Baltic Dry Index. 2378 +101 Brent Crude 58.96 Spot Gold 1525
Never ending Brexit now October 31, maybe. 59 days away.
Trump’s Nuclear China Tariffs Now In Effect.
USA v EU trade war postponed to November, maybe.
Every decision on trade, on taxes, on immigration, on foreign
affairs, will be made to benefit American workers and American families. We
must protect our borders from the ravages of other countries making our
products, stealing our companies, and destroying our jobs. Protection will lead
to great prosperity and strength.
Donald Trump
The big news story this morning is the devastating
category 5 hurricane battering the Bahamas and where it goes next in the
Atlantic. Florida and much of the east coast of America is under threat, though
some computer models suggest it might turn to the north and only brush against
the coastline near the Carolinas.
In trade war news, more tit for tat tariffs between
America and China kicked in yesterday, and while America celebrates Labor Day
today, Asian markets are nervously lower. “Dr Doom” Nouriel Roubini, now thinks
the trade and currency wars will generate a new recession.
Asian factories lashed by trade wars, slowing demand in August
September 2, 2019
/ 5:24 AM
TOKYO (Reuters) -
The bitter trade war between China and the United States kept Asian factory
activity mostly in decline in August, business surveys showed, strengthening
the case for policymakers to unleash fresh stimulus to fend off recession
risks.
In a surprise development, China’s factory activity unexpectedly
expanded in August as output edged up, a private sector purchasing managers’
index (PM) showed on Monday, but orders remained weak and business confidence
faltered.
Export-reliant South Korea, Japan and Taiwan also saw factory activity
shrink, underscoring the growing pain from the tit-for-tat tariff war between
the world’s two-largest economies.
“The broader picture for Asian exports remains very weak because of the
impact of the U.S.-China trade war, which is continuing to escalate,” said
Rajiv Biswas, Asia Pacific chief economist at IHS Markit.
“It’s not only the U.S.-China trade war. It’s also the slowdown in
China’s auto sector and also because the smartphone demand in China has slowed
down. That is again having a negative impact on the South Korean and Japanese
electronics sector.”
In a fresh escalation of trade tensions, the United States began
imposing 15% tariffs on a variety of Chinese goods on Sunday. China
reciprocated with new duties on U.S. crude.
In China, the Caixin/Markit Manufacturing Purchasing Managers’ Index
(PMI) for August rose to a five-month high of 50.4 from 49.9 in July, beating a
median market forecast and exceeding the 50-point level that separates
contraction from growth on a monthly basis.
The reading followed Beijing’s official PMI that showed factory activity
shrank in August for the fourth month in a row, pointing to a further slowdown
in the world’s second-largest economy.
Elsewhere in Asia, Japanese manufacturing activity fell for a fourth
straight month in August, underlining a darkening outlook for the world’s
third-largest economy.
More
Stocks shiver as new U.S.-China tariffs add to global gloom
September 2, 2019
/ 12:53 AM
TOKYO (Reuters) -
Global stock prices fell on Monday after the United States and China imposed
new tariffs on each other’s goods, reinforcing investors’ worries over slowing
global growth.
The E-mini futures for U.S. S&P500 ESc1 fell as much as 1.06% in early trade and last stood down 0.39%.
Japan's Nikkei .N225 shed 0.28%.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS dropped 0.3%, led by 0.5% drop in Hong Kong's Hang Seng .HSI after another weekend of violent anti-government protests.
But mainland Chinese shares fared better, with the CSI300 index .CSI300 rising 0.3% despite the trade row escalation.
China’s State Council said on Sunday it will increase adjustments of economic policy. A private survey on Monday showed factory activity unexpectedly expanded in August, though gains were modest and contrasted with official data that pointed to further contraction. nL3N25Q0XL
U.S. President Donald Trump slapped 15% tariffs on a variety of Chinese goods on Sunday - including footwear, smart watches and flat-panel televisions - while China imposed new duties on U.S. crude, the latest escalation in a bruising trade war.
A variety of studies suggest the tariffs will cost U.S. households up to $1,000 a year, with the latest round hitting a significant number of U.S. consumer goods.
In retaliation, China started to impose additional tariffs on some of
the U.S. goods on a $75 billion target list. Beijing did not specify the value
of the goods that face higher tariffs from Sunday.
“So far Trump appears defiant though on the tariff hikes, blaming the
Fed and American companies for their difficulties in dealing with the tariffs,”
said Shane Oliver, chief economist at AMP in Sydney.
“There is a long way to go though and re-establishing trust will be
difficult after the experience since mid-last year. Share markets may still
have to fall further to pressure Trump to resolve the issue.”
More
Trump Heaps More Tariffs on China, Still No Deal in Sight
By Jenny Leonard and Mark Niquette
September 1, 2019, 4:45 AM GMT+1 Updated on September 1,
2019, 6:37 AM GMT+1
The Trump administration slapped tariffs on roughly $110 billion in
Chinese imports on Sunday, marking the latest escalation in a trade war that’s
inflicting damage across the world economy. China retaliated.
The 15% U.S. duty hit consumer goods ranging from footwear and apparel
to home textiles and certain technology products like the Apple Watch. A
separate batch of about $160 billion in Chinese goods -- including laptops and
cellphones -- will be hit with 15% tariffs on Dec. 15. President Donald Trump
delayed part of the levies to blunt the impact on holiday shopping.
While the Trump administration has dismissed concern about a protracted
trade war, business groups are calling for a tariff truce and the resumption of
negotiations between the world’s two-largest economies.
Face-to-face talks between Chinese and American trade negotiators scheduled for Washington in September are still happening “as of now,” Trump told reporters Friday before going to Camp David, the U.S. presidential retreat.
“We’re going to win the fight,” he said.
How the U.S.-China Trade War Got to This Point: QuickTake
China has repeatedly decried U.S pressure tactics, with signs that its officials are girding for a prolonged confrontation.
“China’s determination to fight against the U.S. economic warmongering has only grown stronger, and its countermeasures more resolute, measured and targeted,” according to a commentary by the official Xinhua News Agency after the tariffs kicked in. One thing that “White House tariff men should learn is that the Chinese economy is strong and resilient enough to resist the pressure brought about in the ongoing trade war.”
While Trump has repeatedly said China is paying for his tariffs, many companies and economists say that U.S. importers bear the cost -- and some of it is passed on to consumers.
The non-partisan Congressional Budget Office in August projected that by 2020, Trump’s tariffs and trade war will reduce the level of real U.S. GDP by about 0.3% and reduce average real household income by $580.
That followed a JPMorgan Chase & Co. note to clients estimating that the latest round of tariffs will increase the average cost per U.S. household to $1,000 a year -- up from $600 for duties enacted last year. That estimate is in the low range because it was based on a duty rate of 10%, before Trump increased it to 15%.
More
China's factory activity shrinks for fourth month as trade woes deepen
August 31, 2019 /
2:14 AM
BEIJING (Reuters)
- Factory activity in China shrank in August for the fourth month in a row as
the United States ramped up trade pressure and domestic demand remained
sluggish, pointing to a further slowdown in the world’s second-largest economy.
Persistent weakness in China’s vast manufacturing sector could fuel
expectations that Beijing needs to roll out stimulus more quickly, and more
aggressively, to weather the biggest downturn in decades.
The Purchasing Managers’ Index (PMI) fell to 49.5 in August, China’s
National Bureau of Statistics said on Saturday, versus 49.7 in July, below the
50-point mark that separates growth from contraction on a monthly basis.
A Reuters poll showed analysts expected the August PMI to stay unchanged
from the previous month.
The official factory gauge showed growing trade frictions with the
United States and cooling global demand continued to wreak havoc on China’s
exporters.
Export orders fell for the 15th straight month in August, although at a slower pace, with the sub-index picking up to 47.2 from July’s 46.9.
Total new orders - from home and abroad - also continued to fall, indicating domestic demand remains soft, despite a flurry of growth-boosting measures over the past year.
“Frontloading of exports to the U.S. ahead of higher tariffs supported trade and overall activity growth, but this effect will likely fade in the next few months,” said analysts at Goldman Sachs in a note.
Manufacturers in consumption-oriented industries such as the auto sector have been especially vulnerable. Carmakers such as Geely (0175.HK) and Great Wall (601633.SS) have slashed expectations for sales and profits.
The data showed activity at medium- and small-sized firms contracted,
even as large manufacturers, many backed by the government, managed to expand
in August.
Factories continued to shed jobs in August amid the uncertain business
outlook. The employment sub-index dropped to 46.9, compared with 47.1 in July.
More
Finally, more on that ever so easy to win trade war with China. Trouble
is it might not be America winning. Could dopey old Europe show up among the
winners?
US-China trade war creates competitive edge European players
August 30, 2019 10:24 AM
The trade war between China and the US is creating additional
opportunities for exporters of plastics, plastic products and ingredients in
both these key markets, as both sides erect protective tariffs against each
other.
While talks to resolve the dispute over American claims of Chinese
misconduct regarding intellectual property misappropriation, industrial
subsidies and market access stall, duties of 10% are being imposed by the US on
Chinese goods and 10% and 5% by China on US exports.
Both sides have announced these latest duties will be imposed in two
stages – on 1 Sep and 15 Dec.
On 1 Sept, US duties will take effect on Chinese plastic products such
as bathroom fittings, dining sets, furniture, nursing products, fasteners,
laminated wallpaper, clothing, footwear, jewellery and sanitary items. Paraffin
wax and other chemicals are also listed.
Plastic office and school supplies, ornaments, waterbeds, pneumatic
mattresses, other footwear, highchairs, toys, as well as hair accessories will
be added to the list 15 Dec.
The Chinese retaliatory duties on US exports focus more on basic plastic
materials lines.
Beijing’s duties will include 5% tariffs on American-made plastic
moulds; polyvinyl chloride; plastic monofilaments, strips, rods and profile
profiles; plastic tubes, hoses, pipes; and polyvinyl chloride sheets, sheets,
films, foils and flat strips, for instance. These duties will take effect at
the beginning of September.
Variable duties of 5% and 10% apply to US-made plastic consumer products
such as bath fittings, boxes, bags and furniture; and suitcases and some
footwear
On 15 Dec, China will impose 10% duties on American plastic
sanitaryware, tableware, window panels, clothes and sculptures.
The December tariffs will also cover a 5% duty for plastic caps,
flowers, doors, window frames, boots and buttons as well as a 10% rate on
US-made plastic moulding and calendaring machines.
The trade war, said Asian business advisors Dezan Shira & Associates,
was weakening US export competitiveness.
“The new tariffs represent an overall total value of about 10% of all
US-China bilateral trade, which…means that another $75bn (€68bn)… is about to
have new or additional tariffs imposed upon them – a significant burden for US
suppliers to China,” said the strategic consulting firm.
Will the US and Chinese governments reach agreement on their disputes
over trade and remove these tariffs? Talks in September are still scheduled,
with the Chinese government calling on the US to create diplomatic conditions
conducive to a deal.
US President Donald Trump is optimistic, saying: “I think we're going to
have a deal, because now we're dealing on proper terms. They understand and we
understand."
However, China’s State Council Tariff Commission has been far less
enthusiastic, saying: “The US measures have led to the continuous escalation of
Sino-US economic and trade frictions, which have greatly harmed the interests
of China, the United States and other countries….”
https://www.plasticsnewseurope.com/news/us-china-trade-war-creates-competitive-edge-european-players
Dr Doom (Roubini) Sees Trade War Triggering Global Recession
August 31, 2019(Project Syndicate / Nouriel Roubini) There are three negative supply shocks that could trigger a global recession by 2020. All of them reflect political factors affecting international relations, two involve China, and the United States is at the center of each. Moreover, none of them is amenable to the traditional tools of countercyclical macroeconomic policy.
The first
potential shock stems from the Sino-American trade and currency war,
which escalated earlier this month when US President Donald Trump’s
administration threatened additional tariffs on Chinese exports, and formally
labeled China a currency manipulator.
The second concerns the slow-brewing cold
war between the US and China over technology. In a rivalry that has all the
hallmarks of a “Thucydides Trap,” China and America are vying for dominance
over the industries of the future: artificial intelligence (AI), robotics, 5G,
and so forth. The US has placed the Chinese telecom giant Huawei on an “entity
list” reserved for foreign companies deemed to pose a national-security threat.
And although Huawei has received temporary exemptions allowing it to continue
using US components, the Trump administration this week announced that it was adding an additional 46 Huawei
affiliates to the list.
More
Enforcing trade deals is spot on. Acting in the interest of
American workers is correct. But large-scale tariffs are a terrible idea.
Lawrence Kudlow
Crooks and Scoundrels Corner.
The bent, the seriously bent, and the totally doubled
over.
No crooks today. Today more on very dangerous hurricane Dorian.
Hurricane Dorian ‘Off the Charts’ as It Batters Bahamas With 185 MPH Winds
By Brian K Sullivan and Jonathan Levin
Updated on September 2, 2019, 5:26 AM GMT+1
Hurricane Dorian, tied as the most powerful storm to hit land anywhere
in the Atlantic, battered the Bahamas inflicting colossal damage to property
and infrastructure across the chain of islands.
The hurricane brought 180 mile-per-hour winds, as much as 30 inches of
rain in isolated areas, and a storm surge that could top 23 feet and leave the
islands devastated for years. The fate of Florida remains uncertain as the
storm churns in the ocean just 135 miles away.
“I wouldn’t want to be on the Abaco Islands, they are going to have 12 to 15 hours of hurricane force winds with only the eye as the respite,” said Jeff Masters, co-founder of Weather Underground, an IBM business. “Everything in that eye is going to get totaled. It is going to take them years, if not a decade, to recover.”
Its maximum sustained winds were 180 mph at 11 p.m. local time, the National Hurricane Center said. Winds were earlier recorded at 185 mph, which tied the 1935 Labor Day hurricane, which crushed the Florida Keys, as the strongest storm ever to hit land anywhere in the Atlantic, said Maureen O’Leary, spokeswoman for the National Weather Service.
Roughly 100,000 of the Bahamas population of 370,000 live in areas that are going to be hit by the storm, said Kevin Peter Turnquest, the country’s deputy prime minister, adding in a response to queries that Abaco suffered “severe destruction of homes and infrastructure.”
While
the devastation mounts in the Bahamas, the threat to Florida and the U.S. East
Coast remains uncertain. A hurricane watch has been extended northward to the
Florida-Georgia line and the mouth of the St. Mary’s River, and remains in
place from Lantana to the Volusia-Brevard county line. While many people focus
on winds, most hurricane deaths are caused by storm surge and drowning from
flooding.
Fluctuations in weather patterns across the U.S. and Atlantic mean
Dorian could hit Florida or further up the coast in Georgia or the Carolinas
later this week -- or not make landfall at all. Mandatory evacuations have been
ordered in parts of Florida, Georgia and South Carolina, including for the
Mar-a-Lago club owned by Donald Trump, which the president often uses as a
“Winter White House.”
“Life-threatening storm surge and dangerous hurricane-force winds are
expected along portions of the Florida east coast through mid-week,” Lixion
Avila, a senior hurricane specialist at the center wrote in an analysis. “Only
a slight deviation to the left of the official forecast would bring the core of
Dorian near or over the Florida east coast.”
More
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?
Israel inaugurates vast Negev thermo-solar power plant
The power plant will contribute significantly to Israel’s target of making 10% of the country’s electricity supply renewable by 2020, and 17% by 2030, according to Energy Minister Yuval Steinitz.
By Eytan Halon
August 30, 2019
Ashalim
in the Negev – was inaugurated on Thursday at a ceremony attended by Energy
Minister Yuval Steinitz and senior government and business officials.
Spanning approximately 390 hectares – larger than the central city of Givatayim – the 121-megawatt solar power facility will supply electricity to approximately 70,000 households in Israel, or approximately 0.75% of all electricity generated in Israel.
Spanning approximately 390 hectares – larger than the central city of Givatayim – the 121-megawatt solar power facility will supply electricity to approximately 70,000 households in Israel, or approximately 0.75% of all electricity generated in Israel.
The
$1.13 billion plant, a public-private partnership (PPP), was constructed by
Negev Energy, a special purpose company held by Shikun & Binui Renewable
Energy, Israeli investment fund Noy Fund and Spanish engineering group TSK. The
Noy Fund and TSK joined the project in April 2016, after Spanish company Abengoa,
a former project partner, went bankrupt.
If
our main purpose in the past was to supply energy for the people in Israel, the
Israeli economy and industry, and public health was maybe secondary, we have
changed our perspective,” said Steinitz. “The main goal now is to supply energy
but also to make it clean and to make sure that we will reduce rather than
increase air pollution.”
The power plant, Steinitz said, will contribute significantly to Israel’s target of making 10% of the country’s electricity supply renewable by 2020, and 17% by 2030. At full capacity, the plant will reduce approximately 245,000 tons of carbon dioxide emissions from fossil fuel sources, equivalent to taking 50,000 vehicles off the road.
“We’re going to meet our target next year, but we are already considering increasing the goal for 2030 and increase the volume of renewables,” Steinitz said. “This is under examination by the Electricity Authority. In the near future, we will terminate the use of coal and other polluting fuels in Israel altogether, and close the coal turbines in Hadera and later on in Ashkelon. It will be only natural gas and renewables, mainly solar systems.”
Unlike nearby photovoltaic (PV) power plants, which directly convert sunlight into electricity, the thermo-solar power plant near Ashalim absorbs solar energy through over 450,000 rotating parabolic mirrors, forming long troughs and collector loops. Synthetic oil inside the loops is heated to 390°C, and by using heat exchangers, thermal energy is mixed with water to power steam turbines and produce electricity.
The power plant, Steinitz said, will contribute significantly to Israel’s target of making 10% of the country’s electricity supply renewable by 2020, and 17% by 2030. At full capacity, the plant will reduce approximately 245,000 tons of carbon dioxide emissions from fossil fuel sources, equivalent to taking 50,000 vehicles off the road.
“We’re going to meet our target next year, but we are already considering increasing the goal for 2030 and increase the volume of renewables,” Steinitz said. “This is under examination by the Electricity Authority. In the near future, we will terminate the use of coal and other polluting fuels in Israel altogether, and close the coal turbines in Hadera and later on in Ashkelon. It will be only natural gas and renewables, mainly solar systems.”
Unlike nearby photovoltaic (PV) power plants, which directly convert sunlight into electricity, the thermo-solar power plant near Ashalim absorbs solar energy through over 450,000 rotating parabolic mirrors, forming long troughs and collector loops. Synthetic oil inside the loops is heated to 390°C, and by using heat exchangers, thermal energy is mixed with water to power steam turbines and produce electricity.
"The
rules-based multilateral trading system is the bedrock of economic
globalization and free trade, and provides important safeguards for win-win
outcomes. The authority and efficacy of the system should be respected and
protected. Some WTO rules do need to be improved. The right approach is for all
to sit down as equals to find solutions.
"The
fundamental principles of free trade should be upheld, the interests and
concerns of all parties be accommodated, and the broadest possible consensus on
reform be built up. Taking a unilateralist approach will not solve any
problems."
Chinese Premier Li
Keqiang, September 2018.
The monthly Coppock Indicators finished August
DJIA: 26,403 +52 Down. NASDAQ: 7,963 +59 Down.
SP500: 2,926 +53 unchanged.
An inconclusive month, but
all three shows signs of weakening.
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