Baltic Dry Index. 1355 -33 Brent
Crude 65.03 Spot Gold 1476
Never ending Brexit now January 31.
Trump’s Nuclear China Tariffs Now in effect.
The USA v EU trade war started October 18. Now in effect.
"On
the whole human beings want to be good, but not too good, and not quite all the
time.”
George
Orwell.
Despite being distinctly under whelming, trade deal lite
phase one, is still a big relief from both the USA and China imposing yet more
tariffs on each other’s goods yesterday.
While not an end in itself, it is perhaps the beginning of the end to
the Trumpian trade wars.
After 18 months of beggar-thy-neighbour trade tariffs, neither
Presidents Trump and Xi have much to show for trade war deal lite phase one.
The biggest winner though is the US consumer, who will now escape President
Trump’s “Christmas” tariffs on China’s consumer goods exports. Santa Trump
comes early.
Despite the light relief, the global economy continues to
wobble. Manufacturing is already in recession led by autos. US agriculture and trucking
are also in recession. Both US and China’s real estate sectors are weakening.
The Baltic Dry (shipping) Index is dropping again, although since it was tweaked
earlier in the year it is a more volatile, less useful indicator of global
shipping. Italy is preparing yet another bank bailout.
Below, half a loaf is better than no loaf at all.
Asian shares up as investors cheer 'phase one' Sino-U.S. trade deal
December 16, 2019
/ 1:02 AM
SHANGHAI
(Reuters) - A broad gauge of Asian share markets hit nearly eight-month highs
on Monday after the United States and China agreed a preliminary trade deal,
and amid policy-easing hopes in Australia, but profit-taking and caution over
the deal’s details capped gains.
U.S. Trade Representative Robert Lighthizer on Sunday said a deal was “totally done”, notwithstanding some needed revisions, and would nearly double U.S. exports to China over the next two years.
Positive sentiment helped push the MSCI’s broadest index of Asia-Pacific shares outside Japan to its highest level since April 18. It was last up 0.35%.
Australia's S&P/ASX 200 led the way as it jumped 1.74%, while shares in Taiwan .TWII added 0.23%.
Ryan Felsman, senior economist at CommSec in Sydney, said that the trade deal and the receding risk of a disorderly Brexit after the UK general election produced a strong Conservative majority provided support for sentiment in Australia.
A lower-than-expected Austrlian budget surplus due to a sluggish economy has “built expectations by markets for further easing from the Reserve Bank (of Australia),” he said, explaining the strong perfomance of Aussie shares.
Chinese investors had a more tepid reaction to the trade news, with the blue-chip CSI300 index .CSI300 finding little impetus to rise further after trade hopes fanned a nearly 2% rise on Friday, despite data showing the country's industrial output growth and retail sales jumped more than expected in November.
The CSI300 index was down 0.01% at the midday break.
Japan's Nikkei 225 .N225 succumbed to some profit-taking, easing 0.05% after surging 2.55% to a 14-month closing high on Friday.
More
In China news, Germany gets a warning on autos. China
continues to slow.
China Threatens Retaliation Should Germany Ban Huawei 5G
By Tony Czuczka and Steven Arons
Updated on December 16, 2019, 4:34 AM GMT
China’s ambassador to Germany threatened Berlin with
retaliation if it excludes Huawei Technologies Co. as a
supplier of 5G wireless equipment, citing the millions of vehicles German
carmakers sell in China.“If Germany were to take a decision that leads to Huawei’s exclusion from the German market, there will be consequences,” Ambassador Wu Ken said Saturday at a Handelsblatt event. “The Chinese government will not stand idly by.”
While the German legislation doesn’t
explicitly name Huawei, it’s tailored to the Chinese company and comes after
months of debate about 5G security. Huawei has repeatedly rejected allegations
of its equipment’s potential for espionage and sabotage.
German Economy Minister Peter Altmaier on Sunday warned against passing laws that single out firms. “We shouldn’t turn against individual companies and instead insist that all electronic and high technology components used in Germany meet the highest security requirements,” he said in an interview published in Der Tagesspiegel newspaper.
“Whoever doesn’t meet them is out.”
More
https://www.bloomberg.com/news/articles/2019-12-14/china-threatens-germany-with-retaliation-if-huawei-5g-is-banned?srnd=premium-europe
China November home price growth slowest in two years; property investment at one-year low
December 16,
2019 / 2:23 AM
BEIJING (Reuters) - China’s new home prices grew at their
weakest pace in nearly two years in November while property investment also
eased, with tightening policies continuing to cool the market even as some
local easing is expected to prevent a sharp slowdown.
The property market, which directly impacts more than 40 industries, is
a key growth driver for China as policymakers try to revive the ailing
manufacturing sector and restore flagging consumer confidence amid a bruising
trade war with the United States.
Average new home prices in China’s 70 major cities rose 0.3% in November
from the previous month, lower than the 0.5% growth reported in October and the
weakest since February 2018, Reuters calculated from official National Bureau
of Statistics (NBS) data on Monday.
On an annual basis, average new home prices in the 70 cities rose 7.1%
in November, down from 7.8% in October and the slowest year-on-year pace since
August 2018.
Most of the 70 cities surveyed still reported monthly price increases
for new homes, but the number was down to 44 from 50 in October.
China has clamped down on property speculation since 2016 to stop prices
rising too quickly. It has tightened domestic and onshore financing for the
sector, and kept down-payment requirements high for individual buyers.
Morehttps://uk.reuters.com/article/uk-china-economy-houseprices/china-november-home-price-growth-slowest-in-two-years-property-investment-at-one-year-low-idUKKBN1YK04U?il=0
In EUSSR news, yet another Italian bank bailout. But for
Italy’s fractious coalition government, is this a coalition breaking bailout? Oh
well, on to Deutsche Bank I suppose.
Italy mulls 1 billion euro rescue for ailing bank Pop Bari - sources
December 15,
2019 / 12:46 PM
ROME (Reuters) - Italy’s cabinet was expected to meet on Sunday evening
to approve a decree that would provide a 1 billion euro (825 million pounds)
lifeline to cooperative lender Banca Popolare di Bari, two sources with knowledge
of the matter said.
The bank, which said last week it needed an urgent injection of up to 1
billion euros, has struggled to cope with mounting loan losses during a slump
that has devastated Italy’s economy, notably in Popolare di Bari’s home region
in the south.
It was placed under special administration by the Bank of Italy on
Friday but the government led by Prime Minister Giuseppe Conte failed to
approve a rescue package as several ministers boycotted a hastily convened
cabinet meeting.
Conte will make a fresh attempt at pushing through an emergency decree
to bail out the bank on Sunday evening, with a cabinet meeting due to be held
at 2000 GMT, the sources said.
---- The crisis at Popolare di Bari has heaped pressure on Conte’s coalition, which brings together the anti-establishment 5-Star Movement and the centre-left Democratic Party.
Only hours before the urgent cabinet meeting on Friday night, Conte said
the banking system was in good health and there would be no need for state
bailouts, prompting the right wing opposition League party to call on him to
resign.
The meeting ended without approving an expected rescue package for
Popolare di Bari as ministers from 5-Star and a small party led by former PD
leader Matteo Renzi stayed away.
5-Star leader Luigi Di Maio said on Saturday he wanted to know why the
bank had been allowed by the Bank of Italy, the sector supervisor, to
deteriorate so badly and which bank managers were responsible before approving
the rescue.
Since 2016, Italy has had to rescue several of its banks, including
Monte dei Paschi di Siena and two Veneto lenders, rescues which 5-Star - which
at the time was in opposition - slammed as a waste of taxpayer money to help
bankers.
With 5 Star and the PD at loggerheads over a growing list of economic
issues, from the fate of airline Alitalia to the troubled Ilva steel plant in
southern Italy, the crisis could have potentially serious implications for the
government.
Like thousands of Italians who invested savings in the shares and bonds
of local banks, Popolare di Bari’s 69,000 shareholders stand to lose their
money in a rescue.
Finally, more on that USA v China trade deal. Not everyone’s happy. Is
50 billion of Ag purchases possible? Talks to continue.
China and U.S. should continue trade talks, remove tariffs - stats bureau
December 16,
2019 / 2:46 AM
BEIJING (Reuters) - China and the United States should continue
bilateral trade talks and work towards removing all existing tariffs, China’s
National Bureau of Statistics spokesman Fu Linghui said on Monday.
Fu also told reporters during a briefing that China’s economic
operations showed positive changes in November and reiterated that China can
achieve its full-year economic growth target.
US-China trade deal gets tepid reception
Heather SCOTT, AFP•December 14, 2019
Washington (AFP) - US officials announced a truce in the trade war with
China with much fanfare, but economists and trade experts call it largely a
victory for Beijing.
After a dispute that raged for close to two years, with several fumbled
efforts at a resolution, the US agreed to cancel planned tariffs and rollback
others immediately, without a similar commitment from China to lift tariffs it
imposed on the US.
"Pardon me if I don't pop champagne, but aside from a cessation of
continued escalation, there is not much worth cheering," leading China
expert Scott Kennedy said in an analysis of the agreement.
"The costs have been substantial and far reaching, the benefits
narrow and ephemeral."
The US Trade Representative office said they expect to sign the phase
one agreement in the first week of January, and issued a fact sheet
highlighting key points, including enforcement provisions and improved
protection for American technology.
In addition, it includes a Chinese commitment to buy $200 billion more
in US goods and services over two years, USTR said.
That would be a significant increase: China imported just shy of $190
billion in goods and services in 2017, so if the target is met it would cut the
US trade deficit with China by a third.
President Donald Trump has long railed against the trade imbalance,
citing it as proof China is using distorting policies to gain an unfair
advantage.
Trump tweeted that Beijing "agreed to many structural changes and
massive purchases of Agricultural Product, Energy, and Manufactured Goods, plus
much more."
- Back from the brink -
Alliance for American Manufacturing President Scott Paul said agreeing
to remove tariffs amounted to "giving away much of our leverage, while
kicking the can down the road on the most meaningful trade issues with
China."
And trade economist Mary Lovely said the deal could only be viewed as a
"partial win" which "didn't move the needle very much."
"We were kind of on a brink, and we saw the negotiators reach a
deal that pulled us back, and I think that is important," she said of the
news Trump canceled the 15 percent tariffs on electronics that were due to hit
Sunday.
But the gains in the deal do not compensate for the damage to US farmers
and businesses, she told reporters.
"President Trump is desperately trying to get back to where the
economy was 18 months ago," before taking this "unilateral, brute
force approach," Lovely said.
But Kennedy said that in exchange for "only limited concessions,
China has been able to preserve its mercantilist economic system and continue
its discriminatory industrial policies at the expense of China’s trading
partners and the global economy."
US farmers and retailers welcomed the end to the dispute, but also
wanted to see more information.
American Farm Bureau Federation President Zippy Duvall noted that prior
to the eruption of hostilities China was the second-largest market for US
agricultural products, but dropped to fifth.
"Reopening the door to trade with China and others is key to
helping farmers and ranchers get back on their feet," Duvall said in a
statement.
In addition to the collapse in exports, and surge in farm bankruptcies,
the US government has paid tens of billions of dollars in aid to farmers to
compensate for lost sales -- funds that come from tariffs paid by US consumers
and businesses.
More
https://news.yahoo.com/us-china-trade-deal-gets-tepid-reception-015910263--finance.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZHJ1ZGdlcmVwb3J0LmNvbS8&guce_referrer_sig=AQAAAB4wTZc8WSvHqSya3XYNnnfts_-YTZGQkY-cd9R4_i2wP_GzMBWveckm8zwdbLJau5VAiqVvqdnoDEqpog_gkVksPsRn_W1yojiOEtDrlqD5J_Ntpz9GVx1TcCbGnpWCSf-NxBzfXeO5b-2-_ZY5fvpcSzDQ1no3K-0VxDA5QxFVDoubts Surface on $50 Billion in China Farm Buys Touted by Trump
Mike Dorning Bloomberg•December 13, 2019
Donald Trump says China will spend $50 billion a year for U.S. farm
products as part of a “phase one” trade deal between the countries. But doubts
are surfacing whether that’s even possible, bolstered by China’s reluctance to
confirm the figure.
While the president expressed confidence China would meet the goal
“pretty soon,” doing so would require a huge jump in China’s imports,
potentially stretching its capacity to absorb the products. Trump’s trade
representative, Robert Lighthizer, laid out some numbers to reporters, but declined
to get very specific.
Meanwhile, Chinese officials repeatedly didn’t answer questions on the
exact size of their commitment in a briefing Friday.
“I have been very skeptical,” said Joseph Glauber, a former chief
economist at the U.S. Department of Agriculture. “How would they do it?”
The $50 billion figure offers Trump an attention-grabbing number to
drive up enthusiasm for the deal in rural America. That’s a key political
constituency for the president as he campaigns for re-election. It also helps
him to defend a partial deal that leaves out many of the objectives he set when
he initially launched the trade dispute.
More
Russian Foreign Minister Lavrov. May 2017.
Crooks and Scoundrels Corner.
The bent, the seriously bent, and the totally doubled
over.
Today, more on the rise and fall of WeWork. Business plan? Who needs a business plan with friends like
these. A modern day morality story of Wall Street greed undone. Only made possible by limitless free money by
central banksters, operating the scam of the Great Nixonian Error of fiat
money.
But how many more WeWorks are there?
The Money Men Who Enabled Adam Neumann and the WeWork Debacle
Veteran executives and financiers helped fuel WeWork’s spectacular rise and fall, pouring in capital while ceding control to its founder
By Maureen Farrell and Eliot Brown
Dec. 14, 2019 12:00 am ET
“I’ve stayed silent too long,” the 65-year-old former Goldman Sachs Group Inc. partner told the six other men on the board, including WeWork’s co-founder and chairman, Adam Neumann.
Mr. Schwartz aired his frustrations about the state of the company, which was perilously low on cash after years of freewheeling spending and had become the butt of jokes on Wall Street, according to people familiar with the meeting.
No more fantasies, he said, as advisers and others looked on. Now, he said, they needed to make decisions that would save the company.
Even more remarkable than the content of Mr. Schwartz’s blistering rebuke was the fact that it came so late. The banker had stayed silent so long that the story was almost over.
We Co., as the parent company is officially known, was already a distressed asset by then, undone by conflicts and the dawning realization that it was just a hip real-estate sublessor—not a tech company. A few weeks earlier, WeWork had shelved its disastrous attempt at an initial public offering and Mr. Neumann had subsequently stepped down as chief executive.
It was a spectacular fall for the company that months before had been America’s most valuable startup.
Little of WeWork’s trajectory would have been possible were it not for the collection of veteran executives and financiers from the upper echelons of Wall Street and Silicon Valley who enabled Mr. Neumann, a charismatic 40-year-old with little prior business experience.
Mr. Neumann mesmerized them with his pitch, which offered a vision for the property-leasing company as a tech startup with limitless potential to transform how people work and live.
Investors poured capital onto Mr. Neumann’s business bonfire and ceded control, rarely pushing back with any force despite mounting problems and year after year of missed projections.
Masayoshi Son, the CEO of SoftBank Group Corp., who helped inflate WeWork’s valuation to $47 billion, pushed an already wild-spending Mr. Neumann to act bigger and crazier. JPMorgan Chase & Co. CEO James Dimon and other bankers, instead of injecting a dose of reality, spent years championing Mr. Neumann and the company as they battled for the coveted IPO assignment.
More, much, much, more!
https://www.wsj.com/articles/the-money-men-who-enabled-adam-neumann-and-the-wework-debacle-11576299616?mod=mhp
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?
Better studying superconductivity in single-layer graphene
Date:
December 13, 2019
Source:
Springer
Summary:
A new study demonstrates that an existing technique is better suited for
probing superconductivity in pure, single-layer graphene than previously
thought. The insight could allow physicists to understand more about the widely
varied properties of graphene; potentially aiding the development of new
technologies.
Made up of 2D sheets of carbon atoms arranged in honeycomb lattices,
graphene has been intensively studied in recent years. As well as the
material's diverse structural properties, physicists have paid particular
attention to the intriguing dynamics of the charge carriers its many variants
can contain. The mathematical techniques used to study these physical processes
have proved useful so far, but they have had limited success in explaining
graphene's 'critical temperature' of superconductivity, below which its'
electrical resistance drops to zero. In a new study published in EPJ B,
Jacques Tempere and colleagues at the University of Antwerp in Belgium
demonstrate that an existing technique is better suited for probing
superconductivity in pure, single-layer graphene than previously thought.
The team's insights could allow physicists to understand more about the
widely varied properties of graphene; potentially aiding the development of new
technologies.
Typically, the approach they used in the study is used to
calculate critical temperatures in conventional superconductors. In this case,
however, it was more accurate than current techniques in explaining how
critical temperatures are suppressed with lower densities of charge carriers,
as seen in pure, single-layer graphene. In addition, it proved more effective
in modelling the conditions which give rise to interacting pairs of electrons
named 'Cooper pairs', which strongly influence the electrical properties of the
material.
Tempere's team made their calculations using the 'dielectric function
method' (DFM), which accounts for the transfer of heat and mass within
materials when calculating critical temperatures. Having demonstrated the
advantages of the technique, they now suggest that it could prove useful for
future studies aiming to boost and probe for superconductivity in single and
bilayer graphene. As graphene research continues to be one of the most diverse,
fast-paced fields in materials physics, the use of DFM could better equip
researchers to utilise it for ever more advanced technological applications.
George Orwell.
The monthly Coppock Indicators finished November
DJIA: 28,051 +76 Up. NASDAQ: 8,665 +94 Up. SP500: 3,141 +90 Up. All higher again, but it’s
not a buy signal I would follow. I would wait for the next sell signal.
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