Baltic Dry Index. 2192-74 Brent
Crude 64.73 Spot Gold 1505
Never ending Brexit now October 31, maybe. 41 days away.
Trump’s Nuclear China Tariffs Now In Effect.
USA v EU trade war postponed to November, maybe.
Faced with the choice between changing one's mind and proving that there is no need to do so, almost everyone gets busy on the proof.
John Kenneth Galbraith
We end the week with red flags on the global economy,
everywhere. Klaxons blaring, alarm bells sounding. Strangely, no one is
listening, it seems. With the Equinox just two days away, that means we are
roughly a week away from the most deadly month for stocks. Yet again no one
seems to care. This is probably how Noah felt as he was busy preparing for the
flood.
Below, maybe they do ring a bell at the top.
OECD says global economy will grow at worst pace since financial crisis
By Steve
Goldstein Published: Sept 19, 2019
6:18 a.m. ET
The Organization for Economic Cooperation and Development on Thursday
downgraded its assessment of the global economy to the worst growth rate since
the financial crisis.
In its interim economic outlook, the Paris-based agency cut its global
GDP view to 2.9% this year, a downgrade of 0.3 percentage points, and its
growth view for 2020 was reduced by 0.4 percentage points to 3%.
The OECD cut its view of U.S. growth by 0.4 points in 2019 to 2.4% and
by 0.3 points in 2020 to 2%. China’s GDP forecast was cut by a tenth in 2019 to
6.1% and by 0.3 points in 2020 to 5.7%.
“Escalating trade policy tensions are taking an increasing toll on
confidence and investment, adding to policy uncertainty, weighing on risk
sentiment in financial markets, and endangering future growth prospects,” the
OECD said.
The OECD said the impact of 2019 U.S-China trade tensions would be to
reduce Chinese GDP by a full percentage point, U.S. GDP by 0.7 points and world
GDP by 0.6 points. A no-deal Brexit could cut U.K. GDP by nearly 3 percentage
points in 2022, and eurozone GDP by 0.6 points.
Investors are holding massive amounts of risky debt, the OECD said,
pointing to leveraged corporate loans in particular. Another concern is the
long-term decline in trend growth could persist.
The OECD said governments are in a position to reverse the spiraling
costs of uncertainty and invest more, and meeting infrastructure investment
could help limit the risks to growth.
More
Bond investor says negative yields are ‘most absurd thing central banks have done’
By Sunny
Oh Published: Sept 19, 2019 5:08
p.m. ET
Marathon Asset Management CEO Bruce Richards said
government bond yields trading at negative levels “is the most absurd thing
central banks have done and it will blow up in their face,” at the CNBC
Institutional Investor Delivering Alpha conference on Thursday.Ultra-loose monetary policy by major central banks including, the Bank of Japan and the European Central Bank, have contributed to the phenomenon of government bond rates falling below subzero levels.
The 10-year German government bond TMBMKDE-10Y, +0.69% finished at negative-0.50% on Thursday.
Richards said investors may be tempted to reap as much gains as they can from this year’s relentless rally in government bonds, but said it was a “fool’s game.”
The 10-year Treasury note yield TMUBMUSD10Y, -1.01% is trading at 1.79%, more than 80 basis points lower than at the start of the year. Bond prices move in the opposite direction of yields.
Richards said he was worried about the bubbling excesses in the
corporate debt market, and that the recent run-up in their performance was
overextended.
Richards said he felt the level of debt on the balance sheets of U.S.
corporations was “unprecedented,” pointing to the rapid growth of the leveraged
loan sector — bank loans made out to sub-investment-grade corporations.
Marathon was already “setting up for the next distressed cycle,” he said.
World economic growth is ‘fragile,’ Lagarde says, and central banks aren’t always the answer
By Mike
Murphy Published: Sept 19, 2019
11:21 p.m. ET
World economic growth is “fragile” and “under threat,”
former International Monetary Fund director Christine Lagarde says, and is
over-reliant on the actions of central banks.In an interview published late Thursday by Agence France-Presse, Lagarde — who exited her IMF post last week and is in line to become president of the European Central Bank before year’s end — also said central banks should be predictable and “stick to [their] mandate.”
Lagarde urged governments to take a more active role in resolving
economic threats on their own, instead of relying on central banks to clean up
their mess. “I think central bankers have done an awful lot and were for many
years regarded as the only game in town,” she told AFP.
Lagarde took over the IMF in 2011, right after the financial crisis, and
is credited with helping stabilize the global economy though uncertain times.
She gave few hints as to how she may govern the ECB.
While she told AFP that tariff wars and Brexit are the biggest current
threats to global growth, she noted that those issues “are manmade and can be
man-fixed.”
“A bit of woman wouldn’t hurt,” she added.
More
Next, Dow Transports continues sending out a warning. As goes transports
so goes the US economy, and with it the global economy?
FedEx stock plunges as outlook prompts four analyst downgrades
Published: Sept 19, 2019 7:41 a.m. ET
FedEx Corp. stock plunged Wednesday after the company’s
quarterly miss and steep outlook cut triggered several Wall Street downgrades.FedEx FDX, -12.92% late Tuesday reported fiscal first-quarter earnings below market expectations and further spooked analysts by cutting its guidance for fiscal 2020 by about 18%, blaming it largely on “trade tensions” and global economic weakness.
FedEx shares closed at their lowest in three weeks and suffered their largest one-day percentage loss since December 2008. The stock traded as low as $148.50, its lowest since Aug. 28.
Of the 27 analysts surveyed by FactSet, at least four analysts downgraded FedEx’s shares and 10 analysts cut their price targets for the stock. The average rating remains overweight, and the average price target was lowered to $171.23 from $180.52 as of the end of August.
Analyst David Ross at Stifel Nicolaus downgraded the package delivery company to hold, after being at buy since March 2018, and cut his price target to $171 from $185. Ross said he expects the stock to continue to underperform over the next few quarters as the global economy is unlikely to rebound in 2020.
----FedEx in August ended its contract to deliver Amazon.com Inc.’s AMZN, -0.14% ground packages, and in June ended its FedEx Express domestic contract with e-commerce giant.
FedEx losses on Wednesday weighed on the Dow Jones Transportation Average DJT, -1.21% and also on rival United Parcel Service Inc.’s UPS, -1.10% shares. FedEx shares have lost 6.5% this year, contrasting with gains of 20% for the S&P 500 index SPX, +0.03% and 16% for the Dow Jones Industrial Average. DJIA, +0.13%
More
Finally, America.
Yet more bad rain news from America. A US missile strike goes wrong. Will
Russia, China, Britain and the EU scream for a UN war crimes investigation? I
think we all know the answer to that. It’s just Afghanistan after all. Not even
reported on the BBC.
Catastrophic flooding after Imelda unloads 3 feet of rain in Texas
Sept. 19, 2019 /
8:41 PM
Sept. 19 (UPI) -- Catastrophic flooding from stalled Tropical Storm Imelda endangered
communities across southeastern Texas on Thursday as the system dumped more
than 3 feet of rain in places, bringing back unwanted memories of Hurricane Harvey in 2017.Forecasters say final rainfall totals could challenge the record amounts left by Harvey two years ago.
Two deaths have been reported. Harris County Sheriff Ed Gonzalez confirmed that a man was pulled from a submerged van and pronounced dead at the hospital. The Jefferson County Sheriff's Office reported a man was electrocuted and drowned while trying to move his horse.
Texas Gov. Greg Abbott declared a state of disaster for 13 counties that were experiencing the flooding.
---- The Harris County Sheriff's Office posted that its dispatchers have fielded 790 weather-related calls, including 350 high-water rescues as of Thursday afternoon.
Some locations have been inundated by feet of rain, in what officials have called a "life-threatening situation." The highest rainfall report through noon Thursday was a 72-hour rainfall total of 42.68 inches near Hamshire, Texas, about 65 miles east of Houston. Texas Greens Bayou, northeast of Houston, recorded 9.68 inches in 3 hours during the middle of the day Thursday.
AccuWeather meteorologists are projecting a maximum of 55 inches.
More
https://www.upi.com/Top_News/US/2019/09/19/Catastrophic-flooding-after-Imelda-unloads-3-feet-of-rain-in-Texas/6231568939068/?ls=2
U.S. drone strike kills 30 pine nut farm workers in Afghanistan
September 19,
2019 / 8:27 AM / Updated 2 hours ago
JALALABAD,
Afghanistan (Reuters) - A U.S. drone strike intended to hit an Islamic State
(IS) hideout in Afghanistan killed at least 30 civilians resting after a day’s
labour in the fields, officials said on Thursday.
The attack on Wednesday night also injured 40 people after accidentally
targeting farmers and labourers who had just finished collecting pine nuts at
mountainous Wazir Tangi in eastern Nangarhar province, three Afghan officials
told Reuters
“The workers had lit a bonfire and were sitting together when a drone
targeted them,” tribal elder Malik Rahat Gul told Reuters by telephone from
Wazir Tangi.
Afghanistan’s Defence Ministry and a senior U.S official in Kabul
confirmed the drone strike, but did not share details of civilian casualties.
“U.S. forces conducted a drone strike against Da’esh (IS) terrorists in
Nangarhar,” said Colonel Sonny Leggett, a spokesman for U.S. forces in
Afghanistan. “We are aware of allegations of the death of non-combatants and are
working with local officials to determine the facts.”
---- Haidar Khan, who owns the pine nut fields, said about 150 workers were there for harvesting, with some still missing as well as the confirmed dead and injured.
A survivor of the drone strike said about 200 labourers were sleeping in
five tents pitched near the farm when the attack happened.
“Some of us managed to escape, some were injured but many were killed,”
said Juma Gul, a resident of northeastern Kunar province who had travelled
along with labourers to harvest and shell pine nuts this week.
Angered by the attack, some residents of Nangarhar province demanded an
apology and monetary compensation from the U.S. government.
More
Crooks and Scoundrels Corner.
The bent, the seriously bent, and the totally doubled
over.
Today, more on the fallout from those Saudi drone/missile strikes. Assuming no more attacks, how long before a
global oil crunch hits?
Real crunch from Saudi Arabia's oil outage has yet to be felt
September 19, 2019
/ 12:33 PM
LONDON
(Reuters) - Saudi Arabia’s ability to avert a global oil supply crunch will
only become clear in a few weeks, because for now its crude held in storage can
fill the gap and mask the scale of damage to its facilities, traders and
analysts say.
Riyadh says production will be back to normal levels in two to three
weeks, which means restoring output to about 10 million barrels per day (bpd),
after Saturday’s attacks on two sites that usually process and clean up about
5.7 million bpd.
While it carries out repairs, the world’s biggest oil exporter has
promised to keep the physical crude market supplied from its inventories held
in the kingdom and abroad, estimated to have been about 180 million barrels in
July.
But traders and analysts are skeptical repairs to the Abqaiq and Khurais
sites will be swift, while the lack of transparency about Saudi inventories
adds to uncertainty about whether Riyadh can keep markets supplied without
disruption.
“A lot of October arrival barrels were already on the water so the hole
is going to show up towards late October,” one senior European oil trader said.
“There has been a mad scramble on the paper markets but the physical scramble
will come later.”
Precisely when any rush for physical crude kicks in will depend on the
level of Saudi Arabia’s inventories and how long it needs to rely on them to
ensure clients receive full allocations.
The Joint Organisations Data Initiative (JODI), a body that issues
energy data using submissions by its members such as Riyadh, said Saudi
inventories at home and abroad fell 8 million barrels in the month of July -
the latest month available - to 180 million barrels.
But one veteran oil trader said the accuracy of the JODI figures was the
“big unknown”, adding that “overground tracked volume total would appear to be
smaller”, a reference to calculations from data analytics firms that use
satellites to measure storage.
The trader said moves by state-run Saudi Aramco’s trading arm Aramco
Trading Corp (ATC) to buy refined products, added to uncertainty about the
level of Saudi stockpiles.
---- Some major clients are already turning to other suppliers to meet their needs. The trading arm of China’s Sinopec, Asia’s top refiner, chartered at least four crude tankers this week from the United States, ramping up its U.S. shipments.
Even if Saudi Arabia keeps the same volumes flowing to customers, there
are signs it may struggle to supply the same grades, an important factor for
refiners whose plants are often built to handle a specific range of lighter or
heavier crudes.
An Aramco source said on Tuesday the Abqaiq complex was already
operating and processing 2 million bpd, although still well below the 4.9
million bpd it handled before the attack.
But Aramco has offered few details about scale of the damage to both
sites. Witness accounts of huge fires caused by the attacks and grainy
satellite images showing scorched sites have raised concerns about how swiftly
they can be fixed.
“Engineering experts claim the damage alone should have taken weeks to
assess, especially with workers only allowed back in the Abqaiq complex for the
first time (on Tuesday),” consultancy Energy Aspects wrote in a note.
“It is likely that the full extent
of the damage will only emerge in the coming weeks,” it said.
More
In any great organization it is far, far safer to be wrong with the majority than to be right alone.
John Kenneth Galbraith.
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?
Platinum-graphene fuel cell catalysts show superior stability over bulk platinum
Date:
September 18, 2019
Source:
Georgia Institute of Technology
Summary:
Films of platinum only two atoms thick supported by graphene could enable fuel
cell catalysts with unprecedented catalytic activity and longevity, according
to a new study.
Films of platinum only two atoms thick supported by graphene could
enable fuel cell catalysts with unprecedented catalytic activity and longevity,
according to a study published recently by researchers at the Georgia Institute
of Technology.
Platinum is one of the most commonly used catalysts for fuel cells because
of how effectively it enables the oxidation reduction reaction at the center of
the technology. But its high cost has spurred research efforts to find ways to
use smaller amounts of it while maintaining the same catalytic activity.
"There's always going to be an initial cost for producing a fuel
cell with platinum catalysts, and it's important to keep that cost as low as
possible," said Faisal Alamgir, an associate professor in Georgia Tech's
School of Materials Science and Engineering. "But the real cost of a fuel
cell system is calculated by how long that system lasts, and this is a question
of durability.
"Recently there's been a push to use catalytic systems without
platinum, but the problem is that there hasn't been a system proposed so far
that simultaneously matches the catalytic activity and the durability of
platinum," Alamgir said.
The Georgia Tech researchers tried a different strategy. In the study,
which was published on September 18 in the journal Advanced Functional
Materials and supported by the National Science Foundation, they describe
creating several systems that used atomically-thin films of platinum supported
by a layer of graphene -- effectively maximizing the total surface area of the
platinum available for catalytic reactions and using a much smaller amount of
the precious metal.
Most platinum-based catalytic systems use nanoparticles of the metal
chemically bonded to a support surface, where surface atoms of the particles do
most of the catalytic work, and the catalytic potential of the atoms beneath
the surface is never utilized as fully as the surface atoms, if at all.
Additionally, the researchers showed that the new platinum films that
are at least two atoms thick outperformed nanoparticle platinum in the
dissociation energy, which is a measure of the energy cost of dislodging a
surface platinum atom. That measurement suggests those films could make
potentially longer-lasting catalytic systems.
----"Typically metallic films below a certain thickness are not stable because the bonds between them are not directional, and they tend to roll over each other and conglomerate to form a particle," Alamgir said. "But that's not true with graphene, which is stable in a two-dimensional form, even one atom thick, because it has very strong covalent directional bonds between its neighboring atoms. So this new catalytic system could leverage the directional bonding of the graphene to support an atomically-thin film of platinum."
Future research will involve further testing of how the films behave in
a catalytic environment. The researchers found in earlier research on
graphene-platinum films that the material behaves similarly in catalytic
reactions regardless of which side -- graphene or platinum -- is the exposed
active surface.
"In this configuration, the graphene is not acting as a separate
entity from the platinum," Alamgir said. "They're working together as
one. So we believe that if you're exposing the graphene side, you get the same
catalytic activity and you could further protect the platinum, potentially
further enhancing durability."
Another weekend and will
the US/Saudi coalition strike back for the drone/missile strikes on Saudi
Arabia? What if it triggers an all out Gulf oil war? Is the west really prepared for such an
outcome? Have a great weekend everyone.
If all else fails, immortality
can always be assured by spectacular error.
John Kenneth
Galbraith.
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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