Baltic Dry Index. 2379 -119 Brent Crude 71.36
Spot Gold 1802
Coronavirus Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 20/12/21 World 275,017,621
Deaths 5,370,462
If you don't have Covid, I suspect one of the best places to catch it is stand in line for hours with people who think they do.
Mike Shedlock.
For the next two to three weeks, it’s all about omicron. If this variant is both more infectious and as or more severe than the delta variant, global economic disaster lies ahead.
Main-stream media, plus politicians and their “scientific advisors” are busy promoting this severity panic although there is scant scientific data yet to back up this omicron severity panic scare.
If the omicron variant is more infectious but less severe, having crossed with the common cold coronavirus, a self-inflicted economic distress lies ahead, probably resulting in the Great 2022 Stagflation.
For now, a media induced omicron panic is the order of the day and spreading.
But scientific data from South Africa, furthest along in the omicron infection, doesn’t support a more severe outcome, just more of a common cold outcome, albeit on only about 5-6 weeks of scientific data.
With the Christmas, New Year holidays virtually upon us and a media panic busy closing down global economies at a time of what would normally be a time of economic boom, a dismal January lies ahead whether omicron is more or less severe than the delta variant.
“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one.”
Extraordinary Popular Delusions and the Madness of Crowds
Asia stocks, oil prices suffer as Omicron spreads
December 20, 2021 5:25 AM GMT
SYDNEY, Dec 20 (Reuters) - Asian share markets fell and oil prices slid on Monday as surging Omicron cases triggered tighter restrictions in Europe and threatened to drag on the global economy into the new year.
A seasonal lack of liquidity made for a bumpy start and S&P 500 futures led the way with a 0.7% drop, while Nasdaq futures shed 0.6%.
MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) slipped 0.4% and Japan's Nikkei (.N225) 0.7%.
The spread of Omicron saw the Netherlands go into lockdown on Sunday and put pressure on others to follow, though the United States seemed set to remain open. read more
"Omicron is set to be the Grinch who stole Europe’s Christmas," said Tapas Strickland, a director of economics at NAB. "With Omicron cases doubling every 1.5-3 days, the potential for hospital systems to be overwhelmed even with effective vaccines remain."
While coronavirus restrictions cloud the outlook for economic growth, they also risk keeping inflation elevated and turning central banks yet more hawkish.
Such hawkish chatter from the Fed is a major reason long-dated Treasury yields fell last week as the short-end rose. That left the two-10 year curve near its flattest since late 2020, reflecting the risk tighter policy will lead to recession.
BofA economists see this risk as reason to be bearish on equities, though their latest survey of fund managers found just 6% expected recession next year and only 13% were underweight stocks. Most remain overweight technology with "long tech" still viewed as the single most crowded trade.
They also noted that for 2021, the winners had been oil with a gain of 48%, REITs at 42%, Nasdaq at 25% and banks with 21%. Losers included biotech with a drop of 22%, while China also lost 22%, silver 19% and JGBs 10%.
It was the best year for commodities since 1996, and the worst for global government bonds since 1949.
Early Monday, yields on U.S. 10-year notes were down at 1.38% and well below their 2021 top of 1.776%.
More
https://www.reuters.com/markets/europe/global-markets-wrapup-1-pix-2021-12-20/
Oil prices slide as rapid Omicron spread dims fuel demand outlook
December 20, 2021 4:42 AM GMT
SINGAPORE, Dec 20 (Reuters) - Oil prices slumped by more than 2% on Monday as surging cases of the Omicron coronavirus variant in Europe and the United States stoked investor worries that new restrictions on businesses to combat its spread may hit fuel demand.
Brent crude futures fell $1.92, or 2.6%, to $71.60 a barrel by 0436 GMT while U.S. West Texas Intermediate (WTI) crude futures fell $2.09, or 3%, to $68.77 a barrel.
"Today's Asia ... weak sentiment in oil prices seems to go in line with a weakness seen in the S&P 500 and Nasdaq 100 e-mini futures," said Kelvin Wong, market analyst at CMC Markets.
"(This is) due to fears of impending restrictions on economic activities to contain the current increasing spread of the COVID-19 Omicron variant worldwide which may increase the risk of demand slowdown."
The Netherlands went into lockdown on Sunday and the possibility of more COVID-19 restrictions being imposed ahead of the Christmas and New Year holidays loomed over several European countries. read more
U.S. health officials urged Americans on Sunday to get booster shots, wear masks and be careful if they travel over the winter holidays, as the Omicron variant raged across the world and was set to take over as the dominant strain in the United States. read more
Meanwhile, U.S. energy firms this week added oil and natural gas rigs for a second week in a row.
The oil and gas rig count, an early indicator of future output, rose by three to 579 in the week to Dec. 17, its highest since April 2020, energy services firm Baker Hughes Co said in its closely followed report on Friday. read more
Still, lower exports are expected from Russia with exports and transit of oil from the country planned at 56.05 million tonnes in the first quarter of 2022 versus 58.3 million tonnes in the fourth quarter of 2021, a quarterly export schedule seen by Reuters showed on Friday. read more
China's diesel exports in November plunged 69% from a year ago as refineries prioritised domestic supply to ease a fuel crunch with state-backed refineries having raised oil processing rates.
Wall St Week Ahead Narrowing market breadth may be worrying signal for stocks
December 18, 2021 12:32 AM GMT
NEW YORK, Dec 17 (Reuters) - Investors are scrutinizing the stock market’s narrowing breadth and other signs of ebbing risk appetite, as markets digest a hawkish pivot from the Federal Reserve, soaring inflation and concern over a fresh wave of COVID-19 cases.
Only 31% of stocks in the tech-heavy Nasdaq (.IXIC) are trading above their 200-day simple moving average despite the index’s 18% year-to-date gain, according to Refinitiv data, the lowest level in at least a year. That number stands at 36% for the small-cap-focused Russell 2000.
Stocks in the S&P 500 are faring better, with 68% of constituents trading above that moving-average mark. Still, just five stocks – Apple (AAPL.O), Microsoft (MSFT.O), NVIDIA (NVDA.O), Tesla (TSLA.O) and Alphabet (GOOGL.O) - have accounted for about half of the index's gain since April, data published by Goldman Sachs earlier this week showed. The S&P is up about 24% for the year and stands near record highs.
Narrowing breadth can presage a period of rocky trading, with deeper-than-average drawdowns and weaker overall returns, Goldman's data showed. The bank's analysts said declines may be limited this time around by factors such as strong corporate earnings and a market that may have already priced in a more hawkish Fed.
Others are less sanguine. Tom Siomades, chief investment officer of AE Wealth Management, believes investors should brace for more market volatility.
"If you can't live with that, you should definitely dial back a little bit of risk," Siomades said.
----Frazzled nerves have also been apparent in the Cboe Volatility Index (.VIX), known as Wall Street’s fear gauge, which stands about 5 points higher than its long-term median. High-growth stocks that thrived in 2020 have tumbled, along with many of the so-called meme stocks that have rallied this year.
The percentage of investors with a bullish short-term outlook for the U.S. stock market slid to the lowest level in three months in the latest American Association of Individual Investors Sentiment Survey (AAII), released Friday. read more
Investors next week will be watching U.S. consumer confidence numbers for a read on whether buyers are changing their purchasing habits in the face of worries of high inflation and COVID-19.
Narrowing breadth poses several potential risks for stocks, investors said.
More
Finally, rising trouble in China. As goes China so goes the world?
China's property distress sours steel sector in warning sign for economy
Sun, December 19, 2021, 1:07 AM
BEIJING (Reuters) - Debt problems at a major Chinese property developer have now spilled over into a vital artery of the nation's industrial engine - the steel sector - and started to ripple through to other critical parts of the world's second-largest economy.
The spreading balance-sheet crisis at real estate firms is a warning for policymakers as a swing in the fortunes of the steel industry would have significant repercussions for China's economy, with cement, glass, and household appliances all vulnerable to demand drops.
Already, steel prices are down from their record highs seen earlier this year due to easing demand from construction activities, which account for over half of the metal's consumption, while steelmakers' share prices have also been hurt.
Steel's acute sensitivity to the ebbs and flows in construction and manufacturing makes it a closely-tracked bellwether for China's economy, which has started to slow down from the second quarter. Steel firms are also massive employers that support a vast supply chain.
Hitting steel operations, real estate developers have dialled back investment in projects to conserve cash in a sector squeezed by tighter borrowing regulations that have engulfed indebted companies, most notably China Evergrande Group.
"We normally stockpile steel products in winter at relatively lower prices and sell them after the new year holidays when consumption resumes. But we are holding off this year," said Qi Xiaoliang, a Beijing-based steel trader.
"There's still uncertainty in the real estate market for 2022 and the situation is not expected to be fully reversed for another six to 12 months," he added.
In the final quarter of 2021, the property market took a further hit as the unease in the sector shook already weak buyer sentiment, with unsold housing stock in China's 100 biggest cities reaching a five-year high in November.
----Cement production, another construction material, was down around 16% for September-November year-on-year, and was lower versus the same period between 2017 and 2019. Demand for earth excavators has also dropped off in recent months.
The broadening spillover impact of the property downturn was also seen elsewhere. In the appliances industry, for example, monthly refrigerator output has been falling since May through to November on an annual basis.
----The closely-tracked steel equity instruments and commodities futures have captured the reversal of fortunes.
After gaining roughly 90% through mid-September, the CSI steel equities index has plunged 27% since, while futures prices for construction materials rebar and wire rod have tumbled 24% and 31% respectively from their historical highs to erase almost all their gains this year.
More
https://www.yahoo.com/news/chinas-property-distress-sours-steel-010740739.html
The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary.
H.
L. Mencken.
Global Inflation/Stagflation Watch.
Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.
Central Banks Worry Omicron Could Sustain Inflation
Latest Covid-19 variant seen as having less effect on growth, more pressure on prices than previous waves
Updated Dec. 19, 2021 3:11 pm ET
The Omicron variant is circling the globe, closing borders and sparking new restrictions on economic activity. Yet central banks, instead of loosening monetary policy to prop up their economies as they did at the start of the pandemic, are moving to unwind stimulus and raise interest rates.
The moves reflect a new thinking among policy makers about the pandemic’s economic effects: Central-bank officials worry that rather than simply threatening to curtail economic growth, a surge in Covid-19 cases could also prolong high inflation.
In the past week, the Federal Reserve, the Bank of England and the European Central Bank all moved to tighten monetary policy in response to inflation concerns.
When the pandemic first became widespread, in early 2020, governments locked down their economies. Consumer spending fell sharply, employers shed workers and prices fell. Within a few months, the rise of e-commerce and remote working allowed the economy in many developed countries to recover rapidly. With mass vaccinations, that recovery has continued this year.
Now, new case surges are having much less severe impacts on spending and job creation. Instead, they are threatening to prolong supply-chain disruptions and keep inflation elevated.
“What we saw in the early stages of the pandemic is that demand initially dropped a lot more than supply so it ended up being deflationary, particularly because of pretty stringent lockdowns,” said Paul Ashworth, chief North America economist at Capital Economics.
Today, with governments reluctant to impose new lockdowns, it is the other way around, he said.
“Supply could potentially be hit more than demand and therefore it becomes inflationary rather than deflationary this time,” he said.
Scientists are still studying the effects of Omicron. So far, it appears to spread faster than earlier variants and is able to evade immunity from vaccines and past infection, but it might cause milder symptoms.
---- Governments have imposed fewer, and more targeted, restrictions with each wave. Moreover, many workers and businesses have adapted to outbreaks, such as reverting to remote work.
Nonetheless, economists and investors do expect Omicron to have some negative impact on growth, particularly with international travel. In recent days several European countries have announced new restrictions on activity. Economists at Pantheon Macroeconomics brought down forecast U.S. growth to 3% annualized in the first quarter from 5%. They see most of that decline being made up in subsequent quarters.
More
https://www.wsj.com/articles/central-banks-worry-omicron-could-sustain-inflation-11639909805
UK tourist travel ban a "disaster" for French ski resorts
December 17, 2021 1:28 PM GMT
PARIS, Dec 17 (Reuters) - In the French ski resort of Val d'Isere, staff had been hired, shelves fully stocked and everyone was looking forward to a good season until, that is, France banned British tourists due to fears over the Omicron variant of the coronavirus.
The ban was announced on Thursday, just two days before the start of the holiday season. read more
"It's an economic disaster," said resort director Christophe Lavaut, pointing out that in Val d'Isere, the bulk of the clients come from Britain. "No business in any sector can make it, losing 42% of its clients in two days."
While he does not contest the need to take measures to fight the spread of the highly transmissible variant - and infections are soaring in Britain - he said his resort would need help from the government.
The government has so far not announced any specific help.
France's statistics office forecast this week that the country's economic recovery from the pandemic had proved stronger than expected this year, with growth on course for a 52-year high as COVID restrictions had been eased and the vaccination campaign gained momentum from mid-year. read more
But for the ski sector, hoping for better times after the 2020/2021 season was all but wiped out, with ski lifts ordered shut, that is of little comfort.
Jean-Marc Silva, of the France Montagne association, said Britons made up the single biggest foreign group of visitors to French mountain resorts, and accounted for 9% of clients - and an even bigger share of business as they enjoyed the apres-ski hospitality.
"Brits love the mountains and don't really have that many in their country, so they've made the French mountains their own," Silva said.
"It's not the same clientele as the French," Silva said. "The French visitor is here to ski. The British visitor will ski but he will also be the first at the after-ski activities ... They have this pub culture. They spend more than others. They really make the most of being there."
More
https://www.reuters.com/world/europe/uk-tourist-travel-ban-disaster-french-ski-resorts-2021-12-17/
“We
find that whole communities suddenly fix their minds upon one object, and go
mad in its pursuit; that millions of people become simultaneously impressed
with one delusion, and run after it, till their attention is caught by some new
folly more captivating than the first.”
Extraordinary Popular Delusions & the Madness of Crowds
Covid-19 Corner
This section will continue until it becomes unneeded.
New Zealand links 26-year-old man's death to Pfizer COVID-19 vaccine
December 20, 2021 4:59 AM GMT
SYDNEY, Dec 20 (Reuters) - New Zealand authorities on Monday said they had linked a 26-year-old man's death to Pfizer Inc's (PFE.N) COVID-19 vaccine after the person suffered myocarditis, a rare inflammation of the heart muscle, after taking his first dose.
The death is New Zealand's second linked to a known but rare side effect from the vaccine after health authorities in August reported a woman had died after taking her doses. read more
"With the current available information, the board has considered that the myocarditis was probably due to vaccination in this individual," a COVID-19 Vaccine Independent Safety Monitoring Board said in a statement.
The man, who died within two weeks of his first dose, had not sought medical advice or treatment for his symptoms. Myocarditis is an inflammation of the heart muscle that can limit the organ's ability to pump blood and can cause changes in heartbeat rhythms.
A Pfizer spokesperson said the company was aware of the report of the death in New Zealand, it monitored all reports of possible adverse events, and continued to believe the benefit-risk profile for its vaccine was positive.
New Zealand's vaccine safety board also said another two people, including a 13-year-old, had died with possible myocarditis after taking their vaccinations. More details were needed before linking the child's death to the vaccine, while the death of a man in his 60s was unlikely related to the vaccine, it said.
Despite the rare side effects, the vaccine safety board said the benefits of vaccination greatly outweighed the risks.
More
Covid 19 vaccine plus breakthrough infection may offer 'super immunity'
Dec. 17, 2021 / 4:05 PM
Breakthrough infections in people who've been vaccinated against COVID-19 may trigger "super immunity" against coronavirus variants, including Omicron, according to a new study.
"The key is to get vaccinated. You've got to have a foundation of protection," said co-author Dr. Marcel Curlin, an associate professor of medicine at Oregon Health & Sciences University in Portland.
For the study, he and his colleagues collected blood samples from 52 people who were fully vaccinated with the Pfizer vaccine.
Twenty-six, the control group, did not have breakthrough infections, while the other 26 had mild cases of COVID after vaccination. That included 10 participants with the highly contagious Delta variant, nine with non-Delta variants and seven with unknown variants.
In lab tests, live coronavirus was exposed to blood from the study volunteers in order to assess immune response. Compared to the control group, blood from those with breakthrough infections generated more antibodies -- and, the study found, those antibodies were much better at neutralizing the live virus.
The antibodies in the blood of people with breakthrough infections were as much as 1,000% more effective than antibodies generated two weeks after the second dose of the Pfizer vaccine, researchers reported.
The study -- published online Dec. 16 in the Journal of the American Medical Association -- is the first of its kind, and researchers said it suggests that immune response triggered by a breakthrough infection is likely to be highly effective against current and future coronavirus variants.
RELATED COVID-19 vaccine booster cuts death rate by 90%, Israeli study finds
"You can't get a better immune response than this," said senior author Fikadu Tafesse, assistant professor of molecular microbiology and immunology at OHSU.
He noted that these vaccines are "very effective" against severe disease. "Our study suggests that individuals who are vaccinated and then exposed to a breakthrough infection have super immunity," Tafesse said in an OHSU news release.
---- "Our study implies that the long-term outcome is going to be a tapering-off of the severity of the worldwide epidemic," Curlin added in the release.
Researchers did not look at the new Omicron variant, which was first reported in late November
More
Covid: Dutch go into Christmas lockdown over Omicron wave
19 December, 2021
The Netherlands has begun a strict lockdown over Christmas amid concerns over the Omicron coronavirus variant.
Non-essential shops, bars, gyms, hairdressers and other public venues are closed until at least 14 January. Two guests per household will be allowed - four over the holidays.
Prime Minister Mark Rutte said the measures were "unavoidable".
Countries across Europe have been tightening restrictions as the heavily mutated variant spreads.
The new rules in the Netherlands are the strictest to have been announced over Omicron so far.
---- Under the new restrictions, people are being urged to stay at home as much as possible.
There are strict limits on the number of people who can meet. A maximum of two guests, aged 13 and over, are allowed in people's homes. This will rise to four people between 24 and 26 December, and on New Year's Eve and New Year's Day.
Events are not permitted other than funerals, weekly markets selling groceries and professional sports matches with no spectators.
Restaurants can continue to sell takeaway meals, and non-essential shops can offer click and collect services.
Meanwhile all schools are now closed until at least 9 January.
---- Several other European countries have also announced measures designed to curb the infections.
France has imposed strict travel restrictions on those entering from the United Kingdom - the hardest hit country in the region, with nearly 25,000 confirmed Omicron cases on Saturday.
From 23:00 GMT on Sunday, Germany will also ban British tourists and business travellers from entering the country.
Europe has already seen more than 89 million cases and 1.5 million Covid-related deaths, according to the latest EU figures.
https://www.bbc.co.uk/news/world-europe-59715940
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
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
'Emergencies' have always been the pretext on which the safeguards of individual liberty have been eroded.
Friedrich August von Hayek.
Technology Update.
With events happening fast in the development of solar power and graphene, I’ve added this section. Updates as they get reported.
Special porous copper kills golden staph bacteria 120 times faster
Ben Coxworth December 13, 2021
While copper does kill bacteria on contact, it typically takes at least an hour to do the job thoroughly. Such is not the case with an experimental new type of copper, however, which is claimed to eradicate almost 100 percent of harmful bacteria in just two minutes.
Regular copper kills bacteria by releasing ions which punch holes in the microbes' protective outer membranes. It's not an instantaneous process, though, taking anywhere from one to four hours to eliminate nearly all of the bacteria that are present on the metal.
This means that if copper is being used to keep commonly-touched surfaces germ-free, well … a lot of people could touch the surface of an item such as a door handle within an hour. That's where the new copper comes in.
Developed via a collaboration between Australia's RMIT University and CSIRO science agency, it's made by first creating a molded alloy made up of copper and manganese atoms. In an inexpensive chemical process known appropriately enough as "dealloying," the maganese atoms are then removed. What's left over is a porous type of copper, full of micro- and nanoscale cavities where the manganese atoms used to be.
This structure gives it way more surface area than normal smooth copper, allowing it to release ions in much greater numbers. Additionally, whereas water forms into droplets on traditional copper surfaces, it's absorbed and spread out into a thin film on the "special" copper. According to the researchers, this causes each bacterium to get stretched out across the copper, making it easier for the ions to infiltrate its outer membranes.
"A standard copper surface will kill about 97 percent of golden staph within four hours," says RMIT's Prof. Ma Qian. "Incredibly, when we placed golden staph bacteria on our specially-designed copper surface, it destroyed more than 99.99 percent of the cells in just two minutes. So not only is it more effective, it’s 120 times faster."
The scientists are now investigating how effective the copper is at killing the SARS-COV-2 virus, which causes COVID-19.
A paper on the research was recently published in the journal Biomaterials. Readers might also be interested in a study performed at Indiana's Purdue University, in which a laser etching process was used to increase copper's surface area, boosting its antibacterial effect.
Source: RMIT University
“During seasons of great pestilence men have often believed the prophecies of crazed fanatics, that the end of the world was come. Credulity is always greatest in times of calamity. Prophecies of all sorts are rife on such occasions, and are readily believed, whether for good or evil.”
Extraordinary Popular Delusions & the Madness of Crowds
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