Thursday, 27 December 2018

All’s Well That Ends Well. Plunge Protection Team’s Back!


Baltic Dry Index. 1271       Brent Crude 54.38

Can President Trump turn America and the world into a banana republic? Probably not, at least not over Christmas and the New Year.

London Irvine Report December 22, 2018.

How wrong I was. On the first trading day after US stock indexes drop into bear market territory, and right after the US Treasury Secretary convened a telephone meeting of the President’s Plunge Protection Team, buyers flooded back into stocks, with the high frequency algo thieves front running the Fed’s NY city Punge Protection Team.

The USA joined communist China and the old age home of Japan in blatantly rigging its stock markets to dress up the economy.  Day one of President Trump’s re-election campaign is off to a spectacular start. Who cares who’s running the Fed in Washington when President “Wall Street” has a Plunge Protection Team and is running the Greatest Banana Republic planet Earth has ever seen.  Will President Trump trump Caligula and make Incitatus a senator next?

Below, whatever “ism” it is, it certainly isn’t capitalism. But can the PPT keep it up for two years?

Nikkei soars, leading Asian-market rebound following Wall Street’s big rally

By MarketWatch and Associated Press  Published: Dec 26, 2018 10:41 p.m. ET
An incredible day on Wall Street, which saw major indexes finishing at least 5% higher, spurred early gains in Asia on Thursday as some traders returned from a Christmas break.

Stock markets also got a boost from crude oil futures, which surged 8% Wednesday, coming off 17-month lows as a Russian official predicted oil prices would stabilize in 2019.

Japan’s Nikkei 225 index NIK, +3.81%   rebounded 3.7%. It had tumbled more than 5% on Tuesday before recovering slightly a day later. The energy sector was among the day’s biggest winners, as Inpex 1605, +4.12%  , JXTG 5020, +7.86%  , Fuji Oil 5017, +7.75%   and Japan Petroleum Exploration 1662, +5.54%   rallied. Nintendo 7974, +4.00%  , Sony 6758, +5.27%   and Fast Retailing 9983, +1.68%  also posted solid gains.

Hong Kong’s Hang Seng Index HSI, +0.12%  , which reopened after the Christmas holiday, rose
0.6%. Energy companies were again among the leaders, with CNOOC 0883, +2.22%  , China Petroleum & Chemical 0386, -1.34%   and PetroChina 0857, +0.82%   rising about 2% or more. Tech stocks gained as well, with Sunny Optical 2382, +1.34%  and AAC 2018, -0.44%   up more than 1% each.

On mainland China, the Shanghai Composite index SHCOMP, +0.07%   was up 0.5%, while the smaller-cap Shenzhen Composite 399106, +0.14%   rose 0.4% as government data showed industrial profits fell in November for the first time in almost three years.

South Korea’s Kospi SEU, +0.03%   added 0.2% as Samsung 005930, -0.13%   and SK Hynix 000660, +2.50%   gained. Australia’s S&P-ASX 200 XJO, +1.88%   rallied 1.5%, with energy companies such as Woodside Petroleum WPL, +4.16%  , Santos STO, +2.67%   and Beach Energy BPT, +1.14%  advancing. Benchmark indexes in Taiwan Y9999, +1.72%   and Singapore STI, +1.91%   rose around 2%.

On Wednesday, U.S. markets snapped a four-day losing streak and clocked their best day in more than 10 years. Investors were reassured by an official signal that President Donald Trump, who has heavily criticized the Fed on Twitter, will not try to oust Chairman Jerome Powell. The broad S&P 500 index SPX, +4.96%   soared 5% to 2,467.70. The Dow Jones Industrial Average DJIA, +4.98%   added over 1,000 points — its biggest point gain in a day — or 5% to 22,878.45. The Nasdaq composite COMP, +5.84%   picked up 5.8% to 6,554.36.

----According to Bloomberg News, the U.S. will send government delegation to hold trade talks with Chinese officials in Beijing in the week starting Jan. 7. It cited two people familiar with the matter. This follows a meeting between Trump and his Chinese counterpart Xi Jinping in Argentina earlier this month. The two leaders agreed to hold off on additional tariffs for 90 days, to work on disagreements on trade and technology policies.

Benchmark U.S. crude CLG9, -0.15%   dropped 12 cents to $46.10 a barrel in electronic trading on the New York Mercantile Exchange. On Wednesday, the contract posted its biggest one-day gain in more than two years to settle at $46.22 a barrel in New York. Brent crude LCOG9, -0.24%  , used to price international oils, shed 13 cents to $54.34 a barrel.
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Wall Street surge provides relief to battered stock markets

December 27, 2018 / 2:02 AM
TOKYO (Reuters) - Asian shares on Thursday rode a dramatic surge on Wall Street as markets, hammered by a recent drum roll of deepening political and economic gloom, cheered upbeat U.S. data and the Trump administration’s effort to shore up investor confidence.

In a buying frenzy that was as spectacular as the recent rout, U.S. stocks soared with the Dow Jones Industrial Average rocketing more than 1,000 points for the first time on Wednesday.
That helped push MSCI’s broadest index of Asia-Pacific shares outside Japan up 0.8 percent and away from eight-week lows. 

Japan’s Nikkei managed to pull out of bear market territory it had entered on Tuesday, surging 3.8 percent.

Australian shares jumped 1.6 percent as trading resumed after the Christmas break, while Chinese blue chips gained 0.6 percent.

There was no single trigger for the overnight relief rally on Wall Street, though a Mastercard Inc report that sales during the U.S. holiday shopping season rose the most in six years in 2018 helped allay concerns about the health of the U.S. economy

There were also some attempts by the White House to temper its broadside against the Federal Reserve. Kevin Hassett, chairman of the White House Council of Economic Advisers, said on Wednesday that Fed Chairman Jerome Powell’s job was not in jeopardy.

His comments came days after President Donald Trump described the Fed as the “only problem” in the U.S. economy after the central bank last week raised rates for the fourth time this year, and retained plans for more hikes in 2019.
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Trump started a fight with the Fed he had zero chance of winning — now he’s backing down

By Jeffry Bartash Published: Dec 26, 2018 4:25 p.m. ET
President Donald Trump fought the Federal Reserve — and the Fed won.

The president has bashed the Fed and his hand-picked chairman, Jay Powell, repeatedly since the summer for raising interest rates. Wall Street largely took the president’s criticism in stride until Trump reportedly mused about whether he could fire Powell.

That did it.

A frenzy of speculation about the president’s intent accelerated a huge selloff in the stock markets in the days leading up to Christmas. The Dow Jones Industrial Average DJIA, +4.98%  was on track to record its worst loss since the throes of the Great Recession in 1931 until Wednesday’s sharp rally.

Opinion might be divided among economists and investors about how fast and how high the Fed should raise U.S. interest rates, but one thing surely unites Wall Street: The Fed should be allowed to do its job free of political interference.

On the heels of these huge losses, Trump has beaten a hasty retreat. His two top economic advisers, Kevin Hassett and Larry Kudlow, have publicly declared the president has no intention of taking any action against Powell.

“The president has voiced policy differences with Jay Powell, but Jay Powell’s job is 100% safe. The president has no intention of firing Jay Powell,” Hassett told the Wall Street Journal, a sister publication of MarketWatch.

The White House reversal helped to calm markets on Wednesday. The Dow soared about 1,086 points after an afternoon rally.
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Back in the real world, the metal bashers of Germany are very worried. Their largest European market for cars may be about to impose WTO tariffs on their exports, just as President Trump slaps 25 percent tariffs on their exports to the USA.  2019 is shaping up to be a very black year in Stuttgart.

German industry views Brexit, Trump as biggest risks to economy

December 26, 2018 / 9:02 AM
BERLIN (Reuters) - Germany’s leading industry groups said on Wednesday that Britain’s departure from the European Union and trade disputes triggered by U.S. President Donald Trump’s ‘America 
First’ policies were posing the biggest risks to growth and prosperity.

The German economy, Europe’s largest, is expected to post its weakest growth rate in many years in 2018 as exporters are facing headwinds from abroad. But vibrant domestic demand means many companies are still able to expand business.

In a survey conducted by Reuters, the heads of Germany’s leading industry associations said they did not see the economy entering a recession and that most forecasts were predicting a solid growth rate of around 1.5 percent for 2019.

But the industry associations said the economic woes of company executives were increasing and the government should do more to help them, for example by lowering corporate taxes and investing more in digital infrastructure.

“The biggest risk in the short term is Brexit,” said Dieter Kempf, president of the BDI industry association.

If Britain left the EU in March without any agreement on its future relations with the bloc, this would create massive uncertainties for trade and business, Kempf warned.

“The British economy would face the direct threat of a recession which would indirectly also affect Germany,” Kempf said.

Holger Bingmann, head of the BGA trade group, said Brexit was the “most urgent problem for the German economy” while an escalation of international trade disputes sparked by the United States could potentially derail the economic upswing.

DIHK President Eric Schweitzer said German companies are still worried about the U.S. imposing higher import tariffs on European cars. “The threat of car tariffs is still on the table,” Schweitzer warned.
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I don't make jokes. I just watch the government and report the facts.

Will Rogers

Crooks and Scoundrels Corner

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

No banksters or bent politicians today. Today the doubled, over man-made global warming Druids.

Will 2019 See Climate Maturity?

The left favors green socialism, while the right discovers the uses of a carbon tax.

By Holman W. Jenkins, Jr.  Dec. 24, 2018 5:23 p.m. ET

Innocent news consumers may be impressed to learn that Germany has reduced carbon-dioxide 
emissions by 27% since 1990. This is the standard the German government itself has employed, and it has been glibly endorsed by many news organizations. Never mind the obvious: 1990 was picked because it was the year of German reunification, and the entirety of the decline is due to the collapse of East German heavy industry.

The real punch line is to be found in two sentences in a recent piece by the nonprofit magazine Yale E360: “In just the past five years government support and costs to consumers have totaled an estimated 160 billion euros ($181 billion),” says the article. And a bit later: “Germany’s carbon emissions have stagnated at roughly their 2009 level.”

That’s right. German consumers and taxpayers spent $181 billion on wind and solar to achieve no net reduction in emissions.

Sadly, the press is too busy elsewhere to draw any lessons. As long as a single blogger or Twitter user anywhere doubts a pending climate catastrophe, 100% of media firepower must be devoted to mowing down “deniers.” Lip service is paid to “science,” but climate journalism today is a liturgy of doom and salvation, not costs and benefits. Only when every last voice of skepticism or opposition is silenced can anything else can be discussed. Ritualized scapegoating is the order of the day.

That’s why, as a public service, we bring you some of the important debates you’re not being told about.

For almost 40 years, science has failed to advance on a basic question: how much warming can we expect from a given increase in atmospheric CO2? The Intergovernmental Panel on Climate Change, the anointed United Nations authority on climate science, employs the same estimate as the Charney Report of 1979: A doubling of atmospheric carbon dioxide corresponds to a temperature increase of between 2.7 and 8.1 degrees Fahrenheit.

Though often reported wrongly, this “equilibrium” temperature would actually be reached only decades after the corresponding CO2 benchmark is reached. And nowhere does the IPCC say its estimates are reliable, only that they emerge consistently from the array of climate simulations that it consults. What does this imply? Those who persist in suspecting a human impact on climate is no big deal may yet be proved right.

The IPCC would make an invaluable contribution in its next big report, due in 2022, by narrowing this range of so-called climate sensitivity. Alas, an interim report in October indicated that the latest science remains polarized, some studies pointing to less warming, some pointing to more.
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Make crime pay. Become a lawyer.

Will Rogers

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?

Using graphene to detect ALS, other neurodegenerative diseases

Date: December 5, 2018

Source: University of Illinois at Chicago

Summary: Graphene can determine whether cerebrospinal fluid comes from a person with ALS, MS or from someone without a neurodegenerative disease.

The wonders of graphene are numerous -- it can enable flexible electronic components, enhance solar cell capacity, filter the finest subatomic particles and revolutionize batteries. Now, the "supermaterial" may one day be used to test for amyotrophic lateral sclerosis, or ALS -- a progressive, neurodegenerative disease which is diagnosed mostly by ruling out other disorders, according to new research from the University of Illinois at Chicago published in ACS Applied Materials & Interfaces.

When cerebrospinal fluid from patients with ALS was added to graphene, it produced a distinct and different change in the vibrational characteristics of the graphene compared to when fluid from a patient with multiple sclerosis was added or when fluid from a patient without neurodegenerative disease was added to graphene. These distinct changes accurately predicted what kind of patient the fluid came from -- one with ALS, MS or no neurodegenerative disease.

Graphene is a single-atom-thick material made up of carbon. Each carbon atom is bound to its neighboring carbon atoms by chemical bonds. The elasticity of these bonds produces resonant vibrations, also known as phonons, which can be very accurately measured. When a molecule interacts with graphene, it changes these resonant vibrations in a very specific and quantifiable way.

"Graphene is just one atom thick, so a molecule on its surface in comparison is enormous and can produce a specific change in graphene's phonon energy, which we can measure," said Vikas Berry, associate professor and head of chemical engineering in the UIC College of Engineering and an author on the paper. Changes in graphene's vibrational characteristics depend on the unique electronic characteristics of the added molecule, known as its "dipole moment."

"We can determine the dipole moment of the molecule added to graphene by measuring changes in graphene's phonon energy caused by the molecule," Berry explained.
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Once again, another year draws to a close and it’s time for my annual appeal. If you are one of the regular LIR readers of this usually six days a week update, that helps support my efforts with the occasional donation via the Paypal button, once again I sincerely thank you. A special thanks this year to the very kind reader that so generously helped me with my vet bills for the operation on my late border collie Rosie. After 12 years, Christmas won’t be the same without Rosie.
If you are a regular reader who finds the LIR informative, interesting, occasionally amusing or entertaining, please consider making a small donation via the Paypal button on the right of the LIR website. For obvious reasons in our new age of mainstream media fake news, I want to keep the LIR advertising free. But in any event thank you for reading and sending along helpful articles and suggestions.

The monthly Coppock Indicators finished November.

DJIA: 25,538 +157 Down. NASDAQ: 7,331 +205 Down. SP500: 2,760 +129 Down. 
All three slow indicators are signalling more correction to come, although not necessarily ahead of the year-end. However, if a tidal wave of stock fund redemptions hits in December, 2018 could end in a great rising wave of panic selling into a generally thin markets trading year-end.

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