: Commodities may be first to show real impact of Trump-China trade war
LAUNCESTON, Australia (Reuters) - The Phoney War stage of U.S. President Donald Trump’s trade dispute with China may be ending, with economic indicators and commodity flows and prices starting to show real world effects.
The latest signal that China’s economy may be feeling some pain
associated with Trump’s tariffs on about $34 billion in Chinese goods was the
softening of the Purchasing Managers’ Index (PMI) in July.
While the overall drop to 50.8 in July from June’s 51.0 was small, of
bigger concern was the slump in the subindex for new export orders, which
dropped to 48.4, a fourth consecutive monthly decline.
The drop in the PMI, a key indicator of manufacturing health in the
world’s second-largest economy, came as Trump’s administration proposed a 25
percent tariff on another $200 billion in Chinese goods, up from an earlier 10
percent plan.
U.S. Trade Representative Robert Lighthizer said in a statement on
Wednesday that Trump directed the increase from the previously proposed duty
because China has refused to meet U.S. demands and imposed retaliatory tariffs
on U.S. goods.
While a poor PMI for one month doesn’t necessarily signal a new trend,
it does highlight the risk that the trade dispute is starting to hit economic
growth.
----As early indicators of global economic health and trade flows, movements in commodity prices and volumes can be instructive.
The temptation is always to look first at copper, given its correlation
with both manufacturing and construction.
London Metal Exchange copper futures have been trending lower since
reaching their peak for this year so far in early June, closing at $6,172 a
tonne on Wednesday.
This is down almost 16 percent from the June peak, a period that
coincides with the ramping up of tariffs by the United States, coupled with
increasingly bellicose rhetoric.
China’s appetite for imported copper has yet to falter, however, with
first-half imports of unwrought copper up 16.3 percent from a year ago,
according to Chinese customs data.
In fact, the rate of growth in the first half well exceeded the 3.6
percent increase in imports of copper in the first half of 2017, showing that
not only is China importing more of the industrial metal, it’s doing so at a
faster pace.
----Other commodities also paint a mixed picture, with China’s iron ore imports dropping 1.6 percent in the first six months of 2018 from the same period last year.
Iron ore prices have also been dropping, with benchmark 62 percent
fines, as assessed by Argus Media, ending at $66.50 a tonne on Wednesday, down
almost 17 percent from their peak this year of $79.90 in late February.
The steel sector appears robust, though, with prices rising and solid
gains in China’s steel PMI, to a seven-month high of 54.8 in July, well above
the 50 level that demarcates expansion from contraction.
Fundamental reasons can be found for both the weakness in iron ore,
which is well supplied, and the strength in steel, which is still seeing strong
demand and pollution-related output restrictions.
Coal is another commodity that appears to have been unaffected by trade
war concerns, with both Chinese import demand and prices rising strongly.
----China appears to have stripped back its imports of U.S. crude oil to near zero for September, having taken about 333,000 barrels per day in the first six months of the year, according to vessel-tracking data.
It’s the same story for liquefied natural gas (LNG), with only one U.S.
cargo booked for arrival in August, and it departed the Gulf of Mexico on July
1, before much of the current escalation in the trade dispute.
The odd thing is that crude oil and LNG aren’t subject to any formal
trade tariffs, and they appear most affected, while steel, which is the target
of U.S. tariffs, is performing strongly.
Logic suggests that if the trade dispute does continue to drag on
China’s economic performance, eventually steel will join copper in trending
lower.
Thus, keeping an eye on China’s imports of major commodities in coming
months will be key to working out just how quickly the trade dispute is
filtering through to the real economy, and determining if the phoney trade war
has become a real one.
‘Hard pressed on
my right. My center is yielding. Impossible to maneuver. Situation excellent. I
attack.’
Ferdinand
Foch during the First Battle of the Marne, Sept 1914
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Today, the sound of
one hand clapping. China asks for reason, and gets populist US politics
instead. Barring another U-turn by President Trump, mutual assured financial
destruction lies directly ahead.
August 2, 2018 / 9:52 AM
China urges U.S. to return to reason on trade, says tactics won't work
BEIJING
(Reuters) - China on Thursday urged the United States to return to reason after
the Trump administration sought to ratchet up pressure for trade concessions by
proposing a higher 25-percent tariff on $200 billion (£152.9 billion) worth of
Chinese imports.
U.S. Trade Representative Robert Lighthizer said on Wednesday that
President Donald Trump directed the increase from a previously proposed 10
percent duty because China has refused to meet U.S. demands and has imposed
retaliatory tariffs on U.S. goods.
Trump’s threats of higher tariffs weighed on China’s financial markets.
But Chinese Foreign Ministry spokesman Geng Shuang reiterated at a regular news
briefing that the United States’ efforts at “blackmail” would fail.
“We would advise the United States to correct its attitude and not try
to engage in blackmail. This won’t work on China,” Geng said.
“Secondly, we would advise the U.S. side to return to reason, and not
blindly let emotions affect their decisions, because in the end this will harm
themselves,” Geng said.
Chinese shares fell on Thursday, and so far this year, the Shanghai
Composite Index has slumped more than 16 percent, the world’s second-worst
performing stock index.
The Chinese yuan also ticked lower against the dollar, extending its
year-to-date decline to more than 4.5 percent.
There have been no formal talks between Washington and Beijing for weeks
over Trump’s demands that China make fundamental changes to its policies on
intellectual property protection, technology transfers and subsidies for high
technology industries.
Geng said China’s door to dialogue on the trade dispute is open, but
that it had to be based on mutual respect and equality.
“The current unilateral threats and pressure from the United States will
only backfire,” he said.
Two Trump administration officials told reporters on a conference call
that Trump remains open to communications with Beijing and that through
informal conversations the two countries are discussing whether a “fruitful
negotiation” is possible.
----China’s commerce ministry said the U.S. tactics will have no effect
on China, and will disappoint countries that are against trade wars.
“China is fully prepared for the United States’ threats to escalate the
two countries’ trade war and will have to fight back to defend its dignity and
the interests of its people,” said the statement posted on the Ministry of
Commerce’s website on Thursday.
Trump has ultimately threatened tariffs on over $500 billion in Chinese
goods, covering virtually all U.S. imports from China.
The USTR said it will extend a public comment period for the $200
billion list to Sept. 5 from Aug. 30 due to the possible tariff rate rise.
More
‘It is my Royal
and Imperial command that you exterminate the treacherous English and march
over General French’s contemptible little army.’
Kaiser Wilhelm II,August 1914
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?
Insight into loss processes in perovskite solar cells enables efficiency improvements
Date:
August 1, 2018
Source:
Helmholtz-Zentrum Berlin für Materialien und Energie
Summary:
In perovskite solar cells, charge carriers are mainly lost through
recombination occurring at interface defect sites. In contrast, recombination
at defect sites within the perovskite layer does not limit the performance of
the solar cells at present. Teams from the University of Potsdam and the
Helmholtz-Zentrum Berlin (HZB) were able to reach this interesting conclusion
through extremely accurate quantitative measurements on 1 cm2 perovskite cells
using photoluminescence.
Even solar cells made of a perfect miracle material would never be able
to convert 100 % of sunlight to electrical energy. This is because the
theoretical maximum achievable power is limited by the position of the energy
bands of the electrons, and by unavoidable radiation of photons (the
thermodynamic or Shockley-Queisser limit). Maximum power conversion efficiency
for silicon is about 33 %, for example. But even this value will never actually
be reached. This is due to defects of various kinds causing the loss of some of
the charge carriers released by sunlight. In order to approach the maximum
value, it is therefore necessary to investigate the various defects in solar
cells and determine which ones lead to losses and how.
Organometallic perovskite absorber layers are regarded as a particularly
exciting new material class for solar cells -- in just ten years, their
efficiency has increased from three per cent to over twenty per cent, an
amazing success story. Now a team headed by Prof. Dr. Dieter Neher at the
University of Potsdam and Dr. Thomas Unold at HZB has succeeded in identifying
the decisive loss processes in perovskite solar cells that limit the
efficiency.
At certain defects in the crystal lattice of the perovskite layer,
charge carriers (i.e. electrons and "holes") that have just been
released by sunlight can recombine again and thus be lost. But whether these
defects were preferentially located within the perovskite layer, or instead at
the interface between the perovskite layer and the transport layer was unclear
until now.
To determine this, the scientists employed photoluminescence techniques
with high precision, spatial and temporal resolution. Using laser light, they
excited the square-centimetre-sized perovskite layer and detected where and
when the material emitted light in response to the excitation. "This
measurement method at our lab is so precise, we can determine the exact number
of photons that have been emitted," explains Unold. And not only that, the
energy of the emitted photons was precisely recorded and analyzed as well using
a hyperspectral CCD camera.
"In this way, we were able to calculate the losses at every point
of the cell and thereby determine that the most harmful defects are located at
the interfaces between the perovskite absorber layer and the chargetransport
layers," reports Unold. This is important information for further
improving perovskite solar cells, for instance by means of intermediate layers
that have a positive effect or through modified fabrication methods.
With
the help of these findings, the group led by Prof. Dr. Dieter Neher and Dr.
Martin Stolterfoht at the University of Potsdam has succeeded in reducing
interfacial recombination and thus increasing the efficiency of 1cm2sized
perovskite solar cells to well over 20 %.
Another weekend, and the America v the
Rest of the World trade war is just about to get really hot. From hot summery,
lazy, complacent London, very few are preparing for the potential economic disaster
looming in the second half of 2018. While Noah was busy building his Ark,
everyone else was busy partying, and getting on with the high-life.
On August 3rd 1914, no one
In Germany, Austria, Russia, France or Great Britain could imagine the disaster
and carnage that lay right ahead. And so it is this summer of 2018. Trade wars
are easy to win, says President Trump. What did victory look like in late 1918.
‘You will be home
before the leaves have fallen from the trees.’
Kaiser Wilhelm II
speaking to German troops in August 1914.
The monthly Coppock Indicators finished July.
DJIA: 25,415 +213 Down. NASDAQ:
7,672 +259 Down. SP500: 2,816 +166 Down.
All
three slow indicators moved down in March and have continued down ever since.
For some a new bear signal, for others a take profits and get back to cash
signal.
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