Baltic Dry Index. 1396 +23 Brent Crude 78.78
“There may be a recession in stock prices, but not anything in the nature of a crash.”Irving Fisher, leading U.S. economist, New York Times, Sept. 5, 1929
In stocks, for every
buyer there’s a seller. That difference in opinion is what makes up the market
place. Right now, with the next phase of Trump’s punitive tariff campaign
against China kicking off on Monday, I think stocks are in an exit rally. Smart
money will use the rally to exit before the new tariffs start to bite, Trump
retaliates against China ahead of the November mid-term elections, and before
Trump launches his all but war against Iran on November 1.
Below, compare and
contrast investment attitudes. Some difference of opinion over the trade war.
Never interrupt
with your enemy when he is making a mistake.
Napoleon.
Asian stocks extend recovery as trade worries take back seat
September 21, 2018 / 2:17 AM
TOKYO (Reuters) - Asian stocks extended
gains on Friday after Wall Street’s S&P 500 set a new all-time high, while
the dollar slipped on views that Beijing’s and Washington’s fresh exchange of
tariffs may be less damaging than initially feared.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.6
percent. It has rebounded 4 percent from a 14-month low on Sept. 12, buoyed in
part by expectations that China will pump more stimulus into its economy to
weather the trade war.
Japan’s Nikkei rose 0.6 percent, hitting an eight-month high.[.T]
On Wall Street, trade-sensitive industrial stocks led the gains on
Thursday. The Dow Jones Industrial Average rose 0.95 percent while the S&P
500 gained 0.78 percent, both hitting record highs that took them deeper into
technically overbought territory.[.N]
The latest rally comes after new U.S. and Chinese tariffs on each
other’s goods were set at lower rates this week than previously expected,
raising hopes that hostilities between the world’s two largest economies may be
easing.
More
Dow, S&P 500 records belie festering fear that China and the U.S. ‘are on a collision course’
By Mark
DeCambre Published: Sept 20, 2018 9:11 p.m. ET
Is Wall Street ignoring the potential for simmering trade conflicts with
China to intensify, upending the stock market’s newfound buoyancy?It may be hard to fathom that consternation tied to President Donald Trump’s hard-line stance with China, Europe and other major economies may bubble up into something more severe for investors after the Dow Jones Industrial Average DJIA, +0.95% on Thursday booked its first record since Jan. 26, joining the S&P 500 index SPX, +0.78% and the Nasdaq Composite Index COMP, +0.98% both of which had already broken out of a lengthy downturn to notch their own records (as recently as Thursday for the S&P 500).
Although on some level the stock market’s climb to new heights represents a growing conviction about the U.S. economy, outweighing the threat that a Beijing-Washington trade fight could morph into the sort of a bellicosity that could disrupt global economic vitality, on another level a number of investors can’t shake a sense of unease about the current trajectory of tariff tensions.
Dec Mullarkey, managing director of investment strategy at Sun Life Investment Management, which manages some $47 billion, thinks the market is being too dismissive.
“I do think that the market right now is incredibly complacent,”
Mullarkey said.
“I think both countries are on a collision course and that’s not going
to get resolved quickly and I think we’re heading toward all China imports
getting hit with tariffs,” he said.
The fact that the recent run-up in stocks comes just as tensions
appeared to be ratcheting up earlier in the week hasn’t sat well with some
market participants either.
On Tuesday, the Chinese government announced plans to impose new tariffs on $60 billion in U.S. exports, in retaliation to the Trump’s administration’s announcement that it was following through with an additional $200 billion in duties on China imports, with Trump adding that “if there’s retaliation against our farmers and our industrial workers and our ranchers, if any of that goes on we are going to kick in another $257 billion.” Both sets of tariffs are due to be implemented on Monday, decreasing the likelihood that the two economic superpowers would easily negotiate a way out of the tit-for-tat conflagration.
A Thursday report from Goldman Sachs Group Inc. GS, +0.77% analysts pegs the probability that tensions intensify at 60%, up from 55%. They anticipate that the U.S. will place tariffs on nearly all goods imported from China that aren’t already covered by current tariffs.
More
Today, more on the rise and rise of China. President Trump needs to get
out more in the real world outside of Washington, and stop self-excluding US
firms from the rise of a growing Chinese economy.
With President Trump reneging on international treaties and promises,
two can play at that game says China’s Ma.
U.S. sanctions China for buying Russian fighter jets, missiles
September 20, 2018 / 6:54 PM
The U.S. State Department said it would immediately impose sanctions on
China’s Equipment Development Department (EDD), the branch of the Chinese
military responsible for weapons and equipment, and its director, Li Shangfu,
for engaging in “significant transactions” with Rosoboronexport, Russia’s main
arms exporter.
The sanctions are related to China’s purchase of 10 SU-35 combat
aircraft in 2017 and S-400 surface-to-air missile system-related equipment in
2018, the State Department said.
They block the Chinese agency, and Li, from applying for export licenses
and participating in the U.S. financial system.
It also adds them to the Treasury Department’s list of specially
designated individuals with whom Americans are barred from doing business.
The administration also blacklisted an additional 33 people and entities
associated with the Russian military and intelligence, adding them to a list
under the 2017 law, known as the Countering America’s Adversaries Through
Sanctions Act, or CAATSA.
CAATSA also seeks to punish Russia for its aggression in Ukraine and
involvement in Syria’s civil war.
Doing significant business with anyone on that list can trigger
sanctions like those imposed on China.
Some of those added to the list, which now contains 72 names, were
indicted in connection with Russian interference in the 2016 U.S. election, the
official said.
More
With copper options, China steps up challenge to London, New York rivals
The Shanghai Futures Exchange (ShFE) will launch copper options trading
on Friday, aiming to take a slice of a $270 billion global market in one of its
biggest challenges yet to London and New York rivals.
The product, which follows the launch of sugar and soymeal options last
year, comes as the exchange also considers opening its flagship copper futures
to foreign investors, and is a major step in China's prolonged effort to
develop its derivatives industry.
Options help metal consumers, producers and traders manage price
exposure. A contract gives the buyer the right - but no obligation - to assume
a futures position at a specified price.
Over the past decade, the Shanghai bourse which was set up in 1999 has
carved out a bigger share of the global copper futures market, challenging the
London Metal Exchange's (LME) near dominance as China's economy boomed and
retail investors flocked to commodities futures trading.
Now it wants a part of the burgeoning options business.
Volumes of copper options traded on the LME totaled around $265 billion
last year at current prices, up 0.3 percent on a year earlier, while Comex
copper options traded on CME Group almost tripled to 104,490 lots in 2017,
worth about $7.3 billion.
Some Chinese copper firms already trade options on the established
London and New York markets, but others are not able to stump up the foreign
currency required as collateral for trading. The ShFE copper contract is
denominated in yuan.
"At the moment, ShFE copper options can be best seen as alternative
to onshore market participants with restricted or no access to LME copper
options," said Rochelle Wei, CEO of J.P. Morgan Futures Co.
Hedging in China rather than overseas may also better reflect the
domestic market for local players, said Qiu Guoyang, assistant general manager
at Shenzhen-based brokerage Jinrui Futures.
He expected the ShFE launch to eventually have an impact on options
volumes on the LME, which was founded in 1877, although not in the short term.
In an emailed response, the LME said it sees the Chinese market as a
complementary trading system "stimulating arbitrage flow and helping to
grow the market as a whole."
more
Jack Ma tears up plans to make 1m American jobs
Jack Ma has reneged on a promise to create one million American jobs, citing a breakdown in US-China relations.
Ma promised the recruitment drive during a meeting with Mr Trump in January 2017 but made a U-turn amid an ongoing trade war, a move that is certain to rattle President Donald Trump.
"The promise was made on the premise of friendly US-China partnership and rational trade relations," Ma told Chinese newspaper Xinhua on Wednesday.
"That premise no longer exists today, so our promise cannot be fulfilled."
Ma, a former teacher who has become China's richest man, said that he would continue "working hard to contribute to the healthy development of China-US trade.
Day and night exactly equal at equinoxes?
We’re coming up on an equinox, a word that means “equal night.” Days and
nights are nearly equal across the globe now. Nearly, but not quite. Here’s
why.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Japan hit by another cryptocurrency heist, $60 million stolen
September 20, 2018 / 3:55 AM
TOKYO (Reuters) - Japanese cryptocurrency firm Tech Bureau Corp said
about $60 million (£45.6 million in digital currencies were stolen from its
exchange, highlighting the industry’s vulnerability despite recent efforts by
authorities to make it more secure.
Tech Bureau, which had already been slapped with two business
improvement orders by regulators this year, said its Zaif exchange was hacked
over a two-hour period on Sept. 14. It detected server problems on Sept. 17,
confirmed the hack the following day, and notified authorities, the exchange
said on Thursday.
Following the hack, Tech Bureau said it had agreed with JASDAQ-listed Fisco Ltd (3807.T) to receive a 5 billion yen ($44.59 million) investment in exchange for majority ownership. The proceeds from the investment would be used to replace the digital currencies stolen from client accounts.
However, Fisco said in a statement the 5 billion yen in “financial assistance” may change in value if the amount affected by the heist changes upon further investigation.
Documents seen by Reuters on Thursday showed Japan’s Financial Services Agency would conduct emergency checks on cryptocurrency exchange operators’ management of customer assets, following the theft. FSA officials were not immediately available for comment.
Japan’s crypto exchanges have been under close regulatory scrutiny after the theft of $530 million in digital coins at Tokyo-based cryptocurrency exchange Coincheck Inc. in January. Coincheck has since been acquired by Japanese online brokerage Monex Group Inc (8698.T).
In the industry-wide check that followed the Coincheck theft, FSA said it found sloppy management at many exchanges, including the lack of proper safeguards for client assets and basic anti-money laundering measures.
In the Tech Bureau theft, virtual currencies worth about 6.7 billion yen ($59.67 million), including Bitcoin, Monacoin and Bitcoin Cash, were stolen from the exchange’s “hot wallet”. About 2.2 billion yen worth of the stolen currency was its own while the remaining 4.5 billion yen belonged to customers, it said.
Hot wallets are connected to the internet. Industry experts consider
them to be more vulnerable to hacks than “cold wallets”, which are not
connected to the internet.
The latest hack is likely to affect the FSA’s ongoing regulatory review
of the industry. Other countries are also grappling with how to regulate crypto
market.
More
"This
crash is not going to have much effect on business."
Arthur
Reynolds, Chairman of Continental Illinois Bank of Chicago, October 24, 1929
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?
Ordering Coffee Through Your Car? New Apps Turn Cars Into Smartphones, Raising Safety Questions
Auto industry looks to tap revenue by providing e-commerce services in cars, but safety advocates warn of driver distraction
Mike ColiasSept. 19, 2018 7:00
a.m. ET
Car makers seeking new revenue streams are offering drivers the ability to
preorder coffee or make restaurant reservations on the move, raising safety
concerns at a time when distracted driving is already at elevated levels.General Motors Co. GM 1.88% late last year became the first major car maker to roll out such services through its Marketplace interface, allowing drivers to order takeout from Applebee’s, pay for gas at a nearby station and make hotel reservations via Priceline.com BKNG 0.44% —all from the vehicle’s touch screen display.
Hyundai Motor Co. is developing a similar system that it has tested with Applebee’s and Chevron Corp. gas stations. BMW AG BMW 1.05% offers a built-in app that lets drivers locate and pay for parking.
Analysts expect more car companies to link up with retailers, fast-food chains and other merchants to offer car owners the same kinds of e-commerce apps that have long been available on smartphones.
Auto industry executives see the new apps as an added convenience and revenue generator, with merchants paying to have their icons and discount deals displayed on the touch screen.
But safety advocates say such features only further contribute to driver distraction. After years of decline, the number of U.S. road deaths increased in 2015 and 2016, and safety groups say the rise is in part driven by smartphones and infotainment systems giving drivers more reason to take their eyes off the road.
Auto makers “are trying to build cars that are like phones, rather than acknowledging that if you’re driving, you shouldn’t be trying to do these tasks at all,” said National Safety Council President Deborah Hersman.
Distracted driving claimed 3,450 lives in 2016, accounting for about 9% of the 37,461 road deaths record that year, according to the latest statistics available from the National Highway Traffic Safety Administration. Some safety advocates say the number is likely higher because the cause of an accident isn’t always apparent.
GM and other car makers believe the on-screen features give drivers a safer option for performing tasks they admit to doing on their smartphone anyway while on the road. For example, many systems allow drivers to execute functions, such as sending and receiving a text, via voice commands, which helps them keep their hands on the wheel.
---- GM estimates that Americans spend an average of 46 minutes a day in their cars, a significant amount of captive time that is attractive to retailers. Companies from Royal Dutch Shell PLC to Office Depot Inc. have signed up.
---- The auto industry’s move into e-commerce is still in early stages, but auto makers see it as part of a broader bid to monetize connected-car data and services, which McKinsey & Co. forecasts could generate global revenue of $750 billion by 2030.
With more cars rolling off dealer lots with built-in internet connections, the opportunity to add more retailing services will only grow over time, say auto executives and analysts. They also expected demand for such capabilities to increase as driverless technologies advance, freeing drivers to perform other tasks on the road.
Auto makers’ efforts to harness data to build new services is likely to raise privacy concerns, especially amid heightened scrutiny over Facebook Inc. and Alphabet Inc.’s handling of consumer data.
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GM said it would use data from Marketplace to track trends among large numbers of users but won’t share data from individual users with retailers. GM’s Marketplace is now available in 2.5 million cars, giving drivers access to about a dozen merchants. Some display-screen apps also offer coupons, such as 10 cents off every gallon of gasoline purchased.---- Revenue generation for auto makers from these apps is modest, falling between $20 and $60 per vehicle annually, according to an estimate from researcher IHS Markit. But longer term, auto makers see it as evolving into an important source of profit growth as vehicle sales eventually come under pressure from the rise of ride-hailing and other alternative forms of mobility.
Reviewers so far have been lukewarm on GM’s Marketplace. Strategy
Analytics Inc., a market-research firm, concluded in an April the system “adds
no value to the in-vehicle experience and is arguably unsafe.”
https://www.wsj.com/articles/ordering-coffee-through-your-car-new-apps-turn-cars-into-smartphones-raising-safety-questions-1537354800?mod=mhpAnother weekend and for those of us in the northern hemisphere autumn and the approach of another winter. The approach of the traditional October crash season too. Have a great weekend everyone. The new punitive US tariffs start on Monday. Christmas bargains at Walmart’s end this weekend.
Walmart warns Trump tariffs may force price hikes - letter
September 21, 2018 / 1:13 AM
(Reuters) - Walmart Inc (WMT.N)
said that it may hike prices of products if the Trump administration imposes a
tariff on Chinese imports, according to a letter the company wrote to U.S.
Trade Representative Robert Lighthizer two weeks ago and seen by Reuters on
Thursday.--- Walmart, the world’s largest retailer, in its letter said the tariff would impact prices of everything from food products to beverages and personal care items.
More
https://uk.reuters.com/article/uk-usa-trade-china-walmart/walmart-warns-trump-tariffs-may-force-price-hikes-letter-idUKKCN1M100S
“The boat struck the bank full tilt. The dreamer, the joyous oarsman, lay on his back at the bottom of the boat, his heels in the air.”
President Trump, with apologies to The Wind in the Willows
The monthly Coppock Indicators finished August.
DJIA: 25,965 +207 Down. NASDAQ:
8,110 +265 Up. SP500: 2,902 +168 Up.
All
three slow indicators moved down in March, but the S&P and NASDAQ have now turned
up. September will be critical for
confirmation of this change.
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