A Critical Week.

Baltic Dry Index. 557 -19  Brent Crude 59.39 Spot Gold 1581

Never ending Brexit now January 31. 5 days away.

Trump’s Nuclear China Tariffs Now in effect.

The USA v EU trade war started October 18. Now in effect.

‘Probably, the cat’s already out of the bag.’

Eric Toner, M.D.

Toner, an M.D. and researcher at the Johns Hopkins Center for Health Security, took part in a simulation, undertaken in partnership with the World Economic Forum and the Bill & Melinda Gates Foundation, that posited such a disease could kill 65 million people within 18 months under the right circumstances.

https://www.marketwatch.com/story/scientist-who-simulated-the-global-impact-of-a-coronavirus-outbreak-says-the-cats-already-out-of-the-bag-and-chinas-efforts-to-contain-the-disease-unlikely-to-be-effective-2020-01-24?mod=home-page

We are starting a critical week for global stock and commodity markets. Coronavirus, impeachment and Brexit all play out this week, although China’s markets are still closed for the Lunar New Year celebrations.

Of the three, what happens next in China’s coronavirus pandemic is the most important. If it goes widespread in China, the second largest national economy in the world, it will present a major drag on the global economy and the major markets.

If it spreads globally, rather than is just mostly confined to mainland China, the downturn in the global economy could easily bring on the next recession, with the central banksters all but out of ammo.

Relatively speaking, what happens to President Trump this week, and GB technically achieving Brexit on Friday, if not actually leaving until the end of the year, are sideshows. 

For most of the world who runs the USA is irrelevant, the rest of the world just has to get along with whoever American’s chose to get the job.

Outside of GB and the wealth and jobs destroying EUSSR, no one really cares if GB is inside or outside of the EUSSR.

The EUSSR badly needs major reform, but there no sign of any willingness to reform  in continental Europe. The rump-EU will just continue its decline relative to the rest of the world. Any new recession will simply accelerate it.

Below, the opening news as we enter a critical week.

Nikkei falls as coronavirus fears rise; most Asian markets remain closed for holiday

By Marketwatch  Published: Jan 26, 2020 11:35 p.m. ET

Stocks fell in Japan on Monday amid fears of a new viral outbreak, as most Asian markets remained closed for the Lunar New Year holiday.

The Nikkei NIK, -1.96%   was last down 1.8%. Shares of Pacific Metals 5541, -8.17%   and Fast Retailing 9983, -5.52%   sank, along with SoftBank 9984, -3.92%   and Toyota 7203, -1.41%  .

Benchmark indexes in Hong Kong, mainland China, South Korea, Taiwan, Singapore and Australia were closed for holidays.

Global traders have been worried about the effects of the fast-spreading coronavirus outbreak in China, where the death toll rose to at least 80 Sunday, with more than 2,700 confirmed cases. Preliminary data Sunday showed the outbreak was already affecting China’s economy, as travel plunged to restrictions.

The end of the Lunar New Year holiday, China’s busiest travel season, was pushed back to Sunday from Thursday to “reduce mass gatherings” and “block the spread of the epidemic,” an official statement said, according to the Associated Press.

“Risk profiles need to be adjusted as the Wuhan frenzy factor kicks in, and risk markets enter the fear zone, a highly pandemic place in its own right,” wrote Stephen Innes, chief market strategist at AxiCorp, in a note.

“The biggest threat to the global economy is not just because the disease spreads quickly across countries through networks related to global travel,” Innes wrote. “But also, because any economic shock to China’s colossal industrial and consumption engines will spread rapidly to other countries through the increased trade and financial linkages associated with globalization.”
https://www.marketwatch.com/story/nikkei-falls-as-coronavirus-fears-rise-most-asian-markets-remain-closed-for-holiday-2020-01-26?mod=home-page

Safe Havens Shine as Spreading Virus Spurs Rush to Buy Gold

By Phoebe Sedgman and Swansy Afonso

January 26, 2020, 11:59 PM GMT Updated on January 27, 2020, 4:35 AM GMT

·        

With no sign of containment, risk-off sentiment sweeps markets

·         Investors add to holdings in gold-backed ETFs as prices climb

 

Gold jumped as the spread of the coronavirus globally spurred demand for haven assets.

 Prices rose as much as 1.1% as risk-off sentiment swept markets, with equities tumbling and Treasures gaining. In the latest attempt at containment, China extended the week-long Lunar New Year holiday and banned all outgoing overseas group tours to avoid having travelers contribute to its spread.

 

President Xi Jinping’s government is under pressure to combat the outbreak that shows little sign of slowing down, with more than a dozen countries and territories reporting the illness within their borders. While the return of risk aversion is supportive of haven assets like bullion, investors are also assessing the extent to which the virus may keep consumers away from shops, damping the usual pick up in gold purchases during the holiday period. 

“News flow on the virus is pushing safe haven buying,” Gnanasekar Thiagarajan, director at Commtrendz Risk Management Services, said by phone from Mumbai. “In this kind of a environment, stock markets could tank and that fear is further adding to the risk-averse sentiment. The outlook is bullish for gold, targeting $1,610 in the near term.”

Contracts on the S&P 500 Index fell more than 1% before paring losses, while Japan’s Topix slid and futures on Chinese shares fell more than 5%. Oil dropped over 2% in New York, while 10-year Treasury yields sank to the lowest since October and the yen strengthened.

“Markets are focused on news around the deadly coronavirus,” Bank of New Zealand said in a report. “There will clearly be a significant economic impact, centered in China. A key question is the time it will take for the virus to be contained and one can only speculate at this stage.”

As concerns about the impact of coronavirus mount, investors have boosted holdings in exchange-traded funds backed by gold to the highest since November, with the assets now less than 25 tons shy of a record. Adding to the momentum, the Federal Reserve is gearing up for its first rate-setting meeting this year, where it’s expected to maintain easy monetary policy, and the World Gold Council will offer its assessment of global demand trends.

Spot gold traded 0.5% higher at $1,579.72 an ounce at 11:40 a.m. in Hong Kong. Silver rose 0.7% and platinum fell. Palladium dropped 1.7%, extending its pullback from a record high.
More
https://www.bloomberg.com/news/articles/2020-01-26/gold-jumps-as-investors-seek-a-haven-amid-growing-virus-fears?srnd=premium

Oil extends declines as fears grow over China virus

January 27, 2020 / 1:46 AM

TOKYO (Reuters) - Crude prices fell more than 2% to multi-month lows on Monday as the rising number of cases of the new coronavirus in China and city lockdowns there deepened concerns over oil demand, even as Saudi Arabia’s energy minister sought to calm the market.

Brent crude LCOc1 fell by $1.36 a barrel, or 2.2%, to $59.33 by 0425 GMT, having earlier dropped to $58.68, its lowest since late October. U.S. crude CLc1 was down by $1.30, or 2.4%, to $52.89, having earlier eased to $52.15, the lowest since early October. 

Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman Al-Saud said on Monday he was watching developments in China and said he felt confident the new virus would be contained.

Markets are being “primarily driven by psychological factors and extremely negative expectations adopted by some market participants despite (the virus’s) very limited impact on global oil demand,” he said. 

With the coronavirus’s ability to spread getting stronger most financial markets are being hit, although many are closed in Asia due to Lunar New Year holidays.

“Such extreme pessimism occurred back in 2003 during the SARS outbreak though it did not cause a significant reduction in oil demand,” Prince Abdulaziz said.

More

https://uk.reuters.com/article/us-global-oil/oil-extends-declines-as-fears-grow-over-china-virus-idUKKBN1ZQ02Z

Firms in China extend holidays, ask staff to work from home as virus spreads

January 27, 2020 / 5:13 AM

SHANGHAI/BEIJING (Reuters) - Big businesses across China are temporarily shutting stores or advising staff to work from home, to guard against the spread of a flu-like virus as the tally of deaths rose to 80, with more than 2,700 people infected. 

Companies are also offering longer holidays, cancelling events and imposing quarantine, as they brace for longer-term impact following China’s weekend decision to extend the week-long Lunar New Year holiday by three days to Feb. 2, in a bid to slow the spread of the virus.

Wuhan, the epicentre of the outbreak and the capital of the central province of Hubei, is already under virtual lockdown, with severe curbs on movement in place in several other cities.

Hotpot restaurant chain Haidilao International Holding (6862.HK) said it would shut stores across China from Sunday to Friday, while gaming giant Tencent Holdings Ltd (0700.HK) and social media firm ByteDance told staff to work from home.

Many companies, including e-commerce firm Pinduoduo, bank UBS Group AG (UBSG.S) and property developer Country Garden (2007.HK) also advised employees returning from Wuhan or Hubei province to stay in quarantine at home.

The Hong Kong Exchanges and Clearing Ltd (HKEX) (0388.HK) cancelled a Wednesday ceremony for the first trading day of the Lunar New Year, it said on Monday, due to the increasing risk of coronavirus infection.

The decision comes after Hong Kong banned residents of Hubei from entering the territory from Monday.

Businesses in China’s eastern manufacturing hub of Suzhou, home to a big industrial park for pharmaceutical firms and tech companies, will stay shut until at least Feb. 8, to guard against any spread, the city government said in a statement on Sunday.

E-commerce firm Alibaba (BABA.N) halted sales of overpriced face masks in its online Taobao marketplace as prices surged.
https://uk.reuters.com/article/uk-china-health-business/firms-in-china-extend-holidays-ask-staff-to-work-from-home-as-virus-spreads-idUKKBN1ZQ0C2?il=0

Britain advises against all travel to China's Hubei province

January 25, 2020 / 10:32 PM

LONDON (Reuters) - Britain said on Saturday it was advising against all travel to Hubei province in China due to the outbreak of coronavirus. 

In new travel advice, the British Foreign and Commonwealth Office told people to leave Hubei province. The city of Wuhan in Hubei is at the centre of the outbreak of coronavirus.

“The Foreign and Commonwealth Office (FCO) advise against all travel to Hubei Province. If you are in this area and able to leave, you should do so. This is due to the ongoing novel coronavirus outbreak,” the UK government said on its website.

https://uk.reuters.com/article/uk-china-health-britain/britain-advises-against-all-travel-to-chinas-hubei-province-idUKKBN1ZO0SW

Singapore says China virus outbreak will hit its economy this year

January 27, 2020 / 4:03 AM

SINGAPORE (Reuters) - Singapore said on Monday that the coronavirus outbreak will hurt its economy this year, as it announced new measures to tackle the disease which originated in China and has spread to the city-state and several other countries. 

The Southeast Asian travel and tourism hub, which recorded its lowest growth rate in a decade last year at 0.7%, has reported four cases of the coronavirus that has killed 80 people in China so far.

“We certainly expect there to be an impact on our economy, business and consumer confidence this year especially as the situation is expected to persist for some time,” trade minister Chan Chun Sing said.

The government is considering support measures for hard-hit sectors like tourism which could include property tax, rebates and worker levy cuts, he added.

Chinese nationals make up the largest share of visitors to Singapore, one of the worst hit countries outside of China in the 2003 outbreak of Severe Acute Respiratory Syndrome (SARS) which killed 800 people globally.

Singapore is currently forecasting growth in a wide range of 0.5-2.5% this year.

Chan is part of a government taskforce set up to tackle the coronavirus spread in Singapore.

The taskforce also announced a raft of new measures on Monday to halt the spread of the virus, including urging all school students and staff with a recent travel history to China to stay at home for a fortnight. Families in Singapore, many of which are ethnically Chinese and have relatives in mainland China, are currently travelling for Lunar New Year holidays.

More

https://uk.reuters.com/article/uk-china-health-singapore/singapore-says-china-virus-outbreak-will-hit-its-economy-this-year-idUKKBN1ZQ093?il=0

Japan to arrange charter flight for Japanese in Wuhan as early as Tuesday - Kyodo

January 27, 2020 / 3:56 AM

TOKYO (Reuters) - Japan is expected to arrange a charter flight as early as Tuesday for any of its citizens who wish to return from Wuhan in China, the epicentre of a coronavirus outbreak, Kyodo news agency cited a senior ruling party official as saying on Monday. 

The death toll from the new virus rose to 80 on Monday as residents of Hubei province, where the disease originated, amid increasing global efforts to halt its rapid spread.

Japan’s Chief Cabinet Secretary Yoshihide Suga told a news conference earlier on Monday the government was working with Chinese authorities to make arrangements for all Japanese nationals wishing to return from Wuhan, including on charter flights.

https://uk.reuters.com/article/uk-china-health-japan/japan-to-arrange-charter-flight-for-japanese-in-wuhan-as-early-as-tuesday-kyodo-idUKKBN1ZQ08W?il=0

French car maker Peugeot to repatriate staff from China's Wuhan area

January 25, 2020 / 5:41 PM

PARIS (Reuters) - French automotive group PSA, maker of the Peugeot and Citroen brands, said in a statement it will repatriate expat staff and their families from the Wuhan area in China, which is at the centre of an outbreak of coronavirus. 

It said that 38 people would be evacuated and that the initiative will be executed in full collaboration with the Chinese authorities and the French general consulate.

PSA said the evacuees will remain in quarantine in Changsha before travelling back to their home countries.

https://uk.reuters.com/article/uk-china-health-france-peugeot/french-car-maker-peugeot-to-repatriate-staff-from-chinas-wuhan-area-idUKKBN1ZO0PM

France to evacuate citizens from Wuhan by air

January 26, 2020 / 7:21 PM

PARIS (Reuters) - France said on Sunday it expected to evacuate hundreds of its citizens from the Wuhan area in China, the epicentre of a coronavirus outbreak.

French Health Minister Agnes Buzyn said any decision to ban flights from China would have to be taken by the European Union and rejected calls for temperature screening of passengers flying in from China as ineffectual. 

“French citizens will be repatriated by airplane to France, with the agreement of Chinese authorities. This will take place midweek,” Buzyn told reporters. 

France expects to repatriate up to a few hundred of its 800 citizens living in the Wuhan area. Evacuees will have to spend 14 days in quarantine to avoid spreading the virus in France. 

Buzyn said that following the discovery of three coronavirus infections in France on Friday - three Chinese nationals - no further cases had been confirmed.

Buzyn rejected the need for temperature screening of airline passengers from China.

More

https://uk.reuters.com/article/uk-china-health-france-evacuation/france-to-evacuate-citizens-from-wuhan-by-air-idUKKBN1ZP0QC?il=0

Crooks and Scoundrels Corner. 

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

In other, mostly irrelevant news this morning, the EUSSR is cooking up yet more pettifogging protectionist rules. More details to come in March, which for the sclerotic EUSSR, is like greased lightening.

EU plans more protectionist antitrust rules, data sharing in policy shake-up

January 25, 2020 / 4:13 PM

BRUSSELS (Reuters) - The EU plans to adopt more protectionist antitrust rules and encourage businesses to share data as part of an industrial policy overhaul aimed at giving European companies a sharper edge in global markets, a strategy document seen by Reuters shows.

Drafted by the European Commission and set to be unveiled in March, the strategy also includes the more aggressive use of trade defense instruments against companies deemed to be benefiting unfairly from foreign subsidies.

“Our vision is not about shielding uncompetitive industries or encouraging protectionist policies ... At the same time, the EU cannot be complacent about third countries or companies undermining fair competition in the single market on global markets,” the document said.

“This strategy sets the contours of a new and assertive industrial policy what will enable the EU to remain a global economic power,” it added.

Numerous EU countries and companies have called for Brussels to adopt a more ambitious and strategic industrial policy, complaining that others are able to take advantage of Europe’s open markets without being subjected to the same rules.

---- That argument was cited by German conglomerate Siemens (SIEGn.DE) and French rival Alstom (ALSO.PA) in their failed bid to gain EU antitrust approval to create a European rail champion last year.

Under the new policy blueprint, the Commission will evaluate and review EU competition rules to ensure that they are fit for purpose and contribute to a strong European industry at home and in the world.

In light of the growing data economy, the new policy envisions setting up a legal framework to facilitate the use, access to and sharing of data in a push to get companies to embrace artificial intelligence and blockchain technology.

It will also promote more “Important Projects of Common European Interest (IPCEI)”, building on the success of an 8-billion-euro battery project involving seven EU countries and 17 European companies approved last year.

More

https://uk.reuters.com/article/us-eu-industrialpolicy/eu-plans-more-protectionist-antitrust-rules-data-sharing-in-policy-shake-up-idUKKBN1ZO0NC

Milton Friedman once put it, if you’re spending your own money on yourself, you care about price and quality. If you’re spending someone else’s money on yourself, you only care about quality. If you’re spending your own money on someone else, you care only about price. And if you’re spending someone else’s money on someone else, you don’t care about either.

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 21^st century onwards?

Blue-emitting diode demonstrates limitations and promise of perovskite semiconductors

Study shows all halide perovskites inherently unstable, requiring great attention to environment

Date: January 24, 2020

Source: University of California - Berkeley

Summary: Halide perovskites have garnered attention because they're highly efficient at capturing energy in solar cells and efficient emitters in diodes. But researchers failed at making perovskite LEDs that emit blue light. Chemists succeeded, but X-ray studies of the LED's structure show that it's very sensitive to temperature, humidity and chemical environment. Hence environmental and chemical control is essential for stable operation. But these properties also allow for potentially broader use, such as sensors.

University of California, Berkeley, scientists have created a blue light-emitting diode (LED) from a trendy new semiconductor material, halide perovskite, overcoming a major barrier to employing these cheap, easy-to-make materials in electronic devices.

In the process, however, the researchers discovered a fundamental property of halide perovskites that may prove a barrier to their widespread use as solar cells and transistors.

Alternatively, this unique property may open up a whole new world for perovskites far beyond that of today's standard semiconductors.

In a paper appearing Jan. 24 in the journal Science Advances, UC Berkeley chemist Peidong Yang and his colleagues show that the crystal structure of the halide perovskites changes with temperature, humidity and the chemical environment, disrupting their optical and electronic properties. Without close control of the physical and chemical environment, perovskite devices are inherently unstable. This is not a major problem for traditional semiconductors.

"Some people may say this is a limitation. For me, this is a great opportunity," said Yang, the S. K. and Angela Chan Distinguished Chair in Energy in the College of Chemistry and director of the Kavli Energy NanoSciences Institute. "This is new physics: a new class of semiconductors that can be readily reconfigured, depending on what sort of environment you put them in. They could be a really good sensor, maybe a really good photoconductor, because they will be very sensitive in their response to light and chemicals."

----"This paper is not just about showing off that we made this blue LED," said Yang, who is a senior faculty scientist at Lawrence Berkeley National Laboratory (Berkeley Lab) and a UC Berkeley professor of materials science and engineering. "We are also telling people that we really need to pay attention to the structural evolution of perovskites during the device operation, any time you drive these perovskites with an electrical current, whether it is an LED, a solar cell or a transistor. This is an intrinsic property of this new class of semiconductor and affects any potential optoelectronic device in the future using this class of material."

More

https://www.sciencedaily.com/releases/2020/01/200124155110.htm?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+sciencedaily%2Fmatter_energy%2Fgraphene+%28Graphene+News+--+ScienceDaily%29

'You just never know. That unpredictability is the great thing about life. You change. The world changes. You live in a country where we are still blessed with enormous opportunity. Leave yourself open to the world of possibility. You have the ambition, you have the smarts and you have the toughness. So, turn the page on your biography - you have just started a new chapter in your lives.'

Lloyd Blankfein, “Mr. Goldman Sacks,” the ex-CEO of Goldman Sachs unintentionally backs Brexit in a US speech to graduates, mid 2016.

The monthly Coppock Indicators finished December

DJIA: 28,538 +91 Up. NASDAQ: 8,973 +125 Up. SP500: 3,231 +114 Up.

All higher again, but it’s not a buy signal I would take. The rally is all down to the Fed monetizing at a rate of about 100 billion a month. I continue to look on the Fed’s latest stock bubble as an exit rally.