Tuesday 14 July 2020

USA v China Round ??? Covid Crisis Deepens.


Baltic Dry Index. 1792 -18  Brent Crude 41.86
Spot Gold 1798

Coronavirus Cases 14/7/20 World 13,242,294
Deaths 574,368

14th July 1683 The Siege of Vienna begins. When it ended in the Battle of Vienna September 12, 1683 and the largest cavalry charge ever, (18,000,) with the defeat of the moslem Ottoman Empire, Christian Europe was saved from further Ottoman attack. The west had finally beaten the east.

That seemingly endless USA v China trade war, seems to be about to take on a new hard line political dimension.  Is President Xi’s miscalculation on Hong Kong about to crimp his “belt and road” initiative?

That, and another lock down in California, have the stock casinos unsettled.

The unhappy reality is that globally the coronavirus crisis is still out of control. Until it’s contained, we have a vaccine, or effective and cheap drugs and therapies that work against Covid-19, the global economy is likely to struggle on in recession.

The gamblers in the central bankster’s casinos finally seem to be becoming aware of just how exposed they are. Well maybe not, buy more!

Asian markets dip as virus and Sino-U.S. tensions flare

July 14, 2020 / 12:37 AM
SINGAPORE/WASHINGTON (Reuters) - Asian stock markets slipped on Tuesday, oil sagged and a safety bid supported the dollar as simmering Sino-U.S. tensions and fresh coronavirus restrictions in California kept a lid on investor optimism as earnings season gets underway.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 1.2%. Japan's Nikkei .N225 retreated from a one-month high touched on Monday, dropping 0.8%. A firm dollar put pressure on the Aussie and kiwi. 

The moves came after a selloff on Wall Street that followed reopening rollbacks in California, where Governor Gavin Newsom ordered bars closed and restaurants and movie theatres to cease indoor operations.

S&P 500 futures ESc1 were flat in Asia after the index .SPX lost 0.9% on Monday.

Meanwhile tension grew between the United States and China. The United States on Monday rejected China’s disputed claims to offshore resources in most of the South China Sea - a shift in tone which prompted a rebuke from Beijing.

The Trump Administration also plans on scrapping a 2013 auditing agreement that could foreshadow a broader crackdown on U.S.-listed Chinese firms, as friction between the world’s two largest economies generates heat on a broad front.

“It’s not just the tempo which is picking up, but the aspect of so many areas being pulled in to the dispute,” said Vishnu Varathan, head of economics at Mizuho Bank in Singapore.

“Last time it was really about the bottom line,” he said, but now what had been primarily a trade dispute ranges across political and strategic dimensions, making a resolution less likely and the next moves less predictable.

California’s return to restrictions also has markets on edge about whether the virus can wreak more economic harm, as total infections surged by a million in five days and now top 13 million.
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China's first-half exports to U.S. down 8.1% year-on-year, imports fall 1.5%

July 14, 2020 / 3:54 AM
BEIJING (Reuters) - China’s exports to the United States fell by 8.1% in the first half from the same period a year earlier while imports from the U.S. declined 1.5%, customs spokesman Li Kuiwen told reporters on Tuesday.

It was not immediately clear if the figures cited by Li were yuan-denominated or dollar-denominated.
The customs agency has yet to release dollar-denominated figures for overall trade. 

China and United States should create favorable conditions to implement the Phase 1 trade deal, Li said.

Pandemic knocks Singapore into recession as GDP plummets 41% in second quarter

July 14, 2020 / 1:07 AM
SINGAPORE (Reuters) - Singapore’s economy suffered a record contraction in the second quarter, tipping it into recession and putting the trade-reliant city-state on course for its worst ever slump this year as the coronavirus outbreak extracts a heavy toll on business.

The grim numbers for the wealthy city-state, the first in Asia to report second-quarter GDP data, underscore the sweeping worldwide impact of the COVID-19 pandemic and suggest a rough first half for the global economy. Many major economies are already facing their steepest downturn in decades. 

Gross domestic product (GDP) plunged by a record 41.2% in the three months ended March, on a quarter-on-quarter annualised basis, preliminary data from the Ministry of Trade and Industry showed on Tuesday, worse than economists’ expectations for a 37.4% decline in a Reuters poll.

The sectoral impact was broadbased with the services and construction sector hardest hit. Construction, which ground to a near halt, plummeted 95.6% on a quarter-on-quarter annualised seasonally-adjusted basis.

“We were expecting these numbers to look quite dismal, although this is worse than what we had expected,” said Steve Cochrane, economist at Moody’s Analytics.

On a year-on year basis, GDP dived 12.6% versus economists forecast for a 10.5% contraction.
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In other news, is spendthrift Uncle Sam out of control?  Gold anyone?

German metal bashers are about to get sacked. The rump-EU talks tough on China/HK, then, as usual, wimps out.

Federal Spending and Deficit Set Records Through June

By Terence P. Jeffrey | July 13, 2020 | 2:41pm EDT
(CNSNews.com) - The federal government set records for both the amount of money it spent and the deficit it ran in the first nine months of fiscal 2020 (October through June), according to data released today in the Monthly Treasury Statement.

During the October-June period, the government spent a record $5,004,372,000,000 while it collected $2,260,069,000,000 in total taxes.

The resulting deficit of $2,744,303,000,000 was the largest the federal government has ever run in the first nine months of a fiscal year.

Prior to this year, the largest deficit the federal government ever ran in the first nine months of the fiscal year was in fiscal 2009, when it ran a deficit of $1,291,239,470,000 in constant May 2020 dollars (adjusted using the Bureau of Labor Statistic inflation calculator).

Prior to spending a record $5,004,372,000,000 in the first nine months of fiscal 2020, the most the federal government every spent in the first nine months of a fiscal year was the $3,359,258,590,000 (in constant May 2020 dollars) it spent in the first nine months of fiscal 2019.

While the deficit and federal spending were setting records in the first nine months of this fiscal year, federal tax collections were declining.

In the October-June period of this fiscal year, the Treasury collected $2,260,069,000,000 in total taxes. The last time it collected less than that was in fiscal 2012, when it collected $2,038,032,750,000 (in constant May 2020 dollars) in the October-June period.

The Department of Health and Human Services led all federal agencies in spending in the first nine months of the fiscal year with outlays of $1,127,768,000,000.
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Federal Reserve's $3 trillion virus rescue inflates market bubbles

July 13, 2020 / 11:16 AM
(Reuters) - The Federal Reserve’s $3 trillion bid to stave off an economic crisis in the wake of the coronavirus outbreak is fuelling excesses across U.S. capital markets.

The U.S. central bank has pledged unlimited financial asset purchases to sustain market liquidity, increasing its balance sheet from $4.2 trillion in February to $7 trillion today. 

While the vast majority of these purchases have been limited to U.S. Treasuries and mortgage-backed securities, the Fed’s pledge to bolster the corporate bond market has been enough to spur a frenzy among investors for bonds and stocks.

“COVID-19 is now inversely related to the markets. The worse that COVID-19 gets, the better the markets do because the Fed will bring in stimulus. That is what has been driving markets,” said Andrew Brenner, head of international fixed income at NatAlliance.

Here are some of the market bubbles that investors are attributing to the Federal Reserve’s intervention.

STOCK MARKET BONANZA

The Federal Reserve has not bought stocks as part of its financial stimulus programs. But its near-zero interest rates and credit support for large swathes of Corporate America have driven yield-hungry investors back to the equity market.
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Daimler talks with workers heat up, with 15,000 jobs at risk 

July 13, 2020 / 12:34 PM
FRANKFURT (Reuters) - Labour representatives at German carmaker Daimler said on Monday that discussions with management over cost cuts had become “rougher”, after a board member said over the weekend that more than 15,000 jobs were at risk. 

The auto industry has been hit hard by the coronavirus pandemic, which shut factories and showrooms forcing traditional carmakers to seek deeper cuts.

Daimler had already said in November, before the pandemic started, that it would cut at least 10,000 jobs worldwide over the following three years, following peers as they cut costs to invest in electric vehicles while grappling with weakening sales.

The owner of the Mercedes-Benz brand had stuck with a pledge at the time to avoid forced redundancies at its German workforce until 2029.

Daimler board member Wilfried Porth told Stuttgarter Zeitung over the weekend, however, that more than 15,000 workers would now have to take a buyout or retire to avoid forced layoffs.

The works council for Daimler said on Monday it was aware of the seriousness of the situation.
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EU preparing measures against China over Hong Kong

July 13, 2020 / 11:52 AM
BRUSSELS (Reuters) - The European Union (EU) is preparing counter-measures on China in response to Beijing’s new security law on Hong Kong, the bloc’s top diplomat said on Monday, but envoys stressed the likely steps will not amount to economic sanctions.

Diplomats said there was broad support among EU member states for some action but tough measures were not being discussed in detail because of resistance from China’s closest trade partners in Europe, such as Hungary and Greece. 

Like much of the West, the EU has denounced the decision by China’s parliament to pass national security legislation for the ex-British colony of Hong Kong despite an international outcry.

While European Commission President Ursula von der Leyen last month warned of “very negative consequences” for Beijing, EU foreign policy chief Josep Borrell detailed lighter measures after a meeting of the bloc’s foreign ministers in Brussels.

“We have agreed today to develop a coordinated European Union response to show support for Hong Kong’s autonomy and civil society,” he told a news conference after the meeting.

“This will comprise measures both at the European Union level and also measures falling on the member states’ national competencies in a coordinated approach,” Borrell said.

He said nothing specific had been decided but that EU foreign ministers had discussed extending the EU’s export ban on “sensitive technology” to Hong Kong.

Borrell was referring to any equipment or software that could be used for suppressing protests aimed at preserving Hong Kong’s autonomy granted under terms of its handover back to China by Britain in 1997.

German Chancellor Angela Merkel backed a common EU response but warned against severing dialogue with China.
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Covid-19 Corner                       

Though hopefully, we are passing/have passed the peak of new cases, at least of the first SARS-CoV-2 outbreak, this section will continue until it becomes unneeded.

California orders indoor businesses to close, limits on churches, gyms in some counties

July 13, 2020 / 5:40 PM
July 13 (UPI) -- California Gov. Gavin Newsom on Monday ordered multiple business sectors to close down once again amid rising COVID-19 cases in the state.

Newsom ordered dine-in restaurants, bars, movie theaters, zoos, museums and some other businesses to close throughout the state which reported 8,358 new cases on Monday. 

"We've made this point on multiple occasions and that is we're moving back into modification mode of our original stay-at-home order," Newsom said during a press conference on Monday.

He also called for counties that have remained on the state's monitoring list for three days to also shut down additional activities.

Under the order some of California's most populous areas including Los Angeles, Orange, Riverside, San Bernadino and Ventura counties, will be required to shut down fitness centers, worship services, protests, offices for nonessential sectors, malls, personal care services, hair salons and barbershops.

"We're seeing an increase in the spread of the virus, so that's why it's incumbent upon all of us to recognize soberly that COVID-19 is not going away anytime soon until there is a vaccine or an effective therapy," Newsom said.

California has risen to second in the nation in positive cases with a total of 329,162, the state also has the fifth-highest death toll in the United States with 7,040 deaths.

Also Monday, the Los Angeles and San Diego unified districts, the two largest in the state, announced that the new school year would begin with online-only instruction as the districts construct a plan for a return to in-person instruction.

The districts cited "skyrocketing" infection rates in the state over the past few weeks as the basis for its decision.
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Coronavirus: Heart scans of more than half of COVID-19 patients abnormal, scientists find

Scientists say they were "surprised" to see so many COVID-19 patients with damage and severe dysfunction to their heart.

Coronavirus may have a serious impact on the heart, with more than half of COVID-19 patients revealing abnormal scans, a study suggests.

Researchers at Edinburgh University examined ultrasound scans, known as echocardiograms, of 1,261 patients in hospitals from 69 countries.

They discovered abnormal changes to the way the heart was pumping in 55% of the patients, with around one in seven showing evidence of severe dysfunction.

Around 3% of patients had suffered a recent heart attack.

The majority - 901 patients - had no known heart problems before, leading scientists to conclude that COVID-19 itself, the disease caused by coronavirus, may seriously affect the heart.

Among this group, heart scans were abnormal in 46% of patients and 13% had severe disease.

The scans showed abnormalities were almost evenly split between the left and right chambers of the heart.

Just how common heart damage is in COVID-19 patients is unclear.

The team stressed that all patients in the study were in hospital and had suspected heart complications.

As a result of their scan, one third of patients had their treatment changed, including being given medicines for heart failure, or more careful control of fluids and therapy to support heart function.
Professor Marc Dweck, who led the research, said: "COVID-19 is a complex, multi-system disease which can have profound effects on many parts of the body, including the heart."

He said many doctors have been hesitant to order echocardiograms for patients with COVID-19 because it is an added procedure which involves close contact with patients.

"Our work shows that these scans are important - they improved the treatment for a third of patients who received them," he added.

"Damage to the heart is known to occur in severe flu, but we were surprised to see so many patients with damage to their heart with COVID-19 and so many patients with severe dysfunction.

"We now need to understand the exact mechanism of this damage, whether it is reversible and what the long-term consequences of COVID-19 infection are on the heart."

The Tricky Math of Herd Immunity for Covid-19

When will a disease stop spreading through a population? The formula is simple, but the variables are much more complicated. 
07.12.2020 08:00 AM
“Once the level of immunity passes a certain threshold, then the epidemic will start to die out, because there aren’t enough new people to infect,” said Natalie Dean of the University of Florida.

While determining that threshold for Covid-19 is critical, a lot of nuance is involved in calculating exactly how much of the population needs to be immune for herd immunity to take effect and protect the people who aren’t immune.

At first it seems simple enough. The only thing you need to know is how many people, on average, are infected by each infected person. This value is called R0 (pronounced “R naught”). Once you have that, you can plug it into a simple formula for calculating the herd immunity threshold: 1 − 1/R0.

Let’s say the R0 for Covid-19 is 2.5, meaning each infected person infects, on average, two and a half other people (a common estimate). In that case, the herd immunity threshold for Covid-19 is 0.6, or 60 percent. That means the virus will spread at an accelerating rate until, on average across different places, 60 percent of the population becomes immune.

At that point, the virus will still spread, but at a decelerating pace, until it stops completely. Just as a car doesn’t come to a stop the moment you take your foot off the gas, the virus won’t vanish the moment herd immunity is reached.

“You could imagine that once 60 percent of the population is infected, the number of infections starts to drop. But it might be another 20 percent that gets infected while the disease is starting to die out,” said Joel Miller of La Trobe University in Australia.

That 60 percent is also the threshold past which new introductions of the virus—say, an infected passenger disembarking from a cruise ship into a healthy port with herd immunity—will quickly burn out.

“It doesn’t mean you won’t be able to start a fire at all, but that outbreak is going to die,” said Kate Langwig of Virginia Polytechnic Institute and State University.

However, things quickly get complicated. The herd immunity threshold depends on how many people each infected person actually infects—a number that can vary by location. The average infected person in an apartment building may infect many more people than the average infected person in a rural setting. So while an R0 of 2.5 for Covid-19 may be a reasonable number for the whole world, it will almost certainly vary considerably on a more local level, averaging much higher in some places and lower in others. This means that the herd immunity threshold will also be higher than 60 percent in some places and lower in others.
More

Some useful Covid links.

Johns Hopkins Coronavirus resource centre

Rt Covid-19

Covid19info.live

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.
Off topic today but interesting. Normal service tomorrow.

Planet Nine could be a black hole, and a new telescope will tell us

Michael Irving  July 12, 2020
The closest confirmed black hole to Earth is 1,000 light-years away – but could there be one hiding in our own backyard? It’s been hypothesized that a tiny black hole could be orbiting the Sun beyond Neptune, and now astronomers have proposed how we might find it within the next few years, using an upcoming telescope.
The fringes of the solar system are littered with strange objects, and in recent years we’re getting a clearer picture of what’s out there. There’s the squashed-snowman-shaped Arrokoth, the eccentric dwarf planet known as The Goblin, and the extremely distant world of Farout.
While most of these dwarf planets are tiny, there’s evidence to suggest that something much bigger is lurking in the shadows out there – perhaps a ninth planet, with the mass of five to 10 Earths. The clues are in the stable but eccentric orbits of these smaller fringe objects, and in the tilt of the Sun itself.

But maybe Planet Nine isn’t a planet after all? One seemingly out-there hypothesis suggests that a tiny black hole could have the same effects. It would still have roughy the same mass – several Earths’ worth – but pack it all into a black hole about the size of a grapefruit.

It’s an intriguing idea, but how would you go about actually proving it, one way or the other? After all, searches have turned up empty for a giant planet – finding a grapefruit would be far harder, let alone the fact that black holes are all but invisible.

And that’s where the new study comes in. Astronomers at Harvard have now outlined a method to search for these tiny black holes in the outer solar system. The key would be to watch out for the times they may flare up, as a result of a comet wandering too close and getting torn to shreds by the gravitational pull.

"In the vicinity of a black hole, small bodies that approach it will melt as a result of heating from the background accretion of gas from the interstellar medium onto the black hole," says Amir Siraj, co-author of the study. "Once they melt, the small bodies are subject to tidal disruption by the black hole, followed by accretion from the tidally disrupted body onto the black hole.”

Even this would be difficult to do normally, the team says, because we’d need to know where to look. We wouldn’t know where in its orbit such a black hole might be at any given time.

But an upcoming telescope could be perfectly suited to detecting these flares, wherever they occur. Rather than focus on any particular spot, the Vera C. Rubin Observatory will photograph the entire visible sky every few nights.

This project is known as the Legacy Survey of Space and Time (LSST), and over the course of 10 years it will allow astronomers to track the motion of objects and changes in their brightness, as well as transient events like supernovae.

The telescope should be sensitive enough, and have a wide enough field of view, to really take a clear census of our neighborhood. The LSST is expected to discover almost 40,000 new small objects in the solar system – and hopefully Planet Nine, whatever it is, will be among them.

The team says that if the mysterious object is a black hole, the LSST would be more than capable of detecting flares from it. In fact, the team is confident enough to claim that its existence would be confirmed or ruled out within a year of the observing runs beginning in 2023.

And if “Planet Nine” is indeed a black hole, its discovery would have even stranger implications. All the currently confirmed black holes in the universe are thought to have formed as the dense, collapsed cores of massive stars exploding as supernovae. But a tiny black hole with the mass of just a few planets would have been born in a completely different way.

Scientists like Stephen Hawking have long hypothesized the existence of things called primordial black holes. Calculations suggest that these objects would have been created in the seconds after the Big Bang, as pockets of matter grew incredibly dense and collapsed under their own gravity. Small enough to fit in your hand but packing the mass of a few planets, these primordial black holes could dot the universe, unseen.

If hypothetical, invisible masses throughout the cosmos sounds familiar to you, well, there’s a very good reason for that. These primordial black holes are a potential explanation for the enigmatic dark matter, but have so far evaded detection. So if the LSST can spot a primordial black hole in our own backyard, we may begin to unravel several long-standing mysteries at once.

"This method can detect or rule out trapped planet-mass black holes out to the edge of the Oort cloud, or about a hundred thousand astronomical units," says Siraj. "It could be capable of placing new limits on the fraction of dark matter contained in primordial black holes."

The Vera Rubin Observatory is currently under construction in Chile, with first light expected by the end of the year. After that, the LSST observing run is planned to begin in 2023, so we might not have too much longer to wait for some answers.

The research has been approved for publication in The Astrophysical Journal Letters.
Interest rates are the most important prices in the economy, according to Nobel laureate F.A. Hayek, because they reflect the collective time preference of individuals to consume either now or later. Accordingly, interest rates co-ordinate allocation of capital across the economy by signalling to businesses whether they should invest. Distortions in interest rates can cause “clusters of errors” in which large swathes of businesses unwittingly miscalculate at the same time. 

Hayek observed that interest rate stimulus interfered with economic calculations, causing managers to invest in projects that would not otherwise have appeared profitable. Losses can subsequently materialise as customer demand fails to meet forecasts that were, in retrospect, optimistic.
 

The Monthly Coppock Indicators finished June

DJIA: 25,813 -2 Down. NASDAQ: 10,059 +196 Up. SP500: 3,100 +75 Down.

The NASDAQ has remained up. The S&P and the DJIA still remain down despite the best efforts of the Fed to get them to go higher. The Dow has now gone negative.

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