Baltic Dry Index. 1477 -36 Brent Crude 77.25
“We
need to keep the [NAFTA] Chapter 19 dispute resolution because that ensures
that the rules are actually followed. And we know we have a president who
doesn’t always follow the rules as they’re laid out.”
Prime
Minister Trudeau.
Today, T-Day arrives.
The end of the comment period on new US punitive tariffs on China’s exports. It
is Trump-Day or Tariff Decision Day, in the White House, although I suppose one
of Trump’s fifth columnists might try hiding whatever piece of paper President
Trump is supposed to sign, if the New York Times anonymous op-ed article is
believable.
In America it looks
like it’s over for the fabulous FANGs too. Increased scrutiny and harsh
legislation seem to lie directly ahead. The good times over, a long overdue
dose of reality is about to descend on US stocks.
Below, as Asian stocks
wobble, perfidy in Washington. Japan takes another hit. Trump has visitors.
Asian Stocks Head for One-Year Low, Yen Advances: Markets Wrap
By Adam Haigh and Andreea Papuc
Updated on 6 September 2018, 05:57 GMT+1
Asian stocks dropped, with a regional benchmark heading for the lowest close
in a year, as investors contemplate the risk of weaker growth thanks to woes in
emerging-markets. The yen gained.The MSCI Asia Pacific Index is down for a sixth straight session, with modest gains in markets including Indonesia and Malaysia offset by declines in Australia and Hong Kong. Japan’s equities underperformed in the wake of a powerful earthquake on its northernmost main island, which knocked out electricity and added to transport strains from a major typhoon earlier this week. A tumble in U.S. tech shares overnight, with executives of some heavyweights facing increased scrutiny on Capitol Hill, added to the negative tone. Ten-year Treasury yields held at 2.90 percent.
While focus remains on efforts by emerging markets from Argentina to
Indonesia to sustain confidence, the potential for President Donald Trump to
announce another round of tariff hikes on Chinese imports as soon as Thursday
also looms large.
Prominent voices on Wall Street are warning that U.S. stocks face
headwinds -- Citigroup Inc. cited sentiment levels as it cautioned that another
pullback may be in the offing and Goldman Sachs Group Inc. said elevated
valuations and a tightening labor market have driven the firm’s bull/bear
market indicator to alarming highs.
----Elsewhere, the
Australian dollar fell after two more lenders raised their home-loan rates.
Philippine stocks had the biggest slide in Asia’s emerging markets as foreign
investors are dumping the nation’s equities at a record pace this year as
inflation soars.
More
Emerging-Market Rout Is Longest Since 2008 as Confidence Cracks
By Srinivasan Sivabalan
Updated on 6 September 2018, 00:00 GMT+1
For stocks, it’s 222 days. For currencies, 155 days. For local
government bonds, 240 days.
This year’s rout in emerging markets has lasted so long that it’s taken
even the most ardent bears by surprise. Not one of the seven biggest selloffs
since the financial crisis -- including the so-called taper tantrum --
inflicted such pain for so long on the developing world.
The
scope of the slide, as measured in the number of days from peak to trough, is
pushing some strategists to say the slump is more than just a knee-jerk
reaction to higher U.S. interest rates or the unfolding trade war. It’s become
a full-fledged crisis of confidence for investors in developing nations.
While traders typically focus on how much they lose in terms of percentage change, that yields only a limited perspective on factors driving the markets -- or the potential for recovery. Short, intense selloffs often lead to short, intense rebounds, lulling investors into a false sense of resilience. That’s what happened repeatedly in 2016 and 2017.
But looking at how long a decline lasts, not just how deep it is, can better expose faultlines. Lingering downtrends upend futures and options contracts, forcing traders to take losses. They also lock up investors’ collateral in the form of enhanced margin calls, leaving them little room to make other trading decisions.
A longer selloff also means the argument for buying the dip -- one frequently made by money managers earlier this year -- gives way to cautions over avoiding a falling knife. And that, in turn, can persuade money managers who treat emerging markets as one homogeneous group to sell weak and strong markets in tandem, no matter their specific fundamentals. It’s the very definition of contagion.
Emerging markets have been here before. From 2013 to 2015, they underperformed the developed world as a succession of shocks, including the Federal Reserve’s plan to dial down stimulus and China’s growth slowdown, limited any potential rebound.
The difference this time is the absence of even temporary resilience.
It’s become a contest between the dollar and everything else denominated in the
U.S. currency. That helps explain why there’s been simultaneous selling in a
haven asset such as gold and riskier emerging-market assets.
"It’s true that the advice of investing gurus is that you make the
most money when you take a contrarian view," said Tony Hann, a money
manager at Blackfriars Asset Management Ltd. in London. "But you have to
be really, really brave to buy in a market like this."
I Am Part of the Resistance Inside the Trump Administration
I work for the president but like-minded colleagues and I
have vowed to thwart parts of his agenda and his worst inclinations.
The Times today is taking the rare step of publishing an anonymous Op-Ed
essay. We have done so at the request of the author, a senior official in the
Trump administration whose identity is known to us and whose job would be
jeopardized by its disclosure. We believe publishing this essay anonymously is
the only way to deliver an important perspective to our readers. We invite you
to submit a question about the essay or our vetting process here.
President Trump is facing a test to his presidency unlike any faced by a
modern American leader.
It’s not just that the special counsel looms large. Or that the country
is bitterly divided over Mr. Trump’s leadership. Or even that his party might
well lose the House to an opposition hellbent on his downfall.
The dilemma — which he does not fully grasp — is that many of the senior
officials in his own administration are working diligently from within to
frustrate parts of his agenda and his worst inclinations.
More
Canada needs NAFTA’s Chapter 19 because Trump ‘doesn’t always follow the rules’: Trudeau
Published 5 September 2018
Prime Minister Justin Trudeau branded Donald Trump a rule breaker in
arguing Wednesday for Canada’s fight to preserve the dispute settlement chapter
that the U.S. president wants shredded from the North American Free Trade
Agreement.
Trudeau offered some of his sharpest criticism of the unpredictable
American president during a telephone interview with an Edmonton radio station,
just as Foreign Affairs Minister Chrystia Freeland resumed NAFTA talks in
Washington with U.S. trade czar Robert Lighthizer.
While Freeland said she agreed with Trudeau’s assessment of Trump, she
went out of her way to praise Lighthizer’s “good faith” and “good will,”
clearly assuming the role of the good cop as the NAFTA talks enter a critical
phase just a block from Trump’s White House.
Trudeau, meanwhile, slid into the so-called bad cop role, telling
Edmonton radio station CHED that Canada won’t give an inch to Trump’s desire to
scrap NAFTA’s Chapter 19 dispute resolution panels. The chapter allows
companies to have their differences settled by independent arbiters — something
Trump views as an infringement of U.S. sovereignty.
“We need to keep the Chapter 19 dispute resolution because that ensures
that the rules are actually followed. And we know we have a president who
doesn’t always follow the rules as they’re laid out,” Trudeau said.
As she emerged in the sweltering Washington humidity after two hours of
talks with Lighthizer, Freeland said she wanted to stick to her agreement with
Lighthizer to not negotiate in public. But she added: “I agree with the prime
minister in public all of the time, and in private 99.99 per cent of the time .
. . he made some important comments.”
At Trump’s behest, the three NAFTA countries have been negotiating for more
than a year to revamp the trilateral agreement that has been integral to the
continent’s economy for more than two decades. The U.S. and Mexico reached a
side deal last month, leaving Canada to negotiate separately with the U.S.
In the radio interview in Edmonton, Trudeau reiterated his full-throated
defence of Canada’s cultural exemption in NAFTA.
Sources familiar with the Canadian bargaining position say the cultural
exemption Canada has insisted on preserving since NAFTA talks reopened remains
an 11th-hour sticking point.
“The idea of preserving it remains an unresolved issue between the two,”
said one source, who requested anonymity because of the sensitivities
surrounding the issue.
More
September 6, 2018 / 5:59 AM
Japan trade minister says will take a week to restore power across Hokkaido
TOKYO
(Reuters) - Restoring full power across Japan’s northern island of Hokkaido
will take at least a week after a powerful earthquake struck early in the day,
damaging its largest fossil fuel power plant, Trade and Industry Minister
Hiroshige Seko said on Thursday.
The
government is seeking to restore partial power to some areas as soon as
possible once Hokkaido Electric Power Co (9509.T) restarts its Sunagawa coal-fired
plant, Seko said.
Hokkaido
Electric had been aiming to first restart its Tomato-Atsuma plant, which
supplies about half the island’s power, but repairs are projected to take at
least a week after the breakout of a fire from the No.4 unit’s turbine and
boiler damage at units No.1 and No.2, Seko said.
Hokkaido Electric has restarted four hydropower units with a total
capacity of 300 megawatts (MW) and will restart the 250-MW Sunagawa coal-fired
plant on Thursday, he said.
The company will also restart its 350-MW coal-fired Naie plant,
oil-fired 700-MW Date plant and 700-MW oil-fired Shiriuchi plant from as early
as Friday, Seko said.
The restoration of 2.9 gigwatts (GW) of power is expected to be possible
by the end of Friday, including 600-MW of power coming across from the
mainland, he said.
Peak power demand in Hokkaido, however, reaches 3.8 GW, so the
restoration of all power across the island should take at least another week,
Seko said.
Hokkaido Electric said this is the first time since its establishment in
1951 that power has been lost across the entire island.
Finally….
Trump's visitors! Four UFOs are spotted flying over US president's Scottish golf course
·
A golf fan shared a snap of the
mysterious objects spotted at Trump's golf club
·
He said it was taken by his niece who
was visiting Turnberry on August 16
·
When he looked at it closely, he noticed
four 'strange disc shaped objects'
It is
the maxim of every prudent master of a family, never to attempt to make at home
what it will cost him more to make than to buy...What is prudence in the
conduct of every private family, can scarce be folly in that of a great
kingdom.
Adam Smith, The Wealth of Nations, 1776.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Trade war news again. Are farmers (anywhere) ever grateful?
"When
a country (USA) is losing many billions of dollars on trade with virtually
every country it does business with, trade wars are good, and easy to
win."
President Trump.
Updated Sept. 4, 2018 at 4:12 PM
Farm aid package a 'small Band-Aid on a big wound,' farmers say
EVANSVILLE, Ind., Sept. 4 (UPI) -- The U.S. Department of Agriculture
began accepting farmer's applications for tariff relief Tuesday.
Though grateful for the assistance, farmers say the amount of aid
promised falls far short of the losses they will sustain this year.
"This appears to be a small Band-Aid on a big wound," said
Randy Souder, a corn and soybean farmer in Iowa. "It'll pay the interest
on a loans the younger farmers have on machinery and land. It will put off the
banks for a year or so -- maybe."
For some commodities, the program is expected to pay farmers roughly
half of their projected losses. Other industries will see smaller payments.
The USDA announced details of the aid package, which it's calling the Market Facilitation Program, on Sept. 27. Soybean growers will receive the largest payments, followed by pork farmers. The corn, wheat, sorghum and dairy industries are also on the list.
This initial aid package releases roughly half of the $12 billion President Donald Trump promised farmers earlier this year. It's unclear if or when the rest of the money will be distributed.
The money will help offset losses farmers are sustaining because of the United States' ongoing trade war with China. China was America's largest importer of soy and second largest importer of pork before its government placed large tariffs on both commodities this summer in retaliation for the Trump administration's tariffs on Chinese goods. Trade between the two countries has since plummeted, causing severe price drops in American soy, pork and other commodities.
Economists say prices will remain low until trade between the two
countries is restored.
"We're thankful for the aid coming," said Gary Asay, an
Illinois pig farmer, who also grows corn and soybeans. "But we need
trade."
Soybean prices were hit hardest, dropping about $1.80 per bushel, which
is nearly 20 percent. The Market Facilitation Program will reimburse farmers
for nearly half their expected losses, paying $1.65 per bushel on 50 percent of
their total fall harvest, said Chad Hart, an economist at Iowa State
University.
Harvest season has begun in some parts of the Midwest, and it will
continue through September and into October.
"It helps as a short-term cash infusion, but it doesn't impact the
long-term impact we will see if prices don't rebound," Hart said.
"This is a Band-Aid, but now we're looking for what's the long-term
cure?"
The program offers a similar deal to pork producers, paying $8 per head
on half the animals in their possession Aug. 1, Asay said. This will be a much
smaller cut for hog farmers, who are also suffering from the ongoing trade
dispute with Mexico, America's number one importer of pork.
"Hog farmers are losing $15-$25 on every hog their selling
now," Asay said. "Pig farmers are taking substantial losses on every
pig they sell."
More
The
statesman who should attempt to direct private people in what manner they ought
to employ their capitals, would not only load himself with a most unnecessary
attention, but assume an authority which could safely be trusted, not only to
no single person, but to no council or senate whatever, and which would nowhere
be so dangerous as in the hands of a man who had folly and presumption enough
to fancy himself fit to exercise it.
Adam Smith, The Wealth of Nations, 1776.
Technology Update.
With events happening fast in the
development of solar power and graphene, I’ve added this section. Updates as
they get reported. Is converting sunlight to usable cheap AC or DC energy
mankind’s future from the 21st century onwards?
Peering into private life of atomic clusters -- using the world's tiniest test tubes
Date:
September 4, 2018
Source:
University of Nottingham
Summary:
Researchers have achieved time-resolved imaging of atomic-scale dynamics and
chemical transformations promoted by metal nanoclusters.
---- Having already succeeded in 'filming' inter-molecular chemical reactions -- using the electron beam of a transmission electron microscope (TEM) as a stop-frame imaging tool -- they have now achieved time-resolved imaging of atomic-scale dynamics and chemical transformations promoted by metal nanoclusters. This has enabled them to rank 14 different metals both in order of their bonding with carbon and their catalytic activity, showing significant variation across the Periodic Table of Elements.
Their latest work, 'Comparison of atomic scale dynamics for the middle
and late transition metal nanocatalysts', has been published in Nature
Communications. Andrei Khlobystov, Professor of Nanomaterials and Director
of nmRC, said: "Thanks to the recent advances in microscopy and
spectroscopy we now know a great deal about the behaviour of molecules and
atoms. However, the structure and dynamics of atomic-scale clusters of metallic
elements remains a mystery. The complex atomic dynamics revealed directly by
imaging in real time sheds light on atomistic workings of nanocatalysts."
Contribution to global GDP
The atomic-scale dynamics of metal nanoclusters determine their
functional and chemical properties such as catalytic activity -- their ability
to increase the rate of a chemical reaction. Many key industrial processes
currently rely on nanocatalysts such as water purification; fuel cell
technologies; energy storage; and bio-diesel production.
Professor Khlobystov said: "With catalytic chemical reactions
contributing substantially to the global GDP, understanding the dynamic
behaviour of nanoclusters at the atomic level is an important and urgent task.
However, the combined challenge of non-uniform structures of nanocatalysts --
for example, distribution of sizes, shapes, crystal phases -- coexisting within
the same material and their highly dynamic nature -- nanoclusters undergo
extensive structural and, in some cases, chemical transformations during
catalysis -- makes elucidation of the atomistic mechanisms of their behaviour
virtually impossible."
From single-molecule dynamics to atomic clusters
Professor Khlobystov led the Anglo-German collaboration that harnessed
the impact of the electron beam (e-beam) in the transmission electron
microscopy (TEM) for imaging single-molecule dynamics. By employing the e-beam
simultaneously as an imaging tool and a source of energy to drive chemical
reactions they succeeded at filming reactions of molecules. The research was
published last year in ACS Nano, a flagship nanoscience and nanotechnology
journal, and selected as ACS Editor's Choice due to its potential for broad
public interest.
----
Elena Besley, Professor of Theoretical and Computational Chemistry at the
University of Nottingham said: "Reaching inside the tiniest building
blocks of metals, this study demonstrated that metal nanoclusters entrapped in
carbon nano test tubes provide a universal platform for studying organometallic
chemistry and enable a direct comparison of the bonding and reactivity of
different transition metals as well as elucidation of the structure-performance
relationship for nanocatalysts -- vital for the discovery of new reaction
mechanisms and more efficient catalysts of the future. This study provides a
first qualitative glimpse of a global perspective of metal-carbon
bonding."
More
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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