Baltic Dry Index. 3190 -28 Brent Crude 75.17
Spot Gold 1788
Coronavirus Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 22/06/21 World 179,552,610
Deaths 3,888,824
Good judgment comes from experience, and a lot of that comes from bad judgment.
Will Rogers.
With the US central banksters all over the place on inflation, tapering, when and by how much interest rates will rise, punters in the stock casinos took that as a signal that the toothless Fed will do nothing! Buy the dip!
For once I’m with the stock gamblers, I too think the Fedster’s will do nothing and intend to let US and global inflation rip.
Having gone all in on Magic Money Tree money in March 2020, the whole global economy is now totally dependent on more Magic Money Tree money forever.
That it all ends in a massive global financial disaster is a given, but it won’t be a financial disaster triggered by a gun shy Federal Reserve.
Reducing Fed bond buying now, just as the US economy is set to phase out some of the Magic Money Tree programs and end some rent and mortgage deferral programs, would trigger that final financial disaster that the Fedster’s are so desperately trying to avoid.
The Great Financial Disaster, when it comes, is highly unlikely to come from Fed Chairman Powell turning into Paul Volker 2.0.
Japan’s Nikkei 225 jumps more than 2% as Asia-Pacific stocks mostly rise
SINGAPORE — Shares in Asia-Pacific rose in Tuesday morning trade, with shares in Japan leading gains among the region’s major markets.
In Japan, the Nikkei 225 jumped 2.33% in morning trade, partially recovering from its more than 3% tumble on Monday. The Topix index gained 2.53%.
Mainland Chinese stocks edged higher as the Shanghai composite gained about 0.4% while the Shenzhen component rose fractionally. Hong Kong’s Hang Seng index fell slightly.
South Korea’s Kospi advanced 0.54%. Over in Australia, the S&P/ASX 200 gained 1.34%.
MSCI’s broadest index of Asia-Pacific shares outside Japan traded 0.26% higher.
Overnight on Wall Street, the Dow Jones Industrial Average jumped 586.89 points to 33,876.97. The S&P 500 also rose 1.4% to 4,224.79 while the Nasdaq Composite advanced 0.79% to 14,141.48.
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 91.97 — lower than levels above 92 seen recently.
The Japanese yen traded at 110.24 per dollar, weaker than levels below 110 seen against the greenback yesterday. The Australian dollar changed hands at $0.7519, still off levels above $0.768 seen last week.
https://www.cnbc.com/2021/06/22/asia-markets-dow-jones-industrial-average-bounce-currencies-oil.html
Here’s why the market may be wrong about the Federal Reserve and interest rates
Monday’s aggressive stock market rally came despite the fears of one Wall Street firm that investors still aren’t appreciating how quickly the Federal Reserve could start raising interest rates.
After getting hammered in the final three trading days last week, Wall Street came roaring back with a move that sent the Dow Jones Industrial Average up more than 1.5%.
“The market is getting back to its comfortable mode,” Mohamed El-Erian, the chief economic advisor at Allianz, told CNBC’s “Squawk Box.” “Growth is strong. They still believe inflation is transitory. They believe the Fed is going to be relatively slow in tapering [monthly asset purchases], and that’s why you’re seeing” stocks higher.
That sanguine view of Fed policy is a mistake, according to Bank of America credit strategist Hans Mikkelsen.
Last week’s Federal Open Market Committee meeting concluded with officials indicating they now see two rate increases coming as soon as 2023, more quickly than the market had been anticipating.
But Mikkelsen’s view is that tighter monetary policy may come even sooner.
“Expect the Fed to soon begin tapering its [quantitative easing] purchases, and to start hiking interest rates earlier than expected – and most importantly much faster than currently priced in markets,” he said in a note to clients.
The bank’s analysis noted the committee was only “two dots,” or the projections of two members of the 18-person committee, away from pulling the first rate increase into 2022. The panel split evenly on whether rates should move next year, while eight members saw as many as three hikes for 2023.
----Mikkelsen said the credit market, which sent rates sharply lower despite the hawkish Fed, is misjudging which way the central bank is heading. From the market’s perspective, it is seeing just a 41% chance that the Fed hikes rates by July 2022, according to the CME’s FedWatch tracker.
“The key mispricing in the rates market, as our rates strategists continue to point out, is not the taper, not the timing of the first rate hike, but the pace of hikes from that point on, which is way too shallow compared with normal hiking cycles in the past,” he wrote.
Mikkelsen pointed out that the Fed in effect has already begun tapering with its moves to unwind the small portfolio of corporate bonds it purchased during the Covid-19 pandemic. That move, “which was 100% unexpected as the Fed has a poor track record selling assets – was a signal the Fed increasingly feels emboldened to exit their super-easy monetary policy stance, even if that means defying market expectations.”
----New York Fed President John Williams, in a speech Monday, reflected the consensus view when he said he sees inflation as transitory and Fed policy as appropriate given the current and expected conditions.
“It’s clear that the economy is improving at a rapid rate, and the medium-term outlook is very good. But the data and conditions have not progressed enough for the FOMC to shift its monetary policy stance of strong support for the economic recovery,” Williams said in prepared remarks.
But within the Fed, opinions are diverging.
More
Finally, unicorn ranching again. China seems to have woken up to the scam.
Still, if cryptocurrency looks like round tripping and causing that Great Financial Disaster that central banksters so dread, how long before the Fed and others in its band of Magic Money fraudsters have to start monetising Bitcoin?
Get fully paid up gold and silver held outside of the control of the banksters.
China’s renewed crypto crackdown wipes nearly $300 billion off the market as bitcoin slides
China’s renewed crackdown on the cryptocurrency industry has wiped off nearly $300 billion in value from the total digital currency market since Friday, when a major bitcoin mining hub ordered miners to shut down operations.
Bitcoin was down around 6.6% at $32,735.71 at around 10:47 p.m. ET, coming off its 24-hour low of $31,179.05, according to CoinDesk data.
Over the past few days, China has stepped up its efforts to rein in the country’s cryptocurrency industry.
On Friday, authorities in China’s Sichuan province, ordered cryptocurrency miners to shut down their operations, according to multiple media reports. Sichuan is one of the biggest bitcoin mining centers in China.
Many bitcoin mines in the southwestern Chinese province were closed as of Sunday, according to state-backed tabloid the Global Times.
The move in Sichuan comes after other mining-intensive provinces in China, including Inner Mongolia, also shut down crypto mining. In May, Beijing called for a crackdown on bitcoin mining, highlighting how the order has trickled down from the top.
Then on Monday, the People’s Bank of China said it spoke to Alipay, the payments service run by Alibaba affiliate Ant Group, and some major financial institutions. The central bank said it urged them not to provide services related to cryptocurrency activities, including account openings or clearing and settlement.
These are not new rules, but the PBOC’s comments show how China’s top regulators are stepping up monitoring and pressure on financial institutions related to cryptocurrencies.
China banned local cryptocurrency exchanges in 2017 forcing them to move offshore. That did not stop Chinese traders buying and selling digital coins, though it added a layer of complexity to crypto trading.
Chinese traders would have to move their Chinese yuan to a platform to buy crypto. That would be done via a payments service like Alipay or a bank account. So the PBOC’s latest reminder to financial institutions could be looking to stamp this out further.
Since Friday, when the Sichuan authorities notified miners to shut down operations, bitcoin is down around 16%. The central bank notice added further pressure.
Other cryptocurrencies including ether and XRP were also sharply lower late on Monday.
Cramer says he ‘sold almost all’ of his bitcoin, fearing China has had it with crypto
CNBC’s Jim Cramer said Monday he’s offloaded most of his bitcoin holdings, expressing concerns around the recent crackdown on crypto mining by the Chinese government and bitcoin’s role in some ransomware attacks.
“Sold almost all of my bitcoin. Don’t need it,” Cramer said on “Squawk on the Street,” more than two months after he first indicated he trimmed his position and paid off a home mortgage with those profits.
The price of bitcoin fell more than 6% on Monday to roughly $33,000 per token, around a two-week low. The move lower follows a report in the Chinese Communist Party-backed Global Times newspaper that said more than 90% of the country’s mining capacity is shut down after authorities in the province of Sichuan closed “many mines” located there.
----“When the PRC goes after something, they tend to have their way. ... It’s not a democracy. It’s a dictatorship,” Cramer said, using an acronym for the People’s Republic of China. He added, “I think that they believe it’s a direct threat to the regime because what it is, is a system that’s outside their control.”
Cramer — who has previously described his bitcoin ownership as an alternative to a cash position — said Tuesday he also harbors concerns about how the U.S. government will approach the world’s largest cryptocurrency by market value in light of the Colonial Pipeline attack.
In that cyber incident, which in May disrupted gas supply in the southeastern U.S., the company paid a $5 million ransom in bitcoin to the hackers. U.S. law enforcement was able to claw back $2.3 million of that payment.
“In our country, I think it’s outside of our control when it comes to ransomware, and I doubt that Colonial is the first company to pay ransomware. I think they’re the first that almost shutdown the East Coast,” Cramer said. “I think the Justice Department and the FBI and the Federal Reserve and Treasury could coalesce and say, ‘OK guys, if you pay ransomware, we’re going to go after you.’”
More
Israel has already tested a digital shekel cryptocurrency
The concept of issuing such a currency has been in discussion since 2017, but it decided to accelerate its research and preparation for the potential issuance.
By ZEV STUB JUNE 21, 2021 18:24
Israel has already conducted a pilot test of a digital shekel cryptocurrency, Bank of Israel Deputy Governor Andrew Abir said, perhaps inadvertently, at a recent conference of the Fair Value Forum of IDC Herzliya.
Toward the end of a panel discussion, Abir said the Bank of Israel had already
run a digital currency pilot. Another member of the panel seemed surprised and asked:
“You have already issued a coin?” Abir responded in the affirmative.
However, Abir said he was not optimistic that such a central-bank digital
currency (CBDC) would ever be launched.
“I had previously estimated that the chance of having a CBDC within five years
is 20%,” Abir said. “My estimate has increased a bit in the last year, mainly
because other countries are advancing with it too. But still there is less than
a 50% chance.”
In May, the Bank of Israel said it was preparing an action plan for how it
could offer a digital currency. The concept of issuing such a currency has been
in discussion since 2017, but it decided to accelerate its research and
preparation for the potential issuance “in view of the rapid developments in
the digital economy and in payments, and in view of the major central banks’
work on the issue.”
More
https://www.jpost.com/jpost-tech/israel-has-already-tested-a-digital-shekel-cryptocurrency-671639
Advertising is the art of convincing people to spend money they don't have for something they don't need.
Will Rogers.
Global Inflation Watch.
Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own
The natural-gas glut has evaporated, driving prices higher
The power-plant fuel costs twice what it did at the start of last summer, portending higher utility bills and manufacturing costs
June 21, 2021
Natural-gas prices are starting the summer air-conditioning season nearly twice as high as they were a year ago.
Demand for the fuel is picking up as the world’s economies reopen and as Americans dial down their thermostats for what is expected to be a hot summer. Meanwhile, U.S. producers have stuck to the skimpy drilling plans they sketched out when prices were lower, eliminating the glut that was keeping them depressed.
Natural-gas futures ended Friday at $3.215 per million British thermal units, up 96% from a year ago and the highest price headed into summer since 2017. Futures traded even higher—and regional spot prices jumped—when triple-digit temperatures baked the Southwest earlier this month. Analysts expect prices to be even higher later in the year when it is time to fire up furnaces.
It isn’t just in the U.S. where gas is running high. Dutch gas futures, a barometer for prices in Western Europe, have more than doubled over the past year—including a sharp rise since February—to multiyear highs. In Asia, imported liquefied natural gas is fetching more than five times what it did last June, beckoning tankers full of chilled shale gas across the Pacific.
More expensive gas has stoked demand in international markets for coal, with which gas competes to fuel power plants. Futures prices for thermal coal loaded at a terminal in Newcastle, Australia, have more than doubled from a year ago. The benchmark price has added 27% over the past month and hasn’t been so high in nearly a decade.
If higher prices persist, Americans can expect bigger utility bills. The work-from-home class could feel a pinch. The pandemic shifted energy costs from employers to employees, who have heated and cooled home offices and run electronics when they would normally be away at work.
Besides being burned to generate electricity and for hot showers and cooking, natural gas is consumed in large volumes to make plastic, fertilizer, steel and cement. Monetary-policy makers don’t consider energy prices when gauging inflation because they are so volatile. Yet climbing gas prices are adding to the costs of producing manufactured goods at a time when investors are on edge about the potential for runaway inflation.
More
https://www.foxbusiness.com/energy/the-natural-gas-glut-has-evaporated-driving-prices-higher
Supply Crunch Risks Extending Into 2022, Stoking Inflation
Orders and backlogs have grown while production and hiring slow
June 20, 2021 10:00 am ET
Supply constraints that have challenged businesses and caused shortages of everything from semiconductors to sweatpants are deepening, adding to pressure on inflation and testing the Federal Reserve’s resolve to keep juicing the economy.
Economists and business executives now say those supply-chain disruptions, key labor shortages and resurgent demand driven by multiple rounds of fiscal stimulus will persist through the end of the year, if not longer.
“It turns out it’s a heck of a lot easier to create demand than it is to—you know, to bring supply back up to snuff,” Fed Chairman Jerome Powell said Wednesday after the central bank’s most recent policy meeting.
The squeeze on U.S. businesses shows little sign of letting up, particularly in the manufacturing sector.
More
Inflation ahead? Even a top economist says it’s complicated
WASHINGTON (AP) — Two months of sharply rising prices have raised concerns that record-high government financial aid and the Federal Reserve’s ultra-low interest rate policies — when the economy is already surging — have elevated the risk of accelerating inflation.
In May, consumer prices rose 5% from a year earlier, the largest such year-over-year jump since 2008.
Many economists see the recent spike as temporary. Others say they worry that higher consumer prices will persist. Jason Furman, a Harvard professor who was President Barack Obama’s top economic adviser, thinks the reality is more complicated. He does, however, lean toward the higher-inflation-will-persist camp.
Furman notes that while most economists expect inflation to slow from its current quickened pace, not all think it will fall back to the Fed’s preferred level of 2% a year.
The Associated Press spoke recently with Furman about why higher inflation might prove only temporary, why it might persist and whether a little more inflation is all that bad.
Q. WHAT’S DRIVING INFLATION UP, AND DO YOU THINK IT WILL PERSIST?
A. There’s been a lot of very temporary inflation from a set of quirks related to the economy’s reopening. For example, used car prices have absolutely soared, and other prices are getting back to where they were pre-pandemic. I don’t think anyone thinks the recent rate of price increase is going to continue. The question is, how much does it slow down? Does it slow down all the way back to the 2% increase every year we used to see? Or does it slow down less than that, and we’re left with something more like a 3% increase every year?
----Q. BEYOND THE ECONOMY’S REOPENING, WHAT MIGHT DRIVE A MORE SUSTAINED BOUT OF INFLATION?
A. I think the four reasons why you might worry that inflation is going to be more persistent are, No. 1, there are some shoes that haven’t dropped yet. The biggest of them being the price of shelter — that’s rent. And then it’s something called owner’s equivalent rent, which is what it costs a homeowner to live in their home. (Both rents and home prices have risen sharply.)
Second factor is some prices are sticky. That means they don’t adjust really quickly and right away. A lot of prices change once a year, and you’re going to see more of those price changes over time. Wages also tend to be sticky. A lot of employers might in September decide on new wages for January.
The third factor is that it’s likely that demand continues to exceed supply through the rest of the year. People have a lot of money. They’re spending that money, but not everyone’s back to work, which means we can’t make everything that people want to buy.
And finally, and most speculatively, expectations for inflation play a big role in the dynamics of inflation. Could expectations change? Could they become unanchored if people start to expect more inflation? It would be self-fulfilling.
More
“Give me a one-handed Economist. All my economists say 'on one hand...', then 'but on the other...”
Covid-19 Corner
This section will continue until it becomes unneeded.
Today, the scandal of Ivermectin suppression. How many deaths could have been prevented if Ivermectin hadn’t been and still is being withheld? A must watch presentation.
Dr. John Campbell explains all. Approx. 22 minutes.
Money for antivirals
https://www.youtube.com/watch?v=Of5_oiuqDp8
What is the Delta variant and how is it altering the course of the pandemic?
Rich Haridy June 20, 2021
UK health authorities are reporting 90 percent of new coronavirus infections are due to the Delta variant. In the US the Centers for Disease Control and Prevention warn the variant will likely become predominant in the coming months. What is the Delta variant, why is it posing such a problem, and will our vaccines still provide protection against it?
The Delta variant was first recorded in India in December 2020. It is one of three lineages of the B.1.617 variant and by June 2021 had been detected in around 80 countries.
While it is still unclear exactly how the Delta variant is more infectious than prior iterations of the virus, epidemiological studies in the UK are seeing it dramatically outperform the previously dominant Alpha variant (also known as the UK variant). Rochelle Walensky, director of the CDC, expects the Delta variant to overtake the Alpha variant in the US over the next few months.
"The UK variant was more transmissible,” Walensky said recently in an interview with CNN. “That is now nearly 70 percent of the virus here. We know that the Delta variant is even more transmissible than the UK variant, and I anticipate that will be the predominant variant in the months ahead.”
Earlier this year, as the Alpha variant was increasing in prominence around the world, researchers estimated it to be anywhere from 40 to 70 percent more transmissible compared to the original strain of SARS-CoV-2. UK health authorities are now indicating the Delta variant is at least 40 percent more transmissible than the Alpha.
More
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
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.
Meringue-like material could make aircraft as quiet as a hairdryer
Extremely low-density graphene-based aerogel 'meringue' can improve passenger comfort and reduce noise up to 80%
Date: June 18, 2021
Source: University of Bath
Summary: An incredibly light new material can reduce aircraft engine noise and improve passenger comfort. The graphene oxide-polyvinyl alcohol aerogel weighs just 2.1kg per cubic meter, making it the lightest sound insulation ever manufactured.
An incredibly light new material that can reduce aircraft engine noise and improve passenger comfort has been developed at the University of Bath.
The graphene oxide-polyvinyl alcohol aerogel weighs just 2.1kg per cubic metre, making it the lightest sound insulation ever manufactured. It could be used as insulation within aircraft engines to reduce noise by up to 16 decibels -- reducing the 105-decibel roar of a jet engine taking off to a sound closer to that of a hair-dryer.
The aerogel's meringue-like structure makes it extremely light, meaning it could act as an insulator within aircraft engine nacelles, with almost no increase in overall weight. The material is currently being further optimised by the research team to offer improved heat dissipation, offering benefits to fuel efficiency and safety.
Researchers from Bath's Materials and Structures Centre (MAST) have published a method for manufacturing the materials in the journal Nature Scientific Reports.
Professor Michele Meo, who led the research, says: "This is clearly a very exciting material that could be applied in a number of ways -- initially in aerospace but potentially in many other fields such as automotive and marine transport, as well as in building and construction.
"We managed to produce such an extremely low density by using a liquid combination of graphene oxide and a polymer, which are formed with whipped air bubbles and freeze-casted. On a very basic level, the technique can be compared with whipping egg whites to create meringues -- it's solid but contains a lot of air, so there is no weight or efficiency penalty to achieve big improvements in comfort and noise."
Although the team's initial focus is in working with partners in aerospace to test the material as a sound insulator in aeroplane engines, they say it could also be used to create panels in helicopters, or car engines. They estimate that the aerogel could be in use within 18 months.
When the Oakies left Oklahoma and moved to California, it raised the I.Q. of both states.
Will Rogers.
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