Tuesday 15 December 2020

China Booms But What Kind Of Boom? Socialism.

 Baltic Dry Index. 1235 +24 Brent Crude 50.01

Spot Gold 1840

Coronavirus Cases 02/04/20 World 1,000,000

Deaths 53,100

Coronavirus Cases 15/12/20 World 73,193,269

Deaths 1,627,977

“Socialism is an alternative to capitalism as potassium cyanide is an alternative to water.”

 Ludwig von Mises.

It’s Tuesday and more of the same. Wobbly stock casinos pinning there hopes on SARS vaccines, in the real world, surging Covid-19 cases closing cities and economies once again.

China booms, or so it says, and take aim at Australia’s coal industry.

In media mainstream news, the US Electoral College tells President Trump “you’re fired.”

Asian stocks dip to 1-week lows as infection fears curb vaccine optimism

December 14, 2020  By Anshuman Daga

SINGAPORE (Reuters) - Asian stocks retreated on Tuesday as worries about increasing COVID-19 deaths and lockdowns overshadowed optimism about the roll-out of coronavirus vaccinations, just days after indexes hit record highs.

EUROSTOXX 50 futures dipped 0.4% and FTSE futures fell 0.6%, indicating a weaker open for European stock markets. E-Mini futures for the S&P 500 were up 0.05%.

Markets showed little reaction to China’s industrial output, which grew in line with expectations in November, expanding for an eighth straight month as an economic recovery gathered pace.

The number of coronavirus deaths in the United States crossed 300,000 on Monday as the hardest hit nation started its first vaccine inoculations, while tighter COVID-19 restrictions were imposed on London.

“While investors can approach 2021 with optimism that an effective COVID-19 vaccine will be available, the path of the economic recovery remains unclear,” Allianz Global Investors said in a report.

Most Asian markets retreated, with MSCI’s index of Asia-Pacific shares outside Japan falling 0.6% to 637.8, the lowest in more than a week after having hit a string of record highs in recent weeks.

Chinese stocks eased 0.3% and Hong Kong lost 0.9%.

Markets in Japan and South Korea, both grappling with surging infection numbers and growing public frustration, slipped 0.4% and 0.5%.

Australian stocks fell 0.4%, pulled down by heavyweight miners on fears of higher regulatory scrutiny over surging iron ore prices in top consumer, China.

News of vaccines has powered gains in the last few months, with the Asian benchmark up nearly 16% so far this year, sitting just shy of a record struck last week. The rally has been led by markets in South Korea, China and Taiwan.

---- On Monday, the S&P 500 closed down 0.4%, the Nasdaq Composite gained 0.5% and the Dow Jones Industrial Average hit a record high but fell back 0.6% for the day.

More

https://uk.reuters.com/article/global-markets/asian-stocks-weaken-as-infection-worries-curb-vaccine-enthusiasm-idUKKBN28O35R

Oil slips on demand worries as COVID-19 lockdowns tighten

MELBOURNE/SINGAPORE (Reuters) - Oil prices fell on Tuesday as tighter lockdowns in Europe and a forecast for a slower recovery in demand next year outweighed relief from vaccination rollouts and concerns about a flare-up of tension in the Middle East.

U.S. West Texas Intermediate (WTI) crude futures fell 36 cents, or 0.8%, to $46.63 a barrel at 0506 GMT, while Brent crude futures fell 40 cents, or 0.8%, to $49.89 a barrel, erasing Monday’s gains.

London stepped up restrictions requiring bars and restaurants to close, as COVID-19 infection rates continued to rise sharply, which will dent fuel demand in the near term.

Further marring the demand outlook, Italy said it was considering more stringent restrictions over the Christmas holidays, while most stores in Germany have been ordered to shut until Jan. 10, with little prospect of an easing early in the new year.

“While the market has been buoyed by the rollout of COVID-19 vaccines, a path towards normalisation of demand remains a difficult one,” ANZ analysts said in a note.

OPEC on Monday pared its forecast for a recovery in oil demand in 202l by 350,000 barrels per day, due to the persistent impact of the pandemic, but said a rapid rollout of vaccines in major economies “provides potential upside for next year’s growth forecast.”

In a sign of weaker demand, analysts expect data from the American Petroleum Institute on Tuesday and the Energy Information Administration on Wednesday to show that U.S. gasoline inventories rose by 1.6 million barrels last week, while distillate inventories, which include diesel and heating oil, rose by 400,000 barrels.

Oil prices had found some support after a fuel transport ship at the Saudi Arabian port of Jeddah was hit by an explosion on Monday, but the kingdom’s ministry of energy noted the incident did not cause any effect on supplies.

More

https://uk.reuters.com/article/global-oil/oil-slips-on-demand-worries-as-covid-19-lockdowns-tighten-idUKKBN28P07A 

Finally, China.  Despite unleashing SARS-CoV-2 on the world, China’s booming. Or is it?

China's factory recovery steps up as export, consumer demand grows

December 15, 2020

WASHINGTON — American imports from China are surging as the year draws to a close, fueled by stay-at-home shoppers who are snapping up Chinese-made furniture and appliances, along with Barbie Dream Houses and bicycles for the holidays.

The surge in imports is another byproduct of the coronavirus, with Americans channeling money they might have spent on vacations, movies and restaurant dining to household items like new lighting for home offices, workout equipment for basement gyms, and toys to keep their children entertained.

That has been a boon for China, the world’s largest manufacturer of many of those goods. In November, China reported a record trade surplus of $75.43 billion, propelled by an unexpected 21.1 percent surge in exports compared with the same month last year. Leading the jump were exports to the United States, which climbed 46.1 percent to $51.98 billion, also a record.

That surge has defied the expectations of American politicians of both parties, who earlier this year predicted that the pandemic, which began in China, would be a moment for reducing trade with that country and finally bringing factories back to the United States.

More

https://www.nytimes.com/2020/12/14/business/economy/us-china-trade-covid.html?action=click&module=Top%20Stories&pgtype=Homepage

What was touted as the world's biggest development project is unravelling into what could become China's first overseas debt crisis

How the wheels came off Xi Jinping's Belt and Road 'project of the century'

14 December 2020

Lending by the Chinese financial institutions that drive the Belt and Road, along with bilateral support to governments, has fallen off a cliff, and Beijing finds itself mired in debt renegotiations with a host of countries.

It has not taken long for the wheels to come off the Belt and Road Initiative. As recently as May 2017, China’s leader Xi Jinping stood in Beijing before a hall of nearly 30 heads of state and delegates from over 130 countries and proclaimed “a project of the century”.

This was not hyperbole. China has promised to spend about US$1 trillion on building infrastructure in mainly developing countries around the world — and finance almost all of this through its own financial institutions. Adjusted for inflation, this total was roughly seven times what the U.S. spent through the Marshall Plan to rebuild Europe after the second world war, according to Jonathan Hillman, author of The Emperor’s New Road.

But according to data published this week, reality is deviating sharply from Xi’s script. What was conceived as the world’s biggest development program is unravelling into what could become China’s first overseas debt crisis. Lending by the Chinese financial institutions that drive the Belt and Road, along with bilateral support to governments, has fallen off a cliff, and Beijing finds itself mired in debt renegotiations with a host of countries.

“This is all part of China’s education as a rising power,” says Hillman, a senior fellow at Washington-based think-tank CSIS. “It has taken a flawed model that appeared to work at home, building large infrastructure projects, and hubristically tried to apply that abroad.”

“Historically, most infrastructure booms have gone bust,” he adds. “Whether China can avert that fate may depend on its ability to renegotiate loans with countries now in urgent need of debt relief. If China is unable or unwilling to provide sufficient relief to its borrowers, it could find itself at the centre of a debt crisis in developing markets.”

The data that describes China’s predicament comes from researchers at Boston University who maintain an independent database on China’s overseas development finance. They found that lending by the China Development Bank and the Export-Import Bank of China collapsed from a peak of US$75 billion in 2016 to just US$4 billion last year.

More

https://financialpost.com/financial-times/what-was-touted-as-the-worlds-biggest-development-project-is-unravelling-into-what-could-become-chinas-first-overseas-debt-crisis

Australia Says Coal Import Ban by China Would Breach WTO Rules

By Jason Scott and Ed Johnson

Updated on December 15, 2020, 6:31 AM GMT

·        

Birmingham says risks of doing business with China have grown

·         China’s actions not consistent with ‘spirit’ of trade accord

·       Prime Minister Scott Morrison said Tuesday that a Chinese ban on Australian coal imports would breach World Trade Organization rules, as his government urged Beijing to resume dialog to ease the worsening diplomatic dispute.

More than 50 vessels carrying Australian coal have been stranded off China after ports were verbally told in October not to offload such shipments. China’s National Development and Reform Commission on Saturday appeared to formalize those curbs after giving power plants approval to import coal without restrictions, except from Australia, under efforts to tame price gains, the Global Times reported.

If that proved to be correct, such a ban would also breach the free-trade agreement that China and Australia signed in 2015, Morrison told reporters. “It would be a bad outcome for the trading relationship,” he said, adding the conflation of political and trade issues could “create a lot of uncertainty for many other trading partners.”

More

https://www.bloomberg.com/news/articles/2020-12-14/australia-deeply-troubled-by-reports-of-china-coal-import-ban

Winter Watch.

From around mid-October, the northern hemisphere snow cover usually rapidly expands, while the Arctic ice gradually expands back towards its winter maximum.

Over simplified, a rapid expansion of both, especially if early, can be a sign of a harsher than normal arriving northern hemisphere winter. Perhaps more so in 2020-2021 as we’re in the low of the ending sunspot cycle, which possibly also influenced this year’s record Atlantic hurricane season.

Update: we seem to have started new sunspot cycle 25 this month, though it’s unlikely to affect 2020-2021s coming winter.

Northern Eur-Asia turned snowy fast in mid-October.  The Arctic sea ice expansion was slow, and from a very low level at the end of September, but with the vastly expanded snow cover, sea ice formation sped up.

The Laptev Sea ice was back to normal at the end of November.  The failure of the Kara Sea ice to return to normal, leads me to bet on a warmer western European winter ahead.

Arctic and Antarctic Sea Ice.

http://nsidc.org/arcticseaicenews/

https://www.natice.noaa.gov/pub/ims/ims_gif/DATA/cursnow_asiaeurope.gif

“Whenever someone starts talking about 'fair competition' or indeed, about 'fairness' in general, it is time to keep a sharp eye on your wallet, for it is about to be picked.”

Murray N. Rothbard

Covid-19 Corner                       

This section will continue until it becomes unneeded.

London Faces Curbs; New York on Path for Shutdown: Virus Update

Bloomberg News

Updated on December 15, 2020, 6:01 AM GMT

London will be placed under England’s toughest coronavirus restrictions from Wednesday.

Hong Kong plans to introduce new virus relief measures before Christmas and Singapore is creating a new “bubble” facility near the airport.

Elsewhere in Europe, the Dutch government is imposing stricter measures for five weeks to reverse a jump in daily cases. Germany will start a hard lockdown Wednesday.

New York is heading toward a second full shutdown should the number of coronavirus cases and hospitalizations continue at the current pace. The first Covid-19 vaccine shots were administered by U.S. hospitals Monday, the initial step in a historic drive to immunize millions of people. Deaths in the country passed the grim milestone of 300,000.

Key Developments:

  • Global Tracker: Cases exceed 72.6 million; deaths surpass 1.6 million
  • Bipartisan U.S. lawmakers propose $908 billion relief package
  • Covid quickens exodus from N.Y., California
  • Europe hit with tougher curbs ahead of vaccine
  • Fauci curious to see secret of Covid shot’s success unlocked

More

https://www.bloomberg.com/news/articles/2020-12-14/u-s-deaths-surpass-300-000-as-vaccinations-begin-virus-update?srnd=coronavirus

Netherlands to go into tough, five-week lockdown over Christmas

December 14, 2020

No comments:

Post a Comment