3:54 PM
By Dan Burns , Howard
Schneider
(Reuters) - The U.S. economy is at
an “inflection point” with expectations that growth and hiring will pick up
speed in the months ahead, but also risks if a hasty reopening leads to a
continued increase in coronavirus cases, Federal Reserve Chair Jerome Powell said.
In an interview on the CBS news
magazine “60 Minutes” that aired on Sunday night, Powell echoed both his recent
optimism about the economy and a now-familiar warning that the COVID-19
pandemic had not yet been fully defeated.
“There really are risks out there.
And the principal one just is that we will reopen too quickly, people will too
quickly return to their old practices, and we’ll see another spike in cases,”
Powell said in the interview, recorded on Wednesday.
The impact of vaccinations should
mean any coming spike in cases is not as severe and does not have the same
disastrous effects on public health and the economy as prior surges. But Powell
said the economic recovery will still “move ahead more quickly to the extent we
keep the spread of COVID under control.”
“It’s going to be smart if people
can continue to socially distance and wear masks.”
Chairs of the U.S. Federal Reserve
appear only rarely on widely-aired broadcast shows like “60 Minutes” though
Powell has used that type of platform several times during the pandemic to
explain Fed policy and, in the beginning, to try to calm fears about a full-on
economic collapse.
A year later, data on the economy
has been positive by and large, with a better-than-expected 916,000 jobs
created in March and some Fed officials suggesting a run of a million new jobs
a month is possible later this year.
Powell said the base case forecast
is for “very strong” job growth in the months ahead, and that it is “in the
range of possibility” for the U.S. to see “quick progress to maximum
employment.”
Those hardest hit by the pandemic,
including low wage workers in the service sector, could see their jobs return
with relative haste in coming months as more and more activities are considered
safe to resume, Powell said.
But Powell reiterated that the Fed
is not about to change its current policy of near zero interest rates and bond
purchases of $120 billion per month.
Officials intend to keep support for
the economy in place until the recovery is largely complete, and “stick with
those people and support them as they try to get back to where they were in
life, which was working.”
While pockets of the United States
are seeing an upswing in COVID-19 cases - in Michigan in particular - infection
rates in large parts of the country are at multi-month lows, and the vaccine
rollout continues apace with a one-day record of 4.6 million doses given on
Saturday, according to a Reuters tracker.
---- A new Fed framework puts more weight on
job creation, and builds in allowances for inflation to run above the central
bank’s 2% target for a time without the Fed intervening to rein it in.
Powell drew a distinction between
the Fed’s intent to let inflation run “moderately” above its 2% target, and
anything faster than that.
“We don’t want inflation to go up
materially above 2% and go back to...the bad, old inflation days,” of the
1970s, Powell said.
Powell said as recently as Thursday
that a coming upswing in inflation readings is likely to be transitory and
won’t cause the Fed to change it plans for monetary policy.
https://www.reuters.com/article/us-usa-fed-powell/feds-powell-u-s-economy-at-an-inflection-point-cbs-60-minutes-idUSKBN2BY0HS
Finally, more on that
Credit Swiss ineptitude scandal. Steel or steal? Were they warned about the
risks of Greensill? See the LIR Easter
update “Searching for an honest man” for more.
Was it all a gigantic fraud?
Fraud? In the City of
London? Involving ex-Prime Minister Dodgy Dave Cameron? Impossible!
Swiss watchdog asked Credit
Suisse on Greensill risks -SonntagsZeitung April 11, 2021 10:40 AM
ZURICH (Reuters) - The head of
Switzerland’s financial regulator FINMA questioned Credit Suisse over risks in
its dealings with now-insolvent finance firm Greensill Capital “months” before
the bank was forced to close $10 billion of funds liked to Greensill, Swiss
newspaper SonntagsZeitung reported Sunday.
Alongside formal discussions on a
technical level between the bank and FINMA, the watchdog’s head Mark Branson
personally discussed the risks with outgoing Credit Suisse Chairman Urs Rohner
and Chief Executive Thomas Gottstein during a meeting on an unspecified date,
the paper reported, citing information it had obtained.
FINMA declined to comment. Credit
Suisse also declined to comment.
Switzerland’s second biggest bank
has been reeling from its exposure to the collapse first of Greensill Capital
and then Archegos Capital Management within the course of one month.
Credit Suisse’s asset management
unit was last month forced to shut $10 billion of supply chain finance funds
that invested in bonds issued by Greensill after the UK firm lost credit
insurance coverage shortly before filing for insolvency. The bank has since
suspended the funds’ managers and changed the head of its asset management
unit.
Huge losses at U.S. investment fund
Archegos this month also prompted Credit Suisse to replace its head of
investment banking and of compliance and risk after it said it would book a
$4.7 billion first-quarter charge from its exposure to the stricken firm.
https://www.reuters.com/article/us-credit-suisse-gp-risks/swiss-watchdog-asked-credit-suisse-on-greensill-risks-sonntagszeitung-idUSKBN2BY09B
Suspect
Sanjeev Gupta invoices used in Greensill loans raise fraud concerns Six companies named in invoices and Credit
Suisse fund documents deny doing business with steel magnate
April
9 2021
Loans
to Sanjeev Gupta’s company from Greensill Capital that were later sold to
Credit Suisse investors were made on the basis of suspect invoices that have
raised suspicions of fraud.
The
revelation is likely to pile more pressure on Gupta, who was once feted by
politicians as the “saviour of steel” for his rescue of metalworks from Wales
to Australia but is now struggling to keep his rickety industrial empire
afloat.
Greensill
collapsed last month, triggering a corporate and political scandal over
lobbying on behalf of the company by former UK prime minister David Cameron.
Investors in a now-suspended $10bn range of Credit Suisse funds are braced for
losses on loans to Gupta’s businesses.
The
Financial Times has seen a series of invoices that Gupta’s Liberty Commodities
trading group provided to Greensill in exchange for cash, including documents
purporting to show it sold products to four European metals businesses: KME
Germany, RPS Siegen, Voestalpine Böhler Edelstahl and Salzgitter Flachstahl.
All
of these companies deny doing business with Gupta’s group. “We have nothing to
do with Liberty,” said Ulrich Becker, chief executive of KME Germany. “We did
not trade with them in the past, we are not trading with them now, and we will
not trade with them. We are copper producers and don’t even know what we would
have bought from them.”
The FT last week revealed that Greensill
Capital’s administrator Grant Thornton had been unable to verify some invoices
as it contacted companies listed as debtors to the collapsed firm.
One
of the companies, a German scrap metal business called RPS Siegen, told the FT
it had never traded with Gupta.
The
steel magnate later told the FT that the company had been “identified as a
potential customer” and financing was provided on that basis. However, among
the invoices seen by the FT is a Liberty Commodities bill submitted to
Greensill, which claimed that Gupta’s trading firm had sold nickel to RPS.
Greensill
packaged the loans to Gupta into funds at Credit Suisse, which list the
underlying receivables — or the money due under invoices.
Six
European metals companies named in Credit Suisse’s fund accounts — RPS Siegen,
Amag Austria, KME Germany, Salzgitter Flachstahl, Voestalpine Böhler Edelstahl
and Trimet Aluminium — all confirmed to the FT they had never traded with
Liberty Commodities.
It
is the clearest sign yet that there may be forged documents at the heart of the
Greensill scandal.
Senior
executives at the Swiss bank are increasingly concerned that their clients may
have been the victims of fraud, according to people familiar with their
thinking.
In
response to questions about the suspect invoices, GFG said: “Many of
Greensill’s financing arrangements with its clients, including with some of the
companies in the GFG Alliance, were prospective receivables programmes,
sometimes described as future receivables. As part of those programmes,
Greensill selected and approved companies with whom its counterparties could
potentially do business in the future.”
GFG
declined to comment further on why there were invoices for a trading relationship
that was only “prospective”.
Suspicions
have been fuelled after the FT revealed on Monday that web domains resembling
those of various commodity trading houses were registered to an email address
of a GFG employee.
More
https://www.ft.com/content/e450c8f9-29fa-432b-98fd-5885edb4680f
Curiouser and curiouser.
Said the FT and Graeme. With apologies to
Lewis Carroll and Alice.
Inflation Watch. Finally, inflation watch.
Given our Magic Money Tree central banksters and our spendthrift politicians,
inflation now needs an entire section of its own.
The biggest ‘inflation scare’ in
40 years is coming — what stock-market investors need to know Last Updated: April 10, 2021 at 8:54 a.m.
ET First Published: April 8, 2021 at 6:00 a.m. ET
By William
Watts
It’s unclear whether inflation will
see a lasting comeback, but a booming, stimulus-fed economy rebounding from the
COVID-19 pandemic seems all but certain to send some near-term inflationary
shock waves through financial markets in coming months.
After all, a sudden surge in demand
following a supply shock is a “classic recipe” for a pickup in inflation, wrote
Christopher Wood, global head of equity strategy at Jefferies, in an April 4
note.
“The result is that investors should
be prepared for the biggest inflation scare in America on the reopening of the
economy since the early 1980s when former Fed Chairman Paul Volcker crushed
double digit inflation in the late 1970s by imposing high real interest rates
on the American economy,” Wood said.
Up for debate is just how
long-lasting any inflationary bout is likely to be — and exactly how the Fed
will respond. The answers to those questions have implications for the overall
stock market and individual sectors.
Data over the next few months will
be closely watched, but any kind of near-term inflation scare is likely to be
more of a “data quirk” tied to base effects, the recent run-up in commodity
prices or kinks in supply chains, said Brian Nick, chief investment strategist
at Nuveen, in a phone interview.
Base effects are the comparison with
prices a year ago, which were often abnormally low as a result of the pandemic.
That means inflation will appear pronounced even if prices are merely returning
to pre-pandemic levels or moving slightly above.
The Fed, meanwhile, has made clear
it doesn’t expect inflation to prove stubborn and is willing to tolerate an
economy that runs hot and pushes inflation above its usual target of 2% for an
unspecified period before pulling back on its extraordinary monetary stimulus
efforts.
The 10-year break-even rate, sometimes
viewed as what holders of Treasury inflation-protected securities anticipate
consumer prices to average over the next decade, stood at 2.32% on Tuesday.
That marks the highest level since mid-2013.
But prospects for inflation over a
shorter-term horizon are even more heightened. The 5-year break-even rate was
at 2.52% Tuesday, around its highest since 2008. Such inversions of the
break-even curve — where short-term inflation expectations exceed longer-term
expectations — are rare, and suggest that these investors expect a pickup in
inflation that subsequently fades away, said Michael Arone, chief investment
strategist at State Street Global Advisors, in a note.
But should investors share the Fed’s
confidence?
“It might be easy for the Fed to
dismiss rising prices as temporary, but with aluminum, copper, oil, lumber and
housing all surging in recent months, it’s risky for investors to ignore the
possibility that this may be a more permanent upward shift in prices,” Arone
wrote.
Not all investors are convinced the
Fed will sit on its hands as inflationary pressures pick up. Fed-funds futures
traders have begun to price in rate increases for late 2022.
More
https://www.marketwatch.com/story/the-biggest-inflation-scare-in-40-years-is-coming-what-stock-market-investors-need-to-know-11617846712?mod=home-page
Column: U.S. corn exporters rack
up monstrous volumes on their way to record books April
8, 2021 10:05 AM
FORT
COLLINS, Colo. (Reuters) - Market participants have patiently awaited a boost
in U.S. corn exports to match the record yearly expectation, but the wait is
officially over as recent shipments have blown past nearly every benchmark.
U.S. corn exports in February hit
6.3 million tonnes (248 million bushels) according to official census data
published on Wednesday. That tops 2008’s record for the month by 17% and is the
largest monthly volume since July 2018.
January corn exports had missed the
month’s all-time high by a handful of cargoes, and the December volume was the
biggest in 13 years. That marked a much-needed reversal from the average export
pace observed in the first quarter of 2020-21 that began on Sept. 1.
Weekly export data suggests that
March shipments reached an all-time monthly record by a long shot, likely
topping 9 million tonnes. The largest-ever volume is 7.75 million tonnes set in
May 2018, and the March high is 6.7 million from 2017.
---- That expected increase, along with the
record annual prediction, is largely driven by unusually strong sales to China.
Through March 25, China had booked 23.2 million tonnes of U.S. corn for the
2020-21 year. The prior high for U.S. corn exports to China was 5.15 million in
2011-12.
In the first half of 2020-21, U.S.
corn shipments to China reached 7.1 million tonnes, leaving a lot of work for
exporters in the second half. However, export inspection data implies that the
March volume to China likely topped December 2020’s all-time high of 1.53
million tonnes.
----
China accounted for roughly 19% of all corn inspected for export in March,
implying more than 7 million tonnes may have been shipped to other destinations.
More
https://www.reuters.com/article/us-usa-corn-braun-column-idUSKBN2BU3M5?taid=606e7fca9974200001474ffb&utm_campaign=trueAnthem:+Trending+Content&utm_medium=trueAnthem&utm_source=twitter
“When it becomes serious, you have to lie.”
Jean-Claude
Juncker. Failed former Luxembourg P.M., serial liar, ex-president of the
European Commission. Scotch
connoisseur.
Covid-19 Corner This
section will continue until it becomes unneeded.
India overtakes Brazil as world's
second worst-hit country by COVID-19 April 12, 2021 5:23
AM
NEW DELHI (Reuters) - India reported
a record 168,912 COVID-19 infections overnight, data from the health ministry
showed on Monday, overtaking Brazil to become the second-most affected country
globally by the coronavirus.
India’s overall tally reached 13.53
million, surpassing Brazil’s 13.45 million cases, according to data compiled by
Reuters. The United States led the global tally with 31.2 million cases.
Deaths in India stood at 904, taking
the total to 170,179, data showed.
https://www.reuters.com/article/us-health-coronavirus-india/india-overtakes-brazil-as-worlds-second-worst-hit-country-by-covid-19-idUSKBN2BZ0A1
South African variant can 'break
through' Pfizer vaccine, Israeli study says April
10, 2021 9:04 PM
JERUSALEM
(Reuters) - The coronavirus variant discovered in South Africa can “break
through” Pfizer/BioNTech’s COVID-19 vaccine to some extent, a real-world data
study in Israel found, though its prevalence in the country is low and the
research has not been peer reviewed.
The study, released on Saturday,
compared almost 400 people who had tested positive for COVID-19, 14 days or
more after they received one or two doses of the vaccine, against the same
number of unvaccinated patients with the disease. It matched age and gender,
among other characteristics.
The South African variant, B.1.351,
was found to make up about 1% of all the COVID-19 cases across all the people
studied, according to the study by Tel Aviv University and Israel’s largest
healthcare provider, Clalit.
But among patients who had received
two doses of the vaccine, the variant’s prevalence rate was eight times higher
than those unvaccinated - 5.4% versus 0.7%.
This suggests the vaccine is less
effective against the South African variant, compared with the original
coronavirus and a variant first identified in Britain that has come to comprise
nearly all COVID-19 cases in Israel, the researchers said.
“We found a disproportionately
higher rate of the South African variant among people vaccinated with a second
dose, compared to the unvaccinated group. This means that the South African
variant is able, to some extent, to break through the vaccine’s protection,”
said Tel Aviv University’s Adi Stern.
The researchers cautioned, though,
that the study only had a small sample size of people infected with the South
African variant because of its rarity in Israel.
They also said the research was not
intended to deduce overall vaccine effectiveness against any variant, since it
only looked at people who had already tested positive for COVID-19, not at
overall infection rates.
---- “Even if the South African variant does
break through the vaccine’s protection, it has not spread widely through the
population,” said Stern, adding that the British variant may be “blocking” the
spread of the South African strain.
Almost 53% of Israel’s 9.3 million
population has received both Pfizer doses. Israel has largely reopened its
economy in recent weeks while the pandemic appears to be receding, with
infection rates, severe illness and hospitalizations dropping sharply. About a
third of Israelis are below the age of 16, which means they are still not
eligible for the shot.
https://www.reuters.com/article/us-health-coronavirus-israel-study/south-african-variant-can-break-through-pfizer-vaccine-israeli-study-says-idUSKBN2BX0JZ
Scientists find clues to why
AstraZeneca's vaccine may cause clots April 10, 2021 / 9:24 AM
Doctors might have figured out why AstraZeneca's COVID-19 vaccine
may cause life-threatening blood clots in very rare cases.
The discovery, made in a pair of reports published online
Friday in the New England Journal of Medicine, could be key to the
global rollout of the AstraZeneca vaccine, helping develop effective treatments
for the side effect and providing clues on how to refine the vaccine and fix
the problem, experts say.
But it also might hinder efforts to
have the vaccine approved in the United States, where there are three other
vaccines available.
The AstraZeneca vaccine appears to
cause certain people to develop antibodies that target a protein in the human
body called platelet factor 4 (PF4), which spurs platelets into action and
activates a clotting cascade, explained report co-author Dr. Theodore
Warkentin, a professor of pathology and molecular medicine at McMaster
University in Ontario, Canada.
"It's an antibody that's
somehow triggered by the vaccine, and in some circumstances this results in
unusual blood clotting," Warkentin said.
The phenomenon is similar to a rare
drug side effect caused by the blood thinner heparin, called heparin-induced
thrombocytopenia, Warkentin said.
The vaccine's clotting side effects
are so rare that the European Medicines Agency and the UK's Medicines and
Healthcare Products Regulatory Agency have decided to keep it on the market,
concluding that its benefits outweigh the risks, AstraZeneca noted in a
statement.
However,
the vaccine's label will be updated to list blood clotting as an extremely rare
potential side effect.
---- As of Sunday4, the EMA had received reports of 169
cases of cerebral clotting and 53 cases of abdominal clotting out of about 34
million AstraZeneca doses administered throughout Europe, according to Reuters.
In the United Kingdom, 19 people have died from serious
blood clots related to the vaccine, CNN reported.
Two of the three COVID-19 vaccines being distributed in the
United States -- Pfizer and Moderna -- have not shown any such side effect. But
on Friday, European drug regulators said they are reviewing reports of rare
blood clots in four people who received Johnson & Johnson's COVID-19
vaccine. Of the four cases, three occurred in the United States during the
rollout of the vaccine and one person had died, and the fourth case was
reported in a clinical trial, CNBC reported.
More
https://www.upi.com/Health_News/2021/04/10/Scientists-find-clues-to-why-AstraZenecas-vaccine-may-cause-clots/1251618060511/
J&J vaccine suspended at
Georgia site after 8 people have adverse reactions April 09, 2021 at 11:26 pm EDT
CUMMING, Ga. — The Georgia Department of
Public Health has paused distributing the Johnson & Johnson vaccine at one
state vaccination site after several people had adverse reactions after getting
the shot on the same day this week.
Georgia is now the fourth state this week to
pause the J&J vaccine due to similar problems.
Channel 2′s Steve Gehlbach was at
the Cumming Fairgrounds, where health officials have suspended distributing the
vaccine after eight people experienced adverse reactions after getting the
shots on Wednesday. One person was taken to the hospital but was released.
Others were monitored at the site and sent home.
----There
were 435 vaccines administered at the site on Wednesday. Less than 2% of those
people had reactions, but it was still enough for officials to investigate.
Tens of thousands of J&J vaccines have been given statewide with no adverse
reactions.
“The reactions were consistent with common
reactions in adults being vaccinated with any vaccine, but due to the number of
individuals affected, the site stopped the J&J vaccinations to evaluate,”
officials said.
Anyone scheduled to get the Johnson &
Johnson vaccine that day was given the option to reschedule or get the Moderna
first dose the same day.
On Friday, the site administered Pfizer
vaccines.
Everyone who had a reaction has recovered.
More
https://www.wsbtv.com/news/local/hall-county/jj-vaccine-suspended-georgia-site-after-8-people-have-bad-reactions/IP3UWPPJ7ZDZTE6JTP4QCJ36XM/
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
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.
Optically active defects improve
carbon nanotubes Scientists
achieve defect control with a new reaction pathway Date: April 9, 2021
Source: University of Heidelberg
Summary: The properties of carbon-based nanomaterials
can be altered and engineered through the deliberate introduction of certain
structural 'imperfections'. The challenge, however, is to control the number
and type of these defects. Chemists and materials scientists have now
demonstrated a new reaction pathway that enables such control for carbon
nanotubes. It results in specific optically active sp3 defects, which are more
luminescent and can emit single photons in the near-infrared.
---- The efficient
emission of near-infrared light is important for applications in
telecommunication and biological imaging.
Usually defects are considered
something "bad" that negatively affects the properties of a material,
making it less perfect. However, in certain nanomaterials such as carbon
nanotubes these "imperfections" can result in something
"good" and enable new functionalities. Here, the precise type of
defects is crucial. Carbon nanotubes consist of rolled-up sheets of a hexagonal
lattice of sp2 carbon atoms, as they also occur in benzene. These hollow tubes
are about one nanometer in diameter and up to several micrometers long.
Through certain chemical reactions,
a few sp2 carbon atoms of the lattice can be turned into sp3 carbon, which is
also found in methane or diamond. This changes the local electronic structure
of the carbon nanotube and results in an optically active defect. These sp3
defects emit light even further in the near-infrared and are overall more
luminescent than nanotubes that have not been functionalised. Due to the
geometry of carbon nanotubes, the precise position of the introduced sp3 carbon
atoms determines the optical properties of the defects. "Unfortunately, so
far there has been very little control over what defects are formed," says
Jana Zaumseil, who is a professor at the Institute for Physical Chemistry and a
member of the Centre for Advanced Materials at Heidelberg University.
The Heidelberg scientist and her
team recently demonstrated a new chemical reaction pathway that enables defect
control and the selective creation of only one specific type of sp3 defect.
These optically active defects are "better" than any of the
previously introduced "imperfections." Not only are they more
luminescent, they also show single-photon emission at room temperature, Prof.
Zaumseil explains. In this process, only one photon is emitted at a time, which
is a prerequisite for quantum cryptography and highly secure telecommunication.
According to Simon Settele, a doctoral
student in Prof. Zaumseil's research group and the first author on the paper
reporting these results, this new functionalisation method -- a nucleophilic
addition -- is very simple and does not require any special equipment. " We are only just starting to explore the potential
applications. Many chemical and photophysical aspects are still unknown.
However, the goal is to create even better defects."
More
https://www.sciencedaily.com/releases/2021/04/210409123706.htm?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+sciencedaily%2Fmatter_energy%2Fgraphene+%28Graphene+News+--+ScienceDaily%29
The Battle that settled the peace after the American Revolution.
Battle
of the Saintes, (April 9–12, 1782), in the American Revolution, major naval
victory for Britain in the West Indies that restored British naval mastery in
the area and ended the French threat to nearby British possessions.
Date:
April 12, 1782
Losses:
British, no ships, 1,000 dead or wounded men; French, 4 ships captured, 1 ship
destroyed, 5,000 dead, wounded, or captured men.
Battle of the Saintes ---- The battle is named after the Saintes (or Saints), a group of islands between Guadeloupe
and Dominica
in the West
Indies . The French had blockaded the British Army
at Chesapeake Bay the year before, during the Siege
of Yorktown , and supported the eventual American victory in their
revolution. The battle, however, had a significant effect on peace negotiations to end the American
Revolution.[1]
https://en.wikipedia.org/wiki/Battle_of_the_Saintes
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