Thursday, 12 September 2019

ECB To Hit Panic Button?


Baltic Dry Index. 2366 -27 Brent Crude 61.24  Spot Gold 1496

Never ending Brexit now October 31, maybe. 49 days away.
Trump’s Nuclear China Tariffs Now In Effect.
USA v EU trade war postponed to November, maybe.

“As government expands, liberty contracts.”

Ronald Reagan

Yesterday it was all about the America v China trade war again. This time it was both generating goodwill gestures in a badly needed attempt to goose up stock markets in the face of ever more distressing signs of a new recession rolling out.

China said it would produce a list of US goods to be excluded from new Chinese tariffs. President Trump said he would delay an October 1st tariff hike to October 15th, since no one had told him October 1st was the 70th anniversary of the founding of modern communist China. You couldn’t make this sort of trade war insanity up.

No one wins a trade war, the “winner” is just who loses least. Right now that seems to be the rest of the world, with America and China in a tight race for the dubious title of loser.

Today, all eyes are on Euroland’s central bank, where developments in Germany are expected to have the ECB hitting the panic button. To this old dinosaur market follower, this is a time to be selling out of stocks to the latest in greater fool buyers.

Asian markets mostly gain as trade tensions ease

Published: Sept 11, 2019 11:06 p.m. ET
Asian markets were mostly up in early trading Thursday as trade-war tensions eased after President Donald Trump announced a two-week delay in implementing tariff hikes against $250 billion in Chinese goods.

In a pair of tweets late Wednesday, Trump said the tariff hikes, which had been scheduled to take effect Oct. 1, will be put off until Oct. 15 as a “gesture of good will.” Earlier in the day, China said it would exempt some U.S. goods from tariff hikes it intends to impose starting Sept. 17. The conciliatory moves appear to be efforts to create goodwill before the resumption of trade negotiations in early October.

In a positive sign, Trump and China appear “willing to negotiate to put an end to this trade war spat,” Stephen Innes, Asia-Pacific market strategist at AxiTrader, wrote in a note.

Investors were also optimistic of a rate cut by the European Central Bank later Thursday. Policy makers are expected to announce further monetary stimulus at a news conference Thursday morning, Eastern time.
More

China unveils lists of US products to be excluded from additional tariffs

Xinhua | Updated: 2019-09-11 13:36
China on Wednesday unveiled the first set of lists of US goods to be excluded from the first round of additional tariffs on US products.

The exemption will be effective from Sept 17, 2019 to Sept 16, 2020, the Customs Tariff Commission of the State Council said in a statement.

Two lists of goods will be excluded from China's first round of tariff countermeasures against the US Section 301 measures.

The first list includes 12 items and allows affected import enterprises to apply for refunds of collected duties within six months from Wednesday.

The second list includes four items that will enjoy the exemption but are not eligible for tariff refunds.

Next, the commission will continue to work on the exemption process and release subsequent lists in due course, according to the statement.
http://global.chinadaily.com.cn/a/201909/11/WS5d7887eba310cf3e3556afbf.html

Trump pledges to postpone 5 percent hike on Chinese tariffs

Sept. 11, 2019 / 8:09 PM
Sept. 11 (UPI) -- President Donald Trump on Wednesday said the United States will postpone a planned 5 percent tariff increase on Chinese goods.

Trump wrote on Twitter that he will push the 5 percent increase in tariffs back two weeks at the request of Chinese Vice Premier Liu He because the original date of Oct. 1 fell on China's 70th anniversary. 

"We have agreed, as a gesture of goodwill, to move the increased tariffs on $250 billion worth of goods (25 percent to 30 percent) from Oct. 1 to Oct. 15," Trump wrote.

The president initially announced the tariff increase last month, again accusing China of "taking advantage of the United States on trade, intellectual property theft and much more."

Also, earlier this month the United States imposed new 15 percent tariffs on about $111 billion worth of Chinese goods including clothing and food.

The news also comes after the two countries agreed to another round of trade negotiations in the coming weeks.
https://www.upi.com/Top_News/US/2019/09/11/Trump-pledges-to-postpone-5-percent-hike-on-Chinese-tariffs/7661568245391/?ls=2

In European news, panic time. Germany is leading Euroland into a new recession and we haven’t had Brexit yet. At the ECB later today, outgoing President Draghi is expected to hit the panic button.

German institutes see recession, cut growth forecasts for 2019, 2020

September 11, 2019 / 9:19 AM
BERLIN (Reuters) - The German economy will slide into a recession in the current quarter, the Kiel Institute for the World Economy (IfW) said on Wednesday as it slashed its growth forecasts for Europe’s biggest economy due to trade disputes and Brexit uncertainty.

The IfW institute said it expected the German economy to shrink by 0.3% quarter-on-quarter in the third quarter after a 0.1% contraction in the previous quarter. 

It also cut its 2019 growth forecast for the German economy to 0.4% from 0.6% previously. For 2020, it now sees growth of 1.0% for 2020, down from its earlier estimate of 1.6%. For 2021, the institute predicts an expansion of 1.4%.

“The real problem with (U.S. President) Donald Trump’s trade disputes is not the tariffs themselves, but the great uncertainty about what is to come. Uncertainty is poison for investment decisions,” IfW President Gabriel Felbermayr said.

---- The RWI economic institute also reduced its growth forecast for the German economy for this year to 0.4% from 0.8% previously. For 2020, it sees 0.9% growth, saying there were increasing signs that the economy was going into a downturn.

“In particular, the decline in production continues in the manufacturing sector, especially in the automotive industry,” it said. “This increases the risk that the German economy will fall into recession.”

Chancellor Angela Merkel told lawmakers earlier that the current economic situation in Germany meant tax revenues may come in lower than expected. This could limit the government’s fiscal room to counter a recession.
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Moment of truth for ECB on new round of stimulus

Issued on:
After 2019 opened with hopes the European Central Bank could begin "normalising" policy after years of buttressing the eurozone, governors appear set for a fresh unconventional turn Thursday, under pressure from financial markets.

Deeper negative interest rates, a new bond-buying programme and relief for struggling banks are all on the agenda, producing a rarely-seen level of public division on the bank's governing council.
President Mario Draghi, who will yield his seat to departing International Monetary Fund chairwoman Christine Lagarde on October 31, could yet tie her hands for months -- or years -- to come with his final moves.

Over the summer, Draghi stoked confidence in an upcoming policy package.

In July he reiterated the "possibility of actions in the future, if there is no improvement" in economic conditions.

"This might be his last stunt, but we expect Mario Draghi to conquer the barricades once again" around the council table, ING bank economist Carsten Brzeski said.

"The costs of waiting or only delivering parts of a big package and then trying to get ahead of the curve at a later stage will be higher," he added.

- Washington watching -

Central bankers have for years failed to hit their inflation target of just below 2.0 percent, despite unprecedented interventions -- peaking in a 2.6-trillion-euro ($2.9-trillion) bond-buying scheme from 2015-18 and negative rates on banks' deposits.

Now US-led trade wars, weakness in emerging markets and the risk of a no-deal Brexit are slowing growth.

In the second quarter, economic activity in the eurozone expanded by just 0.2 percent compared with January-March, while annual inflation fell to 1.0 percent in July. Its leading economy, Germany, is forecast to slide into recession in the third quarter.

Pictet Wealth Management strategist Frederik Ducrozet underscored risk of markets' expectations for future inflation becoming "de-anchored" from the central bank's aim.

The resultant bets on lower future inflation could turn into self-fulfilling prophecies.

Ducrozet suggested Draghi could announce 600 billion euros worth of new bond purchases, as well as a cut in the deposit rate banks pay to park cash with the ECB, from -0.4 to -0.5 percent.

But "dissensions within the governing council could lead to a sub-optimal decision" that leaves asset purchases for another day, he added.

Trouble could also loom from far beyond the ECB's 43-floor glass tower in Frankfurt.

"An ECB decision for further monetary stimulus could be seen by the US president as anti-competitive behaviour by the ECB," warned Nomura analyst Chiara Zangarelli.

"This could well mean a renewed focus by the Trump administration on auto tariffs."
More

Finally, Norway, the poster child of electric vehicles, or is it? Below, what mainstream media don’t cover. How to make a small fortune – start with a large one.

Norway’s electric car miracle is a smug national fraud built on subsidizing rich people with Teslas

Published time: 8 Sep, 2019 09:40 Edited time: 9 Sep, 2019 10:12
The government in Oslo spending billions of oil export dollars to help the affluent buy an electric second car they wouldn’t otherwise want is European environmentalism at its phoniest and most hare-brained.

It’s not that you can’t financially encourage societies to be more planet-conscious, but this charade of perverse incentives, inefficiencies, and negative side effects is not it.

Norway’s electric car miracle is primarily one of numbers.

Last year, EVs accounted for 49.8 percent of all cars purchased in the country, and so far this year three in five new cars bought in Norway are electric. For comparison, 2.1 percent of new cars registered in the US last year were EVs, while for the EU the figure is even lower – 0.9 percent.

Thus, with a population of only 5 million, Norway has become the world’s third biggest electric car market.

This has burnished the Scandinavian country's credentials as a land populated by uniquely-ethical people.

But how has this incredible outlying result been achieved? Pure shameless bribery from the state.

By dropping VAT, CO2 tax and weight tax a Tesla imported for $70k becomes cheaper than an Audi that cost $35k when it crossed the Norwegian border. Add in the lowered road tax and free passage through toll roads, free places on ferries and free parking, as well as the difference in the fuel price, such cars are 75 percent cheaper to operate.

Norway is spending about $2 billion each year on the subsidies – as much as it expends on parental leave pay – and with the current uptake rate and existing rules the current figure will balloon into the tens of billions.

-----At least you are taking conventional cars off the road… Well, not really. Two-thirds of the EV buyers have another internal combustion engine car. Similarly two-thirds of households buying their only car, will still buy traditional engines.

Because other than for urbanites making regular short city runs, owning an electric car is impractical, particularly as your sole means of independent transportation in a country with a small population scattered over great distances.

Unsurprisingly, studies show that rich people are many times more likely to invest in an electric car – particularly since there are few second-hand ones available – than poor people. And then they still use it less than their main car.

One thing it replaces though is public transport, which becomes less financially attractive, and more troublesome, what with the EVs clogging all the dedicated bus lanes they are allowed to use.

“The most terrifying words in the English language are: I'm from the government and I'm here to help.”

Ronald Reagan

 Crooks and Scoundrels Corner.

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

Today, did Apple just seriously misjudge its market in China?

Chinese users are trolling Apple for not having a 5G phone

By Echo Huang  11 September 2019
China’s fans used to stay up late for Apple’s product launch. This time they woke up to complain that the iPhone no longer leads the mobile market.

Hours after the California-based phone maker presented the iPhone 11 series on Wednesday (Sept. 10), Chinese fans expressed their disappointment at the latest lineup on Weibo. Among launch-related topics trending on the social media platform, #iPhone 11 has no 5G version# stood out—posts under the topic have garnered some 30 million views as of writing. 5G is the fifth generation of wireless networking, which will be far speedier than current connections even when dealing with large amounts of data—in other words, great for playing mobile games.

“iPhone 11’s China market will look bad without a 5G version. As domestic phones are rushing to apply 5G, people might not want to get an iPhone 11. Domestic manufacturers will easily beat a phone that cost more than 10,000 yuan with no 5G support in China in 2020,” wrote a user. (The iPhone 11 Pro Max starts at 9,599 yuan, or about $1,350, in China.)

“This version is like a transition product. There’s nothing much to look at besides iOS. I am looking forward to next year’s if they have a bigger change. I am looking at Huawei’s Mate series more than Apple’s iPhones now,” wrote another user

Apple has yet to set a date to launch a 5G phone—Apple-focused news sites have said we might not see a 5G iPhone until well into 2020. Meanwhile several Asian smartphone makers are already selling 5G phones. Chinese phone and telecom equipment maker Huawei, for instance, last month rolled out the Mate 20. Huawei said it has more than a million orders for the phone, which comes with a starting price of  6,199 yuan ($871). Korean electronics maker Samsung rolled out the Galaxy S10, also a 5G model, in March at a starting price of $1,299.

Ahead of the launch, research firm IDC noted that Apple will have a challenging 2019, in part due to its lack of 5G devices. “Commercial deployments have begun in many regions and while 2019 is very much an introductory year at best, 2020 looks to be the year where 5G begins to ramp up,” according to a report by the Chinese-owned market research group in early September.

It’s unclear how the topic got going on Weibo, but some Chinese state media picked up on it. China News Service published a poll that asked whether people would buy the iPhone 11, and a majority of the more than 4,000 comments said they weren’t considering it because of its price and the lack of 5G support.

Some users, though, pointed out there isn’t much use to a 5G phone yet: “Don’t keep talking about whether it has 5G, which is expensive to start with. Also, 5G base stations are far from ready. It will at least take another two years [for the application] to be widespread, so use what you have first,” a user wrote under the poll.

China’s expected to roll out a commercial 5G network next month, starting in Shanghai, while in the US carrier AT&T has turned on 5G in at least 20 cities. South Korea also launched its 5G service this year.

Weibo comments don’t necessarily translate into low sales but they’re a worrying sign given Apple’s recent performance in China hasn’t been great. Sales in the fourth-quarter of 2018, after its last launch, were down 20% from a year earlier, and competition is only likely to intensify as China’s mobile market slows.

“I've heard that hard work never killed anyone, but I say why take the chance?”

Ronald Reagan


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?

Future of portable electronics -- Novel organic semiconductor with exciting properties

Researchers synthesize a new substance that can potentially be adapted to form a semiconductor with wide applications in electronics

Date: September 10, 2019

Source: Tokyo University of Science

Summary: Organic semiconductors have advantages over inorganic semiconductors in several areas. 
However, there are only a few known organic n-type semiconductors, and even they have certain drawbacks such as instability and insolubility in organic solvents. Now, scientists report on the production of a novel organic substance with potential applications as an n-type semiconductor.

Semiconductors are substances that have a conductivity between that of conductors and insulators. Due to their unique properties of conducting current only in specific conditions, they can be controlled or modified to suit our needs. Nowhere is the application of semiconductors more extensive or important than in electrical and electronic devices, such as diodes, transistors, solar cells, and integrated circuits.

Semiconductors can be made of either organic (carbon-based) or inorganic materials. Recent trends in research show that scientists are opting to develop more organic semiconductors, as they have some clear advantages over inorganic semiconductors. Now, scientists, led by Prof Makoto Tadokoro of the Tokyo University of Science, report on the synthesis of a novel organic substance with potential applications as an n-type semiconductor. This study is published in the journal Organic and Biomolecular Chemistry. According to Prof Makoto Tadokoro, "organic semiconductor devices, unlike hard inorganic semiconductor devices, are very soft and are useful for creating adhesive portable devices that can easily fit on a person." However, despite the advantages of organic semiconductors, there are very few known stable molecules that bear the physical properties of n-type semiconductors, compared to inorganic n-type semiconductors.

N-heteroheptacenequinone is a well-known potential candidate for n-type semiconductor materials. However, it has some drawbacks: it is unstable in air and UV-visible light, and it is insoluble in organic solvents. These disadvantages obstruct the practical applications of this substance as a semiconductor.

A team of Japanese scientists -- Dr. Kyosuke Isoda (Faculty of Engineering and Design, Kagawa University; ex-Tokyo University of Science), Mr. Mitsuru Matsuzaka (ex-Tokyo University of Science), Dr. Tomoaki Sugaya (Chiba Institute of Technology, ex-Tokyo University of Science), and Prof Tadokoro -- aimed to bridge this gap, and identified a novel substance called C6OAHCQ, derived from N-heteroheptacenequinone, that overcomes the drawbacks of N-heteroheptacenequinone.

---- The synthesis of organic C6OAHCQ is a new step forward in semiconductor research, due to its distinctive properties that distinguish it from existing organic semiconductors. C6OAHCQ is also a revolutionary step in the current research scenario dominated by inorganic semiconductors. Prof Tadokoro and team assert the importance of this novel substance, stating, "the identification of this organic acceptor molecular skeleton that has the property of stably receiving electrons is very important, as it can be used to develop molecular devices with new functionality. These devices are soft, unlike hard inorganic semiconductor devices, and can help to create portable devices."

“Government's view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”

Ronald Reagan

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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