Tuesday, 18 September 2018

Trade War – The Real War Starts.


Baltic Dry Index. 1357 -09   Brent Crude 77.59

No nation was ever ruined by trade.

Benjamin Franklin

It’s on! For better or worse, and my money’s on worse, President Trump kicked off the real trade war against China with a 10 percent tariff on 200 billion of China’s US exports. If China retaliates, more on that probably later from Beijing today or tomorrow, the tariff jumps to 25 percent. If China turns the other check, highly unlikely, the tariffs jump to 25 percent on January 1, 2019.

If/when China retaliates, we will not have to wait too long before we see the tariffs drag effect on global trade, nor the tariffs push effect on US consumer price inflation. For most Americans, Christmas 2018 looks set to become more expensive. Still, in better news for President Trump, this consumer inflation effect is unlikely to be noticed before the midterm elections on November 6th.

September 18, 2018 / 1:09 AM

Asian shares slip as Sino-U.S. trade tensions intensify

TOKYO/SYDNEY (Reuters) - Asian shares fell and copper prices eased on Tuesday after Washington announced new tariffs on Chinese imports, inflaming trade tensions between the world’s two biggest economies.

U.S. stock futures took a knock as well, with E-Minis for the S&P 500 ESc1 and the Dow Minis 1YMc1 both down 0.2 percent.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS slipped 0.3 percent with Hong Kong's Hang Seng index .HSI off 0.7 percent and Australian stocks down 0.4 percent.

Chinese shares were a touch lower with the blue-chip index .CSI300 off 0.1 percent while Japan's Nikkei .N225 bucked the trend, gaining more than 1.5 percent.

The sell-off came after U.S. President Donald Trump imposed 10 percent tariffs on as additional $200 billion worth of Chinese imports, and warned of duties on more products if China took retaliatory action.

----“The announcement dashes hopes of any trade negotiations between two rivals. Be prepared for a prolonged period of risk-off,” analysts at ING said in a note.

----Chinese Vice Premier Liu He was to convene a meeting in Beijing on Tuesday to discuss the government’s response, Bloomberg News reported, citing a person briefed on the matter.

The South China Morning Post newspaper reported, citing an unidentified source in Beijing, that China was reviewing its previous plan to send a delegation headed by Liu He to the United States next week for fresh talks, and was now unlikely to do so.
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S&P 500, Dow snap win streaks as U.S.-China trade war escalates

Published: Sept 17, 2018 4:40 p.m. ET

Nasdaq books worst day since July 27

U.S. stocks closed lower Monday, with the S&P 500 and the Dow snapping multiday win streaks, as President Donald Trump prepared to announce additional tariffs on Chinese imports while China hinted at a new round of retaliation.

The S&P 500 SPX, -0.56% was off 16.18 points, or 0.6%, to 2,888.80, with technology and consumer-discretionary sectors among the biggest losers. The decline represented the first loss for the broad-market benchmark of the past seven sessions.

The Dow Jones Industrial Average DJIA, -0.35%  fell 92.55 points, or 0.4%, to 26,062.12, marking its first daily drop of the past five sessions, and the Nasdaq Composite Index COMP, -1.43% fell 114.25 points, or 1.4%, to 7,895.79, marking its worst daily decline since July 27, according to FactSet data.

Trade tensions have received renewed attention as the relationship between the U.S. and China showed signs of deteriorating with Trump planning to announce more tariffs on additional $200 billion of Chinese good late Monday.

Over the weekend, China said it may decline a White House offer for trade talks if Trump carries out the tariff threat. “China is not going to negotiate with a gun pointed to its head,” a senior Chinese official told the Journal.

Technology stocks—including names like Amazon.com Inc., which is classified as a consumer-discretionary firm—have been highly correlated to the trade issue, with investors worrying about the impact it could have on their supply chains and global demand prospects.

The Chinese products targeted by the U.S. government for higher tariffs include many for which the country has a dominant market share, according to economists at Capital Economics.

----“Indeed, China is the source of more than half of U.S. imports of the products on the $200 billion list, so alternative suppliers will be hard to find. If the tariff rate is set at only 10%, the impact will also be largely offset by the renminbi’s 6% fall against the dollar since the middle of June,” said Mark Williams, chief Asia economist at Capital Economics, in a report. “The damage from the latest escalation of the trade conflict on China’s economy will be small—much less than 0.5% of GDP, even if policy is not loosened further.”
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Opinion: Apple Watch is safe, but China tariffs could still hit other consumer tech products

Published: Sept 17, 2018 10:25 p.m. ET

Tariffs ‘will stifle our global leadership in 5G, create an internet tax on businesses and cause uncertainty for companies,’ CTA says

While Apple Inc. and the smartwatch business is safe from the latest tariffs the Trump administration enacted against China, there are many other potential areas of tech that could be hurt by the levies on $200 billion in Chinese goods.

Late Monday, the Office of the U.S. Trade Representative issued a final list of goods that will be subject to an initial 10% tariff, beginning Sept. 24, and then rising to 25% in January. While some products developed by Apple Inc. AAPL, -2.66%  and Fitbit Inc. FIT, -1.09%  were spared, after smartwatches and wireless earbuds were removed from the list at the 11th hour, other products — such as those that use printed circuit-board assemblies, for example — appear to be subject to tariffs.

In a brief statement late Monday, the Consumer Technology Association said that it appreciates the Trump administration’s removal of some consumer devices from the tariff list. However, the tech trade group that runs CES said it was especially worried about retaliatory tariffs, especially those on printed-circuit assemblies and networking equipment, which could hurt future investment into 5G, the next-generation telecommunications standard.

“Retaliatory tariffs, whether 10% or 25%, are bad policy,” CTA president and CEO Gary Shapiro said in a statement. “We are especially concerned about retaliatory tariffs on printed-circuit assemblies, routers and networking equipment. They will stifle our global leadership in 5G, create an internet tax on businesses and cause uncertainty for companies.”

In addition, the CTA said that the retaliatory tariffs against China may also violate the law: “Congress has not given the president or the USTR a blank check to pursue a trade war. These new retaliatory tariffs run afoul of the carefully tailored provisions of the Trade Act of 1974.”
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Every decision on trade, on taxes, on immigration, on foreign affairs, will be made to benefit American workers and American families. We must protect our borders from the ravages of other countries making our products, stealing our companies, and destroying our jobs. Protection will lead to great prosperity and strength.

Donald Trump

Crooks and Scoundrels Corner

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

Not the usual crooks and scoundrels today. Today driverless vehicles and the scoundrels promoting them. It’s not quite all it’s hyped up to be.

 

Self-Driving Cars Can Handle Neither Rain nor Sleet nor Snow

To help autonomous vehicles solve inclement conditions, WaveSense will sell a sensor that can see below the ground.

September 17, 2018, 6:00 AM EDT
As things stand today, the driverless car of the future can’t handle more than a dusting of snow.
It’s a known problem in the field, and vaguely embarrassing when the end result is supposed to be robots sophisticated enough to navigate the uncertainties of traffic and improve on lackluster human perception. In Boston, where NuTonomy has been road testing autonomous vehicles in cooperation with city planning officials, snow and seagulls have emerged as two of the biggest obstacles. “Snow not only alters the vehicle’s traction but also changes how the vehicle’s cameras and sensors perceive the street,” concluded a study by the World Economic Forum and the Boston Consulting Group.

For the local breed of unflappable seagulls—which can stop autonomous cars by simply standing on the street, unbothered by NuTonomy’s quiet electric cars—engineers programmed the machines to creep forward slightly to startle the birds. There’s not yet a solution for Boston snow.

After years of testing, with hundreds of cars and vans deployed on public streets and private facilities, even the best autonomous-driving efforts still struggle with inclement weather. The ultimate hurdle to the next phase of driverless technology might not come from algorithms and artificial intelligence—it might be fog and rain.

Another Boston-area startup is promising a way to solve these weather woes, just as leading players race to launch viable businesses. WaveSense has built a radar system to scan what’s below the road, down where there’s no snow at all, rather than parse wintry mix on top.

The cluster of sensors, bolted underneath a chassis like a skid plate, can scan 10 feet beneath the ground to reveal soil, water, roots, and rocks. Once WaveSense has scanned an entire roadway, it creates a map of the subsurface strata that can determine the location of a vehicle within a few centimeters.

Ground-penetrating radar isn’t that novel; archaeologists and land surveyors use it all the time. WaveSense claims it’s the first to use the technique to locate something above ground, and it can do so at speeds up to 65 miles an hour.

----At the moment, autonomous cars rely on a patchwork of sensors: GPS, traditional cameras, radar, and lidar technology that bounces lasers off nearby cars and pedestrians. Mother Nature essentially sidelines two of those four applications: Cameras are useless in fog and heavy snow, and lidar lasers careen wildly off raindrops and snowflakes. The remaining systems also have major deficiencies. GPS connections can be slow and spotty, and radar is lousy at distinguishing obstacles—is that a pedestrian or a seagull?
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The defining moment in American economic history is when Bill Clinton lobbied to get China into the World Trade Organization. It was the worst political and economic mistake in American history in the last 100 years.

Peter Navarro, Assistant to the President, Director of Trade and Industrial Policy, Director of the White House National Trade Council.

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?

Nano-sandwiching improves heat transfer, prevents overheating in nanoelectronics

Date: September 12, 2018

Source: University of Illinois at Chicago

Summary: Sandwiching two-dimensional materials used in nanoelectronic devices between their three-dimensional silicon bases and an ultrathin layer of aluminum oxide can significantly reduce the risk of component failure due to overheating, according to a new study published in the journal of Advanced Materials led by researchers at the University of Illinois at Chicago College of Engineering.

Many of today's silicon-based electronic components contain 2D materials such as graphene. Incorporating 2D materials like graphene -- which is composed of a single-atom-thick layer of carbon atoms -- into these components allows them to be several orders of magnitude smaller than if they were made with conventional, 3D materials. In addition, 2D materials also enable other unique functionalities. But nanoelectronic components with 2D materials have an Achilles' heel -- they are prone to overheating. This is because of poor heat conductance from 2D materials to the silicon base.

"In the field of nanoelectronics, the poor heat dissipation of 2D materials has been a bottleneck to fully realizing their potential in enabling the manufacture of ever-smaller electronics while maintaining functionality," said Amin Salehi-Khojin, associate professor of mechanical and industrial engineering in UIC's College of Engineering.

One of the reasons 2D materials can't efficiently transfer heat to silicon is that the interactions between the 2D materials and silicon in components like transistors are rather weak.

"Bonds between the 2D materials and the silicon substrate are not very strong, so when heat builds up in the 2D material, it creates hot spots causing overheat and device failure," explained Zahra Hemmat, a graduate student in the UIC College of Engineering and co-first author of the paper.

In order to enhance the connection between the 2D material and the silicon base to improve heat conductance away from the 2D material into the silicon, engineers have experimented with adding an additional ultra-thin layer of material on top of the 2D layer -- in effect creating a "nano-sandwich" with the silicon base and ultrathin material as the "bread."

"By adding another 'encapsulating' layer on top of the 2D material, we have been able to double the energy transfer between the 2D material and the silicon base," Salehi-Khojin said.

Salehi-Khojin and his colleagues created an experimental transistor using silicon oxide for the base, carbide for the 2D material and aluminum oxide for the encapsulating material. At room temperature, the researchers saw that the conductance of heat from the carbide to the silicon base was twice as high with the addition of the aluminum oxide layer versus without it.

"While our transistor is an experimental model, it proves that by adding an additional, encapsulating layer to these 2D nanoelectronics, we can significantly increase heat transfer to the silicon base, which will go a long way towards preserving functionality of these components by reducing the likelihood that they burn out," said Salehi-Khojin. "Our next steps will include testing out different encapsulating layers to see if we can further improve heat transfer."
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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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