Baltic Dry Index. 4732 -122 Brent Crude 84.42
Spot Gold 1774
Coronavirus Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 19/10/21 World 241,899,877
Deaths 4,920,759
“When the music stops, in terms of liquidity, things will be complicated. But as long as the music is playing, you’ve got to get up and dance. We’re still dancing.”
Chuck Prince, CEO Citigroup, 2007.
Now the prospect of Chuck Prince dancing is in itself unsettling. But his account amounts to quite an elegant explanation of why financial bubbles persist. Even if Citigroup’s executives were worried that private equity valuations have gotten too frothy and loan terms too loose, it would make little sense for them to pull back. Because they can never know for sure when the music’s going to stop, and they’d be crazy to forego all those underwriting fees for the year or two or three before it does. So they keep dancing.
http://business.time.com/2007/07/10/citigroups_chuck_prince_wants/
In the central bankster fuelled stock casinos, champagne, caviar, dancing and an insane bubble from too much Magic Money Tree fiat cash, flowing out of the central banks since they discovered the Magic Money Tree forest back in March 2020.
That it all ends in a bad hangover is a certainty, but when and how? When it ends, will it damage/destroy the fiat currencies and public trust in modern money?
Asia-Pacific markets higher as tech stocks regionally rise
SINGAPORE — Shares in Asia-Pacific rose in Tuesday trade, with tech stocks in the region jumping following similar gains overnight for their counterparts on Wall Street.
In mainland China, the Shanghai composite edged 0.7% higher by the afternoon while the Shenzhen component was up 0.926%. Hong Kong’s Hang Seng index climbed 1.18%.
The Nikkei 225 in Japan gained 0.67% while the Topix index advanced 0.39%. South Korea’s Kospi climbed 0.66%.
Shares in Australia were also higher, with the S&P/ASX 200 up 0.18%. Minutes from the Reserve Bank of Australia’s October monetary policy meeting showed the RBA expecting the Australian economy to “return to growth in the December quarter and to its pre-Delta path in the second half of 2022.”
MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.99% higher.
Tech stocks rise
Tech stocks in Asia rose in Tuesday trade, with the Hang Seng Tech index in Hong Kong jumping 2.25%. Hong Kong-listed shares of Alibaba and Meituan climbed 1.29% and 2.07% respectively.
Japanese conglomerate Softbank Group also saw its stock soaring 3.01% while shares South Korean chipmaker SK Hynix advanced 0.62%.
Investors also monitored Apple supplier shares in Asia after the Cupertino-based tech giant announced new products on Monday.
In Japan, shares of Taiyo Yuden fell 2.21% while Murata Manufacturing slipped 0.74%.
Elsewhere, shares of Taiwan Semiconductor Manufacturing Company in Taiwan jumped 1.36%. Luxshare’s stock in mainland China also surged 7.07%.
Overnight on Wall Street, the S&P 500 gained 0.34% to 4,486.46 while the Nasdaq Composite jumped 0.84% to 15,021.81. The Dow Jones Industrial Average lagged, dipping 36.15 points to 35,258.61.
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Next, a harsh reality is about to get even harsher. Supply chain chaos has arrived with food and energy price inflation. Stagflation is the way to bet.
Supply chain chaos is already hitting global growth. And it’s about to get worse
Thanks to the rollout of coronavirus vaccines, the global economy is slowly starting to emerge from the pandemic.
But Covid-19 has left one very destructive economic issue in its wake: disruption to global supply chains.
The rapid spread of the virus in 2020 prompted shutdowns of industries around the world and, while most of us were in lockdown, there was lower consumer demand and reduced industrial activity.
As lockdowns have lifted, demand has rocketed. And supply chains that were disrupted during the global health crisis are still facing huge challenges and are struggling to bounce back.
This has led to chaos for the manufacturers and distributors of goods who cannot produce or supply as much as they did pre-pandemic for a variety of reasons, including worker shortages and a lack of key components and raw materials.
Different parts of the world have experienced supply chain issues that have been exacerbated for different reasons, too. For instance, power shortages in China have affected production in recent months, while in the U.K., Brexit has been a big factor around a shortage of truck drivers. The U.S. is also battling a shortage of truckers, as is Germany, with the former also experiencing large backlogs at its ports.
Situation ‘will get worse’
Unfortunately, experts like Tim Uy of Moody’s Analytics say that supply chain problems “will get worse before they get better.”
“As the global economic recovery continues to gather steam, what is increasingly apparent is how it will be stymied by supply-chain disruptions that are now showing up at every corner,” Uy said in a report last Monday.
“Border controls and mobility restrictions, unavailability of a global vaccine pass, and pent-up demand from being stuck at home have combined for a perfect storm where global production will be hampered because deliveries are not made in time, costs and prices will rise, and GDP growth worldwide will not be as robust as a result,” he said.
“Supply will likely play catch up for some time, particularly as there are bottlenecks in every link of the supply chain—labor certainly, as mentioned above, but also containers, shipping, ports, trucks, railroads, air and warehouses.”
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https://www.cnbc.com/2021/10/18/supply-chain-chaos-is-hitting-global-growth-and-could-get-worse.html
U.S. Factory Output Falls in Fresh Supply-Chain Warning
By Olivia Rockeman18 October 2021, 14:17 BST Updated on 18 October 2021, 14:46 BST
· Manufacturing production falls by 0.7%, most since February
· Decline reflects pullback in motor vehicles, nondurable goods
Production at U.S. factories fell by the most in seven months in September, in part reflecting a sharp pullback in the manufacturing of motor vehicles as well as broader backlogged supply chains and materials shortages.
The 0.7% decrease for manufacturers followed a revised 0.4% decline in August, Federal Reserve data showed Monday. Total industrial production, which also includes mining and utility output, fell 1.3% last month.
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U.S. manufacturing output declines in September
October 18, 2021 2:25 PM
WASHINGTON (Reuters) - Production at U.S. factories unexpectedly fell in September as motor vehicle output slumped amid an ongoing global shortage of semiconductors.
Manufacturing output dropped 0.7% last month, the Federal Reserve said on Monday. Data for August was revised down to show production falling 0.4% instead of rising 0.2% as previously reported. Economists polled by Reuters had forecast manufacturing production edging up 0.1%.
Next, in agriculture news, the new Pacific Ocean La Nina usually brings drought problems in much of agricultural Brazil. We will watch Brazil closely in the coming months. More food price inflation to come.
La Niña means dry weather for Brazil
Short-term, wetter weather returns for many Brazilian states.
By Krissy Klinger 10/17/2021
After wet weather last week, the week-ending October 23 turns drier for much of southern Brazil.
In fact, most of the states that saw above-normal precipitation last week will see a reversal in precipitation trends as below-normal precipitation prevails.
The exception will be in Minas Gerais which is forecast to see the seventh wettest third week of October in more than 30 years, according to data from WeatherTrends360. The wetter weather was encouraging news for farmers planting corn and soybeans in the state.
Drier trends will stretch from Mato Grosso do Sul southward to Rio Grande do Sul in the third week of October. This will be one of the driest third weeks of October in 30-plus years across southern Brazil and much of the major full-season corn growing region, according to WeatherTrends360.
Temperatures across the region will run below normal for the third week of October and this is forecast to be one of the coolest since 1991 for the major soybean growing region of Brazil.
Despite the forecast for below-average precipitation, soybean planting progress has been much faster than recent years for Brazil, AgRural reported last week. However, obstacles lie ahead in the 2021/2022 growing season as La Niña has reemerged, as expected, which brings drier risks to Brazil.
On October 14, the National Oceanic and Atmospheric Administration’s Climate Prediction Center officially declared that La Niña has redeveloped. During La Niña, Brazil’s growing regions are at higher risk of below-normal precipitation and drought. Given the antecedent dry conditions across this area, the continued signal for dry weather will likely be a major headwind for Brazil’s agricultural industry in the months ahead. La Niña is expected to persist into Brazil’s early autumn 2022 season.
https://www.agriculture.com/news/crops/la-nina-means-dry-weather-for-brazil
Finally, more dodgy central bankster news at the Fed.
Jerome Powell Sold More Than a Million Dollars of Stock as the Market Was Tanking
Disclosure documents reveal that the spectacle of Fed officials personally trading stocks extended to the chair himself.
by Robert Kuttner October 18, 2021
Federal Reserve Chairman Jerome Powell sold between $1 million and $5 million worth of stock from his personal account on October 1, 2020, according to disclosure forms reviewed by the Prospect. Powell’s sale of shares from a Vanguard Total Stock Market Index Fund has not been previously reported. This sale occurred right before the Dow Jones Industrial Average suffered a significant drop.
A Fed media relations spokesperson was not available for comment. We will report on any Fed statement on Powell’s trades.
Three other senior Fed officials have faced serious criticism for making stock trades during the pandemic. Dallas Fed President Robert Kaplan and Boston Fed President Eric Rosengren were compelled to take early retirements as a result of the disclosure of their trades. Fed Vice Chair Richard Clarida also came under fire for stock trading. The other trades are now the subject of investigations by the Fed’s own inspector general and the SEC.
There is no American with more insider knowledge about government policy that drives financial market movements than the chair of the Federal Reserve. And as COVID caseloads, hospitalizations, and deaths spiked last fall, the economy was in a precarious condition. October turned out to be the stock market’s worst month since March 2020, when the pandemic began.
The Dow would lose 1,600 points in October, or 6 percent of its value. (It would recoup those losses and then some in subsequent months.)
More
https://prospect.org/economy/powell-sold-more-than-million-dollars-of-stock-as-market-was-tanking/
When I was young I thought that money was the most important thing in life; now that I am old I know that it is.
Fed
Chairman Powell, with apologies to Oscar Wilde
Global Inflation Watch.
Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.
Tight U.S. job market triggers strikes for more pay
October 18, 202111:21 AM BST
Oct 18 (Reuters) - Thousands of workers remain on strike across the United States demanding higher pay and better conditions despite Hollywood make-up artists and camera operators reaching a deal over the weekend to avoid a walkout, and the tight jobs market has only emboldened them.
Kevin Bradshaw is an employee at Kellogg Co's (K.N) cereal plant in Memphis, Tennessee, where most of North America's Frosted Flakes are made. He feels anything but great about cuts to healthcare coverage, retirement benefits and vacation time that union officials say the company is pushing for from about 1,400 workers on strike since Oct. 5 at plants in Michigan, Nebraska, Pennsylvania and Tennessee.
"Enough is enough," said Bradshaw, vice president of Bakery, Confectionary, Tobacco Workers and Grain Millers International Union Local 252G at the Memphis plant. "We can't afford to keep giving away things to a company that financially has made record-breaking returns."
Some 60,000 behind-the-scenes workers on movies and TV shows on Saturday avoided joining the Kellogg strikers, but the near-walkout was the latest demonstration of force by union members who say they are fed up with meager or no raises and other givebacks. Kellogg officials could not be reached for comment but have said the company's compensation is among the industry's best.
Labor activists complain that while many of their members were deemed essential during the COVID-19 crisis, that has not been reflected in how they are treated by employers. With an administration in the White House that they see as sympathetic and a job market that saw a record number of Americans quitting in August, unions are ready to test companies' resolve.
So far, at least 176 strikes have been launched this year, including 17 in October, according to Cornell University's Labor Action Tracker.
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Back to 2007: UK house prices rise for every region and buyer type
Monday 18 October 2021 12:01 am
It’s a full house for the UK home buying market, with property prices rising last month in every region of the UK, London included, and for buyer types ranging from first-timers to those at the wealthiest rungs of the property ladder.
In London, the average property price hit £650,683, up another 1.9 per cent on August and 2.6 per cent on September last year, according to the Rightmove House Price.
Across the UK, home sellers were asking for £344,445 on average, £5,983 more than in September.
The average UK house price is was up 6.5 per cent on October last year, despite the end of the stamp duty holiday.
Property platform Rightmove put the resilience of the market down to a rush to do a deal and lock in lower fixed mortgage rates before a Bank of England rate rise as well as fast turnover of property for sale.
Rightmove’s director of property data Tim Bannister said of the across-the-board price rises, or full house effect was an “extremely rare event”..
“The stock shortages started after the first lockdown, and they look set to continue with the underlying housing market fundamentals remaining strong, and an additional incentive to buy and fix your mortgage interest rate before a widely expected rate rise,” he added.
Bannister said although more properties were coming to the market, there was still not enough to match demand.
The average time to secure a buyer across the UK was just 37 days in September, down almost a month from January.
And the number of sales agreed across the UK in September – the most recent full month of data – jumped 15.2 per cent compared with the same month in 2019.
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Investors expect the Fed and European Central Bank will keep rates low for too long, survey says
Published Mon, Oct 18 2021 5:32 AM EDT
LONDON — A substantial portion of investors expect the U.S. Federal Reserve and the European Central Bank to keep monetary policy slightly too loose for too long, according to a Deutsche Bank survey.
In a market sentiment survey of more than 600 investment professionals worldwide, conducted by the German lender between Oct. 6-8, 42% expected the Fed to stay slightly too dovish, while 24% anticipated that the central bank would get policy “about right” and 33% foresaw a more hawkish tilt.
The prospect of a dovish policy error from the ECB was seen as more likely, with 46% expecting policy to remain too accommodative, compared to 26% believing policy across the common currency bloc will be “about right” and 21% seeing a premature or excessive tightening.
By contrast, 45% see a bigger risk of the Bank of England making a hawkish policy error, compared to 20% for “about right” and 20% for dovish.
Central bank policymakers have been striking a cautious tone in recent weeks, seemingly adopting a “wait and see” approach to inflation and the prospect of hiking rates.
However, Bank of England Governor Andrew Bailey on Sunday gave the clearest hint yet that British interest rates could be hiked, telling a panel that the Bank “will have to act” on rising inflation.
Andrea Enria, chair of the ECB’s supervisory board, told the European Parliament’s Economic and Monetary Affairs Committee on Thursday that although the economic outlook has improved, “caution remains of the essence.”
“We are keeping a very close eye on the buildup of risks on bank balance sheets,” Enria said, adding that the ECB is also seeing a “build-up of residential real estate vulnerabilities in some countries.”
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Covid-19 Corner
This section will continue until it becomes unneeded.
Valneva reports positive results for its COVID-19 vaccine candidate
October 18, 2021 8:13 AM BST
PARIS, Oct 18 (Reuters) - Valneva (VLS.PA) reported positive Phase III results on Monday for its inactivated, adjuvanted COVID-19 vaccine candidate VLA2001, a boost for the French biotech company after Britain cancelled a big deal to buy its shot.
Valneva said its latest trial which was conducted on 4,012 participants aged 18 years and older across 26 trial sites in Britain and showed the vaccine prompted a stronger immune response and fewer side-effects than AstraZeneca's shot.
Valneva is among a handful of vaccine developers testing their vaccines against one that's already been approved by a regulator rather than giving volunteers a dummy placebo as shots become more available. read more
"These results confirm the advantages often associated with inactivated whole virus vaccines," said Valneva Chief Executive Thomas Lingelbach, adding that the company believed it would make an important contribution to the fight against COVID-19.
Valneva said it was preparing for trials in children aged 5-12 years and for a Valneva-sponsored trial to evaluate VLA2001's performance for people in need of a COVID-19 vaccine booster shot.
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Over 50 million unreported COVID-19 infections in Africa, WHO estimates
Rich Haridy October 17, 2021
A striking new analysis by the World Health Organization (WHO) has concluded six in seven COVID-19 cases have gone undetected in Africa. The assessment indicates the real number of cases on the continent could be as high as 60 million and a new program to increase testing capacity has been proposed.
To date, there have been 8.4 million cases of COVID-19 and 214,000 deaths officially reported in Africa. However, the continent has experienced tiny levels of testing compared to the rest of the world.
Little more than 70 million COVID-19 tests have been reported by African countries since the beginning of the pandemic. These 70 million tests are a tiny fraction of the continent’s population of more than one billion.
In contrast, around 550 million tests have been administered in the United States since the beginning of the pandemic. And in the United Kingdom the number of tests is even higher, with more than four tests administered for every one person.
“With limited testing, we’re still flying blind in far too many communities in Africa,” says WHO’s regional director for Africa, Matshidiso Moeti. “Most tests are carried out on people with symptoms, but much of the transmission is driven by asymptomatic people, so what we see could just be the tip of the iceberg.”
The new WHO assessment looked at officially reported COVID-19 cases and deaths in Africa, and compared them to infection fatality rates seen in several other parts of the world. The analysis found it likely that 59 million people have been infected in Africa since the pandemic began in early 2020. This is seven times higher than the official count.
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