Baltic Dry Index. 3375 +04 Brent Crude 70.48
Spot Gold 1735
Coronavirus Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 11/08/21 World 204,795,692
Deaths 4,327,096
"Give me a one-handed economist! All my economics say, ''On the one hand, on the other.''"
President Harry Truman.
With the US Senate passing a trillion dollar “infrastructure” bill, well about half of that gets spent on infrastructure, the stock casinos anticipate more boom.
But House Democrats say they will hold the infrastructure Bill hostage until the Senate passes the hard left socialist 3.5 trillion dollar “welfare” Bill, in reality a bribe to largely Democrat voters and potential voters, so the casinos are anticipating another 4.5 trillion of new Magic Money Tree cash. What’s not to like? Happy Days Are Here Again!
Well, the inflation that follows from spending 4.5 trillion of newly created fiat dollars, will add to an already fast rising inflation in the land between the shining seas.
To this old dinosaur markets follower, it looks like the Fed’s “temporary” inflation will likely now extend out to at least 2025.
Time to position for the return of the inflationary Carter years and the fall of the dollar reserve standard, as our global economy transitions away from a hydrocarbon economy traded mostly in US dollars, to a “green” energy electric economy, traded for the most part in local currencies. And all to happen by 2030 (UK) to 2035 (Germany,) to 2040 USA and nearly everyone else. Laggards, India and China, 2050.
Mainland Chinese stocks rise; energy stocks gain on higher oil prices
SINGAPORE — Mainland Chinese stocks edged higher in early trade on Wednesday, tracking gains seen in other major Asia-Pacific markets as Wall Street touched highs.
Meanwhile, oil stocks in the region jumped on the back of higher oil prices.
The Shanghai composite rose 0.21%, while the Shenzhen component was up 0.13%. Hong Kong’s Hang Seng index was slightly below the flatline.
Japan’s Nikkei 225 climbed 0.54%, while the Topix jumped 0.83%. South Korea’s Kospi dipped 0.25%.
The S&P/ASX 200 in Australia was up 0.6%.
Meanwhile, Singapore’s Straits Times index dipped 0.41%
Singapore’s trade and industry ministry said Wednesday that the economy grew 14.7% in the second quarter compared to a year ago, better than official advance estimates of a 14.3% expansion. The country also expects its economy to grow between 6% and 7% in 2021, an upgrade from past projections of 4% to 6%.
Energy stocks gain on higher oil prices
After spiking more than 2% on Tuesday, oil prices continued to rise on Wednesday morning. Brent crude futures was slightly lower at $70.59 per barrel. U.S. crude futures also slipped slightly to trade at $68.27 per barrel.
Oil stocks in the region rode those gains. In Australia, Santos was up 1.43%, while Beach Energy jumped almost 3%. Oil Search climbed 1.55%.
In Hong Kong, Petrochina jumped 3.1%, CNOOC climbed 1.61% and Sinopec was 1.12% higher.
New records on Wall Street
Stocks on Wall Street shot to new records, boosted by the Senate’s passing of a $1 trillion infrastructure package.
The Dow Jones Industrial Average rose 162.82 points to 35,264.67 to close at a record. The S&P 500 rose 0.1% to 4,436.75 and closed at a fresh all-time high.
The Senate’s infrastructure plan, which includes $550 billion in new spending on transportation and broadband, is expected to help give the economy a boost as peak growth slows following the reopening from the pandemic.
More
Stock futures mostly flat after Dow, S&P close at all-time highs
U.S. stock index futures were flat early on Wednesday, after the Dow and S&P 500 closed at record highs following the Senate passing the $1 trillion infrastructure bill.
Futures contracts tied to the Dow Jones Industrial Average edged slightly lower. S&P 500 futures and Nasdaq 100 futures were flat.
During regular trading, the Dow gained 162.82 points, or 0.46%, while the S&P 500 advanced 0.1%. Both hit all-time intraday highs while also closing at records. The Nasdaq Composite slid 0.49%, registering its second negative session in the last three. The dip came as treasury yields advanced, weighing on growth-oriented areas of the market.
The Senate passed the infrastructure bill Tuesday, which earmarks $550 billion in new spending for areas including transportation and the electric grid. The bill now heads to the House, although Speaker Nancy Pelosi, D-Calif., has said she will not bring it to the floor until the Senate also passes a budgetary proposal.
Cyclical areas of the market got a boost during trading, helped by both the bill’s passage and the rise in rates. The energy, materials, industrials and financials sectors all advanced more than 1%.
The march to record highs for stocks comes despite Covid case numbers rising in the U.S. and around the world.
----On the economic data front, July’s Consumer Price Index reading will be released on Wednesday. Economists surveyed by Dow Jones expect the index to have risen 0.5% last month, or 5.3% year over year. In June prices jumped 0.9%, which was the biggest monthly increase since August 2008.
----“There’s been a lot to take in these last few weeks; major earnings, a hawkish Fed and some knockout economic readings,” said Craig Erlam, senior market analyst at Oanda. “Everything it seems is now pointing towards the Fed tapering its asset purchases in the coming months, with delta the only things potentially standing in its way as it spreads across the US (and many other countries).”
https://www.cnbc.com/2021/08/10/stock-market-futures-open-to-close-news.html
Up next, another two handed economist/investor.
Market may be in the ‘biggest bubble of my career,’ all-star investor Rich Bernstein warns
Published Mon, Aug 9 2021 7:18 PM EDT Updated Mon, Aug 9 2021 8:30 PM EDT
An Institutional Investor Hall of Famer sees an urgent need for investors in some of the most popular trades to diversify.
Rich Bernstein, who has spent decades on Wall Street, is waving the red flag on long-duration assets ranging from Big Tech to bitcoin to Reddit rebellion stocks to long-term bonds.
“We are right in maybe the biggest bubble of my career,” Bernstein, the CEO and CIO of Richard Bernstein Advisors, told CNBC’s “Trading Nation” on Monday.
His warning implies the magnitude is bigger than the dot-com and housing bubbles.
‘Kryptonite for this bubble’
“The Fed has so distorted the long-end of the curve that we are seeing a very natural reaction among long-duration assets which is then taking on a life of its own,” said Bernstein. “Anybody who’s out there in these long-duration assets has to be firmly convinced that long-term interest rates are not going to go up because that’s the kryptonite for this bubble.”
Bernstein believes the backdrop is more perilous than June, when he warned on “Trading Nation” that bitcoin was a bubble. The cryptocurrency has rallied since then, but it’s still off about 20% over the past three months.
“When you get into a bubble, people become very myopic. They look only at a very small universe of investments,” he said. “People always say to me ‘Okay. Well, you’re so smart. When is the bubble going to burst?’ And, the answer is nobody knows.”
Bernstein, who is also known for running strategy at Merrill Lynch, recommends diversifying to groups that have pricing power in an inflationary environment.
“That would lead you most towards commodities, towards materials, energy, things like that,” he said. “I find it very interesting that energy over the last six or 12 months has been in a major bull market and everybody says it’s unsustainable. Bitcoin has been in a major bear market, and everybody is waiting for it to come back.”
Despite his epic bubble warning, Bernstein is not predicting an overall market meltdown. He views the market as a seesaw.
“We’re balancing between these long-duration assets that are very overvalued and a bubble versus the rest of the world,” Bernstein said. “Unless liquidity dries up very rapidly, which seems unlikely, the probability of a major bear market is probably much lower than people might think.”
As of Monday’s close, the S&P 500, Dow and Nasdaq were fractions of one percent off their all-time highs.
https://www.cnbc.com/2021/08/09/market-may-be-in-the-biggest-bubble-of-my-career-rich-bernstein.html
Finally, China. China’s latest bout of Covid-19 will impact the rest of the world, says strategist David Roche, an expert who ought to know.
China’s Covid lockdown could have economic costs to the world, says strategist
Published Tue, Aug 10 2021 3:24 AM EDT
China has tightened Covid-19 measures to combat an uptick in daily cases — a move that could hold back the country’s economic growth and hit its stock markets, said veteran strategist David Roche.
Investor sentiment toward Chinese stocks has been dampened by Beijing’s regulatory crackdown on sectors including technology and after-school tutoring.
“Markets have got into the mode of thinking Covid is very ... bad, but economic recovery (is) taking away lockdowns, removing social restrictions — that’s kind of the world recipe at the moment,” Roche, president and global strategist at Independent Strategy, told CNBC’s “Street Signs Asia” on Tuesday.
“Well it’s very much not the world recipe in China for good reasons, and therefore markets have to come to terms with the fact that there are economic costs not only within China, but globally as a result of this,” he added.
The country’s National Health Commission reported 143 new Covid cases in mainland China on Monday — the highest number of daily infections since January, according to Reuters. Chinese state media attributed the latest resurgence in infections to the highly transmissible delta variant.
Chinese authorities last week ordered mass testing in Wuhan city — where the coronavirus was first detected — and imposed widespread movement restrictions in major cities including Beijing.
Some economists have raised concerns about China’s “zero tolerance” approach to Covid, which refers to the country’s aggressive clampdown on any flare-ups in Covid cases. The approach, which includes strict lockdowns and mass testing, helped China keep previous outbreaks under control before the latest resurgence.
But the delta variant is more contagious and could be more difficult to contain — and that could hurt economic recovery in China, economists have warned.
“If lockdowns and vaccination progress do not allow local economies to reopen by mid-August or early September we will need to revisit our 8.8% 2021 GDP forecast,” economists from Australian bank ANZ wrote in a Tuesday report.
Any disruptions in the Chinese economy could affect global economic growth, said Roche.
The strategist explained that broader lockdowns across China could interrupt global supply chains – much of which are located in the country.
That could hit international trade, increase the costs of some goods, and raise inflation expectations around the world, he added.
More
"Whenever I make a bum decision, I go out and make another one."
President Harry Truman.
Global Inflation Watch.
Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.
Home Builders Are Restricting Sales, Pushing Up New Home Prices
Many cannot increase construction quickly enough to meet booming demand and are turning away business
Aug. 10, 2021 8:00 am ET
Home builders have sold more homes than they can build. Now they are limiting their sales in an effort to catch up, helping push home prices even higher.
Low interest rates and the search for more space to work from home helped push sales of new homes to multiyear highs in late 2020 and early 2021. But builders have been hampered by labor shortages, steep lumber prices, material backlogs and a limited supply of ready-to-build land.
As a result, they couldn’t increase construction quickly enough to meet booming demand. Many are effectively turning away business.
“Through our history, to have somebody walk into our models and to tell them, ‘We don’t have a house for you to buy today,’ is something that is foreign to us,” said David Auld, chief executive officer of D.R. Horton Inc., on an earnings call last month.
D.R. Horton’s net sales orders fell 17% in the most recent quarter from a year earlier, as the company slowed its sales pace. “We’re all managing through a market that none of us have ever seen,” Mr. Auld said.
Home builders restricting the number of homes they sell is helping to further fuel new home prices at a time when the median existing-home price has climbed to a record high of $363,300.
More
Corporate America Is Ponying Up for Workers Suddenly in Demand
Jordyn Holman, Leslie Patton and Peyton Forte August 9, 2021
(Bloomberg) -- For the first time in decades, the American worker is finally in command when it comes time to talk money.
There are tell-tale signs everywhere that this is so.
Like the way some employers -- such as Kroger Co., Chipotle Mexican Grill Inc. and Under Armour Inc. -- are frantically pushing up hourly wages to try to retain employees. Or the way others -- like Starbucks Corp. and Drury Hotels -- are dangling hiring bonuses to entry-level applicants. Or the way CVS Health Corp. is no longer requiring job seekers to have high-school diplomas. Or the way Dan Sacco, the owner of Your Pie restaurants in Iowa, is instructing his general managers to poach workers from rivals with offers of better hours and higher pay.
“Everything is fair game now,” Sacco says.
It is unclear how long all of this will last in the wild and disjointed economic recovery that’s followed last year’s pandemic collapse. But one thing is certain: Workers are scoring the fattest pay hikes since the early 1980s. Wages for the leisure and hospitality industry have surged at an annualized pace of 6.6% over the past two years. And data released Friday showed that payrolls rose nationally at the fastest pace in almost a year, a sign of how desperate employers are to fill jobs.
“If you’re not able to get staff to cover, it leaves you really crunched and that’s what we’re seeing at the moment,” said Neil Saunders, a managing director at market research firm GlobalData who covers retailers and grocers. “Wages have gone up and have been going up.”
----Inflation is another complicating factor that’s limiting the benefits of pay raises. Consumer prices surged 5.4% in June from a year ago, the fastest pace since 2008. According to a Peterson Institute study, inflation-adjusted compensation for all civilian workers is now lower than it was in December 2019.
But if policy makers can tamp down on the price increases, workers should do well. Data from the Labor Department show median wage growth was 4.8% in July on a 24-month annualized basis, up from a 3.3% pace in January 2020. Service workers saw gains almost two percentage points higher than the average for all employees last month.
That could help narrow income inequality, however slightly, after years of widening gaps amid fairly stagnant wages for the service industry accompanied by soaring salaries for white-collar workers. For the most part, corporate America expects wage increases to continue.
More
Senate nears OK of Dems’ $3.5T budget, despite GOP attacks
WASHINGTON (AP) — Democrats pushed their expansive $3.5 trillion framework for bolstering family services, health, and environment programs toward Senate passage early Wednesday, as Republicans unleashed an avalanche of amendments aimed at making their rivals pay a price in next year’s elections.
Congressional approval of the budget resolution, which seems assured, would mark a crucial first step by Democrats toward enacting the heart of President Joe Biden’s domestic agenda. It would open the door to a follow-up measure aiming the government’s fiscal might at assisting families, creating jobs and fighting climate change, with higher taxes on the wealthy and big companies footing much of the bill.
Senate Budget Committee Chairman Bernie Sanders, I-Vt., once a progressive voice in Congress’ wilderness and now a national figure with legislative clout, said the measure would help children, families, the elderly and working people — and more.
More.
Below, why a “green energy” economy may not be possible anyway, and if it is, it won’t be quick and it will be very inflationary, setting off a new long-term commodity Supercycle. Probably the largest seen so far.
The “New Energy Economy”: An Exercise in Magical Thinking
https://media4.manhattan-institute.org/sites/default/files/R-0319-MM.pdf
Mines, Minerals, and "Green" Energy: A Reality Check
https://www.manhattan-institute.org/mines-minerals-and-green-energy-reality-check
"An Environmental Disaster": An EV Battery Metals Crunch Is On The Horizon As The Industry Races To Recycle
by Tyler Durden Monday, Aug 02, 2021 - 08:40 PM
"It's a recession when your neighbor loses his job; it's a depression when you lose your own."
President Harry Truman. [Stolen/borrowed unattributed by Reagan.]
Covid-19 Corner
This section will continue until it becomes unneeded.
Fully vaccinated people are still getting infected with Covid. Experts explain why
Published Tue, Aug 10 2021 1:26 AM EDT
LONDON — People who are fully vaccinated against Covid-19 are highly protected against severe infection, hospitalization and death caused by the virus. But coronavirus cases among the fully vaccinated — so-called “breakthrough” Covid cases — are still being seen among those who have had two doses.
This is happening for a number of reasons, experts note.
For a start, none of the vaccines being deployed in the U.S. or Europe are 100% effective at preventing infection.
In addition, new Covid strains such as the highly infectious delta variant — which is now prevalent around the world —have complicated the efficacy picture. There is also incomplete data into how long immunity from Covid lasts following vaccination.
The alarm was raised over breakthrough Covid cases when preliminary data in Israel — which had one of the fastest vaccination programs in the world — published in late July found that the Pfizer-BioNTech Covid-19 vaccine was just 40.5% effective at preventing symptomatic disease.
The analysis, which was carried out as the delta variant became the country’s dominant strain, still found that having two doses of the shot provided strong protection against severe illness and hospitalization, however, the country’s Health Ministry reported.
The data also appeared to show a waning effectiveness of the Pfizer-BioNTech shot too, with the vaccine only 16% effective against symptomatic infection for those individuals who had two doses of the shot back in January. For people that had received two doses by April, the efficacy rate (against symptomatic infection) stood at 79%, however.
But a study in England carried out from April to May found that, after two doses, the Pfizer-BioNTech vaccine was 88% effective against symptomatic disease caused by the delta variant.
Comparing the results is tricky, however, given differences in the nature of the vaccination programs in both countries (Israel gave all its adult population the Pfizer vaccine, for example, while in the U.K. there are several vaccines in use, with the Pfizer-BioNTech shot predominantly given to younger people) as well as differences in the study dates, Covid testing regimes and age groups.
Like the Israeli data, the English data also concluded that after two doses the Pfizer-BioNTech Covid vaccine is 96% effective against hospitalization from the delta variant. Similarly, it found that the Oxford-AstraZeneca vaccine was 92% effective in preventing hospitalization after two doses.
---- Professor Lawrence Young, a virologist at the University of Warwick’s Medical School in the U.K., told CNBC that cases of Covid in fully vaccinated people are a reminder that “no vaccine is 100% effective.”
“There will always be a proportion of individuals who will still remain susceptible to infection and illness,” he said Monday.
“There are also two other factors that impact vaccine effectiveness: (1) waning immunity — we still don’t know how long vaccine-induced protective immunity lasts.
More
‘Goldilocks virus’: Delta vanquishes all variant rivals as scientists race to understand its tricks
Author: The Washington Post
Updated: August 9, 2021
The variant battle in the United States is over. Delta won.
Since late last year, the country has been overrun by a succession of coronavirus variants, each with its own suite of mutations conferring slightly different viral traits. For much of this year, the alpha variant - officially known as B.1.1.7 and first seen in the United Kingdom - looked like the clear winner, accounting for the majority of cases by April. In second place was iota, B.1.526, first seen in New York City. A few others made the rogue’s gallery of variants: gamma, beta, epsilon.
Then came delta - B.1.617.2. It had spread rapidly in India, but in the United States, it sat there for months, doing little as the alpha advanced. As recently as May 8, delta caused only about 1% of new infections nationally.
Today, it has nearly wiped out all of its rivals. The coronavirus pandemic in America has become a delta pandemic. By the end of July, it accounted for 93.4% of new infections, according to the Centers for Disease Control and Prevention.
The speed with which it dominated the pandemic has left scientists nervous about what the virus will do next. The variant battles of 2021 are part of a longer war, one that is far from over.
Delta is sending thousands of people into hospitals every day and has knocked the Biden administration back on its heels. In a few short weeks, the delta variant changed the calculations for what it will take to end the pandemic.
Epidemiologists had hoped getting 70 or 80% of the population vaccinated, in combination with immunity from natural infections, would bring the virus under control. But a more contagious virus means the vaccination target has to be much higher, perhaps in the range of 90%.
Globally, that could take years. In the United States, the target may be impossible to reach anytime soon given the hardened vaccine resistance in a sizable fraction of the country, the fact that children under 12 remain ineligible and the persistent circulation of disinformation about vaccines and the pandemic.
With so many people unvaccinated, in the United States and around the world, the virus has abundant opportunity not only to spread and sicken large numbers of people, but to mutate further. Some scientists have expressed hope that the virus has reached peak “fitness,” but there is no evidence this is so.
---- What’s most sobering to scientists is how the coronavirus keeps getting better at jumping from person to person.
The original strain that emerged in Wuhan, China, had an estimated reproductive number - an “R-naught” - of roughly 2.5. That’s the average number of new infections generated by each infected person in a population without immunity or mitigations. Any number above 1 means that outbreaks will expand and spread. But the CDC and other scientists say delta has a reproductive number greater than 5.
The result is what the United States has endured this summer: viral explosion.
More
Coronavirus: Israel registers over 6,000 cases in a day
Some 6,275 COVID cases were identified on Monday, with almost 5% of the people screened testing positive.
By ROSSELLA TERCATIN AUGUST 10, 2021 10:13
Israel registered over 6,000 cases on Monday, marking the highest number since the peak of the pandemic in February and an increase of some 2,500 cases compared to the previous fourth wave record of around 3,850 new virus carriers identified in a day.
“We are at a critical point for all of us, for the health, the life and the economy,” Coronavirus Commissioner Prof. Salman Zarka said in an interview to Radio Kan Bet.
Some 6,275 cases were registered on Monday, with almost 5% of the 130,000 people screened testing positive – also the highest in five months.
The number of serious patients continued to increase, standing at 394 as of Tuesday morning. A week earlier they were 232. Of them, some 64 are currently on ventilators.
According to Tuesday’s update by the Health Ministry, some 16 people died on Sunday, making it the deadliest day since the beginning of April.
While the figure is still much lower than what was happening at the peak of the third wave, when at times dozens of people were killed by COVID over the course of 24 hours, it still represents a dramatic increase compared to a few weeks ago. In the whole month of June, some seven people succumbed to COVID, the toll in already stands at 82.
Since the beginning of the pandemic a total of 6,559 people have died.
More
https://www.jpost.com/breaking-news/coronavirus-israel-registers-over-6000-cases-in-a-day-676317
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.
Graphene binds drugs which kill bacteria on medical implants
Date: August 9, 2021
Source: Chalmers University of Technology
Summary: Bacterial infections relating to medical implants place a huge burden on healthcare and cause great suffering to patients worldwide. Now, researchers have developed a new method to prevent such infections, by covering a graphene-based material with bactericidal molecules.
Bacterial infections relating to medical implants place a huge burden on healthcare and cause great suffering to patients worldwide. Now, researchers at Chalmers University of Technology, Sweden, have developed a new method to prevent such infections, by covering a graphene-based material with bactericidal molecules.
"Through our research, we have succeeded in binding water-insoluble antibacterial molecules to the graphene, and having the molecules release in a controlled, continuous manner from the material" says Santosh Pandit, researcher at the Department of Biology and Biological Engineering at Chalmers, and first author of the study which was recently published in Scientific Reports.
"This is an essential requirement for the method to work. The way in which we bind the active molecules to the graphene is also very simple, and could be easily integrated into industrial processes."
Certain bacteria can form impenetrable surface layers, or 'biofilms', on surgical implants, such as dental and other orthopaedic implants, and represent a major problem for healthcare globally. Biofilms are more resistant than other bacteria, and the infections are therefore often difficult to treat, leading to great suffering for patients, and in the worst cases, necessitating removal or replacement of the implants. In addition to the effects on patients, this entails large costs for healthcare providers.
Graphene is suitable as an attachment material
There are a variety of water-insoluble, or hydrophobic, drugs and molecules that can be used for their antibacterial properties. But in order for them to be used in the body, they must be attached to a material, which can be difficult and labour intensive to manufacture.
"Graphene offers great potential here for interaction with hydrophobic molecules or drugs, and when we created our new material, we made use of these properties. The process of binding the antibacterial molecules takes place with the help of ultrasound," says Santosh Pandit.
In the study, the graphene material was covered with usnic acid, which is extracted from lichens, for example fruticose lichen. Previous research has shown that usnic acid has good bactericidal properties. It works by preventing bacteria from forming nucleic acids, especially inhibiting of RNA synthesis, and thus blocking protein production in the cell.
More
"My father was not a failure. After all, he was the father of a president of the United States."
President Harry Truman.
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