Baltic Dry Index. 1011
+98 Brent
Crude 72.80
Never ending Brexit
now October 31, maybe.
Day 152 of the
never-ending USA v China trade talks. Everyone’s “optimistic.”
USA v EU trade war 14
days away? No one optimistic.
In central banking as in diplomacy, style, conservative
tailoring, and an easy association with the affluent count greatly and results
far much less.
John Kenneth Galbraith
The big story today
will probably be whether America’s attempted coup in Venezuela succeeds with
the military turning against elected President Maduro or whether it all
descends into chaos and violence.
In other news, with
most of Asia and Europe on holiday, its all about the Trump Fed staying on
Trump’s message later today, China, and an old Vodafone story from nearly a
decade ago, now being re-spun as proof of Huawei “backdoors.” I wonder which
alphabet soup gang has an interest in doing that? If the “Five Eyes” had really
found any backdoor in Huawei programming, I suspect it would be all over the
front page of every newspaper on planet earth.
Australian stocks rise, with most Asian markets closed for holiday
By Marketwatch
Published: Apr 30, 2019 11:42 p.m. ET
Australian stocks rose in early trading Wednesday, one of
the only major Asia-Pacific indexes open on a day that was a public holiday in
most countries.Japan’s Nikkei remained closed as part of a 10-day holiday commemorating the installation of a new emperor, Naruhito, who was installed Wednesday, a day after his father officially abdicated.
In Beijing, the U.S. and China resumed trade negotiations, with Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer leading the U.S. delegation. The two sides are reportedly close to a final deal, and Mnuchin said Monday that he would know in the next week or two the deal will be good enough for him to recommend to President Donald Trump.
More
Powell will try not to draw ire of Trump or rock markets after Fed meeting Wednesday
- Fed Chairman Jerome Powell is under pressure not to shake up markets or the White House when he briefs the media, following the Fed’s two-day meeting Wednesday.
- Behind closed doors, the Fed may be talking about the most dovish of topics, a rate cut, but that’s not likely a policy it will yet embrace or even discuss publicly.
- The Fed is expected to hold policy steady, upgrade its comments on the economy and discuss how inflation has weakened.
Fed Chairman Jerome Powell has a tough job ahead of him, as he will have
to avoid ruffling both markets and the White House during his briefing
Wednesday.
Fed watchers say the chairman will have to walk a fine line, so as not
tilt too hawkish, which could unnerve markets and draw the ire of President
Donald Trump. Trump launched a new Twitter attack on the Fed as it met on
Tuesday, calling for a 1 percentage point rate hike and a return to
quantitative easing.
The Fed chair will also want to avoid sounding too dovish, due to the
strength of the economy and the fact financial conditions have improved
considerably in the last several months. The Fed is not expected to announce
any change in interest rate policy, when it issues its statement at 2 p.m. ET,
though it may mention that the economy has improved and inflation has weakened.
More
Trump Rate Rocket, U.S. Trade Threat, $2 Trillion Plan: Eco Day
By Michael Heath- The U.S. economy might indeed take off like a rocket if the Fed acquiesces to President Donald Trump’s demands -- but it would increase the risk of crash-landing later. Meantime, the Fed will offer little evidence that it’s drifting from its "patient" posture at the current meeting, says Carl Riccadonna
- The White House is ramping up pressure to reach a trade deal with China in the next two weeks, warning that it’s prepared to walk away from the negotiations
·
· Democratic leaders said Trump agreed to aim
for a $2 trillion infrastructure plan,
while leaving open how to pay for it
·
· Southeast Asia, China, Japan and South Korea
are expected to remain “resilient” in
the face of heightened trade tensions and stronger global headwinds, a regional
body said
·
· ECB policy makers who sounded the alarm about
the region’s slowdown last month can now relax a bit as the stimulus
they prepped becomes less urgent
·
· Ken Griffin, the billionaire founder of
Citadel, blasted socialism and said raising taxes on the wealthy isn’t the
solution to inequality
·
· Here’s how 20 years of policies masterminded
by charismatic former paratrooper Hugo Chavez dragged Venezuela into crisis
More
In commodities news,
Soc Gen finds it too hot in the commodities kitchen and is leaving. Will a
Chinese bank join the LBMA as a replacement later this year?
Societe Generale resigns as London gold and silver market maker
April 30, 2019 /
12:45 PM
LONDON (Reuters) -
The London Bullion Market Association (LBMA) said Societe Generale had resigned
as a market maker for gold and silver, as France’s third-largest bank pushes
ahead with a downsizing of its commodities business.
SocGen said this
month it would cut 1,600 jobs to boost profits after poor performance last year
and will exit over-the-counter commodities trading.
SocGen declined to comment.
In over-the-counter trading deals are done bilaterally between banks and
brokers rather than on a financial exchange. London is the world’s largest
over-the-counter gold trading hub, overseen by the LBMA.
Market makers commit to provide liquidity to the market. SocGen’s exit
leaves 12 LBMA market making banks including JPMorgan, HSBC and BNP Paribas.
Finally,
China. It’s not the 1990s anymore. All now tread very carefully in China’s San Hai, or
“Three Seas”: the South China Sea, East China Sea and Yellow Sea. After the
trade war, is a hot war inevitable in deep state Washington??
Special Report: China's vast fleet is tipping the balance in the Pacific
April 30, 2019 /
12:44 PM
TAIPEI (Reuters) -
A generation ago, from mid-1995 into early 1996, China lobbed missiles in the
waters around Taiwan as the self-governing island prepared to hold its first
fully democratic presidential election. Washington forcefully intervened to
support its ally, sending two aircraft carrier battle groups to patrol nearby.
The carriers, then as now the spearhead of American power, intimidated Beijing.
The vote went ahead. The missiles stopped.
Today, with tension again running high, Washington still backs Taiwan.
Chinese President Xi Jinping on January 2 renewed Beijing’s longstanding threat
to use force if necessary to restore mainland control over the island. But the
United States is now sending much more muted signals of support.
On Sunday, American ships sailed through the Taiwan Strait. This was the
seventh passage of U.S. warships through the narrow, strategically sensitive
waterway since July. Each time, though, just two U.S. vessels have ventured
through; this week, it was a pair of destroyers. No powerful flotillas and
certainly no aircraft carriers. It has been more than 11 years since an
American carrier traversed the Taiwan Strait.
“The Trump administration faces a dilemma,” said Chang Ching, a retired
Taiwan naval captain and researcher at the Taipei-based Society for Strategic
Studies. “They want to send smart, calibrated signals to Beijing without
causing an overreaction or misunderstanding.”
This caution is typical of the restraint the U.S. and allied navies,
including Japan and Australia, now display in international waters near the
Chinese coast, according to more than 10 current and former senior U.S. and
Western military officials.
China now rules the waves in what it calls the San Hai, or “Three Seas”:
the South China Sea, East China Sea and Yellow Sea. In these waters, the United
States and its allies avoid provoking the Chinese navy.
In just over two decades, the People’s
Liberation Army (PLA), the Chinese military, has mustered one of the mightiest
navies in the world. This increased Chinese firepower at sea - complemented by
a missile force that in some areas now outclasses America’s - has changed the
game in the Pacific. The expanding naval force is central to President Xi
Jinping’s bold bid to make China the preeminent military power in the region.
In raw numbers, the PLA navy now has the world’s biggest fleet. It is also
growing faster than any other major navy.
---- China’s Ministry of National Defence, the U.S. Indo-Pacific Command and the Pentagon did not respond to questions from Reuters.
For the United States, the stakes are now much higher in any operation
to support its regional allies, including Japan and Taiwan. America now faces
daunting obstacles to any efforts to reinforce heavily outgunned Taiwan in a
crisis. Beijing regards Taiwan as a renegade province and is currently building
an amphibious force that could give it the capacity to launch an invasion of
the island.
Senior Asian defence and security officials say the PLA’s naval advances
have introduced a new uncertainty in such scenarios: If Beijing can sow serious
doubt about whether Washington will intervene against China, it would undermine
the value of U.S. security guarantees in Asia.
--- Since 2014, China has launched more warships, submarines, support ships and major amphibious vessels than the entire number of ships now serving in the United Kingdom’s fleet, according to an analysis from the London-based International Institute for Strategic Studies published in May last year. Between 2015 and 2017, China launched almost 400,000 tonnes of naval vessels, about twice the output of U.S. shipyards in that period, the IISS said.
The PLA navy now has about 400 warships and submarines, according to
U.S. and other Western naval analysts. By 2030, the Chinese navy could have
more than 530 warships and submarines, according to a projection in a 2016 U.S.
Naval War College study.
more
US and China will have many more battles to fight when the trade war ends
·
Negotiators are focused on resolving a
long-running tariff dispute but the conflict between Washington and Beijing
extends far beyond sales of soybeans and aluminium
·
Technology, politics, ideology and even the
military are all areas where tensions could bubble over, analysts say
Jodi Xu
Klein, US correspondent Published: 9:00pm, 29 Apr, 2019
China and the United States appear closer than ever to an accord that
would end their trade war but policymakers and investors are not popping any
champagne.
As Washington’s top trade negotiators prepare to meet their counterparts
in Beijing on Tuesday amid expressions of confidence that China’s markets will
further open up, many with stakes in the talks’ outcome are focused on other
developments – like the US government’s recent moves against a Chinese company
that owns a popular gay dating app.
Rarely does a week go by without an announcement about US sanctions
against Chinese companies, espionage investigations or warnings from lawmakers
that the US military must prepare for a hot war with China.
The trade deal
that is likely to come within weeks will be barely enough to slow a less
visible but more lasting clash. Many believe more serious conflicts between the
two countries are just unfolding.
“US-China relations have entered a competitive phase that goes well
beyond trade disputes,” Richard Turnill, lead researcher at BlackRock, the
asset management giant, wrote in a global outlook report this month.
“Tensions have broadened to include technological, political,
ideological and military dimensions – and we see them as long-lasting.” He
warned investors against confusing “any trade truce with a detente in the
overall relationship”.
As if to punctuate the point, on Friday FBI director Christopher Wray
told the Council on Foreign Relations in Washington that China was determined
to “steal its way up the economic ladder” at the United States’ expense,
warning of a “multilayered” counter-intelligence threat posed by Beijing.
“China has pioneered a societal approach to stealing innovation in any
way it can, from a wide array of businesses, universities and organisations,”
he said.
More
Interest rates are the most important prices
in the economy, according to Nobel laureate F.A. Hayek, because they reflect
the collective time preference of individuals to consume either now or later.
Accordingly, interest rates co-ordinate allocation of capital across the
economy by signalling to businesses whether they should invest. Distortions in
interest rates can cause “clusters of errors” in which large swathes of
businesses unwittingly miscalculate at the same time.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled
over.
Today, Huawei again. “There’s
a red under the bed,” and all that. So
which USA agency leaked/planted/spun the old story to USA’s Bloomberg? We all
know only too well why. Programming flaws/errors now become “backdoors.” If
there were a real backdoor, Uncle Scam would have published it by now.
Things
are seldom what they seem,
Skim milk masquerades as cream;
Highlows pass as patent leathers;
Jackdaws strut in peacock's feathers.
Skim milk masquerades as cream;
Highlows pass as patent leathers;
Jackdaws strut in peacock's feathers.
HMS
Pinafore. Gilbert and Sullivan.
Vodafone found security flaws in Huawei equipment in 2011, 2012
April 30, 2019 /
9:39 AM
LONDON (Reuters) - Telecoms group Vodafone found security flaws in
equipment supplied by China’s Huawei to its Italian business in 2011 and 2012,
the two companies said on Tuesday.
Vodafone, Europe’s biggest telecoms group, said it had found security
vulnerabilities in two products and that both incidents had been resolved
quickly. Bloomberg reported the news first.
Huawei, the world’s biggest producer of telecoms equipment, is under
intense scrutiny after the United States told allies not to use its technology
because of fears it could be a vehicle for Chinese spying. Huawei has
categorically denied this.
Britain last week sought to navigate its way through the bitter dispute
between the two countries, deciding to block Huawei from all core parts of its
5G network and restrict access to non-core parts.
Huawei said it was made aware of historical vulnerabilities in 2011 and
2012 and that they had been addressed at the time.
“Software vulnerabilities are an industry-wide challenge,” it said.
“Like every Information and Communications Technology vendor we have a
well-established public notification and patching process, and when a
vulnerability is identified we work closely with our partners to take the
appropriate corrective action.”
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?
Researchers mix graphene and sulphur for battery breakthrough
Written by Gareth Halfacree April 29, 2019 | 11:26
Graphene, a honeycomb lattice of carbon measuring just one atom thick, has been positioned as a miracle material for a range of technologies - including batteries, where it has been available on the market since 2012. Researchers at Chalmers University of Technology, though, have now found a way to use a graphene sponge to help bring energy-dense lithium sulphur batteries to market - potentially boosting the lifespan of future mobile devices fivefold.
Where a traditional battery is made up of four key parts - the anode, cathode, electrolyte, and a separator so the anode and cathode electrodes don't make direct contact - the researchers' work sees the cathode and electrolyte combined into a single liquid dubbed a 'catholyte'. Previously, though, this combination - while offering reduced weight, faster charging, and improved capacities - proved unreliable.
The solution: The insertion of a layer of graphene aerogel. 'You take the aerogel, which is a long thin cylinder, and then you slice it – almost like a salami. You take that slice and compress it, to fit into the battery,' explains lead researcher Carmen Cavallo. 'The porous structure of the graphene aerogel is key. It soaks up a high amount of the catholyte, giving you high enough sulphur loading to make the catholyte concept worthwhile. This kind of semi-liquid catholyte is really essential here. It allows the sulphur to cycle back and forth without any losses. It is not lost through dissolution – because it is already dissolved into the catholyte solution.'
The redesigned battery could, the researchers claim, scale up to a
theoretical maximum energy density of 1,500 watt-hours per kilogramme - a
considerable boost over the 350 watt-hours per kilogramme available from
perfect lithium-ion batteries. 'Furthermore, sulphur is cheap, highly
abundant, and much more environmentally friendly,' adds Professor
Aleksander Matic. 'Lithium sulphur batteries also have the advantage of not
needing to contain any environmentally harmful fluorine, as is commonly found
in lithium ion batteries.'
The prototype created by the research team shows an 85 percent capacity
retention after 350 charge-discharge cycle, proving considerably more reliable
than previous lithium sulphur efforts. The team, however, warns that there is a
long road to commercialisation still ahead: 'Since these batteries are
produced in an alternative way from most normal batteries,' explains
Professor Matic, 'new manufacturing processes will need to be developed to
make them commercially viable.'
The team's work is published in the Journal of Power Sources under open access terms and a
Creative Commons licence.
Alan Schwartz, CEO Bear Stearns, March 12, 2008.
Bust March 16, 2008.
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 wrong fast.
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