By John
McCrank
NEW YORK (Reuters) - As a
technology-driven rally brings U.S. stock indexes within striking distance of
fresh records, concerns that big names are over-extended and that new
regulation might be coming have some investors diversifying beyond the rally
leaders.
The S&P 500's five biggest companies,
Apple Inc AAPL.O MSFT.O AMZN.O GOOGL.O FB.O
On average, these tech and internet-driven
stocks have gained 49.23% this year, compared to a 7% gain for the S&P 500
- and are up 9.6% on average since Sept. 21, versus 6.6% for the S&P 500.
They are expected to report strong third-quarter earnings in coming weeks,
proving their mettle in a year when the coronavirus pandemic fueled a
work-from-home economy while devastating companies linked to sectors like
travel, restaurants, and fossil fuels.
(Graphic: S&P 500's big tech boost tmsnrt.rs/2SUGbw3
Still, some worry that mega-cap tech
companies are exposed to factors that may cut their allure in the months ahead.
Being long technology is the most crowded trade of all time, according to a
recent Bank of America fund manager survey.
“It’s all about trying not to have all your
eggs in one basket,” said Laura Kane, head of Americas thematic investing at
UBS Global Wealth Management. “It’s about trimming certain exposures and
rotating into something else.”
UBS analysts have recommended diversifying
out of mega-cap tech stocks on signs of an economic recovery and climbing valuations.
They urge rebalancing into U.S. semiconductors, which are more sensitive to
economic recovery, as well as emerging market value stocks and United
Kingdom-based equities.
Societe Generale analysts also recently
cited a challenging regulatory environment as one reason to diversify out of
U.S. tech shares and into Asian ones and European stocks.
Regulatory concerns have heightened
following a scathing report here
More
https://uk.reuters.com/article/uk-usa-stocks-weekahead/wall-street-week-ahead-big-tech-nervousness-prompts-calls-to-diversify-idUKKBN2712S3
U.S. Budget Gap Tripled to
Record $3.1 Trillion in Fiscal 2020, Treasury Says Spending soared 47% in year
ended Sept. 30 as government rolled out programs to battle coronavirus and
recession October 16, 2020
WASHINGTON—The U.S. budget deficit tripled to a record $3.1
trillion in the fiscal year that ended Sept. 30 as the government battled the
global coronavirus pandemic that plunged the country into a recession, has
taken more than 217,000 American lives and thrown millions out of work.
As a share of economic output, the budget gap in fiscal
year 2020 hit roughly 16.1%, the largest since 1945, the Treasury Department
said Friday, when the country was financing massive military operations to help
end World War II.
Federal debt totaled 102% of gross domestic product, the
first time it has exceeded the size of the economy for the full fiscal year in
more than 70 years, according to estimates from the Committee for a Responsible
Federal Budget. That has put the U.S. in a league with Greece, Italy and Japan
among the most heavily indebted nations.
Senate Republicans, citing the mounting debt, have balked
at a White House proposal to spend another
$1.88 trillion House Democrats’ $2.2 trillion bill Many economists and Federal Reserve
officials
---- The International Monetary Fund this week said global public debt
---- To cover the budget shortfall, the Treasury has
sold a flood of new securities, boosting total government debt held by the
public to $21 trillion, a 25% increase from the beginning of the fiscal year.
Investors
have shown scant worry about the deficit. U.S. government bonds were little
changed Friday, with the yield on the benchmark 10-year Treasury note ticking
up to 0.743% from 0.730% Thursday, according to Tradeweb. Yields rose in the
morning following better-than-expected retail sales data but fell after a disappointing
report on industrial production.
More.
https://www.wsj.com/articles/u-s-budget-gap-tripled-to-record-3-1-trillion-in-fiscal-year-2020-treasury-says-11602871210
Asia’s Money Managers Buy
Gold, China Stocks to Hedge Election By Ishika
Mookerjee ,Moxy
Ying , and Kartik Goyal
October
17, 2020, 1:00 AM GMT+1
Money managers in Asia are deploying a range of traditional
and unconventional strategies to cushion any losses as they brace for turbulence
Chinese equities feature high in some recommendations on
expectations the vote will have a limited impact on Asian assets, while
derivatives that protect against a market slide are also listed among the
strategies. Several investors suggest more conventional hedges such as the yen
and gold as well as just holding cash to avoid risk exposure.
And even as election fears ebb survey
“Global risk assets could experience near-term volatility
as a disputed election could initially put downward pressure on them and cause
a flight to safety,” said David Chao, market strategist for Asia Pacific
ex-Japan at Invesco, which oversees $1.2 trillion globally. “A diversified
portfolio makes sense, especially one that includes safe haven assets and
market neutral strategies.”
More
https://www.bloomberg.com/news/articles/2020-10-17/asia-s-money-managers-buy-gold-china-stocks-to-hedge-election
Finally as the days get shorter,
something of interest this autumn weekend.
Hundreds of Native American
Treaties Digitized for the First Time The National Archives has
scanned more than 300 agreements between the United States and Indigenous
tribes smithsonianmag.com October 15, 2020 2:22PM
For many Native American tribes, historical treaties are a
fraught reminder of promises made—and broken—by the United States government
over centuries of colonial expansion and exploitation. The documents are also
of paramount importance today, as tribes and activists point to them as binding
agreements
Thanks to a newly completed digitization effort by the U.S.
National
Archives Museum
of Indian Arts and Culture unprecedented
access
The online collection features 374 ratified Indian treaties
from the archives’ holdings. According to a blog post wampum
Those hoping to delve into the trove can use Indigenous Digital
Archive (IDA) Treaties Explorer
“The treaties between the U.S. and Native nations are
relevant, and few people have had access to know about treaties that are
related to where they live,” Della Warrior Albuquerque
Journal
More
https://www.smithsonianmag.com/smart-news/hundreds-native-american-treaties-digitized-and-online-first-time-180976056/?utm_source=smithsoniandaily&utm_medium=email&utm_campaign=20201015-daily-responsive&spMailingID=43692303&spUserID=NjUwNDIzNTUzNDE0S0&spJobID=1861278322&spReportId=MTg2MTI3ODMyMgS2
As
someone who once drove to Santa Fe through the mountain and desert back roads
from Denver, I can recommend Santa Fe and the nearby Rio Grande Gorge Bridge,
just north of Taos, when happier travel times return.
Rio Grande
Gorge Bridge The Rio Grande Gorge Bridge , locally known as the
"Gorge Bridge" or the "High Bridge",[2] deck arch bridge Rio
Grande Gorge Taos,
New Mexico United States Rio Grande tenth highest bridge in
the United States [3]
More.
https://en.wikipedia.org/wiki/Rio_Grande_Gorge_Bridge
Covid-19 Corner This
section will continue until it becomes unneeded.
U.S. Tops 8 Million Cases;
Europe Breaks Records: Virus Update October 15, 2020, 11:38 PM GMT+1 Updated on October 16, 2020, 10:25 PM GMT+1
The U.S. reported the most daily infections in two months
as temperatures begin to dip across the U.S., students return to classrooms and
more people stay indoors where the virus spreads easily.
Meanwhile, cases worldwide surpassed 39 million. Nations
from Germany to Italy to Portugal reported record cases as the pandemic’s
accelerating resurgence across Europe forced fresh lockdowns banned
Pfizer Inc. said it could seek emergency-use
authorization
Key Developments: Global Tracker :
Cases exceed 39 million; deaths top 1.1 millionCovid-19 cases spread across the U.S. as winter nears Virus surge crimps Europe with London and
Paris leading the way A Hong Kong-Singapore travel bubble will reopen financial hub links Who’s succeeding against the coronavirus and why: QuickTake https://www.bloomberg.com/news/articles/2020-10-16/covid-19-cases-spread-across-the-u-s-as-winter-nears
France reports over 25,000 new
coronavirus infections in past 24 hours October 16, 20206:46
PM
BERLIN
(Reuters) - The number of confirmed coronavirus cases in Germany increased by
7,830 to 348,557, data from the Robert Koch Institute (RKI) for infectious
diseases showed on Saturday.
The reported
death toll rose by 33 to 9,734, the tally showed.
https://uk.reuters.com/article/uk-health-coronavirus-germany-cases/germanys-confirmed-coronavirus-cases-rise-by-7830-to-348557-rki-idUKKBN27203C?il=0
Japan to test anti-virus
measures at near-full baseball stadium October 16, 20205:40 AM By Jack
Tarrant
TOKYO
(Reuters) - Yokohama Stadium will hold three baseball games at around 80%
capacity later this month as Japan looks to test its COVID-19 countermeasures
at big events ahead of the rearranged Tokyo Olympics next year.
Professional
sports stadiums in Japan have been limited to 50% capacity as part of efforts
to curb the spread of the novel coronavirus, with the vast majority of games
going ahead without issue.
Economic
revitalization minister Yasutoshi Nishimura, who heads Japan’s COVID-19 fight,
told reporters late on Thursday that if the “experiment” was a success all
professional stadiums would be allowed to boost capacity.
The Yokohama
Baystars, who play at the 34,000-capacity Yokohama Stadium, which will also be
used during the Olympics, confirmed in a statement that three games would be
played at the venue with capacity set at around 80%.
On Thursday
at the Tokyo Dome, where the Yomiuri Giants hosted Hiroshima Carp, 19,000 fans
attended the game with full coronavirus countermeasures on display.
As well as
having their temperature checked upon entry and disinfectant being available
throughout the venue, which can host up to 45,000, all fans had to give their contact
details to staff in case of an outbreak.
Giants fans
have even changed their most popular chant to involve less yelling and vigorous
movement that may spread the virus, while there was no sign of the ‘uriko’ beer
vendors who are usually bringing drinks to fans in their seats.
More
https://uk.reuters.com/article/uk-olympics-2020-baseball-fans/japan-to-test-anti-virus-measures-at-near-full-baseball-stadium-idUKKBN2710HQ
Gilead questions WHO study
that cast doubts on drug's COVID-19 benefits October 15, 202011:15 PM By Deena
Beasley , Vishwadha Chander
(Reuters) - Gilead Sciences Inc GILD.O
The American
company told Reuters the data appeared inconsistent, the findings were
premature and that other studies had validated the drug’s benefits.
In a blow to
one of the few drugs being used to treat people with COVID-19, the WHO said on
Thursday its “Solidarity” trial had concluded that remdesivir appeared to have
little or no effect on 28-day mortality or length of hospital stays among
patients with the respiratory disease.
The
antiviral medication was one of the drugs used to treat U.S. President Donald
Trump’s coronavirus infection, and has been shown in previous studies to have
cut time to recovery, though the European Union is investigating it for
possible kidney injury.
The WHO
trial was conducted in 11,266 adult patients in more than 30 countries. The
evidence was conclusive, the WHO said.
Gilead said
other trials of remdesivir, including with 1,062 patients that compared it with
a placebo, showed the treatment cut COVID-19 recovery time.
“The
emerging (WHO) data appears inconsistent, with more robust evidence from
multiple randomized, controlled studies published in peer-reviewed journals
validating the clinical benefit of remdesivir,” Gilead told Reuters.
---- In April, the top U.S. infectious
disease official, Anthony Fauci, predicted remdesivir would become “the
standard of care”.
Companies such as Gilead are racing to find
a treatment for COVID-19. Some 1.1 million people have died and 39.1 million
have been reported infected in the pandemic, and the global economy has been
thrown into chaos.
Remdesivir was developed for Ebola, which
causes fever, bleeding, vomiting and diarrhoea and spreads among humans through
bodily fluids.
It was quickly repurposed and has offered
some hope for patients, though the WHO's findings may shift the focus of the
search for a vaccine to new monoclonal antibodies being developed by companies
including Regeneron REGN.O
More
https://uk.reuters.com/article/uk-health-coronavirus-remdesivir/gilead-questions-who-study-that-cast-doubts-on-drugs-covid-19-benefits-idUKKBN27032T?il=0
Next, some very useful vaccine
links kindly sent along from a LIR reader in Canada. The links come from a most
informative update from Stanford Hospital in California.
World Health Organization -
Landscape of COVID-19 candidate vaccines . https://www.who.int/publications/m/item/draft-landscape-of-covid-19-candidate-vaccines
NY Times Coronavirus Vaccine Tracker . https://www.nytimes.com/interactive/2020/science/coronavirus-vaccine-tracker.html
Stanford Website . https://racetoacure.stanford.edu/clinical-trials/132
FDA information . https://www.fda.gov/media/139638/download
Regulatory Focus COVID-19
vaccine tracker . https://www.raps.org/news-and-articles/news-articles/2020/3/covid-19-vaccine-tracker
Some more useful Covid links.
Johns Hopkins Coronavirus
resource centre
https://coronavirus.jhu.edu/map.html
Rt Covid-19
https://rt.live/
Covid19info.live
https://wuflu.live/
In general, the art of government consists of taking as much
money as possible from one class of citizens to give to another.
Voltaire
Technology Update.
With events happening
fast in the development of solar power and graphene, and science in general, I’ve
added this section. Updates as they get reported.
A
self-erasing chip for security and anti-counterfeit tech Date: September 24, 2020
Source: University of Michigan
Summary: Self-erasing chips could help
stop counterfeit electronics or provide alerts if sensitive shipments are
tampered with.
Self-erasing
chips developed at the University of Michigan could help stop counterfeit
electronics or provide alerts if sensitive shipments are tampered with.
They rely on
a new material that temporarily stores energy, changing the color of the light
it emits. It self-erases in a matter of days, or it can be erased on demand
with a flash of blue light.
"It's
very hard to detect whether a device has been tampered with. It may operate
normally, but it may be doing more than it should, sending information to a
third party," said Parag Deotare, assistant professor of electrical
engineering and computer science.
With a
self-erasing bar code printed on the chip inside the device, the owner could
get a hint if someone had opened it to secretly install a listening device. Or
a bar code could be written and placed on integrated circuit chips or circuit
boards, for instance, to prove that they hadn't been opened or replaced on
their journeys. Likewise, if the lifespan of the bar codes was extended, they
could be written into devices as hardware analogues of software authorization
keys.
The
self-erasing chips are built from a three-atom-thick layer of semiconductor
laid atop a thin film of molecules based on azobenzenes -- a kind of molecule
that shrinks in reaction to UV light. Those molecules tug on the semiconductor
in turn, causing it to emit slightly longer wavelengths of light.
To read the
message, you have to be looking at it with the right kind of light. Che-Hsuan
Cheng, a doctoral student in material science and engineering in Deotare's
group and the first author on the study in Advanced Optical Materials ,
is most interested in its application as self-erasing invisible ink for sending
secret messages.
The
stretched azobenzene naturally gives up its stored energy over the course of
about seven days in the dark -- a time that can be shortened with exposure to
heat and light, or lengthened if stored in a cold, dark place. Whatever was
written on the chip, be it an authentication bar code or a secret message,
would disappear when the azobenzene stopped stretching the semiconductor.
Alternatively, it can be erased all at once with a flash of blue light. Once
erased, the chip can record a new message or bar code.
The
semiconductor itself is a "beyond graphene" material, said Deotare,
as it has many similarities with the Nobel Prize-winning nanomaterial. But it can
also do something graphene can't: It emits light in particular frequencies.
More
https://www.sciencedaily.com/releases/2020/09/200924135321.htm?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+sciencedaily%2Fmatter_energy%2Fgraphene+%28Graphene+News+--+ScienceDaily%29
This weekend’s musical diversion.
Vivaldi again but this time in a minor key. But is this best for violin as
Vivaldi composed it, or as arranged by Bach for the piano, via the harpsicord?
You decide. Vivaldi: Concerto for 4
Violins in B minor RV 580 https://www.youtube.com/watch?v=SY3Kxf7ZTeI
Bach-Vivaldi/Concerto for 4
Pianos/MultiPiano Ensemble https://www.youtube.com/watch?v=7OwQOb6bd1M
This weekend’s chess problem solved. A
gem.
Greatest Queen Sacrifice
Repeated in 2019!!! || Nezhmetdinov Would Be Proud https://www.youtube.com/watch?v=H1tPZk6r_1U
Finally, the infamous London Horse Shoe
Brewery disaster.
The
London Beer Flood of 1814 by Ben Johnson On Monday 17th October 1814, a terrible disaster claimed
the lives of at least 8 people in St Giles, London. A bizarre industrial
accident resulted in the release of a beer tsunami onto the streets around
Tottenham Court Road.
The Horse Shoe Brewery stood at the corner of Great Russell
Street and Tottenham Court Road. In 1810 the brewery, Meux and Company, had had
a 22 foot high wooden fermentation tank installed on the premises. Held
together with massive iron rings, this huge vat held the equivalent of over
3,500 barrels of brown porter ale, a beer not unlike stout.
On the afternoon of October 17th 1814 one of the iron rings
around the tank snapped. About an hour later the whole tank ruptured, releasing
the hot fermenting ale with such force that the back wall of the brewery
collapsed. The force also blasted open several more vats, adding their contents
to the flood which now burst forth onto the street. More than 320,000 gallons
of beer were released into the area. This was St Giles Rookery, a densely
populated London slum of cheap housing and tenements inhabited by the poor, the
destitute, prostitutes and criminals.
The flood
reached George Street and New Street within minutes, swamping them with a tide
of alcohol. The 15 foot high wave of beer and debris inundated the basements of
two houses, causing them to collapse. In one of the houses, Mary Banfield and
her daughter Hannah were taking tea when the flood hit; both were killed.
In the
basement of the other house, an Irish wake was being held for a 2 year old boy
who had died the previous day. The four mourners were all killed. The wave also
took out the wall of the Tavistock Arms pub, trapping the teenage barmaid
Eleanor Cooper in the rubble. In all, eight people were killed. Three brewery
workers were rescued from the waist-high flood and another was pulled alive
from the rubble.
More
https://www.historic-uk.com/HistoryUK/HistoryofBritain/The-London-Beer-Flood-of-1814/
With the exception only of the period of the gold standard,
practically all governments of history have used their exclusive power to issue
money to defraud and plunder the people.
F. A. von Hayek
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