Baltic Dry Index. 2596 +18 Brent Crude 115.49
Spot Gold 1839 US 2 Year Yield 3.17 +0.03
Coronavirus Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 21/06/22 World 544,875,708
Deaths 6,341,880
Never spend your money before you have it.
Thomas Jefferson. Repealed August 15, 1971.
In the stock casinos, more churn and burn, exit rally.
With global interest rates going from 40 years of falling interest rates into Zirp, and in much of Europe Nirp, into months, if not years, of rising interest rates, a major bear market is just getting underway in the stock casinos.
Of course, Fed Chairman Powell could pull an Arthur Burns and just let inflation rip through the economy, doing very little by way of raising interest rates to bring an end to inflation, but that risks setting off wage price inflation on top of cost push inflation and demand pull inflation.
It also risks the international status of the already wobbly Dollar Reserve Standard.
Chinese stocks climb as Asia-Pacific markets rise; RBA expects inflation to peak by year end
SINGAPORE — Asia-Pacific markets were mostly buoyant on Tuesday while bitcoin continued to rise after a recent rebound. Meanwhile, Australia’s central bank says inflation will peak by the end of the year.
Japanese stocks led gains, with the Nikkei 225 trading 2.1% higher while the Topix also rose by around 2%. Taiwan’s Taiex index also rose more than 2%.
Hong Kong’s Hang Seng index climbed 1.5%, with tech stocks Tencent and Alibaba posting gains of 2.48% and 0.77% respectively.
Mainland Chinese stocks were muted, with the Shanghai Composite marginally up by 0.18% while the Shenzhen Component sat above the flatline.
The Kospi in South Korea was also in positive territory, trading 1% higher.
Australia’s S&P/ASX 200 rose 1.46%, and the MSCI’s broadest index of Asia-Pacific shares outside Japan was up 1.24%.
Australia signals more rate hikes ahead
The Reserve Bank of Australia governor Philip Lowe said in a speech that he expected inflation in Australia to peak at around 7% by the end of the year as pandemic-related supply chain disruptions resolve.
Lowe said monetary policy tightening and interest rate hikes globally would work together to drive down inflation by creating a balance between the demand and supply of goods.
“Achieving that balance is not straightforward and there are risks involved, but higher interest rates will lessen the current inflationary pressures,” he said, adding that Australia should expect more rate increases with the RBA committed to charting back to inflation levels of 2% to 3%.
Meeting minutes released this morning showed the bank had leaned towards more tightening amid a resilient economy with record-low unemployment rates.
More
Dow futures surge more than 400 points as the market is set to rebound from a brutal week
Stock futures rose in overnight trading Monday following a brutal week as investors assessed a more aggressive Federal Reserve and rising chances of a recession.
Futures on the Dow Jones Industrial Average jumped 433 points, or 1.45%. S&P 500 futures climbed 1.67% and Nasdaq 100 futures also rose 1.7%. U.S. stock markets were closed earlier Monday for Juneteenth.
The major averages just suffered their 10th losing week in 11 on fears that the central bank will hike rates aggressively to tame inflation at the risk of causing an economic downturn. The S&P 500 dropped 5.8% last week for its biggest weekly loss since March 2020, dipping deeper into bear market territory. The equity benchmark is now more than 23% off its record high from early January.
The blue-chip Dow slid 4.8% last week, falling below 30,000 for the first time since January 2021 last week. The tech-heavy Nasdaq Composite slipped 4.8% last week, down 33% from its record high.
“The recent drop in equity markets and inflection in investor attitudes make a bottoming thesis more difficult to make,” said Nationwide’s chief of investment research, Mark Hackett. “Investors are acting emotionally, but the fundamentals are beginning to follow the weakness in the technicals.”
Fed Chair Jerome Powell will testify before Congress Wednesday and Thursday. His appearance comes after a recent rate hike by three-quarters of a percentage point, the central bank’s biggest increase since 1994.
Investors will monitor incoming data, including existing home sales on Tuesday, to gauge the health of the economy. Recent data showing low consumer confidence, falling retail spending and a cooling housing market have fueled recession fears as the Fed battles inflation at 41-year highs.
Meanwhile, cryptocurrencies continued their roller-coaster ride. Bitcoin fell to a new 2022 low of $17,601.58 over the weekend before climbing back above the $20,000 mark on Monday. The world’s largest cryptocurrency by market cap sits 70% below its all-time high hit in November.
https://www.cnbc.com/2022/06/20/stock-market-news-futures-open-to-close.html
Have markets hit the bottom? Ed Yardeni says it’s not over until inflation peaks
Markets have been on a wild ride recently, swinging between gains and losses. However, the brutal selling has meant the S&P 500 is still in a bear market.
When asked whether markets have hit a bottom, Wall Street veteran Ed Yardeni said he doesn’t think “we’re gonna climb out of this thing very quickly, not in a fundamental sense.”
“I think investors have learned this year — ‘don’t fight the Fed,’” he told CNBC’s “Street Signs Asia” on Monday. The mantra refers to the idea that investors should align their investments with, rather than against, the U.S. Federal Reserve’s monetary policies.
“For many years, the idea of don’t fight the Fed was if the Fed was going to be easy [on monetary policy.] You want to be long equities,” said Yardeni, president of consultancy Yardeni Research. “But what changed dramatically this year is ‘don’t fight the Fed’ now means don’t fight the Fed when it’s fighting inflation. And that means that that’s not a good environment for equities on a short-term basis.”
‘Too late to panic’
With inflation soaring to new highs this year, the Fed raised interest rates by 75 basis points last week — its biggest since 1994 — and signaled continued tightening ahead. Fed Chair Jerome Powell said another hike of 50 or 75 basis points at the next meeting in July is likely.
However, the economy now faces the risk of stagflation as economic growth tails off and prices continue to rise.
----Yardeni said it “isn’t going to be over” till there are definitive signs that inflation, brought on by soaring food and energy prices, has peaked. Market watchers have also blamed rising prices on the Fed’s fiscal overstimulation of the economy amid the Covid-19 pandemic.
“We’ve got to see a peak in inflation before the market will be substantially higher,” he said, adding that point could come next year.
More
https://www.cnbc.com/2022/06/21/ed-yardeni-on-bear-market-the-fed-and-inflation.html
In other news, Russia’s oil trade, like the Russian Rouble, is booming.
China May oil imports from Russia soar to a record, surpass top supplier Saudi
June 20, 2022 6:52 AM GMT+1
SINGAPORE, June 20 (Reuters) - China's crude oil imports from Russia soared 55% from a year earlier to a record level in May, displacing Saudi Arabia as the top supplier, as refiners cashed in on discounted supplies amid sanctions on Moscow over its invasion of Ukraine.
Imports of Russian oil, including supplies pumped via the East Siberia Pacific Ocean pipeline and seaborne shipments from Russia's European and Far Eastern ports, totalled nearly 8.42 million tonnes, according to data from the Chinese General Administration of Customs.
That's equivalent to roughly 1.98 million barrels per day (bpd) and up a quarter from 1.59 million bpd in April.
The data, which shows that Russia took back the top ranking of suppliers to the world's biggest crude oil importer after a gap of 19 months, indicates that Moscow is able to find buyers for its oil despite western sanctions, though it has had to slash prices.
And while China's overall crude oil demand has been dampened by COVID-19 curbs and a slowing economy, leading importers, including refining giant Sinopec and trader Zhenhua Oil, have stepped up buying cheaper Russian oil on top of sanctioned supplies from Iran and Venezuela that allows them to scale back competing supplies from West Africa and Brazil. read more
Saudi Arabia trailed as the second-largest supplier, with May volumes up 9% on year at 7.82 million tonnes, or 1.84 million bpd. This was down from April's 2.17 million bpd.
Customs data released on Monday also showed China imported 260,000 tonnes of Iranian crude oil last month, its third shipment of Iran oil since last December, confirming an earlier Reuters report.
Despite U.S. sanctions on Iran, China has kept taking Iranian oil, usually passed off as supplies from other countries. The import levels are roughly equivalent to 7% of China's total crude oil imports. read more
More
“In a bull market and particularly in booms, the public at first makes money which it later loses simply by overstaying the bull market.”
Jesse Livermore.
Global Inflation/Stagflation Watch.
Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.
Power demand in parts of China sets new records amid searing heat
June 20, 2022 9:25 AM GMT+1
BEIJING, June 20 (Reuters) - Power consumption surged in large Chinese provinces north of the Yangtze river amid warmer-than-normal weather, with regions like Henan, China's third-most populous province, challenged by record electricity demand.
The maximum power demand load in Henan, which has a population of nearly 100 million people, set a new record of 65.34 million kilowatts on Sunday, state television reported on Monday.
While the provincial grid was able to cope with the heavy demand, electricity supply in Henan is expected to be relatively difficult this summer, according to the report, with the maximum load seen rising further to nearly 75 million kilowatts.
In contrast to the heaviest rainfall in 60 years in southern China, Henan and nearby Shandong and parts of Hebei have battled with scorching heatwaves and drought-like conditions this month. read more
Temperatures in Henan's capital Zhengzhou, where major Taiwanese Apple supplier Foxconn (2317.TW) has a production hub, have reached 40 degrees Celsius (104 degrees Fahrenheit) in recent days.
As temperatures climb, demand for power rises as homes and businesses crank up air-conditioning, peaking typically around the end of July and beginning of August in China.
---- In Jiangsu, the maximum power demand load in China's fourth-most populous province broke above 100 million kilowatts on June 17 for the first time this summer, 19 days earlier than in 2021, according to state media.
Power consumption in Hefei, capital of eastern Anhui province, has also reached new highs, prompting calls to save electricity.
"Dear aunties, please turn down the air-conditioning setting by one degree in the summer and save more than 6% in electricity," officials urged residents of one county.
Top three Aussie miners to shed $11 bln in market value as commodity rout accelerates
June 20, 2022 9:32 AM GMT+1
June 20 (Reuters) - Australia's big three miners were on track to lose more than A$16 billion ($11.12 billion) in combined market value on Monday at current levels, as a commodities selloff over easing China demand and fears of a global recession deepened.
Rio Tinto's Australia-listed shares (RIO.AX) were set to shed nearly A$2 billion in value, BHP (BHP.AX) more than A$10 billion, and Fortescue Metals (FMG.AX) over A$4 billion.
Lower output from Chinese steel mills has hit demand for iron ore, while prices of commodities like copper and aluminium have slumped on worries that aggressive interest rate hikes by the U.S. Federal Reserve's and other central banks could tip the global economy into a recession.
The three Australian mining behemoths, so far this month, have already lost roughly A$30 billion of their combined market value, and are facing a third straight week of losses after hitting multi-week lows on Monday.
Rio Tinto and BHP are trading at a one-month low, while Fortescue is at a three-month low.
"Are we doomed? Or is it darkest before dawn?," Jefferies analysts wrote on Saturday with reference to recent economic data, China's COVID-19 lockdowns and the Fed's policy narrative.
They seemed to lean towards the latter, confident that the slowdown in demand for commodities would be followed by a recovery that would be led by miners, adding that recession fears and inflation would give way to recovery.
Analysts at JP Morgan also echoed risks to the sector but said fresh policy support along with easing COVID-19 lockdowns in China would spur a rebound in the second half of 2022, and maintained their "neutral" view on Rio Tinto and BHP.
Below, why a “green energy” economy may not be possible, 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
Covid-19 Corner
This section will continue until it becomes unneeded.
The top 9 most terrifying words in the English Language are: I'm from the government, and I'm here to help.”
Ronald Reagan.
Computer glitch: Ministry of Health accidentally tells thousands they have Covid-19
20 Jun, 2022 07:07 AM
The Ministry of Health has apologised after accidentally sending a text message to 6000 people telling them they have Covid-19 and need to isolate.
The message was sent to people who have tested positive for the virus in the last 10 days, meaning the text was a duplicate of advice they had already received.
The Covid-19 Response Minister's office said Ayesha Verrall was aware of the incident and has been assured by the Ministry it was the result of a glitch.
An uploading error on Friday afternoon and through into Saturday morning meant people were sent repeat text messages mistakenly telling them they had returned a positive Covid-19 test.
"The duplicate text again told the recipient they'd tested positive for Covid-19 and gave the standard advice about isolating, asking them to fill in the contact tracing form and where to find information, support, and healthcare advice," the Ministry admitted tonight in a Twitter post.
The Ministry's contact tracing team discovered the glitch early on Saturday morning and the error was fixed that day.
Text messages have been sent to all those affected to clarify the error, apologise and provide a phone number should people require further information or support, the Ministry said.
he phone line will be available this evening until 9pm and again from tomorrow morning.
The Ministry reported 4024 new community cases of Covid-19 in New Zealand today.
There were also a further nine Covid-related deaths.
The deaths include two people from the Auckland region, two from the Bay of Plenty, two from Wellington, two from Canterbury and one from South Canterbury.
One person was aged in their 40s, one was in their 60s, one was in their 70s, four were in their 80s and two were aged over 90. Of these people, six were women and three were men.
Today's reported deaths take the total number of publicly reported deaths with Covid to 1415.
There are 391 people in hospital with the virus, including three in intensive care.
Next, some vaccine links kindly sent along from a LIR reader in Canada.
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
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, among other things, I’ve added this section. Updates as they get reported.
Solar panels based on biosourced materials
French solar energy institute INES has developed new PV modules with thermoplastics and natural fibers sourced in Europe, such as flax and basalt. The scientists aim to reduce the environmental footprint and weight of solar panels, while improving recycling.
June 17, 2022 Gwénaëlle DeboutteMarie Beyer
Researchers at France's National Solar Energy Institute (INES) – a division of the French Alternative Energies and Atomic Energy Commission (CEA) – are developing solar modules featuring new bio-based materials in the front and rear sides.
“As the carbon footprint and the life cycle analysis have now become essential criteria in the choice of photovoltaic panels, the sourcing of materials will become a crucial element in Europe in the next few years,” said Anis Fouini, the director of CEA-INES, in an interview with pv magazine France.
Aude Derrier, the research project's coordinator, said her colleagues have looked at the various materials that already exist, to find one that could allow module manufacturers to produce panels that improve performance, durability, and cost, while lowering the environmental impact. The first demonstrator consists of heterojunction (HTJ) solar cells integrated into an all-composite material.
“The front side is made of a fiberglass-filled polymer, which provides transparency,” Derrier said. “The rear side is made of composite based on thermoplastics in which a weaving of two fibers, flax and basalt, has been integrated, which will provide mechanical strength, but also better resistance to humidity.”
The flax is sourced from northern France, where the entire industrial ecosystem is already present. The basalt is sourced elsewhere in Europe and is woven by an industrial partner of INES. This reduced the carbon footprint by 75 grams of CO2 per watt, compared to a reference module of the same power. The weight was also optimized and is less than 5 kilograms per square meter.
“This module is aimed at the rooftop PV and building integration,” said Derrier. “The advantage is that it is naturally black in color, without the need for a backsheet. In terms of recycling, thanks to thermoplastics, which can be remelted, the separation of the layers is also technically simpler.”
The module can be made without adapting current processes. Derrier said the idea is to transfer the technology to manufacturers, without additional investment.
More
https://www.pv-magazine.com/2022/06/17/solar-panels-based-on-biosourced-materials/
Finally, weather permitting, a chance to see one of God’s spectaculars.
Epic alignment of 5 planets, moon to peak after summer solstice
This rare planetary parade has not been seen since 2004 and won't happen again like this until 2040 -- and the best time to catch it will be just days after the summer solstice.
Published Jun. 15, 2022 7:32 PM BST | Updated Jun. 20, 2022 3:14 PM BST
A rare planetary alignment that won't occur again for nearly two decades has taken shape in the night sky, and while it will remain visible through the end of June, viewing the spectacle may be tricky and could require losing some sleep.
Mercury, Venus, Mars, Jupiter and Saturn have lined up in the early morning sky, a planetary procession that can be seen above the eastern horizon every morning through the end of June. This long-lasting event will give early risers plenty of opportunities to enjoy the sights of the planetary quintet.
The last time that all five of these planets were visible in the night sky at the same time was in 2004, the same year that Facebook was created and three years before the first iPhone was released, according to Sky & Telescope magazine.
A telescope is not required to see this month's unique grouping of planets, but it could still be difficult to spot all five, even if the weather is perfect.
The parade of planets will be best seen about 45-60 minutes before sunrise on cloud-free mornings through the end of the month. Since June features some of the earliest sunrises of the entire year, this translates to heading outside before 5 a.m., local time, to look skyward.
Mercury is the most elusive of the planets that can be seen with the naked eye due to its close proximity to the sun. The tiny planet will remain very low on the horizon, so seeing it requires an unimpeded view of the eastern horizon as trees, buildings and mountains all could potentially get in the way.
Venus will be a guide to spotting Mercury, glowing brighter and appearing just above and to the right of the closest planet to the sun. Mars, Jupiter and Saturn will be much easier to find as they will be higher in the sky.
More
https://www.accuweather.com/en/space-news/5-planets-to-align-with-moon-in-june-night-sky/1201835
The politician attempts to remedy the evil by increasing the very thing that caused the evil in the first place: legal plunder.
Frederic Bastiat.
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