Baltic Dry Index. 1003 -20 Brent Crude 63.13
I’ve
fallen and I can’t get up – stocks.
With
apologies to Life Call’s 1980s commercial.
From cryptocurrencies
to commodities, from stocks to the Baltic Dry (shipping) Index, from Asia to
America, everywhere the cry went out yesterday, “help, I’ve fallen and I can’t
get up.” Unlike the oft parodied 1980s commercial, there’s no rescue force of
medics, neighbours, family and doctors, (aka as buy the dip stock buyers,) racing
towards our crumbling global markets.
What’s heading
towards our markets and global economy instead, is an ever growing trade war assault
on China by President Trump’s team of
trade war hard liners, 25 percent punitive tariffs against China starting January
1st, rising interest rates, the end of Trump tax cut fuelled stock
buy backs, plus an emerging market and oil fracking debt crisis.
Besides, if stock
prices don’t stabilise this US Thanksgiving Day shortened trading week, a
massive wave of stock market fund
redemptions will roll in for the year end. This may not be the end for
falling markets, it may not even be the end of the beginning.
"Liquidation
sometimes is orderly, but more frequently degenerates into panic as the
realization spreads that there is only so much money, not enough to enable
everyone to sell out at the top."
Charles
P. Kindleberger, Manias, Panics and Crashes.
Asia stocks fall, oil stymied as growth worries grip global markets
November 21, 2018 / 12:31 AM
TOKYO
(Reuters) - Asian stocks slid on Wednesday as intensifying concerns about
global economic growth gripped financial markets, sending Wall Street shares
and crude oil prices tumbling and driving the safe haven dollar up from a
two-week low.
The Shanghai Composite Index .SSEC swerved in and out of the red and was last down 0.2 percent.
Australian stocks lost 0.6 percent, South Korea's KOSPI .KS11 retreated 0.85 percent and Japan's Nikkei .N225 fell 0.7 percent.
U.S. stocks sold off for a second day on Tuesday as energy shares dropped with oil prices, while retailers including Target and Kohl’s sank after weak earnings and forecasts, fuelling worries about economic growth. [.N]
The Nasdaq .IXIC closed at its lowest in more than seven months on Tuesday while the S&P 500 .SPX and Dow .DJI ended at their weakest since late October.
“It is difficult to pinpoint a single factor driving the global risk aversion. Apple and trade tensions seem to be touted as factors every other day, but it is difficult to blame them for all the woes,” said Soichiro Monji, senior economist at Daiwa SB Investments.
More
Worst Day of an Awful Year Leaves No Corner of Market Unscathed
By Lu Wang, Elena Popina, and Vildana Hajric
20 November 2018, 21:33 GMT Updated
on 21 November 2018, 02:32 GMT
One of the toughest years for financial markets in half a century got
appreciably worse Tuesday, with simmering weakness across assets boiling over
to leave investors with virtually nowhere to hide.
Stocks buckled for a second day, sending the S&P 500 careening
toward a correction. Oil plumbed depths last seen a year ago, while credit
markets -- recently impervious -- showed signs of shaking apart. Bitcoin is in
a freefall, while traditional havens like Treasuries, gold and the yen stood
still.
Add
it all up -- the 2 percent drop in equities, oil’s 6 percent plunge, the
downdraft in corporate bonds -- and markets ended up doling out one of the
worst single-session losses since 2015. The S&P 500 erased its gain for
2018, oil tumbled to a one-year low and and an ETF tracking junk bonds capped
its worst streak of declines since 2014.
“While
there’s still no ‘panic in the streets,’ most traders are unconvinced that the
selling will slow down anytime soon,” said Larry Weiss, head of trading for
Instinet LLC in New York. “The flight to quality is now a flight to cash. It’s
tough to convince anyone that now is the time to put money to work.”
More
Apple’s stock tumble makes it unanimous — the FAANG bull market has ended
By MarketWatch Published: Nov 20, 2018 5:00 p.m. ET
For the first time, all five FAANG stocks are in bear markets.Apple Inc.’s stock AAPL, -4.78% made it unanimous Tuesday, as it tumbled 4.8% to the lowest close since May 3, helped there by a price target cut at Goldman Sachs. The stock closed 23.7% below its Oct. 3 record close of $232.07.
Many on Wall Street define a bear market as a decline of 20% or more from a bull-market peak. On Monday, Apple’s stock dipped briefly into bear market territory, but pared losses to close 19.9% below its record. Read more about how Apple flirted with a bear market.
Apple‘s last bear market started on Aug. 21, 2015, and didn’t end until Aug. 9, 2016. The stock fell as much as 32% during that downturn.
Goldman analyst Rod Hall cut his stock price target to $182 from $209, citing concerns over “deteriorating demand,” following the technology giant’s disappointing holiday season guidance and revenue guidance cuts from multiple smartphone suppliers.
Apple‘s last bear market started on Aug. 21, 2015, and didn’t end until Aug. 9, 2016. The stock fell as much as 32% during that downturn.
Goldman analyst Rod Hall cut his stock price target to $182 from $209, citing concerns over “deteriorating demand,” following the technology giant’s disappointing holiday season guidance and revenue guidance cuts from multiple smartphone suppliers.
More
As the stock market and economy are set to skid, Goldman says cash will be king
By Mark
DeCambre Published: Nov 20, 2018
4:39 p.m. ET
Cash is king. That is according to Goldman Sachs strategists who predict
that 2019 will deliver lackluster, single-digit stock-market returns, making
greenbacks the best game in town.“We forecast S&P 500 will generate a modest single-digit absolute return in 2019. The risk-adjusted return will be less than half the long-term average. Cash will represent a competitive asset class to stocks for the first time in many years,” analysts at Goldman, led by David Kostin, wrote in a research reported dated Nov. 19.
Referencing a bull market approaching its 10th year that has delivered double-digit gains in 2017 and repeated records for the Dow Jones Industrial Average DJIA, -2.21% the S&P 500 index SPX, -1.82% and the Nasdaq Composite Index COMP, -1.70% Goldman said “all good things must eventually come to an end.”
The strategists echo a common mantra among market bears: a deceleration in economic expansion and corporate profits will occur in 2019 because 2018 produced stellar GDP and earnings fueled by corporate tax cuts from the Trump administration and other business-favorable policies.
On top of that, adjusting for the risk associated with owning equities, Goldman views cash as a better option. Analysts at the investment bank say that households, mutual funds, foreign investors and pensions funds tend to have an allocation to cash that ranks in the lowest percentile and while equity allocations tend to be in the 89th percentile on a historical basis.
Goldman is forecasting that the Federal Reserve will lift interest rates four times in 2018, pushing the federal-funds rate to a range of 3.25%-3.5% by the end of 2019 from 2%-2.25% currently. In that environment, the analysts see the 10-year Treasury note TMUBMUSD10Y, +0.27% yielding 3.5% by the second half of 2019, which also translates to richer yields for short-term so-called T-bills and other money-market funding.
Finally, in US trade
war news, President Trump proposes to shoot America’s high tech industries in
both feet. America, under President Trump, is turning itself into a unreliable
parts supplier.
Trump Threatens High-Tech Export Curbs in Latest Swipe at China
By Sarah Wells
20 November 2018, 09:21 GMT
The Trump administration is considering tighter curbs on technology exports,
a step that Deutsche Bank AG says would have a “profound and long lasting
adverse impact” on relations between the U.S. and China.A request for public comment, published Monday on the U.S. government’s Federal Register, asks if a list of new technologies that have national security applications -- from artificial intelligence to microprocessors and robotics -- should be subject to more stringent export-control rules. That would affect U.S. manufacturers as well as purchasers in China.
The
news added to bearish sentiment in China’s stock market on Tuesday, with two
manufacturers of surveillance equipment -- Hangzhou Hikvision Digital
Technology Co. and Zhejiang Dahua Technology Co. -- leading large-cap losses.
“Many
technologies and products are used for both military and civil purposes,”
Deutsche Bank analysts Zhiwei Zhang and Yi Xiong wrote in a note. “In an
economic cold war, even if the controls are not imposed on certain products at
the current stage, companies will likely feel the potential risk if the tension
escalates between China and the U.S. down the road.”
High-end
technology has taken center stage in a burgeoning U.S.-China trade war, as
President Donald Trump pushes Beijing to drop plans to dominate leading-edge
industries like electric vehicles, robotics and artificial intelligence. Trump
plans to hold a high-stakes meeting with Chinese President Xi Jinping at the
Group of 20 summit in Argentina at the end of the month.
----Under the proposed curbs, Apple Inc., Alphabet Inc.’s Google, IBM, Amazon.com Inc. and similar companies could see limits placed on the way they export the technology behind voice-activated smartphones, self-driving cars and fast supercomputers to China, the Washington Post reported. The newspaper said spokespeople for the companies, as well as the Commerce Department, either declined to comment or didn’t respond to requests for comment.
The proposal also raises the prospect of retaliation from China, where the anti-monopoly regulator is already investigating Samsung Electronics Co., SK Hynix Inc. and Micron Technology Inc. Progress has been made in that probe, a Chinese official said late last week.
More
U.S. Accuses China of Continuing IP Theft Amid Trade War
By Shawn Donnan and Jenny Leonard
Updated on 21 November 2018, 05:49 GMT
The U.S. on Tuesday accused China of continuing a state-backed campaign
of intellectual property and technology theft even as the world’s two largest
economies have descended into a tit-for-tat tariff war.
The new accusations came in a detailed 53-page report released by U.S.
Trade Representative Robert Lighthizer’s office just 10 days before President
Donald Trump is due to meet Chinese President Xi Jinping on the sidelines of a
Nov. 30-Dec. 1 Group of 20 summit in Buenos Aires.
The U.S. on Tuesday accused China of continuing a state-backed campaign of intellectual property and technology theft even as the world’s two largest economies have descended into a tit-for-tat tariff war.
The new accusations came in a detailed 53-page report released by U.S. Trade Representative Robert Lighthizer’s office just 10 days before President Donald Trump is due to meet Chinese President Xi Jinping on the sidelines of a Nov. 30-Dec. 1 Group of 20 summit in Buenos Aires.
The timing of the report’s release appeared to be a move by some of the more hawkish members of Trump’s administration, such as Lighthizer, to bolster their case ahead of the summit and as other cabinet members such as Treasury Secretary Steven Mnuchin push for a resumption of negotiations.
“China fundamentally has not altered its acts, policies, and practices related to technology transfer, intellectual property, and innovation, and indeed appears to have taken further unreasonable actions in recent months,” the report said.
In the report the U.S. accused China of continuing a state-backed campaign of cyber-attacks on American companies that were both intensifying and growing in sophistication.
China’s Ministry of Commerce didn’t immediately respond to a faxed request for comment on the matter.
As an example, it cited an October 2018 report by experts from the U.S. Naval War College and Tel Aviv University that found that China Telecom may be engaging in a "malicious" campaign to "hijack Internet traffic and direct it through Mainland Chinese servers for possible collection and analysis.”
More
"Under
capitalism man exploits man; under socialism the reverse is true."
Polish saying
under communism.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Yes, unicorn ranching again. Is it
time to harvest and slaughter them yet? At least when I bought the Brooklyn
Bridge, I could see what I’d bought. My unicorns are very hard to see. In fact,
I’ve never seen one yet, but that might not stop them round tripping back to
zero.
“At the end, fiat money and
Bitcoin returns to its inner value—zero.”
With apologies to Voltaire.
Bitcoin for payments a distant dream as usage dries up
November 20, 2018 / 12:41 PM
LONDON (Reuters) - The use of bitcoin for commercial payments has
dropped dramatically this year, even as the original digital coin starts to
fulfill one of the basic features of any payment currency: stability.
The value of bitcoins handled by major payment processors shriveled
nearly 80 percent in the year to September, data from blockchain researcher
Chainalysis shows. That suggests the cryptocurrency is struggling to mature
from speculative asset to a serious alternative to state-issued money.
Months of relative calm in bitcoin prices after the wild swings of last
winter had fueled hopes it would become widely used for payments, its intended
purpose.
But its collapse in use as a payment currency has instead left big
finance and crypto insiders eyeing better technological infrastructure to help
bitcoin take off as a way to pay.
“There would have to be a stability requirement if it is to become
another form of money,” said Joni Teves, a strategist at UBS in London.
“But one thing that would take bitcoin into the mainstream is
scalability — is it able to process the value or volume of transactions that
money tends to do?”
The blockchain technology, where all bitcoin activity is recorded and validated, can only process a fraction of the transactions per second that major credit card companies can. That renders its mass use impractical.
Bitcoin still endures torrid swings in price, as this week’s 30 percent plunge shows. For a spell last month, though, the cryptocurrency was more stable than U.S. stocks.
Despite that growing stability, the value of bitcoin payments collapsed to $96 million in September from a December high of $427 million, the data from Chainalysis shows.
More
Bitcoin-Rigging Criminal Probe Focused on Tie to Tether
By Matt Robinson and Tom Schoenberg
20 November 2018, 09:00 GMT
As Bitcoin plunges, the U.S. Justice Department is investigating whether
last year’s epic rally was fueled in part by manipulation, with traders driving
it up with Tether -- a popular but controversial digital token.While federal prosecutors opened a broad criminal probe into cryptocurrencies months ago, they’ve recently homed in on suspicions that a tangled web involving Bitcoin, Tether and crypto exchange Bitfinex might have been used to illegally move prices, said three people familiar with the matter.
Bitfinex has the same management
team as Tether Ltd., a Hong Kong-based company that created the namesake
cryptocurrency. When new coins come to market, they’re mostly released on
Bitfinex.
Some traders -- as well as academics -- have alleged that these Tethers are used to buy Bitcoin at crucial moments when the value of the more ubiquitous digital token dips. JL van der Velde, the chief executive officer of Tether Ltd. and Bitfinex, has previously rejected such claims.
Bitfinex’s general counsel, as well as outside lawyers for the exchange and Tether Ltd., didn’t respond to phone calls and emails seeking comment.
The Justice Department’s probe adds to an existing inquiry into possible misconduct. Both Tether Ltd. and Bitfinex received subpoenas last year from the U.S. Commodity Futures Trading Commission, Bloomberg reported in January. The Justice Department and CFTC are coordinating their examinations, the people said.
---- Cryptocurrencies captured investors’ attention in 2017 with Bitcoin surging to a record high of about $20,000 last December. But it’s been a different story this year as many on Wall Street have concluded the market was a fad. Another factor in Bitcoin falling below $5,000 Monday: Scrutiny by government officials, who’ve repeatedly warned that the mostly unregulated industry is likely rife with fraud.
A focus of the Justice Department’s investigation is whether the dramatic rise of digital tokens in recent years was purely driven by actual demand, or was partially fanned on by market tricks. Along with the CFTC, prosecutors have been looking into a number of trading strategies, including spoofing -- the illegal practice of flooding the market with fake orders to trick other traders into buying or selling, Bloomberg reported in May.
---- While not as well known as Bitcoin, Tether is widely used by traders to bet on price moves for other cryptocurrencies. That’s because the token is more stable than other digital coins but remains outside the traditional banking system, making it relatively easy to transfer between different crypto exchanges.
Tether’s stability, and it’s name, comes from the fact that its value is supposed to be tethered to the U.S. dollar. Tether Ltd. even says that for each digital coin issued, it has $1 in the bank. Some investors have questioned that claim. One reason the CFTC subpoenaed the company was to seek proof that tokens are backed by a reserve of U.S. dollars, Bloomberg reported in June.
Among the issues the Justice Department is examining is how Tether Ltd. creates new coins and why they enter the market predominantly through Bitfinex, the people said.
More
"I know but one sure tip from a broker.... your margin call.
Jesse
Livermore, stock manipulator.
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?
Bending light around tight corners without backscattering losses
New photonic crystal waveguide based on topological insulators paves the way to build futuristic light-based computers
Date:
November 19, 2018
Source:
Duke University
Summary:
Researchers demonstrate a new optical waveguide capable of bending photons
around tight corners on a smaller scale than previously possible. The
technology is made possible by through photonic crystals using the concept of
topological insulators.
Engineers at Duke University have demonstrated a device that can direct
photons of light around sharp corners with virtually no losses due to
backscattering, a key property that will be needed if electronics are ever to
be replaced with light-based devices.
The result was achieved with photonic crystals built on the concept of
topological insulators, which won its discoverers a Nobel Prize in 2016. By
carefully controlling the geometry of a crystal lattice, researchers can
prevent light traveling through its interior while transmitting it perfectly
along its surface.
Through these concepts, the device accomplishes its near-perfect
transmittance around corners despite being much smaller than previous designs.
The Semiconductor Industry Association estimates that the number of
electronic devices is increasing so rapidly that by the year 2040, there won't
be enough power in the entire world to run them all. One potential solution is
to turn to massless photons to replace the electrons currently used for
transmitting data. Besides saving energy, photonic systems also promise to be
faster and have higher bandwidth.
Photons are already in use in some applications such as on-chip photonic
communication. One drawback of the current technology, however, is that such systems
cannot turn or bend light efficiently. But for photons to ever replace
electrons in microchips, travelling around corners in microscopic spaces is a
necessity.
"The smaller the device the better, but of course we're trying to
minimize losses as well," said Wiktor Walasik, a postdoctoral associate in
electrical and computer engineering at Duke. "There are a lot of people
working to make an all-optical computing system possible. We're not there yet,
but I think that's the direction we're going."
Previous demonstrations have also shown small losses while guiding
photons around corners, but the new Duke research does it on a rectangular
device just 35 micrometers long and 5.5 micrometers wide -- 100 times smaller
than previously demonstrated ring-resonator based devices.
In the new study, which appeared online on November 12 in the journal Nature
Nanotechnology, researchers fabricated topological insulators using electron
beam lithography and measured the light transmittance through a series of sharp
turns. The results showed that each turn only resulted in the loss of a few
percent.
"Guiding light around sharp corners in conventional photonic
crystals was possible before but only through a long laborious process tailored
to a specific set of parameters," said Natasha Litchinitser, professor of
electrical and computer engineering at Duke.
"And if you made even the
tiniest mistake in its fabrication, it lost a lot of the properties you were
trying to optimize."
"But our device will work no matter its dimensions or geometry of
the photons' path and photon transport is 'topologically protected,'"
added Mikhail Shalaev, a doctoral student in Litchinitser's laboratory and first
author of the paper. "This means that even if there are minor defects in
the photonic crystalline structure, the waveguide still works very well. It is
not so sensitive to fabrication errors."
The researchers point out that their device also has a large operating
bandwidth, is compatible with modern semiconductor fabrication technologies,
and works at wavelengths currently used in telecommunications.
The researchers are next attempting to make their waveguide dynamically
tunable to shift the bandwidth of its operation. This would allow the waveguide
to be turned on and off at will -- another important feature for all-optical
photon-based technologies to ever become a reality.
"Rarely
have so many people been so wrong about so much."
Richard
M. Nixon, 37th United States President.
The monthly Coppock Indicators finished October.
DJIA: 25,116 +176 Down. NASDAQ:
7,306 +232 Down. SP500: 2,712 +146 Down. All three slow indexes went sharply down in
October, suggesting there’s more of the correction to come.
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