Special Update 30/01/2021 The Reddit Rout. Silver Next?

 Baltic Dry Index. 1452 -18  Brent Crude 55.88

Spot Gold 1848

Covid-19 cases 02/04/20 World 1,000,000

Deaths 53,100

Covid-19 cases 30/01/21 World 102,641,877

Deaths 2,216,584

“The surest way to remain poor is to be an honest man.”

Ebenezer Squid, with apologies to Napoleon Bonaparte.

January 2021 is a month for the history books. The month began with the Trump mob storming the US Capitol building, that alone was good enough for the history books.

But it ended with the Reddit mob storming the Wall Street hedge funds, completely trashing those daft enough to be short obscure, thinly traded stocks.

As an aside, how did the hedge funds come to be short 140 percent of GameStop’s float? Surely Wall Street wasn’t allowing “naked” shorting? They wouldn’t do that would they?

By the end of the week, the Reddit mob was pressing their luck in commodities, forcing the price of silver futures to jump by 99 cents on Friday. A nasty shock for the silver shorts. (Are the 1970s volatile commodity markets about to return? And if they do, what happens to inflation and the Fed’s promise of zero interest rates forever?) 

Coming next, an exciting February?

Sideshow or main event? GameStop stock ride weighed as bubble warning

January 29, 2021  10:51 PM  By Lewis Krauskopf

NEW YORK (Reuters) - Some investors are growing concerned that wild swings in GameStop and other stocks driven by small-time traders could be fresh signs of overexuberance that foreshadow volatility for the broader stock market.

GameStop shares closed up 400% for the week after the video game chain’s stock became a battleground between retail traders and Wall Street professionals, a tussle that captivated investors the world over.

Some market-watchers see those massive gains, as well as the moves in American Airlines and other heavily shorted stocks, as a sideshow in a rally underpinned by Federal Reserve support, anticipated coronavirus relief spending and expectations that vaccines against COVID-19 will help the U.S. economy rebound later this year.

Fed Chairman Jerome Powell earlier this week pushed back on suggestions that the central bank’s super-low interest rates and massive bond purchases were creating asset bubbles.

But those comments failed to quell some investors’ worries that the Fed’s monetary policy has encouraged excessive risk-taking across broader markets: The S&P 500 is up 66% since March and stocks stand near their highest valuations in two decades.

The action in GameStop and other stocks “definitely gives us some cause for concern,” said James Ragan, director of wealth management research at D.A. Davidson. “At the very least, you have to consider that there’s a chance of a market correction.”

The moves also drew some comparisons to the internet stock mania two decades earlier.

“Just the fact that you have a group of investors that are really chasing abnormal gains, that’s what is reminiscent of the dot-com bubble,” Ragan said.

Some barometers of general over-exuberance are already flashing: Citi said its “Panic/Euphoria” model is in “elevated euphoric territory.” And the latest fund manager survey from BofA Global Research noted that allocations to cash had dropped rapidly, indicating that investors are putting more funds into riskier assets.

The frenzied trading dominated the news on Wall Street this week, even as Apple Inc, Microsoft Corp and other corporate heavyweights reported quarterly results. The S&P 500 fell 3.3% for the week, with trading volume surging above 24 billion shares on Wednesday, well above the 14.4 billion-share average of the past 20 sessions. The CBOE volatility index closed above 30 points this week for the first time since early November.

One potential catalyst for further volatility could come if hedge funds are forced to sell out of positions in order to cover failed short selling bets, although it was unclear whether there would be enough of such selling to create a broad risk to equities.

Already, some short-selling hedge funds appeared to be changing their approach. Short seller Andrew Left, whose company Citron Research was one of the hedge funds to spark this week’s battle with small-time traders over GameStop Corp, said in a YouTube video on Friday that his company would no longer publish short selling research.

Others said the ramped-up activity of retail investors - who last year helped drive rallies in shares of Tesla Inc and other names - could in itself be the latest sign of market frothiness.

“When you think about market bubbles, the last players that jump on board are retail, and that is generally what is happening right now,” said Mike Mullaney, director of global markets research at Boston Partners.

More

https://www.reuters.com/article/us-usa-stocks-weekahead/sideshow-or-main-event-gamestop-stock-ride-weighed-as-bubble-warning-idUSKBN29Y322

Below, Bloomberg gives the best explanation of the past week’s casino fun and games.

“This week markets were fixated by an astronomical run-up in shares of GameStop Corp., which at one point were up 2,000% in less than a month. Much of the moonshot was driven by retail investors, who used online forums like Reddit's WallStreetBets to organize a concerted push at the expense of hedge funds like Melvin Capital Management LP. 

Read on for a Bloomberg explainer.

Understanding the Trade

GameStop shares have surged from $19 at the start of the year to as much as $483 at one point this week. Stocks that experience moves this extreme and this fast usually have technical drivers behind them.

Some traders on online forums saw that GameStop was one of the most 'shorted' in America. What this means is that investors had borrowed shares from brokers and sold them in the market with the expectation that price would fall so they could buy the shares back, return them to the broker and then pocket the difference. The problem for investors that are short a company is that they will eventually have to buy the shares back no matter what the price is.

The very large short interest in GameStop meant that retail investors could, if enough of them moved together, push the share price of the company higher. This would cause the investors who were short to buy stock to limit their loses, with that buying pushing the price even higher. This can lead to very violent share price moves -- called a short squeeze.

Another tactic that's been used by retail traders to push shares of the company higher comes from the options market, which involve contracts that give investors the right to sell or buy a stock.

If a trader buys an option to buy a stock at a vastly inflated price to the current market value, they can pick it up fairly cheaply. For example, on Jan. 21 a GameStop option with a $60 strike price could be purchased for $0.07. The dealer who sold the option would usually buy some of the stock in order to hedge their position, which again would push the price higher. The more options bought, the more the dealer has to buy stock, and the higher the price rises. As it gets closer to the option strike price, the dealer has to buy even more stock to cover their exposure. This is known as a gamma squeeze.   

The traders on online forums have been using these tactics for a while, deploying the options trade to lift the price of companies such as Virgin Galactic Holdings Inc. and Plug Power Inc. early last year.

If they can get a short squeeze and a gamma squeeze in place, both can become self-sustaining, leading to a big surge in the share price, lots of gains for the traders, and a proliferation of rocket emojis.

But Why Video Games?

GameStop ticked the “massive short position” box. But it also had a couple of other factors in its favor for a move like this. The free float (the number of shares that could be traded) was relatively small, meaning shares might not be readily available in the market for investors covering their shorts -- scarcity driving the price higher. The other thing it had in its favor was something we could call "chat momentum." Online forums had been discussing this stock for a long time. So when the move started there were plenty of retail investors ready to pile into a stock they were familiar with.

At its peak on Thursday, GameStop had a market value of $33.7 billion, bigger than half of the companies listed on the S&P 500 Index. For many of the retail traders involved, the chance of making huge amounts of money was an obvious motivating factor. For some others, getting one over on Wall Street seems to have been a strong added bonus.

But this isn't just a story about GameStop. There are short squeezes happening all over the world at the moment.

----Short squeezes do have a tendency to stop abruptly. The most famous squeeze of the millennium -- which also involved lots of option-based shenanigans -- was Volkswagen AG's brief move to become the world's most valuable company back in 2008. It didn't last very long.

But markets have also changed dramatically in the past few years. The emergence of no-commission trading through platforms like Robinhood Markets Inc. and the popularity of online forums and social networks mean that trading is more accessible than ever before. So a squeeze could go on for longer than a lot of people on Wall Street might expect. Options in particular have exploded in popularity.

Markets always change. New technology emerges. New products become available. New trends become hot. Old ones are discarded. Prices reach an equilibrium. Things that may be cheap or free now -- like buying lots of call options on stocks -- can get repriced. Regulators might choose to take action, though it's unlikely there would be much public support for any moves that could be seen as protecting big investors at the expense of small retail ones.

In the meantime, we're already starting to see Wall Street and markets adapt to the wild week that was. There are signs that hedge funds are bailing out of their short positions even before the retail army turns up, taking a small loss now for fear of a larger one later. Meanwhile, the chat forums are already looking for the next stock to send to da moon.” 

End.  

Finally, did Wall Street’s finest collude to bailout the trapped hedge fund shorts? The Texas AG has his suspicions.

Texas attorney general probes GameStop trade curbs from Robinhood, others

January 29, 2021  8:26 PM 

WASHINGTON (Reuters) - Texas Attorney General Ken Paxton issued 13 civil investigative demands on Friday to Robinhood, Discord, Citadel and other trading apps that put curbs on stock trading, his office said in a statement the day after those curbs stalled a rally in shares of GameStop.

The CIDs, the civil equivalent of a subpoena, were sent following a week-long slugfest in which retail investors bid up shares of video game retailer GameStop and other out-of-favor companies, resulting in huge losses to big hedge funds that had shorted those stocks.

On Thursday, GameStop shares fell after Robinhood and other trading apps imposed the limits, a move that angered many elected officials and prompted calls for action from regulators.

“This apparent coordination between hedge funds, trading platforms, and web servers to shut down threats to their market dominance is shockingly unprecedented and wrong,” Paxton said in a statement.

The CIDs were sent to Discord, Robinhood Financial, Robinhood Markets, Robinhood Securities, Interactive Brokers, TD Ameritrade, TD Bank, E-Trade, WeBull Financial, Public Holdings, M1 Holdings, Citadel Financial, and Apex Clearing Corporation, Paxton’s office said in a statement.

https://www.reuters.com/article/retail-trading-robinhood-texas/corrected-update-1-texas-atty-general-probes-gamestop-trade-curbs-from-robinhood-others-idUSL1N2K42UY

Covid-19 Corner             

This section will continue until it becomes unneeded.

Approx. 12 minutes.

NEW COVID 19 Variants (How Concerned Should We BE?)

https://www.youtube.com/watch?v=Rxg01L6Hh2E

Japan Discovers New Types of U.K. Coronavirus Strain

By River Davis 

30 January 2021, 04:55 GMT

Three new types of U.K. strain detected in Tokyo hospital

·         Research group says new variants are likely spreading in Japan

Three new types of the U.K. coronavirus strain, previously not detected in Japan, were discovered in patients at the Tokyo Medical and Dental University Hospital, according to a research group studying Covid-19 cases at the hospital.

None of the three patients infected with mutations of the U.K. strain had traveled abroad, meaning there is a high possibility that the variants are spreading in Japan, the group said in a statement on Friday. The patients were hospitalized during the period of November through late-December, with two of the three experiencing severe symptoms.

The new U.K. strains had previously not been detected in Japan outside of airport quarantine areas, according to the research group. Various strains have previously been found in Japan including one discovered in four passengers arriving from Brazil earlier this month. A variant found in South Africa was also detected in Japan in late December.

Japan has witnessed a spike in new coronavirus cases since the start of this year, with new infection numbers stuck above 1,000 a day in the capital in recent weeks. A state of emergency covering 11 prefectures is set to remain in place until Feb. 7.

Speaking at a briefing Friday, Hiroaki Takeuchi of the research group, urged that measures be taken to strengthen Japan’s borders to prevent the arrival of more new strains of the virus, national broadcaster NHK reported.

— With assistance by Muneeza Naqvi

https://www.bloomberg.com/news/articles/2021-01-30/japan-discovers-new-types-of-u-k-coronavirus-strain?srnd=premium-europe

What One Covid-19 Cluster on an Airplane Tells Experts About Risk Factors While Flying

When one person with Covid-19 took an 18-hour flight from Dubai to New Zealand, several people got sick

smithsonianmag.com  January 28, 2021 7:45AM

After an 18-hour flight from Dubai to New Zealand, seven passengers tested positive for Covid-19 while under managed isolation and quarantine. Analysis of the virus’ genetic code—along with details about the passengers’ symptoms and behavior throughout their trip—indicates that one passenger infected at least four others while aboard the plane, according to a study published in Emerging Infectious Diseases.

Air travel has been difficult to study because different airlines and countries have different safety policies, and all policies rely on passengers’ willingness to follow the rules. The cluster of cases shows how precautionary measures, like obtaining a negative Covid-19 test result before a flight, aren’t enough to prevent transmission of the virus if other safety measures like mask-wearing aren’t strictly followed, Harvard Medical School physician Abraar Karan writes for Vox. It also shows how the managed isolation and quarantine, or MIQ, system successfully prevented the travelers from sparking new community spread of the disease, the researchers write.

---- The pair said that they wore masks and gloves while on the plane, but took their masks off when they were seated, sleeping or eating, Marc Daalder reports for the New Zealand-based Newsroom.

On such a long flight, people need to eat and drink, but each instance makes it more likely that the virus will spread.

“It is surprising and not surprising, on an 18-hour flight, that an outbreak would occur,” says Karan to the New York Times’ Benedict Carey. “It’s more than likely that more than just those two people took off their mask at some point.”

The flight also stopped to refuel in Kuala Lumpur, Malaysia, so the air filtration system was turned off for 30 minutes.

During the 14-day quarantine period in New Zealand, five other travelers from the same flight tested positive for Covid-19. All of them sat within two rows in front of or behind the two people who tested positive, with symptoms, on the third day. (Another person tested positive on the third day but didn’t show symptoms.)

More

https://www.smithsonianmag.com/smart-news/what-one-covid-19-cluster-airplane-tells-experts-about-risk-factors-while-flying-180976844/?utm_source=smithsoniandaily&utm_medium=email&utm_campaign=20210128-daily-responsive&spMailingID=44348007&spUserID=NjUwNDIzNTUzNDE0S0&spJobID=1922452384&spReportId=MTkyMjQ1MjM4NAS2

NY Nursing Home Deaths May Have Been 50% Higher Than Reported, AG's Office Says

Gov. Andrew Cuomo has been under fire for months over his nursing home policy and the true number of deaths in those facilities

By Marina Villeneuve, Bernard Condon and Matt Sedensky • Published January 28, 2021 •

New York may have undercounted COVID-19 deaths among nursing home residents by thousands, the state attorney general charged in a report Thursday that dealt a blow to Gov. Andrew Cuomo's oft-repeated claims that his state is doing better than others in protecting its most vulnerable.

The 76-page report found an undercount of more than 50%, backing up the findings of an Associated Press investigation last year that focused on the fact that New York is one of the only states in the nation that count residents who died on nursing home property and not those who later died in hospitals.

Such an undercount would mean the state's current official tally of 8,711 nursing home deaths to the virus is actually more than 13,000, boosting New York from No. 6 to highest in the nation.

---- The report from a fellow Democratic official undercut Cuomo's frequent argument that the criticism of his handling of the virus in nursing homes was part of a political “blame game," and it was a vindication for thousands of families who believed their loved ones were being omitted from counts to advance the governor's image as a pandemic hero.

“It’s important to me that my mom was counted,” said Vivian Zayas, whose 78-year-old mother died in April after contracting COVID-19 at a nursing home in West Islip, New York. “Families like mine knew these numbers were not correct.”

More

https://www.nbcnewyork.com/news/coronavirus/ny-nursing-home-deaths-may-have-been-50-higher-than-reported-ags-office-says/2853434/

60-Year-Old Father Dies After Receiving Second Dose Of Pfizer Vaccine

By CBSLA Staff January 28, 2021 at 4:15 am

SANTA ANA (CBSLA) – A 60-year-old Orange County man died after receiving a second dose of the coronavirus vaccine. Now investigators are trying to determine if the vaccination played any role in his death.

Hours after getting his second Pfizer dose on January 5, Tim Zook was in the emergency room of the hospital where he worked.

“He just couldn’t breathe on his own, he had stomach problems, he just wasn’t feeling good,” said Kyle Zook, his son.

He fell into a coma within two days and passed away four days after getting the shot.

“He was so bad he told them, ‘put me on the ventilator, I want to live,” said Kyle. “Those were his last words.”

Tim had high blood pressure but was otherwise healthy, Kyle said.

More

https://losangeles.cbslocal.com/2021/01/28/pfizer-vaccine-orange-county-moderna/

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/

The Spectator Covid-19 data tracker (UK)

https://data.spectator.co.uk/city/national

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.

Analysis: Propane Outpaces Electric for Carbon Footprint in Trucks

January 27, 2021 by Emily Holbrook

A new comparative analysis published recently analyzes the carbon footprint of medium-duty and heavy-duty (MD-HD) engine vehicles powered by propane and electricity. The analysis, “Decarbonization of MD-HD Vehicles with Propane,” found that propane-fueled MD-HD internal combustion engine vehicles provide a lower carbon footprint solution in 38 US states and Washington, DC, when compared to MD-HD electric vehicles (EVs) charged using the electrical grid.

Fifteen states and Washington, DC have proposed full electrification of medium- and heavy-duty trucks by 2050 with a target of 30% “zero-emission” vehicle sales by 2030. The rationale behind the proposals is based on the assumption that the electrical grid will be fully decarbonized by that time. Likewise, policy based on exhaust carbon dioxide (CO2eq) emissions alone as opposed to life-cycle analysis results misses the full picture, according to the Propane Education & Research Council (PERC). As a result, PERC says the policy proposals today conflate the promise of electrification with actual decarbonization.

The comparative analysis also reveals that MD-HD vehicles powered by renewable propane provide a lower carbon footprint solution in every US state except Vermont where electricity is generated by, and imported from, Canadian hydroelectric power plants. Renewable propane is derived from sources such as beef fats, vegetable oils, grease residue, and other biomass feedstocks.

Moreover, the analysis shows that decarbonization can be accelerated by adopting propane as the fuel of choice for MD-HD vehicles. The conclusion is supported by a life-cycle analysis of equivalent CO2eq emissions between electric and propane-fueled vehicles across the US using CARB carbon intensity values along with a powertrain efficiency analysis.

More

https://www.environmentalleader.com/2021/01/analysis-propane-outpaces-electric-for-carbon-footprint-in-trucks/

Major manufacturer drops hydrogen trucks in favor of battery-electrics

By Loz Blain  January 28, 2021

Where will hydrogen fit in the clean transport mix? Not in trucking, says one of the world's largest heavy duty vehicle manufacturers, which is scaling back its fuel cell big-rig research and development operations in favor of battery-electric power.

Hydrogen is definitely happening. It's a convenient (if inefficient) way to store, transport and export clean energy, it offers huge energy density advantages for zero-emissions aviation and shipping, and many folk are expecting it to find a compelling use case in long-distance trucking, where its quick refilling ability can keep big rigs on the road longer than battery trucks that need to plug in and charge for long periods.

But Sweden's Scania, the world's tenth-largest trucking company, thinks otherwise. Having already launched both battery and fuel cell trucks, the company has announced it's committing to batteries, citing hydrogen's wastefully inefficient use of renewable energy, as well as additional system complexity, cost, safety and ongoing maintenance factors.

"Scania has invested in hydrogen technologies," reads a press release, "and is currently the only heavy-duty vehicle manufacturer with vehicles in operations with customers. The engineers have gained valuable insights from these early tests and efforts will continue. However, going forward the use of hydrogen for such applications will be limited since three times as much renewable electricity is needed to power a hydrogen truck compared to a battery electric truck. A great deal of energy is namely lost in the production, distribution, and conversion back to electricity."

More

https://newatlas.com/automotive/scania-ditches-hydrogen/

 

This weekend’s musical diversion.  Vivaldi doubles down, 1726. I wonder what it sounds like swapping out the harpsichords for soft pianos? Approx. 8 minutes.

Concerto Con molti Istromenti Del Vivaldi / RV 555 in C major (Autograph score)

For three solo violins, two trumpets, oboe, two recorders, two ‘viole all’inglese’, two chalumeaux, two cellos, two harpsichords, strings and basso continuo.

https://www.youtube.com/watch?v=ltavr8Ptdxs

Next, this week’s chess masterclass.  Approx. 19 minutes.

Battle For The Future: Heart and Soul || Carlsen vs Firouzja || Tata Steel (2021)

https://www.youtube.com/watch?v=TCfyFxQCSQM

Finally, ingenious India. Approx. 10 minutes.

India's Solar Canals. Lateral thinking at its finest!

https://www.youtube.com/watch?v=Ix9LNZIbTpc

“Whenever you are asked if you can do a job, tell ‘em, “Certainly I can!” Then get busy and find out how to do it.”

Theodore Roosevelt.

    

Stock Casinos “GameStopped.”

Baltic Dry Index. 1470 -70 Brent Crude 55.37

Spot Gold 1845

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

Deaths 53,100

Coronavirus Cases 29/01/21 World 102,041,120

Deaths 2,201,044

“I do think the contagion risk is real. Any stock that is heavily shorted is exposed to getting GameStopped.”

Michael Purves, chief executive of Tallbacken Capital Advisors.

Faced with mounting losses all week on hedge funds short certain market stocks, Wall Street did what Wall Street does best, the smart money insiders went back to rigging the market against the little guy retail traders. 

Will it work?  We’ll have a better answer by Monday after we see what chaos unfolds later today, the first month-end in 2021, and after we see what more rigging is put in place over the weekend.  Is this the start of the Biden Bust?

Ironic justice to the Fedster’s, who’ve been rigging the Wall Street casinos at least ever since the 1987 “Black Monday” stock market crash. As you sow so shall you reap. 

Commodities next? Silver’s ideal, but remember how Comex and the Fed rigged silver against the Hunt brothers in 1980. Great fun.

Somebody has to be on the other side.

George Goodman, aka Adam Smith. The Money Game. Why Are The Little People Always Wrong?

Equity futures slide on nerves over retail-trading frenzy

January 28, 2021  11:58 PM  By Tom Westbrook

SINGAPORE (Reuters) - European and U.S. stock futures fell on Friday, while Asian equities headed for their steepest weekly loss in months, as a Wall Street retail-trading frenzy and a liquidity squeeze in China unnerved investors and weighed on frothy markets.

S&P 500 futures fell 1.2% and Nasdaq 100 futures fell 1.4%. FTSE futures, DAX futures and EuroSTOXX 50 futures all fell by just over 1%. The U.S. dollar rose to a seven-week high against the yen.

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.5% and is on course for a weekly loss of 3.8% - which would be the largest since September. Japan’s Nikkei fell 1.5% and is heading for its first weekly loss of the year.

“I’m definitely seeing the nerves,” said Chris Weston, head of research at Melbourne broker Pepperstone.

“There’s a knock-on effect that happens from targeting hedge funds, and this could have legs ... people are unsure how this social media movement plays into greater financial markets.”

Wall Street has been gripped by a coordinated assault by small traders organising over online forums, such as Reddit, to force hedge-funds to reverse short positions - or bets that stocks would fall.

They lost some of their firepower overnight when brokers cut off borrowing facilities and restricted trading in some of the hottest names, such as GameStop and BlackBerry.

The boss of popular online broker Robinhood said the curbs were deployed to protect the brokerage and its customers but that some restrictions will be lifted on Friday.

“Robinhood relented. The mob is back in,” said Bank of Singapore foreign exchange analyst Moh Siong Sim, with stocks the focus for currency traders as equity moves drive sentiment.

“The price action over the past week has been strange,” he said, (which) speaks of forced position shakeouts rather than being driven by fundamentals.”

The nervousness drove some buying into the U.S. dollar, although apart from making a fresh high for the year of 104.57 yen, it kept within recent ranges against other major currencies.

----Adding to nerves, the shake up in equity markets comes as COVID-19 vaccine rollouts have run into trouble and as global economic data starts to look less rosy.

Investors were impressed by a smaller-than-expected rise in U.S. weekly jobless claims on Thursday. But they still rose by more than 840,000 and data showed the U.S. economy contracted last year at its sharpest pace since World War Two.

Vaccine production delays have also snowballed into a spat between the European Union and drugmakers over how best to direct limited supplies.

Meanwhile, the People’s Bank of China (PBOC) injected 100 billion yuan into the financial system on Friday, following a week of reducing liquidity, which had sparked concerns the central bank was in fact tightening monetary policy.

Still, the extra money did little to loosen short-term money markets, where rates rose for a fifth straight day and benchmark overnight repo rates surged to their highest in nearly six years.

“The size was not sufficient to fill the liquidity gap across the Chinese New Year and it is too early to conclude the end of liquidity squeeze for now,” said Mizuho’s chief Asian FX strategist Ken Cheung, referring to Lunar New Year holidays in coming weeks.

More

https://www.reuters.com/article/us-global-markets/equity-futures-slide-on-nerves-over-retail-trading-frenzy-idUSKBN29X351?il=0

"GameStop effect" could ripple further as Wall Street eyes short squeeze candidates

January 28, 2021  6:30 PM  By April Joyner, Saqib Iqbal Ahmed 

NEW YORK (Reuters) - The clash between retail traders and Wall Street professionals that sparked roller coaster rides in the shares of GameStop Corp may pose a risk to dozens of other stocks and potentially create a headache for the broader market, analysts said.

Market watchers identified dozens of stocks potentially vulnerable to extreme volatility after a buying spree from an army of retail traders in recent days prompted hedge funds to unwind their bets against GameStop and other companies, fueling surges in their share prices in a phenomenon known as a “short squeeze.”

“Unfortunately, it’s definitely not a one-off thing,” said Randy Frederick, vice president of trading and derivatives at the Schwab Center for Financial Research. “The type of activity that drove that higher, I believe, has caused people to try to duplicate that in other names.”

J.P. Morgan earlier this week named 45 stocks that may be susceptible to short squeezes and similar “fragility events,” including real estate company Macerich Co, restaurant chain Cheesecake Factory Inc and clothing subscription service Stitch Fix Inc.

Like GameStop, American Airlines Group Inc, AMC Entertainment Holdings Inc and others that have recently become targets of retail traders in recent days, all the stocks have high short interest ratios.

That means a large percentage of investors have borrowed the stock to sell it in anticipation that they will be able to buy it back at a lower price and profit on the trade. But if the stock rises sharply, those investors may be forced to buy back the stock at a loss.

“The unfortunate events in GameStop this week may be building a dangerous precedent for markets whereby retail investors act en masse to leverage their buying powers to spark fragility events,” analysts at J.P. Morgan said in a note.

----GameStop shares were recently down 25% on Thursday as retail brokerages Robinhood Markets Inc and Interactive Brokers Inc, restricted purchases of the stock, along with several others that have catapulted in recent days, including AMC Entertainment Group Inc and BlackBerry Ltd.. Even so, the video game retailer’s shares have gained more than 500% since last Thursday.

Barring wider trading restrictions, similar patterns could play out over several weeks as short sellers unwind their bets, said Michael Purves, chief executive of Tallbacken Capital Advisors.

Some firms run strategies that involve holding both long and short positions on a stock, he said, and as a result, certain stocks could see a surge and then a sharp drop as those firms adjust their positions. That process could put pressure on stocks more broadly and contribute to market volatility.

“I do think the contagion risk is real,” Purves said. “Any stock that is heavily shorted is exposed to getting GameStopped.”

https://www.reuters.com/article/us-retail-trading-shorts/gamestop-effect-could-ripple-further-as-wall-street-eyes-short-squeeze-candidates-idUSKBN29X2MG

Facebook shuts popular stock trading group amid GameStop frenzy

January 28, 2021  11:43 PM  By Paresh Dave

(Reuters) - Facebook Inc took down a popular Wall Street discussion group, Robinhood Stock Traders, in a move that its founder on Thursday described as backlash for conversations buoying shares of GameStop Corp and other companies this week.

GameStop, AMC Entertainment Holdings Inc and BlackBerry have been at the center of a market battle as individual investors coordinating on social media including Reddit, and using trading apps such as Robinhood, bought shares and squeezed hedge funds that had bet big on those struggling companies to tank.

Allen Tran, a 23-year-old from Chicago who created Robinhood Stock Traders, said he woke up on Wednesday to a notification that Facebook had disabled the 157,000-member group. The notification, seen by Reuters, said without detail that the group violated policies on “adult sexual exploitation.”

“We were first on the picking tree to be cut off because we are on Facebook, not a free platform like Reddit,” said Tran, referring to the typically lighter moderation on the discussion website.

Some of his group’s members made tens of thousands of dollars in recent trades first popularized on Reddit’s WallStreetBets forum, he said.

Tran, who also runs the 20,000-member HaiKhuu Trading group on chat app Discord, said he has never seen adult content on the Facebook group.

Facebook spokeswoman Kristen Morea said, “This group was removed for violating our Community Standards, unrelated to the ongoing stock frenzy.” She did not respond to requests to elaborate.

---- “With all these major institutions being frustrated with the success of retail, they are trying to target any groups they can,” said Tran, who was featured in a Wall Street Journal article in November and described his Facebook group as the largest of its kind.

Tran expressed concern that a replacement group he formed to carry on discussions also will be taken down.

https://www.reuters.com/article/us-retail-trading-facebook/facebook-shuts-popular-stock-trading-group-amid-gamestop-frenzy-idUSKBN29X34P

Silver Thursday

Silver Thursday was an event that occurred in the United States silver commodity markets on Thursday, March 27, 1980, following the attempt by brothers Nelson Bunker Hunt, William Herbert Hunt and Lamar Hunt to corner the silver market. A subsequent steep fall in silver prices led to panic on commodity and futures exchanges.

---- On January 7, 1980, in response to the Hunts' accumulation, the exchange rules regarding leverage were changed; COMEX adopted "Silver Rule 7", which placed heavy restrictions on the purchase of commodities on margin. The Hunt brothers had borrowed heavily to finance their purchases, and, as the price began to fall again, dropping over 50% in just four days, they were unable to meet their obligations, causing panic in the markets.

----- The Hunt brothers had invested heavily in futures contracts through several brokers, including the brokerage firm Bache Halsey Stuart Shields, later Prudential-Bache Securities and Prudential Securities. When the price of silver dropped below their minimum margin requirement, they were issued a margin call for $100 million. The Hunts were unable to meet the margin call, and, with the brothers facing a potential $1.7 billion loss, the ensuing panic was felt in the financial markets in general, as well as commodities and futures. Many government officials feared that if the Hunts were unable to meet their debts, some large Wall Street brokerage firms and banks might collapse.^[2]

To save the situation, a consortium of US banks provided a $1.1 billion line of credit to the brothers which allowed them to pay Bache which, in turn, survived the ordeal. The U.S. Securities and Exchange Commission (SEC) later launched an investigation into the Hunt brothers, who had failed to disclose that they in fact held a 6.5% stake in Bache.^[3

https://en.wikipedia.org/wiki/Silver_Thursday

This is the way things are, and the Game has been so successful that, like everything, it will get more and more successful until it stops being successful.

George Goodman, aka Adam Smith, The Money Game. 1968.

Covid-19 Corner                       

This section will continue until it becomes unneeded.

Lung, mobility problems plague COVID-19 patients months after recovery

Jan. 27, 2021 / 11:03 AM

Jan. 27 (UPI) -- More than half of adults hospitalized with COVID-19 had diminished lung function four months after they have recovered and returned home, a study published Wednesday by JAMA Network Open found.

A similar percentage of these patients also had mobility problems, including difficulty walking. And just over 17% had symptoms of post-traumatic stress disorder four months after hospital discharge, the data showed.

The findings highlight the "long-lasting physical and psychological" complications caused by the virus, the researchers said.

"Their real impact on public health is a major issue that needs to be investigated and clarified in the next months," study co-author Dr. Mattia Bellan told UPI.

RELATED Strong blood thinners may help people with moderate COVID-19

"Recovered patients often complain of persistent symptoms for weeks or even months -- more specifically, fatigue and reduced tolerance to physical exercise are particularly common and may be paralleled by an objective reduction of physical performances," said Bellan, a professor of translational medicine at the University of Eastern Piedmont in Novara, Italy.

Although COVID-19 is "generally considered an acute illness," according to Bellan, several studies have documented long-term health complications among adults and children who have recovered from the virus.

In adults, these complications may include brain inflammation, or encephalitis, as well as fatigue and lung, heart and mental health problems.

RELATED Study: COVID-19 pneumonia more deadly because it spreads like 'wildfires'

Heart problems have also been observed in children infected with the new coronavirus.

For this study, Bellan and his colleagues followed 238 COVID-19 patients ranging in age from 50 to 71 years.

All of the patients in the study had been hospitalized with the virus in Italy in spring 2020, when the country had one of the largest outbreaks in the world, the researchers said.

More

https://www.upi.com/Health_News/2021/01/27/Lung-mobility-problems-plague-COVID-19-patients-months-after-recovery/6301611756981/

Drugmakers jointly study combo antibody treatment for mild COVID-19

Jan. 27, 2021 / 3:50 PM

Jan. 27 (UPI) -- Drugmakers Lilly, Vir Biotechnology and GlaxoSmithKline on Wednesday announced plans to conduct a clinical trial to evaluate a combination of two drugs in people with mild to moderate COVID-19.

The drugs are both monoclonal antibodies, which are laboratory-made proteins designed to mimic the immune system's ability to fight off viruses.

Similar combinations of these drugs can reduce levels of virus in the blood of COVID-19 patients by up to 20%, according to recent research.

"With a virus like [COVID-19], it's expected that variants could emerge that require new therapeutic options, which is why Lilly is studying bamlanivimab together with other neutralizing antibodies," Lilly chief scientific officer Dr. Daniel Skovronsky said in a press release.

RELATED Eli Lilly says 2 drugs lower death rate among high-risk COVID-19 patients

The companies expanded an ongoing clinical trial will now evaluate the combination of Lilly's bamlanivimab, at a dose of 700 milligrams, and Vir's VIR-7831, at a dose of 500 mg., according to the companies.

"Adding VIR-7831 to our study is an important part of our commitment to develop therapies to treat current and future strains of COVID-19 until vaccines are widely available and utilized," Skovronsky said.

Bamlanivimab already has received an emergency use authorization from the U.S. Food and Drug Administration for the treatment of mild to moderate COVID-19 in those who are at high risk for progressing to severe illness, Lilly said.

RELATED Study: Antibody combo offers benefit in mild, moderate COVID-19

VIR-7831, which has not been approved by the FDA, is being evaluated in clinical trials as a standalone "early" treatment of COVID-19 in adults at high risk for hospitalization from the disease, officials said.

"We believe that VIR-7831 has significant potential as a single agent," Vir CEO George Scangos said in a statement.

"As the virus continues to evolve, we, along with Lilly and GSK, share the view that we should pursue all possibilities to help end the pandemic and maximize the number of lives that can be saved," he said.

https://www.upi.com/Health_News/2021/01/27/Drugmakers-jointly-study-combo-antibody-treatment-for-mild-COVID-19/4231611768291/

Monoclonal antibodies may prevent severe COVID-19, but there’s a catch

By Rich Haridy  January 27, 2021

Promising interim data from a unique Phase 3 trial testing the efficacy of a monoclonal antibody cocktail developed to prevent SARS-CoV-2 infection has been announced by pharmaceutical company Regeneron. The preliminary results suggest this novel treatment is 100 percent effective at preventing symptomatic infection, but despite these positive signs there are concerns the prohibitive cost of producing monoclonal antibody therapies will severely limit widespread use.

Last week pharma company Eli Lilly revealed its monoclonal antibody treatment for COVID-19 is 80 percent effective at preventing viral infection. Not to be outdone, Lilly’s major monoclonal antibody competitor Regeneron is now announcing early results from its ongoing Phase 3 clinical trial.

Monoclonal antibody treatments are a little different to vaccines. Instead of teaching a body how to produce antibodies against a virus, monoclonal antibodies are a single dose of lab-produced antibodies intended to either prevent infection or reduce the severity of a disease for a short period of time.

Regeneron’s therapy is called REGEN-COV and it comprises two different but complimentary types of lab-engineered antibodies developed to rapidly stop the virus from replicating inside an infected patient. These kinds of monoclonal antibody therapies are designed to be administered to subjects at high-risk of being infected with SARS-CoV-2, or given to patients at the very earliest stage of COVID-19.

Because monoclonal antibodies only offer limited short-term protection the trials testing them must be very focused. Eli Lilly’s bamlanivimab treatment, for example, is being trialled in nursing homes and aged care centers at the first sign of a localized outbreak. Regeneron on the other hand is looking at how well its antibody cocktail can prevent viral infection in subjects living in households with a confirmed COVID-19 case.

To qualify for the trial subjects must be recruited and dosed with the antibodies within four days of their household contact testing positive for SARS-CoV-2. Regeneron plans to recruit 2,450 subjects in this blinded, randomized and placebo-controlled Phase 3 trial.

Regeneron's interim data analysis comprises the first 409 subjects enrolled in the trial. The data has yet to be peer-reviewed or published in a journal but complete results for the entire trial are hoped to be delivered in the first half of 2021.

These early results reveal the antibody cocktail delivered 100 percent protection from symptomatic infection (8/223 placebo vs. 0/186 REGEN-COV). The trial is also testing for asymptomatic infections and found the treatment effective on that measure (23/223 asymptomatic infections in placebo group vs. 10/186 REGEN-COV).

The interim data also shows those in the REGEN-COV group who did still get infected with SARS-CoV-2 displayed decreased peak viral levels and significantly shorter durations of viral shedding. In other words, those asymptomatic cases in the antibody group were potentially much less contagious than similar cases in the placebo group.

"These data using REGEN-COV as a passive vaccine suggest that it may both reduce transmission of the virus as well as reduce viral and disease burden in those who still get infected," says Regeneron’s chief scientific officer, George D. Yancopoulos.

Perhaps the most significant aspect of this new announcement from Regeneron is the way the therapy was administered. Traditionally monoclonal antibodies must be administered by intravenous infusion. Eli Lilly’s competing therapy requires a 60 minute infusion which severely limits how broadly these treatments can be deployed.

This new REGEN-COV trial, however, tested the efficacy of administration by subcutaneous injection. This essentially turns an onerous, medically supervised 60 minute infusion into a swift single injection that can be delivered virtually anywhere. Considering this kind of monoclonal antibody treatment may be most effective as a very early preventative measure in communities at high-risk of infection, delivery by injection is nothing short of a game-changer.

More

https://newatlas.com/health-wellbeing/monoclonal-antibodies-coronavirus-regeneron-phase3-data/

Next, some 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

Regulatory Focus COVID-19 vaccine tracker. https://www.raps.org/news-and-articles/news-articles/2020/3/covid-19-vaccine-tracker

Some other 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/

Centers for Disease Control Coronavirus

https://www.cdc.gov/coronavirus/2019-ncov/index.html

The Spectator Covid-19 data tracker (UK)

https://data.spectator.co.uk/city/national

 

Technology Update.

With events happening fast in the development of solar power and graphene, I’ve added this section. Updates as they get reported.

Approx. 6 minutes.

Aluminium - The Material That Changed The World

https://www.youtube.com/watch?v=yn9qhQSMCRk

Another weekend, what will President Biden tweet? How will Wall Street rig the casinos against the punters? Have a great weekend everyone.

“Beyond this, the problem is universal. It is that governments are now held responsible for the welfare of the people. The aspirations of the people can outrun their ability to pay for them, and nobody has yet found a way to create answers to the aspirations out of thin air.”

George Goodman, aka Adam Smith, The Money Game. 1968.

Until 2020.