Baltic Dry Index. 1694 -10 Brent Crude 72.15
“In 9/11 and in the 2008 financial
crisis, the powers of the world worked together with a common approach.
Co-operation today is proving much more difficult. This puts at risk the
post-war economic and security order."
Lord
Rothschild.
With Trump and his
team of trade war hooligans, on the global rampage like Geronimo’s off
reservation Indians, it didn’t take long in our new trade war world, for others
to start playing hardball back. Not officially of course, everyone is still
officially playing by the Queensbury rules. Still not for much longer I suspect.
With Team Trump trapped
into a corner of their own making ahead of this November’s mid-term elections,
there’s no way President Trump can be seen to reverse course in his escalating
trade wars. In fact the reverse, with blowback increasingly appearing in
mainland USA, President Trump will be forced to step up his scorched earth hooliganism
to play to his potential voters. The disconnect between global reality and rising
stock mania has never been greater.
Nothing is so admirable in politics as a short memory.
John Kenneth Galbraith.
August 10, 2018 / 2:09 AM
Russia, China object to U.S. proposal to blacklist Russian bank at U.N. - diplomats
UNITED
NATIONS (Reuters) - Russia and China on Thursday objected to a U.S. proposal to
add a Russian bank, Moscow-based North Korean banker and two other entities to
a U.N. Security Council blacklist, diplomats said.
The list of proposed designations mirrors new sanctions announced by the
U.S. Treasury last week. [nL1N1UU0VN]
The United States made the proposal to the 15-member U.N. Security
Council North Korea sanctions committee, which operates by consensus.
Russia objected to the designations because it said the U.S. proposal
was not “adequately substantiated by sufficient information,” diplomats said.
China gave no reason for its objections.
Russia and China have suggested the Security Council discuss easing
sanctions after U.S. President Donald Trump and North Korean leader Kim Jong Un
met for the first time in June and Kim pledged to work toward denuclearization.
The United States and other council members have said there must be
strict enforcement of sanctions until Pyongyang acts.
Last week, Washington imposed sanctions on Moscow-based Agrosoyuz
Commercial Bank, North Korean banker Ri Jong Won, China-based Dandong
Zhongsheng Industry & Trade Co Ltd and North Korea-based Korea Ungum
Corporation.
The U.S. Treasury Department said Agrosoyuz Commercial Bank had
conducted “a significant transaction” for North Korean banker Han Jang Su, who
had been blacklisted by Washington. Han is the Moscow-based chief
representative of Foreign Trade Bank (FTB), North Korea’s primary foreign
exchange bank.
The Security Council blacklisted FTB in August last year. Ri is FTB’s
deputy representative in Moscow.
The U.S. Treasury said Dandong Zhongsheng Industry & Trade and Korea
Ungum Corporation were FTB front companies.
The U.N. blacklist would impose a global travel ban and asset freeze on
those designated.
Russia and China last month delayed a U.S. push for the Security Council
sanctions committee to order a halt to refined petroleum exports to North
Korea, asking for more detail on a U.S. accusation that Pyongyang breached
sanctions, diplomats said. [nL1N1UF15D]
Sanctions by the United States and the U.N. Security Council, which
include a ban on exports of coal, iron, lead, textiles and seafood from North
Korea, and caps on imports of oil and refined petroleum products, are aimed at
choking off funding for Pyongyang’s nuclear and ballistic missile programs.
Lord Rothschild: The New World Order Is At Risk
Thu, 08/09/2018 - 13:44
Over the past three years, an unexpected voice of caution has
emerged from one of the most legendary families in finance: Lord Jacob
Rothschild.
Little did he know that they were only going to keep rising, but related to that, he also made another warning which the market has so far blissfully ignored:
The period of monetary accommodation may well be coming to an end. Geopolitical problems remain widespread and are proving increasingly difficult to resolve.
Fast forward to today when in the latest half-year commentary from RIT Capital Partners, Lord Rothschild has made his latest warning to date, this time focusing on the global economic system that was established after WWII, and which he believes is now in jeopardy.
The billionaire banker pointed to the US-China trade war and the Eurozone crisis as the key problems putting economic order at risk, and the lack of a "common approach" - a reference to the gradual unwind of globalization in the wake of President Trump - that has made "co-operation today much more difficult":
----With global risks growing, how is Rothschild positioned? The Lord writes that "in the circumstances our policy is to maintain our limited exposure to quoted equities and to enter into new commitments with great caution" and indeed, in the first half, RIT had a net quoted equity exposure of only 47%, historically low. The reason: the iconic banking family is concerned that the 10-year bullish cycle and market rally could finally be ending.
The cycle is in its tenth positive year, the longest on record. We are
now seeing some areas of weaker growth emerge; indeed the IMF has recently
predicted some slowdown.
While Rothschild noted that "many of the world’s economies have
enjoyed a broad-based acceleration not seen since the aftermath of the
financial crisis of 2008, with as many as 120 countries seeing stronger growth
last year" he also cautioned that "we continue to believe that
this is not an appropriate time to add to risk. Current stock market
valuations remain high by historical standards, inflated by years of low
interest rates and the policy of quantitative easing which is now coming to an
end."
One potential risk is Europe, where debt levels have reached
"potentially destructive levels":
The problems confronting the Eurozone are of concern – both political
and economic – given the potentially destructive levels of debt in a number of
countries.
There is also the threat that the global trade war escalates
substantially from here, as Chinese stocks have learned the hard way:
The likelihood of trade wars has increased tension and the impact on
equities has been marked, for example by early July the Shanghai
Composite Index had dropped some 22% from its peak in January.
Rothschild also echoed the recent warning from the head of the Indian
Central Bank, warning that the shrinking of global dollar liquidity is hurting
emerging markets:
More
America’s booming, or so they say on the stock pitching TV
fake business news channels. So what’s wrong with this?
Housing market has hit a ‘significant slowdown’ in recent weeks, Redfin CEO says
Published: Aug 9, 2018 10:46 p.m. ET
Redfin stock dives after top exec says sudden downfall is expected to continue in August and September
The housing market hit a sudden and “significant” slowdown in the past few weeks that could continue in coming months, Redfin Corp.’s chief executive said Thursday afternoon.The real-estate brokerage and website company announced second-quarter earnings Thursday afternoon that beat expectations, but the company’s third-quarter forecast came in short of what Wall Street was projecting. On a conference call to discuss the results, Chief Executive Glenn Kelman reported that Redfin had pulled down its forecast after “an unexpected drop in Redfin’s bookings growth in the past three weeks, slowing traffic growth in a weakening real-estate market.”
Redfin RDFN, +2.07% stock, which fell in extended trading after the forecast was made public, saw that decline accelerate to a loss of almost 10% after Kelman spoke Thursday afternoon, but he did not hold back. He said a decline in U.S. home sales in June was expected to reappear in August and September after a slight relief in July, specifically calling out difficulties in markets on the West Coast that have driven home sales higher in the past few years.
“For
the first time in years, we are getting reports from managers of some markets
that home buyer demand is waning, especially in some of Redfin’s largest
markets,” Kelman said, specifically calling out Seattle, Portland and San Jose
as areas where inventory was still tight but did not seem to be pushing prices
higher still.
“June
sales were down in these markets by double-digits and inventory was up also by
double-digits,” he said of the West Coast cities. “The trend is continuing in
July and reports are now coming in from Washington, D.C.; Boston; Virginia and
parts of Chicago as well that homes there are getting harder to sell.”
More
Up next, trade wars,
currency wars, oil wars, egregious sanction wars, and now this. Expect El Nino
to return this autumn, says Japan. What else could yet go wrong, not that
anyone else on planet earth seems to care. A Democrat sweep in November setting up a
repeat of 1974?
August 10, 2018 / 6:11 AM
Japan weather bureau sees 60 percent chance of El Niño emerging in autumn
TOKYO (Reuters) - Japan’s weather bureau said on Friday there is a 60 percent
chance that an El Niño weather pattern could emerge during the northern
hemisphere autumn, from September to November.
The Japan Meteorological Agency also said there was a 70 percent chance
of normal weather patterns during the summer season, without either a La Niña
or El Niño.
A U.S. government weather forecaster said on Thursday that the El Niño
weather pattern had a 60 percent chance of emerging during autumn, with the
chances increasing to 70 percent during the subsequent winter.
The last El Niño, a warming of ocean surface temperatures in the eastern
and central Pacific that typically occurs every few years, occurred from around
2015 to 2016 and caused weather-related crop damage, fires and flash floods.
Finally, in NY subway/transit
follow up news, when the sky falls it really comes crashing down. The downside
of fake fiat money increasingly arrives, and it’s the next generations time to
pick up the bill. Come back Mayor Beame, all is forgiven.
Get ready for a commuter apocalypse
It’s a good thing that New York is the city that never sleeps — since it takes all day to get anywhere.A perfect storm of subway repairs, highway construction, commuter rail woes and worsening gridlock is creating a commuter doomsday the likes of which the city has never seen before.
“It’s really bad out there, and it doesn’t seem like it’s going to get any better,” Robert Sinclair, spokesman for AAA Northeast, said of the amalgam of transit troubles. “For the next four or five years, every day will be like Thanksgiving.”
‘L’ on Earth
The dreaded April 2019 kickoff of the 15-month shutdown of L-train service between Brooklyn and Manhattan is still months off, but the line’s riders are about to face a painful precursor.Starting at 11:30 p.m. Friday, much of the line will go dark until 5 a.m. Monday, with trains operating only between Broadway Junction and the southern terminal at Canarsie-Rockaway Parkway.
-----The L-train madness aside, regular subway riders have long given up on getting anywhere on time — and that won’t change anytime soon.
The average weekday on-time rate of trains across the system continues
to languish at 64 percent between July 2017 and June 2018 — barely an
improvement from the previous year’s 61.8 percent, despite the $836 million
Subway Action Plan stopgap born out of 2017’s transit “Summer of Hell.”
Even when the trains arrive, unplanned snafus still frequently snarl the
larger subway system, setting off a string of rush-hour delays like a row of
dominos.
As recently as Wednesday, three separate incidents decimated service
across the system on both the morning and evening rushes.
A track fire at Lexington Avenue and East 53rd Street was coupled with
signal issues at Chambers and Fulton streets to muck up the a.m. trip, while
switch issues between 125th and 145th streets ruined the evening ride home.
“Everybody’s stressed out early morning when they should be relaxed,”
said Rose Singh, who says her average morning commute from Long Island to the
city has become “a nightmare.”
“Everybody’s pushing … People are yelling at each other. They’re
frustrated,” Singh griped. “The problems are everywhere.”
MTA officials said they’re working on fixing what’s wrong, but it will
take time.
Helix to Hell-ix
Extensive roadwork is set to begin Friday on the elevated highway connecting the Lincoln Tunnel to the New Jersey Turnpike — the final stretch an oft-snarled spiral to the tubes known as the “helix.”Already deemed the worst traffic choke point this side of Chicago, Route 495 carries about 10,000 vehicles an hour during peak travel times.
On Aug. 17, the repairs ramp up as one lane in each direction will be closed off for round-the-clock construction, setting up the stretch for hellacious bottlenecking.
The $90.3 million project, begun last September, is expected to drag on for two years.
“That is going to be a headache for anyone trying to get to the city by car,” said Kate Slevin, senior vice president of state programs and advocacy for the Regional Plan Association. “We have underinvested in our transportation network for many years and are paying the price now.”
More
“It is difficult not to marvel at the imagination which was implicit in this gargantuan insanity. If there must be madness something may be said for having it on a heroic scale."
John Kenneth Galbraith. The Great Crash: 1929.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Trade war becomes trench war. Expect the unexpected to start showing up
in a matter of weeks, not that our dream world stock markets care for now. They
will though, give it time.
August 9, 2018 / 12:52 AM
Chinese state media accuse U.S. of 'mobster mentality', vow to fight tariffs
SHANGHAI
(Reuters) - Chinese state media on Thursday accused the United States of a
“mobster mentality” in its move to implement additional tariffs on Chinese
goods, and warned Beijing had all the necessary means to fight back.
The
comments mark a ratcheting up in tensions between the world’s two largest
economies over a trade dispute, which is already impacting industries ranging
from steel to cars and causing unease over which products could be targeted
next.
Beijing late on Wednesday said it would slap additional tariffs of 25
percent on $16 billion worth of U.S. imports, in retaliation to news the United
States plans to begin collecting 25 percent extra in tariffs on $16 billion of
Chinese goods from Aug. 23.
“The two countries’ trade conflict, which is merely push and shove at
the moment, is likely to escalate into more than just a scuffle if the U.S.
administration cannot marshal its mobster mentality,” state newspaper China
Daily said in an editorial.
“China continues to do its utmost to avoid a trade war, but in the face
of the U.S.’s ever greater demand for protection money, China has no choice but
to fight back,” it said.
So far, China has now either imposed or proposed tariffs on $110 billion
of U.S. goods, representing the vast majority of its annual imports of American
products. Big-ticket U.S. items that are still not on any list are crude oil
and large aircraft.
“China has confidence in protecting its own interests, has many means,”
state broadcaster CCTV said on its early morning news show.
Another commentary, written by China Institute of International Studies
research fellow Jia Xiudong and published in the overseas edition of the
People’s Daily newspaper, said the United States was trying to “suppress
China’s development”.
China
should consider “unconventional methods” such as the stimulus plan used by
Beijing during the global financial crisis if needed to sustain economic
growth, the Global Times newspaper, a tabloid published by the ruling Communist
Party’s People’s Daily, said in a commentary.
August 9, 2018 / 8:07 AM
U.S. coal cargoes heading for China as Beijing takes aim with new tariffs
BEIJING (Reuters) - At least four cargoes of U.S. coal worth $30 million
(£23.32 million) are headed to China as Beijing prepares to hit imports with
hefty 25-percent tariffs, threatening a niche supply of the fuel even as
China’s appetite for foreign coal shows no sign of abating.
The vessels, carrying a combined 335,000 tonnes of coal, are the only
confirmed cargoes in transit from the United States to China, and are scheduled
to land in time to avoid the new duties.
On Wednesday night, the Ministry of Commerce published its final list of
U.S. items worth $16 billion in imports that will incur an additional
25-percent tariff, including coal.
The penalties will come into effect on Aug. 23 after Washington plans to
start collecting duties on Chinese products of the same value. Coal was also in
the draft list issued in June.
China’s coal imports have soared as domestic output has flagged, while
searing summer temperatures have fuelled demand from utilities. Data on
Wednesday showed arrivals hit their highest in more than four years in July.
But the new duties are likely to curb exports from the United States,
which ramped up shipments in 2017 as its beleaguered coal mining sector has
undergone a resurgence under U.S. President Donald Trump.
The United States shipped 3.2 million tonnes of coal to China last year,
up from less than 700 tonnes in 2016, making it China’s seventh largest
supplier, although well behind top supplier Australia with nearly 80 million
tonnes.
More
What caused Black Monday: The stock market crash of 1987?
Monday October 19,1987, is known as Black Monday. On that day, stockbrokers in New York, London, Hong Kong, Berlin, Tokyo and just about any other city with an exchange stared at the figures running across their displays with a growing sense of dread. A financial strut had buckled and the strain brought world markets tumbling down.In the United States, sell orders piled upon sell orders as the Dow shed value of nearly 22%. There had been talk of the U.S. entering a bear cycle – the bulls had been running since 1982 – but the markets gave very little warning to the then-new Federal Reserve Chairman Alan Greenspan.
Greenspan hurried to slash interest rates and called upon banks to flood the system with liquidity. He had expected a drop in the value of the dollar due to an international tiff with the other G7 nations over the dollar's value, but the seemingly worldwide financial meltdown came as an unpleasant surprise that Monday.
Exchanges also were busy trying to lock out program trading orders. The idea of using computer systems to engage in large-scale trading strategies was still relatively new to Wall Street and the consequences of a system capable of placing thousands of orders during a crash never had been tested. These computer programs automatically began to liquidate stocks as certain loss targets were hit, pushing prices lower. To the dismay of the exchanges, program trading led to a domino effect as the falling markets triggered more stop-loss orders. The frantic selling activated yet another round of stop-loss orders, which dragged markets into a downward spiral. Since the same programs also automatically turned off all buying, bids vanished all around the stock market at basically the same time.
More
https://www.investopedia.com/ask/answers/042115/what-caused-black-monday-stock-market-crash-1987.asp
Faced with the choice between changing one's mind and proving that there is no need to do so, almost everyone gets busy on the proof.
John Kenneth
Galbraith
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?
World's first graphene-skinned airplane unveiled in the UK
Ben Coxworth 9 August 18
At the recent Farnborough Air Show 2018, aerospace engineers from
Britain's University of Central Lancashire presented what they state is the
world's first graphene-skinned aircraft. Known as Juno, the 3.5 meter-wide
(11.5-ft) unmanned plane could be a sign of things to come.
Developed in partnership with the Sheffield Advanced Manufacturing
Research Centre, the University of Manchester's National Graphene Institute,
and Haydale Graphene Industries, Juno additionally features graphene-based
batteries and 3D-printed components. Its skin, though, is where the real action
is.
Consisting of one-atom-thick layers of linked carbon atoms, graphene is
not only the world's strongest manmade material, but it's also highly
conductive, both thermally and electrically.
Because it's so strong, an outer covering of it adds strength to
conventional fuselage materials. This allows for less of those materials to be
used, leading to significant weight reductions. As a result, aircraft
incorporating such skins could carry heavier payloads without using more fuel,
or fly for longer distances on a given amount of fuel. Additionally, because
graphene's thermal conductivity allows heat to spread throughout the material,
it's not prone to ice buildup.
And finally, the electrical conductivity of graphene causes the energy
of lightning strikes to be dispersed throughout the surface of the fuselage, as
opposed to causing damage through localized heating in one area.
The engineers plan to conduct test flights of Juno over the next two
months.
https://newatlas.com/graphene-skinned-aircraft/55817/?utm_medium=email&utm_campaign=2018-08-09%20084005%20Other%20Daily%20Basic%202018-08-09%20084511%20Worlds%20first%20graphene-skinned%20airplane%20unveiled%20in%20the%20UK&utm_content=2018-08-09%20084005%20Other%20Daily%20Basic%202018-08-09%20084511%20Worlds%20first%20graphene-skinned%20airplane%20unveiled%20in%20the%20UK+CID_b939613c566156147539ed770e3196f0&utm_source=Campaign%20Monitor&utm_term=Worlds%20first%20graphene-skinned%20airplane%20unveiled%20in%20the%20UKAnother weekend and we are deep into the northern hemisphere summer, almost 2/3rds the way to the Autumn equinox. With President Trump having weaponised the Chinese stock market as a sign of his triumph, my guess is that it will not take long for others to follow suit and weaponise the American markets. Have a great weekend everyone.
If all
else fails, immortality can always be assured by spectacular error.
John Kenneth
Galbraith.
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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