Baltic Dry Index. 1026
+13 Brent
Crude 70.48
Never ending Brexit
now October 31st, maybe.
Nuclear Trump
Tariffs Now In Effect.
USA v EU trade war 1
days away? No one optimistic.
On the United States-China trade war, Greenspan expressed a
bleaker view, noting that trade restrictions will lead American taxpayers to
pay for tariffs on Chinese imports. In a best-case scenario for the United
States, he noted, it would only be that “we lost less than they did.”
Reality hit global
stocks hard yesterday, even as President Trump tried desperately to hype a possible
meeting with China’s President Xi at next month’s G-20 summit in Osaka, Japan
on the 28th and 29th. No meeting is actually scheduled,
though President Xi is unlikely to turn down a request for one from President
Trump.
And that about sums
up President Trump’s trade war miscalculation. It’s President Trump doing the
begging not China’s President Xi. Having tied his 2020 re-election to the fate
of the US stock market, President Trump desperately needs a trade deal with
China to prop up stocks, plus a compliant Federal Reserve dropping interest rates.
For now, neither look likely in the short term.
Below, Asian markets
are vary of President Trump’s iffy late June trade deal “relief.” Like Aesop’s
shepherd boy, President Trump has cried wolf (relief) too many times before.
Asian shares extend losses as U.S.-China trade war escalates
May 14, 2019 /
1:36 AM
SHANGHAI (Reuters)
- Asian shares deepened losses on Tuesday amid a fresh deterioration in the
Sino-U.S. tariff war, although comments from U.S. President Donald Trump that
he expected trade negotiations to be successful helped stabilise sentiment.
China on Monday announced it would impose higher tariffs on $60 billion
of U.S. goods following Washington’s decision last week to hike its own levies
on $200 billion in Chinese imports.
MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.9%
in mid-morning trade, after earlier touching its lowest level since Jan. 30.
Providing some support for Asian markets were comments from Trump late
Monday that trade talks with China “are going to be very successful”. That
helped lift U.S. stock futures 0.5%, through sentiment remained fragile.
Kerry Craig, global market strategist at J.P. Morgan Asset Management
said that the global sell-off could continue.
“Politicians may be willing to focus less on the market impact until
things get more severe, making it doubtful there will be an early resolution to
the current breakdown in negotiations simply based on market moves,” he said.
“Furthermore, as there isn’t a clear schedule for meetings between
Chinese and U.S. negotiators, markets are likely to be more volatile.”
Broader Asian markets were dragged lower by sagging Chinese shares, with
the MSCI China index dropping 1.3%. But China’s blue-chip CSI300 index turned
higher in volatile trade, gaining 0.3%.
Australian shares lost 1.1% while Japan’s Nikkei stock index slid 0.7%.
The U.S. Trade Representative’s office on Monday said it planned to hold
a public hearing next month on the possibility of imposing duties of up to 25%
on a further $300 billion worth of imports from China.
More
S&P, Dow suffers worst day since Jan. 3 as China imposes retaliatory tariffs
By
Sunny
Oh Published: May 13, 2019 4:11 p.m. ET
U.S. stocks
finished sharply lower on Monday as the U.S. and China escalated their
longstanding trade spat. The S&P 500 SPX, -2.41%
fell 2.4% to end around 2,812. The Dow Jones Industrial Average DJIA, -2.38%
slipped 2.4%, or 617 points, to around 25,326, based on preliminary numbers.
The Nasdaq Composite COMP, -3.41%
tumbled 3.4% to end around 7,647. The Nasdaq had its worst day this year. The
S&P and Dow suffered their biggest losses since Jan. 3.
China launched its
own broadside of tariffs on $60 billion of U.S. imports after the Trump
administration late last week raised tariffs on $200 billion of Chinese
imports. President Donald Trump also said the U.S. was ready to impose another
round of tariffs on $300 billion of Chinese goods. Trump said he would later
meet with China's leader Xi Jinping in June at the Group of 20 summit in Japan
Opinion: Washington and Wall Street wake up to the reality that Beijing is happy to walk away
By Steve
Goldstein Published: May 13, 2019 3:05 p.m. ET
As Wall Street reels from the shock of a trade war
exploding to new heights in the form of tariffs and counter tariffs, there’s another
reality that is setting in — that China seems happy to walk away from trade
talks.That’s the upshot after China first rolled back some concessions — prompting a new escalation in tariffs — and then showed up to Washington without any other compromises.
“Until a week ago, it looked likely that a far-reaching trade deal would be struck between the U.S. and China within a matter of weeks. But negotiations hit a severe impasse, as the U.S. side accused the Chinese side of having reneged on key concessions,” said Stephen Gallagher, U.S. chief economist at Societe Generale, in a note to clients.
Whether Beijing has miscalculated or not, China’s policy makers are betting that they can absorb a blow to the nearly $400 billion of exports that the country, on net, sells to the U.S. each year.
“Between loose credit and loose fiscal policy, China did rebalance away from exports,” said Brad Setser, senior fellow for international economics at the Council on Foreign Relations.
According to World Bank estimates, consumption in China last year contributed 4.6 percentage points to growth, up from 3.6 points in 2013. Investment, meanwhile, declined to 2.3 points in 2018 from 4.3 percentage points in 2013.
Apart from an usually strong March, industrial production in China has slowed markedly as well.
“Trump’s escalation comes at an awkward time, but if push comes to
shove, they’re quite capable of supporting growth through more investment and
credit,” he said. He added that China has the capability of borrowing more,
particularly if it’s through the central government and not more debt-saddled
provincial governments.
In fact, China has already done so.
“China has stepped up its stimulus measures aggressively since the start
of the year, which suggests mature policy appreciation of the risks,” added
Lena Komileva, chief economist at G-Plus Economics, in a note to clients.
More
US farmers who sell to China feel pain of Beijing’s tariffs
DES MOINES, Iowa (AP) — China’s announcement Monday of higher tariffs on
$60 billion of American exports — retaliation for President Donald Trump’s
latest penalties on Chinese goods — hit particularly hard in the farm belt.
China’s vast consumer market has been a vital source of revenue for American
farmers.
Since December, when U.S. and China negotiators called a truce to
tariffs and began signaling that an agreement might be reached, soybean farmers
had been holding out hope that sales to China would resume, said Todd Hultman,
an Omaha-based grain market analyst with agriculture market data provider DTN.
In the meantime, the farmers had been storing a record stockpile of nearly 1
billion bushels.
The latest news of a new round of tariffs, with no agreement in sight,
spooked the financial markets and some farmers who had been tentatively
optimistic.
“This is hitting the market at a very emotionally distressful time,”
Hultman said. “The rug of hope was pulled out from under us and especially with
the announcement this morning that China is going to retaliate with higher
tariffs of their own.”
In a statement Monday, the American Soybean Association reacted with
frustration edged with anxiety.
“The sentiment out in farm country is getting grimmer by the day,” said
John Heisdorffer, a soybean farmer in Keota, Iowa, who is chairman of the ASA.
“Our patience is waning, our finances are suffering and the stress from months
of living with the consequences of these tariffs is mounting.”
A slowdown in soybean sales, and the huge stockpiles that result, has a
ripple effect. Farmers in many parts of the corn belt have suffered from a wet
and cooler spring, which has prevented them from planting corn. Typically when
it becomes too late to plant corn, farmers will instead plant soybeans, which
can grow later into the fall before harvest is required. Yet now, planting
soybeans with the overabundance already in bins and scant hope for sales to one
of the biggest buyers in China, could raise the risk of a financial disaster.
“This is the fifth year of low prices, basically, for crops,” Hultman
said. “I think time is just wearing us out.”
To Brent Gloy of Grant, Nebraska, many farmers like him appear to be
facing only bleak alternatives for planting.
“There’s just not a lot people can do,” Gloy said. “You’re looking at
late corn planting through part of the corn belt. They would normally go to
soybeans. Man it’s just a mess.”
More
Finally, more on there
went the jobs. But what do you do with all the unemployed people? Retrain them
as stock traders? Economists? Banksters? How many banksters does America need?
Exclusive: Amazon rolls out machines that pack orders and replace jobs
May 13, 2019 /
11:08 AM
SAN FRANCISCO
(Reuters) - Amazon.com Inc is rolling out machines to automate a job held by
thousands of its workers: boxing up customer orders.
The company started adding technology to a handful of warehouses in
recent years, which scans goods coming down a conveyor belt and envelopes them
seconds later in boxes custom-built for each item, two people who worked on the
project told Reuters.
Amazon has considered installing two machines at dozens more warehouses,
removing at least 24 roles at each one, these people said. These facilities
typically employ more than 2,000 people.
That would amount to more than 1,300 cuts across 55 U.S. fulfillment
centers for standard-sized inventory. Amazon would expect to recover the costs
in under two years, at $1 million per machine plus operational expenses, they
said.
The plan, previously unreported, shows how Amazon is pushing to reduce
labor and boost profits as automation of the most common warehouse task –
picking up an item – is still beyond its reach. The changes are not finalized
because vetting technology before a major deployment can take a long time.
Amazon is famous for its drive to automate as many parts of its business
as possible, whether pricing goods or transporting items in its warehouses. But
the company is in a precarious position as it considers replacing jobs that
have won it subsidies and public goodwill.
“We are piloting this new technology with the goal of increasing safety,
speeding up delivery times and adding efficiency across our network,” an Amazon
spokeswoman said in a statement. “We expect the efficiency savings will be
re-invested in new services for customers, where new jobs will continue to be
created.”
Amazon last month downplayed its automation efforts to press visiting
its Baltimore fulfillment center, saying a fully robotic future was far off.
Its employee base has grown to become one of the largest in the United States,
as the company opened new warehouses and raised wages to attract staff in a
tight labor market.
----
The new machines, known as the CartonWrap from Italian firm CMC Srl, pack much
faster than humans. They crank out 600 to 700 boxes per hour, or four to five
times the rate of a human packer, the sources said. The machines require one
person to load customer orders, another to stock cardboard and glue and a
technician to fix jams on occasion.
More
In the international trade area,
the language is almost always about how we must export, and what’s really good
is an industry that produces exports, and if we buy from abroad and import,
that’s bad. But surely that’s upside-down. What we send abroad, we
can’t eat, we can’t wear, we can’t use for our houses. The goods and services
we send abroad, are goods and services not available to us. On the other hand,
the goods and services we import, they provide us with TV sets we can watch,
with automobiles we can drive, with all sorts of nice things for us to use.
The gain from foreign
trade is what we import. What we export is a cost of getting those
imports. And the proper objective for a nation as Adam Smith put it, is to
arrange things so that we get as large a volume of imports as possible, for
as small a volume of exports as possible.
This carries over to the
terminology we use. When people talk about a favorable balance of trade, what
is that term taken to mean? It’s taken to mean that we export more than we
import. But from the point of our well-being, that’s an unfavorable balance.
That means we’re sending out more goods and getting fewer in. Each of you in
your private household would know better than that. You don’t regard it as a
favorable balance when you have to send out more goods to get fewer coming in.
It’s favorable when you can get more by sending out less.
Milton Friedman.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled
over.
Today, another “Tonkin Incident,” or is
someone, some agency, really attacking Saudi oil tankers in the Gulf? Is this
the unofficial start of the next oil war? Tehran or bust?
Saudi oil tankers among those attacked off UAE amid Iran tensions
May 13, 2019 /
7:01 AM
DUBAI/LONDON
(Reuters) - Saudi Arabia said on Monday that two of its oil tankers were among
those attacked off the coast of the United Arab Emirates and described it as an
attempt to undermine the security of crude supplies amid tensions between the
United States and Iran.
The UAE said on Sunday that four commercial vessels were sabotaged near
Fujairah emirate, one of the world’s largest bunkering hubs lying just outside
the Strait of Hormuz. It did not describe the nature of the attack or say who
was behind it.
The UAE on Monday identified the vessels as two crude oil tankers owned
by Saudi shipping firm Bahri, a UAE-flagged fuel bunker barge and a Norwegian-registered
oil products tanker.
The owner of the Norwegian vessel, Thome Ship Management, said the
vessel was “struck by an unknown object”. Footage seen by Reuters showed a hole
in the hull at the waterline with the metal torn open inwards.
A Reuters witness said divers were inspecting the ships. The UAE’s state
news agency said Fujairah port was operating normally.
Iran, embroiled in an escalating war of words with the United States
over sanctions and the U.S. military presence in the region, moved to distance
itself on Monday.
Iran’s Foreign Ministry called the incidents “worrisome and dreadful”
and called for an investigation.
A senior Iranian lawmaker said “saboteurs from a third country” could be
behind it, after saying on Sunday the incident showed the security of Gulf
states was fragile.
A U.S. official familiar with American intelligence said Iran was a
leading candidate for having carried out the attacks but the United States does
not have conclusive proof.
“It fits their M.O. (modus operandi),” said the official on condition of
anonymity, suggesting Iran’s statements distancing itself from the incident
were an attempt “to muddy the waters.”
POMPEO WARNS OF ESCALATING THREATS
U.S. Secretary of State Mike Pompeo shared information on “escalating” threats from Iran during meetings with EU counterparts and the head of NATO in Brussels, the U.S. special representative for Iran Brian Hook told reporters.Hook declined to say whether he believed Iran played a role or if Pompeo blamed Iran. He said the UAE had sought U.S. help in the investigation and Washington was glad to provide this.
The U.S. Maritime Administration said in an advisory on Sunday that
incidents off Fujairah, one of the seven emirates that make up the UAE, had not
been confirmed and urged caution.
Last week the Maritime Administration said Iran could target U.S.
commercial ships including oil tankers sailing through Middle East waterways.
Iranian Foreign Ministry spokesman Abbas Mousavi said the UAE incident
“has a negative impact on maritime transportation security” and asked regional
countries to be “vigilant against destabilising plots of foreign agents”, the
semi-official ISNA news agency reported.
More
By means of glasses, hotbeds, and hotwalls, very good grapes can
be raised in Scotland, and very good wine too can be made of them at about
thirty times the expense for which at least equally good can be brought from
foreign countries. Would it be a reasonable law to prohibit the importation of
all foreign wines, merely to encourage the making of claret and burgundy in
Scotland?
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?
Substrate defects key to growth of 2D materials
Date:
May 9, 2019
Source:
Penn State
Summary:
Creating two-dimentional materials large enough to use in electronics is a
challenge despite huge effort but now, researchers have discovered a method for
improving the quality of one class of 2D materials, with potential to achieve
wafer-scale growth in the future.
The field of 2D materials with unusual properties has exploded in the 15
years since Konstantin Novoselov and Andre Geim pulled a single atomic layer of
carbon atoms off of bulk graphene using simple adhesive tape. Although a great
amount of science has been conducted on these small fragments of graphene,
industrial-sized layers are difficult to grow.
Of the materials envisioned for next-generation electronics, a group of
semiconductors called transition metal dichalcogenides are at the forefront.
TMDs are only a few atoms thick but are very efficient at emitting light, which
makes them candidates for optoelectronics such as light-emitting diodes,
photodetectors, or single-photon emitters.
"Our ultimate goal is to make monolayer films of tungsten
diselenide or molybdenum disulfide sheets, and to deposit them using chemical
vapor deposition in such a way that we get a perfect single crystal layer over
an entire wafer," said Joan Redwing, professor of materials science and
electronics, and director of Penn State's 2D Crystal Consortium, a National
Science Foundation Materials Innovation Platform.
--- In recent publications in the journals ACS Nano and Physical Review B, researchers in Penn State's Departments of Materials Science and Engineering, Physics, Chemistry, and Engineering Science and Mechanics show that if the TMDs are grown on a surface of hexagonal boron nitride, 85 percent or more will point in the same direction. Vin Crespi, distinguished professor of physics, materials science and engineering and Chemistry, and his group ran simulations to explain why this happened.
They found that vacancies in the hexagonal boron nitride surface, where a boron or nitrogen atom was missing, could trap a metal atom -- tungsten or molybdenum -- and serve to orient the triangles in a preferred direction. The improved material showed increased photoluminescence emission and an order of magnitude higher electron mobility compared to 2D TMDs grown on sapphire.
"Our next step is to develop a process to grow hexagonal boron
nitride across a wafer scale," Redwing said. "That's what we're
working on now. It's difficult to control defects and to grow a single crystal
layer across a large surface. Many groups are working on this."
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.
The monthly Coppock Indicators finished April
DJIA: 26,593 +51 Down. NASDAQ: 8,095 +89 Down.
SP500: 2,946
+55 Up.
The S&P has
reversed to up largely as a result of the Fed falling into line with President
Trump’s demands, but with President Trump wanting to be judged by the
performance of the stock market and the Fed’s Plunge Protection Team now
officially part of President Trump’s re-election team, probably the safest
action here is still fully paid up synthetic double options on most of the
major indexes. This could all go very wrong very fast.
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