Baltic Dry Index. 1673 +22 Brent Crude 62.95

Spot Gold 1734

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

Deaths 53,100

Coronavirus Cases 03/03/21 World 115,302,067

Deaths 2,560,647

The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary.

H. L. Mencken

It’s Wednesday, in the UK it’s Budget Day, with no surprises priced in to the stock casino. Now is not the time for new taxes or serious financial cutbacks.

We may get some long term outline though, of how GB intends to cover much of the Magic Money Tree debt run up in the fight against the coronavirus pandemic and all the economy closedowns.

Elsewhere, it’s more of the same. Stocks are moving higher front running more expected Magic Money Tree money and the expected consumer spending boom to come.

Bonds are stabilising uneasily, though for now, immediate fears over inflation have passed.

Oil, gold and commodities in general, are paused awaiting new developments.

Elsewhere, Texas is reopening next week, removing nearly all coronavirus protections. Time will tell if the timing is right, though an early spring with warmer weather should help.

Below, back to the “one way” street.

Asian Stocks, U.S. Equity Futures Rise; Bonds Slip: Markets Wrap

By Emily Barrett and Andreea Papuc

2 March 2021, 21:57 GMT Updated on 3 March 2021, 05:31 GMT

· U.S. equity futures advance after tech weighed on gauges

· Australia shares, local dollar bolstered by latest GDP report

Asian stocks climbed with U.S. and European equity futures Wednesday amid easing concerns that markets are too stretched and as the focus turned back to the stimulus-fueled recovery from the pandemic. Treasury yields edged up.

Indexes in Hong Kong and China outperformed. Shares rose in Australia, where data showed the economy maintained its rapid recovery in the final three months of 2020. S&P 500 and Nasdaq 100 futures advanced after technology shares led overnight losses in the benchmarks. The dollar was little changed.

Treasury yields had retreated Tuesday amid comments from Federal Reserve Governor Lael Brainard that bond-market volatility may further delay any pullback in the central bank’s asset purchases.

The V-shape recovery coming into sharp relief in Australia highlighted expectations for a global rebound that boosts earnings and supports the run up in stocks. At the same time, investors remain wary of a widespread jump in inflationary pressures that could shake confidence by undercutting pledges from central banks to keep monetary policy loose.

“Real yields are still pretty negative and it’s still really easy monetary policy,” said Kathy Jones, chief fixed income strategist at Charles Schwab. “As we normalize and move away from a market dominated by central banks and policy, to one that is more driven by supply and demand, there’s going to be bouts of volatility.”

“If interest rates start moving higher and quicker than expected, then there’s a chance there might be more significant pullback in the market,” Katerina Simonetti, Morgan Stanley Private Wealth Management senior vice president, told Bloomberg TV.

Read: Guggenheim’s Minerd Says Treasury Yields Can Still Turn Negative

Elsewhere, oil rebounded after a three-day fall with the OPEC+ alliance said to be poised to agree an output increase at its meeting this week. Bitcoin fluctuated below $50,000.

There are some key events to watch this week:

U.S. Federal Reserve Beige Book is due Wednesday.
OPEC+ meeting on output Thursday.
U.S. factory orders, initial jobless claims and durable goods orders are due Thursday.
The February U.S. employment report on Friday will provide an update on the speed and direction of the nation’s labor market recovery.

https://www.bloomberg.com/news/articles/2021-03-02/asia-stocks-set-for-muted-open-treasuries-gain-markets-wrap?srnd=premium-europe

China's services sector grows at slowest rate in 10 months in February: Caixin PMI

March 3, 2021 2:08 AM By Reuters Staff

BEIJING (Reuters) - China’s services sector activity grew at its slowest pace in 10 months in February as firms struggled with sluggish demand and high costs, a private sector survey showed on Wednesday, prompting them to cut jobs.

The Caixin/Markit services Purchasing Managers’ Index (PMI) fell to 51.5, the lowest since April, from 52.0 in January but remained above the 50-mark that separates growth from contraction on a monthly basis.

A sub-index for employment stood at 47.9, slipping into contraction after six months of growth, as businesses laid off workers, the survey showed. New export business also shrank after expanding for three months.

The loss of momentum came as China faced coronavirus flare-ups at the start of the year, while overseas demand continued to be hit by the COVID-19 pandemic. The findings were largely in line with an official survey released on Sunday.

https://www.reuters.com/article/us-china-economy-pmi/chinas-services-sector-grows-at-slowest-rate-in-10-months-in-february-caixin-pmi-idUSKBN2AV05M

Up next, economist David Rosenberg again, one of the few economists to call the Great Recession ahead of time. Shame that no one at his the firm of Merrill Lynch paid any notice and they blew up.

Here he posits that any forecast recovery consumer spending boom may be a lot weaker and shorter than the casinos expect.

David Rosenberg: Three basic economic laws the pundits are overlooking as we enter the recovery phase

Economists missing the signs pointing to a sustained period of elevated personal savings rates

Mar 02, 2021

There are three things that I think most pundits are missing in their prognosis for the economy and they are all basic laws of economics.

Let’s start with the law of diminishing returns, as this applies to saturated expenditures of big-ticket durable goods. This is also related to the law of diminishing marginal utility, which posits that, all else being equal, as consumption increases, the marginal utility derived from each additional unit declines. We appear to have hit that point in at least eight per cent of consumer expenditures, which is double the share of the services expected to stage a huge comeback once the pandemic is fully in the rear-view mirror. Consumer expenditure on big-ticket durables in the United States is now at a record US$16,000 per household, about 60 per cent above the average of the past three decades.

Another basic law is Ricardian Equivalence, which is all about how economic agents prepare for a future of higher taxation, manifesting in an elevated personal savings rate. This means that attempts to stimulate an economy by increasing debt-financed government spending will not be effective, because investors and consumers understand that the debt will eventually have to be paid for in the form of future taxes.

----This theory was developed by David Ricardo in the early 19th century and was later expanded upon by Harvard professor Robert Barro in 1974. It is pertinent that tax-increase expectations in the January release of the Federal Reserve Bank of New York’s Survey of Consumer Expectations rose for the third month in a row to the highest level in more than seven years; coincidentally occurring alongside the explosion in government debt-growth expectations, which are now double normal pre-pandemic levels.

Finally, let’s consider the Permanent Income Hypothesis, which posits that only shocks to incomes and wealth that are deemed to be permanent in nature, as opposed to transitory, have an enduring impact on spending behavior. Milton Friedman developed this hypothesis, believing that consumer spending is a result of estimated future income, as opposed to consumption, that is based on current after-tax income.

----Even if economic policies are successful in increasing income, the policies may not kick off a multiplier effect with regards to increased consumer spending. Rather, the theory predicts that there will not be a recurring positive growth rate in consumption absent altered expectations about future incomes. Friedman’s consumption analysis was a key factor in his winning the Nobel Prize for economics in 1976.

The February University of Michigan survey shows that household five-year real income expectations, even in the face of the fiscal stimulus, have rolled back to a five-month low. The level of consumer confidence in terms of personal finances has peeled back to its lowest levels in more than five years. All this augurs for a sustained period of elevated personal savings rates, and this is the first thing that investors should be asking the economists they pay attention to.

https://financialpost.com/investing/investing-pro/david-rosenberg-three-basic-economic-laws-the-pundits-are-overlooking-as-we-enter-the-recovery-phase

Finally, will the 2020 the very unusual Arctic ozone hole return again in 2021? 2020 saw record and near record warm temperatures across Siberia, a near record low in Arctic sea ice cover, and an earlier start to the Atlantic hurricane season, plus more typhoons in the Pacific.

Of course, there’s no science backing any connection(s) between any of these events, but hardly anyone is looking, as far as I know. And with Donald Trump long gone, if it returns for a second year in 2021, it can’t be Trump’s fault this time round.

North Pole's largest-ever ozone hole finally closes

By Brandon Specktor - Senior Writer April 27, 2020

An unusually strong polar vortex kept the hole open for nearly a month — now, it's finally shut again.

After looming above the Arctic for nearly a month, the single largest ozone hole ever detected over the North Pole has finally closed, researchers from the European Union's Copernicus Atmosphere Monitoring Service (CAMS) reported.

"The unprecedented 2020 Northern Hemisphere ozone hole has come to an end," CAMS researchers tweeted on April 23.

The hole in the ozone layer — a portion of Earth's atmosphere that shields the planet from ultraviolet radiation — first opened over the Arctic in late March when unusual wind conditions trapped frigid air over the North Pole for several weeks in a row.

Those winds, known as a polar vortex, created a circular cage of cold air that led to the formation of high-altitude clouds in the region. The clouds mixed with man-made pollutants like chlorine and bromine, eating away at the surrounding ozone gas until a massive hole roughly three times the size of Greenland opened in the atmosphere, according to a statement from the European Space Agency (ESA).

While a large ozone hole opens every autumn over the South Pole, the conditions that allow these holes to form are much rarer in the Northern Hemisphere, the ESA researchers said. The Arctic ozone hole opened this year only because the cold air was concentrated in the area for much longer than is typical.

The unprecedented 2020 northern hemisphere #OzoneHole has come to an end. The #PolarVortex split, allowing #ozone-rich air into the Arctic, closely matching last week's forecast from the #CopernicusAtmosphere Monitoring Service.More on the NH Ozone hole➡️https://t.co/Nf6AfjaYRi pic.twitter.com/qVPu70ycn4April 23, 2020

Late last week, that polar vortex "split," the CAMS researchers said, creating a pathway for ozone-rich air to rush back into the area above the North Pole.

For now, there's far too little data to say whether Arctic ozone holes like this one represent a new trend.

https://www.livescience.com/arctic-ozone-hole-closes.html

What's Up with the Ozone Layer?

https://www.youtube.com/watch?v=j3p2NqhXf-U

Approx. 10 minutes.

Covid-19 Corner

This section will continue until it becomes unneeded.

Texas governor lifts state's mask mandate, business restrictions

March 2, 2021 8:23 PM By Dan Whitcomb

(Reuters) - Texas Governor Greg Abbott issued the most sweeping rollback of coronavirus restrictions of any U.S. state on Tuesday, lifting a mask mandate and saying most businesses may open at full capacity next week.

Abbott’s executive order comes as many U.S. states and major cities seeing a sharp decline in coronavirus infections and hospitalizations begin to ease the unprecedented lockdowns put in place a year ago.

“It is now time to open Texas 100%,” Abbott, a first-term Republican, told a news conference. He said the order would take full effect on March 10.

The order lifts all mask requirements statewide and forbids local authorities from penalizing residents who do not wear a face covering. It removes all restrictions on businesses in counties without a high number of hospitalizations.

---- The governor said he was able to lift the restrictions because Texas, the third most-populous U.S. state, had administered nearly 5.7 million vaccine shots to its 29 million residents.

https://www.reuters.com/article/us-heath-coronavirus-usa/texas-governor-lifts-states-mask-mandate-business-restrictions-idUSKCN2AU2JB

Chinese vaccines sweep much of the world, despite concerns

By HUIZHONG WU and KRISTEN GELINEAU March 2, 2021

TAIPEI, Taiwan (AP) — The plane laden with vaccines had just rolled to a stop at Santiago’s airport in late January, and Chile’s president, Sebastián Piñera, was beaming. “Today,” he said, “is a day of joy, emotion and hope.”

The source of that hope: China – a country that Chile and dozens of other nations are depending on to help rescue them from the COVID-19 pandemic.

China’s vaccine diplomacy campaign has been a surprising success: It has pledged roughly half a billion doses of its vaccines to more than 45 countries, according to a country-by-country tally by The Associated Press. With just four of China’s many vaccine makers claiming they are able to produce at least 2.6 billion doses this year, a large part of the world’s population will end up inoculated not with the fancy Western vaccines boasting headline-grabbing efficacy rates, but with China’s humble, traditionally made shots.

Amid a dearth of public data on China’s vaccines, hesitations over their efficacy and safety are still pervasive in the countries depending on them, along with concerns about what China might want in return for deliveries. Nonetheless, inoculations with Chinese vaccines already have begun in more than 25 countries, and the Chinese shots have been delivered to another 11, according to the AP tally, based on independent reporting in those countries along with government and company announcements.

It’s a potential face-saving coup for China, which has been determined to transform itself from an object of mistrust over its initial mishandling of the COVID-19 outbreak to a savior. Like India and Russia, China is trying to build goodwill, and has pledged roughly 10 times more vaccines abroad than it has distributed at home.

---- China has said it is supplying “vaccine aid” to 53 countries and exports to 27, but it rejected a request by the AP for the list. Beijing has also denied vaccine diplomacy, and a Ministry of Foreign Affairs spokesperson said China considered the vaccine a “global public good.” Chinese experts reject any connection between the export of its vaccines and the revamping of its image.

---- China has targeted the low- and middle-income countries largely left behind as rich nations scooped up most of the pricey vaccines produced by the likes of Pfizer and Moderna. And despite a few delays of its own in Brazil and Turkey, China has largely capitalized on slower-than-hoped-for deliveries by U.S. and European vaccine makers.

Like many other countries, Chile received far fewer doses of the Pfizer vaccine than first promised. In the month after its vaccination program began in late December, only around 150,000 of the 10 million Pfizer doses the South American country ordered arrived.

It wasn’t until Chinese company Sinovac Biotech Ltd. swooped in with 4 million doses in late January that Chile began inoculating its population of 19 million with impressive speed. The country now has the fifth highest vaccination rate per capita in the world, according to Oxford University.

https://apnews.com/article/technology-santiago-chile-diplomacy-coronavirus-pandemic-0382aefa52c75b834fbaf6d869808f51

Austria and Denmark break ranks with EU to produce vaccines with Israel

March 2, 2021 10:46 AM By Francois Murphy, Jacob Gronholt-Pedersen

VIENNA/COPENHAGEN (Reuters) - Austria and Denmark, chafing at the slow rollout of COVID-19 vaccines in the European Union, have broken ranks with Brussels to form an alliance with Israel to produce second-generation vaccines against mutations of the coronavirus.

The move by the two EU member states comes amid rising anger over delays in ordering, approving and distributing vaccines that have left the 27-member bloc trailing far behind Israel’s world-beating vaccination campaign.

Austrian Chancellor Sebastian Kurz said while the principle that the EU procures vaccines for member states was correct, the European Medicines Agency (EMA) had been too slow to approve them and lambasted pharmaceutical companies’ supply bottlenecks.

“We must therefore prepare for further mutations and should no longer be dependent only on the EU for the production of second-generation vaccines,” the conservative chancellor said in a statement on Tuesday.

Danish Prime Minister Danish Mette Frederiksen was also critical of the EU’s vaccine programme.

“I don’t think it can stand alone, because we need to increase capacity. That is why we are now fortunate to start a partnership with Israel,” she told reporters on Monday.

When asked if Denmark and Austria wanted to take unilateral action in obtaining vaccines, Frederiksen said: “You can call it that.”

Kurz and Frederiksen are due to travel to Israel this week to see Israel’s rapid vaccine roll-out up close.

A growing number of EU countries have placed side orders for doses of vaccines from Russia and China, even though the EMA has yet to rule on whether they are both safe and effective.

Slovakia on Monday ordered 2 million doses of Russia’s Sputnik V vaccine. It expects half to arrive this month as it looks to step up vaccinations amid a surge in COVID-19 infections and deaths.

The neighbouring Czech Republic - currently facing the worst COVID-19 outbreak of any EU country - is also considering ordering Russia’s Sputnik V.

Hungary, meanwhile, has taken delivery of a vaccine developed by China’s Sinopharm, with Prime Minister Viktor Orban announcing on Sunday that he had received the shot.

https://www.reuters.com/article/us-health-coronaviurs-vaccine-europe/austria-and-denmark-break-ranks-with-eu-to-produce-vaccines-with-israel-idUSKBN2AU11D?il=0

Below, two very informative videos. Thank you to both producers.

Approx. 15 minutes.

Coronavirus Update 124: California and New York Variants (COVID 19 Mutations)

https://www.youtube.com/watch?v=LRp15GNJBF8

Approx. 25 minutes.

Virus isolates, variants, strains - what are they?

https://www.youtube.com/watch?v=G2G2bWUAef0

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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/

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.

Scientists induce artificial 'magnetic texture' in graphene

Quantum science advancement could help lead to powerful spintronic devices, such as semiconductors and quantum computers

Date: February 25, 2021

Source: University at Buffalo

Summary: Graphene is not magnetic -- a shortcoming that has stunted its usefulness in spintronics, an emerging field that could rewrite the rules of electronics, leading to more powerful semiconductors and computers. Researchers report an advancement to overcome this obstacle. They describe pairing a magnet with graphene, and inducing what they call 'artificial magnetic texture' in the nonmagnetic wonder material.

Graphene is incredibly strong, lightweight, conductive ... the list of its superlative properties goes on.

It is not, however, magnetic -- a shortcoming that has stunted its usefulness in spintronics, an emerging field that scientists say could eventually rewrite the rules of electronics, leading to more powerful semiconductors, computers and other devices.

Now, an international research team led by the University at Buffalo is reporting an advancement that could help overcome this obstacle.

In a study published today in the journal Physical Review Letters, researchers describe how they paired a magnet with graphene, and induced what they describe as "artificial magnetic texture" in the nonmagnetic wonder material.

"Independent of each other, graphene and spintronics each possess incredible potential to fundamentally change many aspects of business and society. But if you can blend the two together, the synergistic effects are likely to be something this world hasn't yet seen," says lead author Nargess Arabchigavkani, who performed the research as a PhD candidate at UB and is now a postdoctoral research associate at SUNY Polytechnic Institute.

Additional authors represent UB, King Mongkut's Institute of Technology Ladkrabang in Thailand, Chiba University in Japan, University of Science and Technology of China, University of Nebraska Omaha, University of Nebraska Lincoln, and Uppsala University in Sweden.

For their experiments, researchers placed a 20-nanometer-thick magnet in direct contact with a sheet of graphene, which is a single layer of carbon atoms arranged in a two-dimensional honeycomb lattice that is less than 1 nanometer thick.

"To give you a sense of the size difference, it's a bit like putting a brick on a sheet of paper," says the study's senior author Jonathan Bird, PhD, professor and chair of electrical engineering at the UB School of Engineering and Applied Sciences.

Researchers then placed eight electrodes in different spots around the graphene and magnet to measure their conductivity.

The electrodes revealed a surprise -- the magnet induced an artificial magnetic texture in the graphene that persisted even in areas of the graphene away from the magnet. Put simply, the intimate contact between the two objects caused the normally nonmagnetic carbon to behave differently, exhibiting magnetic properties similar to common magnetic materials like iron or cobalt.

Moreover, it was found that these properties could overwhelm completely the natural properties of the graphene, even when looking several microns away from the contact point of the graphene and the magnet. This distance (a micron is a millionth of a meter), while incredibly small, is relatively large microscopically speaking.

The findings raise important questions relating to the microscopic origins of the magnetic texture in the graphene.

https://www.sciencedaily.com/releases/2021/02/210225142721.htm?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+sciencedaily%2Fmatter_energy%2Fgraphene+%28Graphene+News+--+ScienceDaily%29

It is hard to believe that a man is telling the truth when you know that you would lie if you were in his place.

H. L. Mencken

London Irvine Report

Pages

Wednesday 3 March 2021

Stocks Up. Bonds Down. Texas Reopening.