Tuesday, 11 September 2018

Waiting For The Storm.


Baltic Dry Index. 1482 -08   Brent Crude 77.52

We really can't forecast all that well, and yet we pretend that we can, but we really can't.

Alan Greenspan

With the US east coast preparing for a large hurricane, wobbly Asian stock markets are preparing for a storm of a different kind, flirting with entering bear market territory. And Trump hasn’t even opened up against China yet.

Below, waiting for the next shoe to fall. If not bunker time, Ark time.

September 11, 2018 / 1:31 AM

Asia shares can't shake trade stress, pound up on Brexit talk

SYDNEY (Reuters) - Asian shares were struggling to avoid a ninth straight session of losses on Tuesday as the spectre of a Sino-U.S. trade war haunted investors, while the pound perched near a five-week top on hints a Brexit deal might be nearer.

Japan’s Nikkei fared better on the back of a softer yen and rallied 1 percent.

Weighing on the yen was news Japanese chipmaker Renesas was buying U.S. peer Integrated Device Technology for about $6.7 billion in cash.

Yet, MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.34 percent to hit its lowest since July last year.

Most bourses in the region nursed modest losses with Shanghai blue chips off 0.3 percent and South Korea 0.4 percent as investors awaited the next round of trade hostilities.

Having warned last week that he was ready to levy additional taxes on practically all Chinese imports, U.S. President Donald Trump was uncharacteristically quiet on trade on Monday.

China has cautioned it will respond if the United States takes any new steps on trade.
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Hong Kong Stocks Hit From All Sides as Reasons to Sell Mount

By Sofia Horta e Costa
Updated on 11 September 2018, 05:27 GMT+1
A rout in technology stocks, emerging market contagion, currency weakness, an economy under threat.

Welcome to Hong Kong, where just about every problem afflicting global equity investors has found a foothold.

The Hang Seng Index’s 1.3 percent slide Monday put it on the brink of a bear market, extending its loss since a January peak to almost 20 percent. Already reeling from a selloff in Internet and tech firms as well as concerns over China’s slowing growth, Hong Kong is now caught in an emerging-market exodus first sparked by currency crises in Latin America and Turkey. The MSCI Emerging Markets Index is down 21 percent from Jan. 26.

Traders predict more money will bleed out of funds that follow the MSCI EM Index around Sept. 21, when options and futures tied to the gauge expire. That tends to increase volume as global money managers, who use those derivatives to hedge risk or bet on the direction of a large basket of stocks, opt to switch or defend their positions before the next quarter. Firms with a primary listing in Hong Kong make up 23 percent of the emerging market benchmark.

----Indiscriminate selling across emerging markets has hit Asian stocks particularly hard, thanks in part to the $2 trillion that follows MSCI’s benchmark index. All the bottom 38 performers in the past three months are firms based in Hong Kong, China and Taiwan, which were among the most-owned stocks earlier this year. In March, Taiwan Semiconductor Manufacturing Co. featured in 63 percent of emerging-market portfolios and Tencent Holdings Ltd. was in 53 percent, according to eVestment data.

The rotation around the last index options expiry in June was so aggressive that the largest exchange-traded fund tracking the index lost $5.4 billion that month, the biggest outflows since 2014. The Hang Seng Index is on track for its worst quarter in three years, when China’s chaotic yuan devaluation roiled markets around the world.
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Next, Boeing ignores the long term damage Trump’s trade wars are doing everywhere, and on hopium boosts its estimate of Chinese purchases of Boeing planes ahead. My guess is just the opposite. Trump’s arbitrary tearing up international treaties, starting trade wars, and attempt to put China’s ZTE and Russia’s Rusal out of business at a stroke, make relying on US products and companies a highly risky proposition in the 21st century.
Long term, most nations, friend and foe alike, will be seeking to reduce US exposure, not increase it. NATO ally Turkey was just blocked from its purchase of US F-35 fighters. Trump just incentivised all the rest of the world to shop elsewhere where possible. Long term damage to brand USA.

September 11, 2018 / 4:26 AM 

Boeing ups forecast Chinese new plane purchases over 20 years by 6.2 percent

BEIJING (Reuters) - Chinese airlines will buy 7,690 new planes worth $1.2 trillion (921.3 billion pounds) over the next two decades to keep pace with booming consumer and business demand for air travel, Boeing Co said on Tuesday, raising a previous forecast.

The U.S. planemaker’s latest estimate for the period to 2037 is 6.2 percent higher than its previous prediction of 7,240 planes until 2036 made last year.

“The growth in China can be attributed to the country’s growing middle class, which has more than tripled in the last 10 years and is expected to double again in the next 10,” said Randy Tinseth, Boeing Commercial Airplanes’ vice president of marketing, in a statement.

Boeing and its European rival Airbus have been jostling to increase market share in China, the world’s fastest growing aviation market, with both opening assembly plants in the country.

The company has so far been mostly spared in an ongoing trade war between the United States and China. Large airplanes have been left out of China’s retaliatory tariff lists although U.S. President Donald Trump has threatened to slap tariffs on virtually all Chinese imports into the United States.
Boeing also predicted that China will account for 18 percent of the world’s commercial airplane fleet by 2037, up from 15 percent currently, and forecast that the country will need over $1.5 trillion in commercial services to support its fleet.

Three quarters of the 7,690 plane orders over the next 20 years will likely be for single-aisle aircraft while China’s widebody fleet will require 1,620 new planes, tripling the country’s current widebody fleet size, it added.
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Finally, the US east coast readies for hurricane Flo. The first of several potential storms in the Atlantic.

September 9, 2018 / 10:53 AM

Hurricane Florence nears Carolinas as 1 million-plus ordered to evacuate

HOLDEN BEACH, N.C. (Reuters) - More than 1 million people along the Carolina coast fled toward higher ground on Monday in a mass evacuation ordered three days before the expected arrival of Hurricane Florence, a Category 4 storm and the most powerful to menace the region in nearly three decades.

With maximum sustained winds of 140 miles per hour (220 kph), Florence was due to grow even stronger before making landfall on Thursday, mostly likely in southeastern North Carolina near the South Carolina border, the National Hurricane Center in Miami said.

Authorities also warned of life-threatening coastal storm surges and the potential for Florence to unleash prolonged torrential rains and widespread flooding across several states, especially if it lingers inland for several days.

Florence is expected to be an extremely dangerous major hurricane through Thursday,” the NHC said in its latest bulletin. North Carolina Governor Roy Cooper told a news conference his state was in “the bull’s eye.”

Cooper and his counterparts in South Carolina, Virginia and Maryland all declared states of emergency.

Mindful of devastation wrought by a string of deadly U.S. hurricanes last year, jittery residents in the Carolinas began the rituals of disaster preparation - boarding up windows and stocking up on groceries, water and gasoline.

----Coastal properties were especially vulnerable to possible flooding from the hurricane’s storm surge, which according to the California-based risk assessment service CoreLogic, will put more than 758,000 homes in the Carolinas and Virginia at risk.

NHC Director Ken Graham also warned of “staggering” amounts of rainfall that may extend hundreds of miles inland and cause flash flooding across the mid-Atlantic region.

Forecasts call for 10 to 15 inches (25-38 cm) of rain in the hardest-hit areas, possibly more if the storm stalls over land, as expected, Graham said.
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Hurricane Florence Could Be the Worst Storm to Ever Hit North of Florida

Since records began, only 10 major hurricanes have made landfall around the Carolinas. This one has the potential to blow them all out of the water.

----If Florence strikes North Carolina at its current classification, Category 4, it would be only the third to do so in recorded history, and the first to do so this early in the Atlantic hurricane season, which runs from the beginning of June to the end of November. It would be the 11th major hurricane to make landfall along the southeastern Atlantic coast, excluding Florida.

Experts weren’t ready to rule out the possibility that Florence could even make landfall as a Category 5 hurricane, a feat never achieved by any recorded storm in the region. Dennis Feltgen, a spokesperson for the National Hurricane Center in Miami, says that reaching Category 5 is “certainly a possibility.” If Florence doesn’t undergo a phenomenon known as an eyewall replacement cycle, which would weaken the storm, it has a chance of reaching the 157-mph boundary line and making history, Feltgen says.
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The Atlantic Ocean Looks Insane Right Now - 3 Hurricanes Are Churning Above It

And Hurricane Florence is coming fast.
JEREMY BERKE, BUSINESS INSIDER
11 SEP 2018
Hurricane season officially peaks today: September 10.

It has been a quieter-than-average hurricane season so far, but things are picking up in a big way: three hurricanes are churning in the Atlantic, with Hurricane Florence rapidly approaching the US East Coast.

----But the season is just now peaking, and Hurricanes Florence, Isaac, and Helene are a stark reminder that we are not out of the woods yet.

Hurricane Isaac, churning in the mid-Atlantic Ocean with wind speeds of around 75 miles per hour (120 kilometres per hour), is following closely behind Florence. Behind Isaac, Hurricane Helene is gaining strength, with wind speeds of over 105 miles per hour (170 kilometres per hour) as of Monday afternoon.

----Storms generally form over the equator, where the water temperature is especially high, then move north and west, pushed along by currents in the tropical Atlantic.

Sluggish or stalled hurricanes – like Hurricane Harvey, which flooded swaths of Houston, Texas and the Gulf Coast last year – can become even more dangerous as they stick around, pouring rain.

These types of slow-moving hurricanes are becoming more frequent. Recent research from the National Oceanic and Atmospheric Administration found that storms slowed by an average of 10 percent over land between 1949 and 2016.
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Corruption, embezzlement, fraud, these are all characteristics which exist everywhere. It is regrettably the way human nature functions, whether we like it or not. What successful economies do is keep it to a minimum. No one has ever eliminated any of that stuff.

Alan Greenspan

Crooks and Scoundrels Corner

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

For free money, even the Gnomes of Zurich would sign up to a bad idea. Still if anyone wants to sponsor a scheme in my part of the sleepy Thames Valley, England, I’ll gladly sign up too.

Swiss Village Says ‘Yes’ to 2,500-Franc a Month Free Money Trial

By Catherine Bosley
10 September 2018, 11:21 GMT+1
It’s hard to say ‘no’ to something for nothing.

A village in Switzerland has decided to go ahead with an experiment on basic income, with a payout of 2,500 francs ($2,570) per month.

More than 50 percent of the inhabitants of Rheinau, close to the German border, signed up for the project, according to the organizers website. At least half the 1,300 inhabitants needed to say ‘yes,’ and the count stood at 692 on Monday.

The decision comes two years after a proposal for a nationwide unconditional state stipend failed to pass in a national vote. The next step is to raise money to finance the plan via crowdfunding. The submitted ballots also still have to be checked against government data to ensure eligibility.
Read more: Basic Income Wins Converts from Musk to Zuckerberg

Rheinau, on the banks of the river Rhine an hour by train from the banking hub of Zurich, was selected by filmmaker Rebecca Panian for the basic income trial. She says she became fascinated by the notion during the national debate before up the 2016 vote, decided to select a village as a guinea pig, and make a documentary.

Earnings and social benefits would count against the payment, which will have to be raised from private sources rather than the government.

While the idea of paying people money -- no strings attached -- has been around for more than a century, it has gained some traction in recent years due to concerns in major economies about rising inequality and jobs losses due to automation.

Finland introduced a pilot project to examine the benefits of a universal basic income, while it’s also on the agenda of Italy’s populist government.

The United States can pay any debt it has because we can always print money to do that. So there is zero probability of default.

Alan Greenspan

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?
September 10, 2018 / 12:18 AM

British air taxi firm takes flight, inspired by F1 racing advances


LONDON (Reuters) - A British energy entrepreneur and one-time Formula 1 racing team owner is entering the race to build new inter-city “flying taxi” services that tap recent aerospace advances while steering clear of more fanciful blue-sky visions touted by tech-focused rivals.

Stephen Fitzpatrick, founder of Ovo Energy, an upstart challenger to the UK’s big six electric utilities, said his new venture will apply lessons from F1 racing to build electric Vertical Take Off and Landing (eVTOL) aircraft.

Vertical Aerospace, as his self-funded, Bristol-based flying company is known, aims to offer short-haul, inter-city flights carrying multiple passengers using piloted aircraft within four years, Fitzpatrick said. 

Since its inception in 2016, the firm has hired 28 veteran aerospace and technical experts from Airbus, Boeing, Rolls-Royce, Martin Jetpack and GE with extensive experience building certified commercial aircraft.

Unlike the majority of flying-car projects from tech, aerospace and automotive entrepreneurs that have captured the popular imagination by seeking to turn aircraft into pilotless, autonomous vehicles, Vertical believes it can overcome regulatory and safety concerns by delivering piloted, fixed-wing aircraft that capitalise on incremental, existing innovations.

Vertical is looking to target some of the most congested air corridors in the world with aircraft that don’t require runways but also have enough heft to travel up to 500 miles (800 km), Fitzpatrick said in an interview.

“We are investing in all the technology evolution taking place in aerospace but we are trying to apply that to something that’s real world and is possible to execute four years out,” the Vertical Aerospace founder and chief executive said.

“We are not waiting for huge changes in existing regulations.”

Competitors working toward launching autonomous flying cars early in the next decade range from aerospace giant Airbus to Uber, which is developing an intra-city flying taxi fleet, Volocopter, which is testing drone taxis that resemble a small helicopter powered by 18 rotors, and AeroMobil, with a stretch-limousine concept that can turn into a fixed-wing aircraft.

Several of these projects envision services that can be ordered up, on-demand, via smartphones, from skyhubs in city centres.
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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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